Kathleen Daniels, Probate & Trust Specialist, Probate Real Estate  (KD Realty - 408.972.1822)

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Rainer
116,985
Christine Kankowski North SD and Temecula
House Match Inc - Poway, CA
Excellent Sales and Property Management

Sales agents commissions are included in everyone from the new car you purchase, to the insurance you buy, to the stockbroker you use. WHen you purcahse presciption drugs, you are also paying for the sales commisions of the pharmaceuttical sales reps, etc. 

Just like the checkers at Mcdonalds and Wal-mart are paid for due to you buying things at the stores, so I agree and say of course, any buyer is paying for all the thinks required to get that product to the marketplace and sold.  The income that comes in pays for everything that company does. 

Its just a different way of looking at it.

 

Apr 14, 2017 12:32 PM
Rainmaker
867,969
Candice A. Donofrio
Next Wave RE Investments LLC Bullhead City AZ Commercial RE Broker - Fort Mohave, AZ
928-201-4BHC (4242) call/text

Dude, that presupposes that you would get a discount on the price if I was not involved. That's not likely to happen. Because like you, the seller wants to realize as much profit as possible. PS bite me.

Apr 14, 2017 12:29 PM
Rainmaker
906,417
Jennifer Mackay
Counts Real Estate Group, Inc. - Panama City, FL
Your Bay County Florida Realtor 850.774.6582

I'm with you - must have taken a seminar on how to buy houses and alienate real estate agents

Apr 14, 2017 12:33 PM
Rainmaker
3,952,391
Michael Jacobs
Pasadena, CA
Los Angeles Pasadena 818.516.4393

I don't always read the answers before responding but this time I'm glad I did -- good question and the very thorough answer from Christine Kankowski Temecula & San Diego is an excellent one.  Through reading the answers and your comments to the responses, I'm not surprised it came from a first time buyer as I have heard the question before.  

Apr 15, 2017 03:48 AM
Rainmaker
3,901,197
Nina Hollander, Broker
Coldwell Banker Realty - Charlotte, NC
Your Greater Charlotte Realtor

I've heard that many times and in a sense it's true.

Apr 14, 2017 04:13 PM
Ambassador
3,214,328
Anna Banana Kruchten CRS, CRB, Phoenix Broker
HomeSmart Real Estate BR030809000 - Phoenix, AZ
602-380-4886

1st time buyer et?  Knows more than you apparently cause he learned all thing re himself on the net.

Apr 14, 2017 12:52 PM
Rainmaker
5,570,625
Barbara Todaro
RE/MAX Executive Realty - Retired - Franklin, MA
Previously Affiliated with The Todaro Team

I've always felt the buyer pays for the commission because it comes from the proceeds....the buyer is paying those proceeds....it is deducted from the amount of money received by the seller but it's from the buyer....

Apr 14, 2017 04:06 PM
Rainmaker
825,132
Pete Xavier
Investments to Luxury - Pacific Palisades, CA
Outstanding Agent Referrals-Nationwide

I would actually agree with him, but for him trying to use that "excuse" to receive a rebate of the commission...NO WAY!

Apr 14, 2017 03:56 PM
Rainmaker
1,176,198
Thomas J. Nelson, REALTOR ® e-Pro CRS RCS-D Vets
Big Block Realty 858.232.8722 - La Jolla, CA
& Host of Postcards From Success Podcast

I'd say "GREAT! I'll take mine now. Make the check out to Thomas J...."

 

Apr 14, 2017 08:47 PM
Rainmaker
868,731
Annette Lawrence , Palm Harbor, FL 727-420-4041
ReMax Realtec Group - Palm Harbor, FL
Making FLORIDA Real Estate EZ

The argument has always been 'The one bringing the money to the table is the one paying for everything.'

To the buyer asking this question I would ask, "Do you know how much you are paying your mortage comany and/or loan officer? How about your financial planner or who you are really paying when you get that cell phone bill?"

"Thank you for your significant contribution to the service based economy."

Apr 14, 2017 12:50 PM
Rainmaker
605,010
Eve Alexander
Buyers Broker of Florida - Orlando, FL
Exclusively Representing ONLY Orlando Home Buyers

The debate over who pays the commission has been going on for decades.

One side says it comes from the seller because they pay it and the other side says that without the buyers money, there is no money to pay any commission.

Commission is billed into the purchase price no different than tax on a loaf of bread...the rest is not important.

Eve

 

Apr 14, 2017 12:26 PM
Rainmaker
808,497
Kasey & John Boles
Jon Gosche Real Estate, LLC - BoiseMeridianRealEstate.com - Boise, ID
Boise & Meridian, ID Ada/Canyon/Gem/Boise Counties

I actually had a buyer say that before but it was in my defense to a builder who was being a jerk to me and claimed I needed to do what he said because he was paying my commission.  The buyer was ticked off and used that claim as a way to tell the builder to shut up.  I don't usually need buyers to stick up for me, but it's nice when they are loyal and appreciate you. That was about 10 or so years ago. -Kasey

Apr 14, 2017 12:22 PM
Rainmaker
3,069,684
Tony and Suzanne Marriott, Associate Brokers
Serving the Greater Phoenix and Scottsdale Metropolitan Area - Scottsdale, AZ
Haven Express @ Keller Williams Arizona Realty

Candice A. Donofrio nailed this one!

Apr 15, 2017 05:27 AM
Ambassador
4,081,291
Debe Maxwell, CRS
www.iCharlotteHomes.com | The Maxwell House Group | RE/MAX Executive | (704) 491-3310 - Charlotte, NC
The right Charlotte REALTOR!

Oh, I think Christine Kankowski Temecula & San Diego has a great response for you, Kathleen Daniels!  I'm surprised this came from a first-time homebuyer too!  

Apr 14, 2017 10:46 PM
Ambassador
5,208,324
Bob Crane
Woodland Management Service / Woodland Real Estate, EXP - Stevens Point, WI
Forestland Experts! 715-204-9671

Different ways of looking at things...

I posted a Q here a few weeks ago regarding buyer gifts and several agents here implied that the buyer was indirectly paying for the commission and thus deserved a gift.

Apr 14, 2017 10:15 PM
Ambassador
3,637,985
Paul S. Henderson, REALTOR®, CRS
Fathom Realty Washington LLC - Tacoma, WA
South Puget Sound Washington Agent/Broker!

I agree with Nina Hollander 

Apr 14, 2017 08:21 PM
Rainmaker
1,835,867
Bob "RealMan" Timm
Ward County Notary Services - Minot, ND
Owner of Ward Co. Notary Services, retired Realtor

I've heard it more than once Kathleen Daniels and of course there is some truth to it. My response would be based on the persons demeaner. One thing I am sure of is that my part of the conversation would start with "Thank You".

Apr 14, 2017 07:54 PM
Rainmaker
680,271
Steve Higgins
RE/MAX Kelowna - Kelowna, BC

Technically yes, but for him to say that takes a lot of........

Apr 14, 2017 06:53 PM
Ambassador
1,350,695
Susan Emo
Sotheby's International Realty Canada - Brokerage - Kingston, ON
Kingston and the 1000 Islands Area

I agree with your Buyer.  Whoever brings the money has the commission built in.  As for your appraisal question, we don't have appraisals in Canada

Apr 14, 2017 06:15 PM
Rainmaker
831,078
Jeff Pearl
RE/MAX Distinctive / LIC in VA - Lovettsville, VA
Full Service Full Time Realtor

And when he buys a new car, he is paying the salespersons commission. I would have said "so what". Followed by " And you will be paying my commission directly to my broker if the the seller of the house you buy isn't paying it."

Apr 14, 2017 04:52 PM
Rainmaker
1,444,327
Michael Setunsky
Woodbridge, VA
Your Commercial Real Estate Link to Northern VA

Kathleen Daniels Per the listing agreement the seller negotiates and pays the fee. The buyer can negotiate their fee in the BBA.

Apr 14, 2017 02:47 PM
Rainmaker
1,696,694
Lyn Sims
RE/MAX Suburban - Schaumburg, IL
Schaumburg Real Estate

'embedded' interesting phrase. There are 2 schools of thought here. I say the seller is paying for it because he nets less. Others say that the commission is mortgaged by the buyer. I'm sure he picked that up on Z.

Apr 14, 2017 02:03 PM
Rainmaker
526,279
Lynnea Miller
Bend Premier Real Estate - Bend, OR
Premier Real Estate Service in Central Oregon

I have never heard this from a buyer before, but the cost of anything you buy is figured into the price. Most of the agents who have already responded have said this far better than me.

Apr 14, 2017 12:57 PM
Rainmaker
846,275
Marco Giancola
Beachfront Realty - Miami Beach, FL
Realtor (305)608-1922, Miami Beach Florida

"And your point is?"

Apr 15, 2017 05:43 AM
Rainmaker
2,805,935
Debbie Gartner
The Flooring Girl - White Plains, NY
The Flooring Girl & Blog Stylist -Dynamo Marketers

Yes, I completely agree with this statement from your buyer! That's how it works from an economics standpoint.  Most buyers don't realize this, but yes, this is completely correct.

 

That aside, the fallacy is that if they don't use an agent, that is a lost opportunity/opportunity cost and they are (as a general rule), not going to get a lower price.

Apr 15, 2017 05:39 AM
Rainmaker
1,716,596
Anthony Acosta - ALLATLANTACONDOS.COM
Harry Norman, REALTORS® - Atlanta, GA
Associate Broker

I have never had a buyer say that to me. 

Apr 15, 2017 05:31 AM
Rainmaker
4,433,483
Gita Bantwal
RE/MAX Centre Realtors - Warwick, PA
REALTOR,ABR,CRS,SRES,GRI - Bucks County & Philadel

I have heard it before.

Apr 15, 2017 12:39 AM
Ambassador
4,312,167
Praful Thakkar
LAER Realty Partners - Andover, MA
Andover, MA: Andover Luxury Homes For Sale

Kathleen Daniels - technically, the only person who brings in money at the table is the buyer - so it is okay for the first time home buyer to think that way.

However, at the time of disbursement of the money, the buyer has NO right on how that works.

Apr 14, 2017 11:29 PM
Rainmaker
144,616
Julie Larson Realtor® Sarasota FL 941-882-0322
PalmerHouse Properties Florida - 941-882-0322 | Serving Sarasota, Manatee & Charlotte Counties - Sarasota, FL
When you're thinking of moving...ThinkSuncoast.com

I can understand your buyer's logic. We say that the seller pays the commissions, but the buyer is the one who ultimately paying the purchase price which includes the marketing fees.

Apr 14, 2017 09:00 PM
Rainer
318,363
Melissa Jackson
Century 21 Alliance Properties - Azle, TX
Helping You Make The Right Move

I understand both parties point of view. On a blog I once posted, a visitor voiced their opinion as the buyer pays. 

Apr 14, 2017 08:33 PM
Rainmaker
3,985,771
William Feela
WHISPERING PINES REALTY - North Branch, MN
Realtor, Whispering Pines Realty 651-674-5999 No.

Yes I have and I go into great detail in how commissions and other fees are paid and by who

Apr 14, 2017 08:29 PM
Ambassador
3,986,518
Debbie Reynolds, C21 Platinum Properties
Platinum Properties- (931)771-9070 - Clarksville, TN
The Dedicated Clarksville TN Realtor-(931)320-6730

I have had a buyer say that and all I said was Thank You. When I owned my own company I had one of my agents tell me she paid for my new car with all the money she made me. It takes all kinds.

Apr 14, 2017 07:11 PM
Rainmaker
4,133,040
Dorie Dillard Austin TX
Coldwell Banker Realty ~ 512.750.6899 - Austin, TX
NW Austin ~ Canyon Creek and Spicewood/Balcones

Christine Kankowski Temecula & San Diego came up with an awesome answer.

Apr 14, 2017 06:57 PM
Rainer
353,360
Jim Cheney
Saint Francis Property Santa Rosa, CA - Santa Rosa, CA
Rincon Valley Realtor 707.494.1055

I've heard that once before.  It took awhile to wrap my head around their persepective.  I don't necessarily agree with it, but I understand why some people might think it...

Apr 14, 2017 04:49 PM
Rainmaker
1,509,802
Inna Ivchenko
Barcode Properties - Encino, CA
Realtor® • GRI • HAFA • PSC Calabasas CA

I heard such things too, even they do not pay your commission, they still try to get some kind of rebate. Thanks to Redfin or similar services education on such . 

Apr 14, 2017 04:14 PM
Rainmaker
1,707,297
Joe Pryor
The Virtual Real Estate Team - Oklahoma City, OK
REALTOR® - Oklahoma Investment Properties

They are correct but put into context, without professional representation they might pay no commmssion but either buy the wrong house or pay too much.

Apr 14, 2017 02:53 PM
Ambassador
4,482,201
Jeff Dowler, CRS
eXp Realty of California, Inc. - Carlsbad, CA
The Southern California Relocation Dude

I have not been told that by a buyer but have had a couple ask how the commission is paid and if they were responsible

Apr 14, 2017 02:45 PM
Rainmaker
2,609,744
Richie Alan Naggar
people first...then business Ran Right Realty - Riverside, CA
agent & author

I respect points of view as a rule. When in an impasse, you believe you and I believe me takes place....each one going their own merry way

Apr 14, 2017 02:31 PM
Rainmaker
4,014,748
Wayne Martin
Wayne M Martin - Chicago, IL
Real Estate Broker - Retired

Never ends, but since the buyer only pays what the market will bear, the seller takes the hit on profit, And, if a FSBO seller keeps the money. So take it however you want, if will be paid! 

Apr 14, 2017 01:06 PM
Rainmaker
709,204
Richard Bazinet /MBA, CRS, ABR
West USA Realty - Scottsdale, AZ
Phoenix Scottsdale. Sellers, Buyers & Relocations

I say... YEP!

I heard that before, and I say, "ya... so? Would you prefer to pay now for it separately, and save the seller grief?" "...See, you can pay me cash directly now and save the money on the seller's price that would otherwise be on your loan in the purchase price over the life of the mortgage".

In our AZ buyer broker agreement - which I get every single client to sign, it clearly says that the buyer is responsible to pay the buyer-broker commission. But for practical reasons, it's paid at close of escrow from the seller's proceeds to the listing broker who in turn agrees to pay the buyer broker - all in one accounting swoop.

But on the other side of the coin is to explain that it is the listing broker that pays the buyer broker and not the seller - in AZ that's the correct technical answer. The money comes from the seller BUT as a result of an agreement between the seller and the listing broker.

SO... the seller is under no obligation to pay a buyer-broker commission, they could opt to not offer any buyer-broker commission if they want to (read: not sell their house).

SO in the end, does the money comes from the seller? Sure. But it's voluntary.

Apr 15, 2017 03:57 PM
Ambassador
2,544,939
Fred Griffin Tallahassee Real Estate
Fred Griffin Real Estate - Tallahassee, FL
Licensed Florida Real Estate Broker

Christine Kankowski Temecula & San Diego provided an outstanding answer.   I also like the last two words of Candice A. Donofrio's answer!

Apr 15, 2017 03:24 PM
Rainmaker
3,829,973
Will Hamm
Hamm Homes - Aurora, CO
"Where There's a Will, There's a Way!"

wonder who they are learning their lesson from

Apr 15, 2017 01:17 PM
Rainmaker
1,361,043
Ryan Huggins - Thousand Oaks, CA
https://HugginsHomes.com - Thousand Oaks, CA
Residential Real Estate and Investment Properties

You can't fix stupid, not even with duct tape.  Probably tells cops "My taxes pay your salary" too.

Apr 15, 2017 10:10 AM
Rainer
258,899
Mick Michaud
Distinctly Texas Lifestyle Properties, LLC Office:682/498-3107 - Granbury, TX
Your Texas Lifestyle is Here!

The cost of selling the house is in the price.  So yes, the buyer is paying the commission.

Apr 15, 2017 08:59 AM
Rainmaker
1,623,672
Sandy Padula and Norm Padula, JD, GRI
HomeSmart Realty West & Lend Smart Mortgage, Llc. - Carlsbad, CA
Presence, Persistence & Perseverance

So what was the buyer saying, You aren't worthy of being paid for your professional service? What an insult!

Apr 15, 2017 08:09 AM
Rainmaker
138,626
Kelly Turbeville
Keller Williams - Lake Forest, CA
Turning Real Estate Dreams into Reality

UGH!  Agree with what Christine Kankowski Temecula & San Diego as someone who use do Product Development, trust me all expenses are built into a product as well as anticipated discounts.  But that should not take away from our value as an Agent.

Apr 15, 2017 07:52 AM
Rainmaker
3,867,763
Richard Weeks
Dallas, TX
REALTOR®, Broker

I would say "yes and what is your point"?

Apr 15, 2017 07:08 AM
Rainmaker
3,296,247
Scott Godzyk
Godzyk Real Estate Services - Manchester, NH
One of the Manchester NH's area Leading Agents

Technically the buyer does pay it in the sense that it is built in the price. However, the seller is the one with a contract and who actually pays the commission from their proceeds. 

Apr 15, 2017 06:02 AM
Rainmaker
6,363,029
Roy Kelley
Realty Group Referrals - Gaithersburg, MD

Just say that the commission is a reduction from the proceeds to the seller.

Apr 15, 2017 05:30 AM
Rainmaker
4,799,306
Gabe Sanders
Real Estate of Florida specializing in Martin County Residential Homes, Condos and Land Sales - Stuart, FL
Stuart Florida Real Estate

In a way, he's right.  So, what difference does it make?

Apr 15, 2017 05:25 AM
Ambassador
1,616,204
Harry F. D'Elia III
RentVest - Phoenix, AZ
Investor , Mentor, GRI, Radio, CIPS, REOs, ABR

we need to educate the buyer more

Apr 15, 2017 05:25 AM
Rainmaker
1,384,363
Wayne Zuhl
Remax First Realty II - Cranford, NJ
The Last Name You'll Ever Need in Real Estate

Indirectly, sure. And I work very hard in my client's best interests to earn that money.

Apr 15, 2017 04:39 AM