Typical agent commission on home sale

6% normal? Thought it might be a little lower considering it was my sister in law's "friend". Michigan btw.

State/county taxes 8.60 per thousand

Owners title policy 1,200

Title work $500
Compliance fee $295

Additional misc fees of deed transfer and loan payoff

kingstonlake wrote:6% normal? Thought it might be a little lower considering it was my sister in law's "friend". Michigan btw.

State/county taxes 8.60 per thousand

Owners title policy 1,200

Title work $500
Compliance fee $295

Additional misc fees of deed transfer and loan payoff

Right in the range. Michigan tends to be in the 5%-7% range.

All of those numbers are correct.

As for lowering a commission, the agents broker may not allow it. the agent could make a deal on their own but they still have to pay their broker so it will cost them more than the 1%.

Brokers are like bookies, they are going to get their juice.

My agent went to 2.5% to get the listing. I'm paying 5.5% total.

IntenSity, if the list agent is going to lower a commission this is the right way to go.

If they go straight 5% it will have a negative effect. While not exactly ethical, a buyers agent is less like to show a home when they know it will cost them in commission of .5%.

Many agents will cut a deal if they also bring the buyer to their own listing. If they do, they will get the full commission and be more inclined bargain.

But, of course, the broker is still going to get their cut.

3% for each realtor for a total of 6% unless you negotiate a lower price.

Hey Snake, reading the other board yesterday: mods don't care that that uofm fan is using the alleged victims name? I'm all for making it right by any victim, but those couple threads were nuts. What's the story?

Sorry for the hijack.

6% plus or minus is correct, varies a bit by region. I have a real estate license in Ohio (a sideline), our typical commission is 7% on the first $100k, 5% on the balance up to total of $500k, then is steps down to around 3.5% and typically another step at $1 mill.
Ask your realtor how the split their commission, too. If they aren't going 50/50 between sell and list, ask why. Some sales agents do look at the commission offered when deciding what houses to show.

Hey, real estate guys. I got an offer for full asking. I'm very nervous about the appraisal, it will be $35k higher than the last sale. Any chance it will even appraise at $285? I'm asking $295. One of the units like mine took $260 for some reason.

I put my house on Craigslist. It sold for $200K over asking price. I'm just waiting for this damn check from Nigeria to clear.

InTenSity wrote:Hey, real estate guys. I got an offer for full asking. I'm very nervous about the appraisal, it will be $35k higher than the last sale. Any chance it will even appraise at $285? I'm asking $295. One of the units like mine took $260 for some reason.

Hell that's good news. You'll be moving in no time.

DWags wrote:Hey Snake, reading the other board yesterday: mods don't care that that uofm fan is using the alleged victims name? I'm all for making it right by any victim, but those couple threads were nuts. What's the story?

Sorry for the hijack.

I barely go there anymore. If you point it out to me (link the thread) I'll gladly go ban the douche and remove the posts.

DWags, which thread is it? I'd like to take a peek.

Is buying a house even worth it these days?

Seems like you pay about 14k in fees just to buy the damn house, you are going to pay fees just to sell the damn thing, for a 30 yr mortgage the estimate in interests I saw for 20% down was above 100k, and that doesn't even count for repair fees ie tree removal, new roofs (10-20k), new furnaces, boilers, painting, and so on.

I just don't see a good return on investment in this deal.

steveschneider wrote:Is buying a house even worth it these days?

Seems like you pay about 14k in fees just to buy the damn house, you are going to pay fees just to sell the damn thing, for a 30 yr mortgage the estimate in interests I saw for 20% down was above 100k, and that doesn't even count for repair fees ie tree removal, new roofs (10-20k), new furnaces, boilers, painting, and so on.

I just don't see a good return on investment in this deal.

It's not.

steveschneider wrote:Is buying a house even worth it these days?

Seems like you pay about 14k in fees just to buy the damn house, you are going to pay fees just to sell the damn thing, for a 30 yr mortgage the estimate in interests I saw for 20% down was above 100k, and that doesn't even count for repair fees ie tree removal, new roofs (10-20k), new furnaces, boilers, painting, and so on.

I just don't see a good return on investment in this deal.

I bought about 4 years ago. $200k selling, we put 10% down, cost I think $33000 all in. I'm selling for $295k now, minus commission, if I get the full asking will walk away with around $275k, with equity, that puts me somewhere around $106k in 4 years. I'm buying a place for $350k, hoping to put $80 down, with closing costs that will be $93k, then have about 10-15 to update. The house I'm moving into is probably worth closer to $425, why wouldn't I do that immediately? In another 4 years, if the place is worth 5-600k, I think I'm doing better on buying than my 401 or any other investment.

InTenSity wrote:

steveschneider wrote:Is buying a house even worth it these days?

Seems like you pay about 14k in fees just to buy the damn house, you are going to pay fees just to sell the damn thing, for a 30 yr mortgage the estimate in interests I saw for 20% down was above 100k, and that doesn't even count for repair fees ie tree removal, new roofs (10-20k), new furnaces, boilers, painting, and so on.

I just don't see a good return on investment in this deal.

I bought about 4 years ago. $200k selling, we put 10% down, cost I think $33000 all in. I'm selling for $295k now, minus commission, if I get the full asking will walk away with around $275k, with equity, that puts me somewhere around $106k in 4 years. I'm buying a place for $350k, hoping to put $80 down, with closing costs that will be $93k, then have about 10-15 to update. The house I'm moving into is probably worth closer to $425, why wouldn't I do that immediately? In another 4 years, if the place is worth 5-600k, I think I'm doing better on buying than my 401 or any other investment.

You are definitely in a hotter real estate market than I am. Your purchases sound like great investments.

Word on street is the auto industry is prime for another collapse. Giving out sub prime loans again, to heavy into leasing, 8 year loans, heard that the number of over 90 past due is more than 2008. Not there yet but the writing is on the wall. Could be a really bad ripple effect for michigan.

Bought the first house in Royal Oak in '86. Wanted to build our own home 5 years later so listed it with a realtor friend. He held one open house and sold it the same day. Only home he ever sold at an open house without a buyer agent involved. After the 4% commission he and his broker agreed to we made 50%.

The Pantry wrote:Bought the first house in Royal Oak in '86.  Wanted to build our own home 5 years later so listed it with a realtor friend.  He held one open house and sold it the same day.  Only home he ever sold at an open house without a buyer agent involved.  After the 4% commission he and his broker agreed to we made 50%.  

Yeah, we've looked at house histories and tracked the prices they've sold for. Seems like before the 2000's was the time to buy.  A lot of the people that bought their houses in the 80's or 90's doubled their investment when they sold them in the 2000's. Not so sure I can see the same return on investment happening.

kingstonlake wrote:Word on street is the auto industry is prime for another collapse. Giving out sub prime loans again, to heavy into leasing, 8 year loans, heard that the number of over 90 past due is more than 2008. Not there yet but the writing is on the wall. Could be a really bad ripple effect for michigan.

Read a couple things a few weeks ago. One said inventory levels are high. The other predicted used car prices are going to drop significantly over the next couple years.

I believe it but doubt it will come close to the way shit went down in 2008/9 when the entire economy went to hell.

steveschneider wrote:

The Pantry wrote:Bought the first house in Royal Oak in '86.  Wanted to build our own home 5 years later so listed it with a realtor friend.  He held one open house and sold it the same day.  Only home he ever sold at an open house without a buyer agent involved.  After the 4% commission he and his broker agreed to we made 50%.  

Yeah, we've looked at house histories and tracked the prices they've sold for. Seems like before the 2000's was the time to buy.  A lot of the people that bought their houses in the 80's or 90's doubled their investment when they sold them in the 2000's. Not so sure I can see the same return on investment happening.

Depends on how you buy. I've got more time on my hands than most of you so I buy 3-6 parcels a year in tax sales and sell them myself. I've got 2 lots yet to sell from last summer but have already got 3X my initial back. I had a RE license for over 30 year but let it go 5-6 years back. But I still do all the paperwork and closings myself so that helps.

I tend to fart around on the low end of the market and keep it close to home (30 minutes or less). So my upside isn't huge in absolute $$'s but there's also very little downside.

steveschneider wrote:

InTenSity wrote:
I bought about 4 years ago. $200k selling, we put 10% down, cost I think $33000 all in. I'm selling for $295k now, minus commission, if I get the full asking will walk away with around $275k, with equity, that puts me somewhere around $106k in 4 years. I'm buying a place for $350k, hoping to put $80 down, with closing costs that will be $93k, then have about 10-15 to update. The house I'm moving into is probably worth closer to $425, why wouldn't I do that immediately? In another 4 years, if the place is worth 5-600k, I think I'm doing better on buying than my 401 or any other investment.

You are definitely in a hotter real estate market than I am. Your purchases sound like great investments.

Aren't you in NY? I dunno, if you are staying somewhere for 10 years or more, at least you get something out of it, right? We also didn't know the market was this good, until a couple of months ago. But I'll ride it while I can, and also make sure that whatever I buy, I'm happy with being there and can afford it.

InTenSity wrote:

steveschneider wrote:

You are definitely in a hotter real estate market than I am. Your purchases sound like great investments.

Aren't you in NY? I dunno, if you are staying somewhere for 10 years or more, at least you get something out of it, right? We also didn't know the market was this good, until a couple of months ago. But I'll ride it while I can, and also make sure that whatever I buy, I'm happy with being there and can afford it.

I could never afford to buy in NYC. The current market is an outright bidding war, and you have the Chinese or Russians buying up everything in cash. If you are buying with a mortgage you are pretty much at a huge disadvantage.

Also, the building fees, property taxes and mortgage would probably be pretty damn steep.

InTenSity wrote:Hey, real estate guys. I got an offer for full asking. I'm very nervous about the appraisal, it will be $35k higher than the last sale. Any chance it will even appraise at $285? I'm asking $295. One of the units like mine took $260 for some reason.

You should be fine, appraisals have mostly been coming in 'where you want them to be' of late.
Worst case scenario your buyer will have to put more money down, probably can get a loan at less than 20% of appraised value, too.

Bought our house about a year and half ago. It was 6% commission. I keep hearing how we are close to another collapse, and I wonder what situation we will be in. Ideally, we were planning on being in this house for 8-10 years, and then build a house we like. I just hope it all doesn't go to shit in that time frame.

But even if it did, I still wouldn't regret buying our house. Our payment, including insurance and taxes, is only $100 more/month than renting an apartment. Our utilities are the exact same price as in the apt, and we have so much more room and a yard. Yes, we've spent money on the house, but I can do stuff with it unlike an apt. So no regrets. I just hope it works out in the next 6-8 years.

Dendrobates wrote:Bought our house about a year and half ago. It was 6% commission. I keep hearing how we are close to another collapse, and I wonder what situation we will be in. Ideally, we were planning on being in this house for 8-10 years, and then build a house we like. I just hope it all doesn't go to shit in that time frame.

But even if it did, I still wouldn't regret buying our house. Our payment, including insurance and taxes, is only $100 more/month than renting an apartment. Our utilities are the exact same price as in the apt, and we have so much more room and a yard. Yes, we've spent money on the house, but I can do stuff with it unlike an apt. So no regrets. I just hope it works out in the next 6-8 years.

Real Estate will always have cycles, I don't see anything like 2008 on the horizon, though. With a 6-8 year time frame you will be fine, and your kids will have great memories of your home. .
A lesson I learned is to not to count on your home as a great investment. It's your shelter and not your portfolio, hopefully it appreciates close to inflation, but don't count on it for your retirement. Put retirement savings in a real investment vehicle.

tGreenWay wrote:DWags, which thread is it? I'd like to take a peek.

Can't find it now. Guy was a uofm fan who graduated from wmu and lived in Colorado. Claims he was a friend of the victim. RCMB immediately outed him, his real name his job everything. He didn't seem to care. He even jumped into one thread that was begging the mods to ban him for using the girls name. Crazy couple of threads. I probably skim that board once a week. That was a crazy thread. That board just sucks ass now.

Like others said, 6% seems to be the norm. Sold my folks place for the estate @ 3.5% with a listing only agent. Sold my last home by owner in a week and it cost me $500 in attorney fees. The buyer had a lawyer look over the standard boiler plate agreement.

Whatever you do don't sign more than a 60, maybe 90
Sales Agreement. If they can't sell your place in 60 days in the current market they aren't trying.

I didn't read the whole thread and it has been a while since I bought/sold a house....but the 6% is a baked in 3% for the selling agent and 3% for the buying agent (plus legal doc fees). If you don't have a buying or selling agent, than half of the commission (and who is going to handle/pay for the legal doc fees) is negotiable.

Dendrobates wrote:Bought our house about a year and half ago. It was 6% commission. I keep hearing how we are close to another collapse, and I wonder what situation we will be in. Ideally, we were planning on being in this house for 8-10 years, and then build a house we like. I just hope it all doesn't go to shit in that time frame.

But even if it did, I still wouldn't regret buying our house. Our payment, including insurance and taxes, is only $100 more/month than renting an apartment. Our utilities are the exact same price as in the apt, and we have so much more room and a yard. Yes, we've spent money on the house, but I can do stuff with it unlike an apt. So no regrets. I just hope it works out in the next 6-8 years.

The market very well could collapse again, but it won't be any time soon. Default rates are near a 10 year low. As well they should be with the 2008 disaster in that time frame.

https://us.spindices.com/indices/specialty/sp-experian-first-mortgage-default-index

GRR Spartan wrote:Like others said, 6% seems to be the norm. Sold my folks place for the estate @ 3.5% with a listing only agent. Sold my last home by owner in a week and it cost me $500 in attorney fees. The buyer had a lawyer look over the standard boiler plate agreement.

Whatever you do don't sign more than a 60, maybe 90
Sales Agreement. If they can't sell your place in 60 days in the current market they aren't trying.

Yeah my last two homes were without an agent. Swallowing that 6% grinds my teeth, lol.