I see this question online and hear it time and time again. The answer is ‘no’ – and ‘yes’. Let me explain.
It is important to know what is common in your local market to offer the Buyers’ Agent. The compensation that you pay your Listing Broker is usually split so that 50% goes to the Listing side and 50% goes to the Buyer’s Agent. For example, if you have a 6% listing agreement, in most cases (make sure to read your contract) the listing agent will offer 3% in the MLS to agents that bring a buyer.
If you hire an agent that works for 4%, and they offer 2% in the MLS, you may potentially have a problem if most of the competition is offering 2.5% or 3%. In this case, raising the commission may help you sell your home with increased showings (if you are already priced right).
On the other hand, if you are wondering if offering 3.5%, or even 4%, will get that home sold, the short answer is no, but let me qualify this in the following ways:
- Buyers usually choose which properties they want to see – regardless of the commission.
- If we are having a Be Honest, agents will show the home as long as the commission is in line with the market. The exception – if there is a large inventory, or a lot of similar floorplans, showings will then favor the higher commissions because agents will have to find a way to narrow down the showings.
- You may find some increased showing activity with the Bonus. Agents may make a point of forwarding the listing to their buyers that may request a showing. But, it still must appeal to the buyers.
What will get your home sold? The right buyer seeing it at the right price. If you are struggling with a choice between reducing your price and offering a bonus or an unusually high commission, go with the lower price.
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