You used to hear how 6% was the “typical” commission in the real estate business. I remember years ago, when I hung my license with a large brokerage, a class they were giving on how to convince a seller that paying a 7% or 8% commission was in their best interest. It was one of the reasons Paradise Sharks was born. High quality real estate services should be available to everyone and they should not cost an arm and an leg. The clients deserved to be educated, not sold.
These days, you are more likely to hear the “typical” real estate commission is 5% to 6% of a homes sales price. More often than not, in the Jupiter area, that “typical” 5% to 6% commission is split equally between the seller’s brokerage and the buyers brokerage. The trend for sellers of Jupiter single family homes is for lower commissions and that trend is very significant.
Back in 2009, 77% of all single family home sales in Jupiter offered the buyers brokerage a 3% commission. Over the seven years since, that percentage has dropped each and every year. In 2010 it dropped to 75%. In 2011 it dropped again to 73%. A bigger fall happened in 2012 to 62%. The next four years took the percentage of buyers brokers being paid a 3% commission to 57%, then 53%, then 45%, then 41%. It was clear to see that “typical” was no longer 6%. Not even close.
As we started this year, we watched closely to see if this multi year drop in real estate commissions would continue. The good news for Jupiter single family home sellers is the percentage of buyers brokerage commissions of 3% has dropped again to 35%. In August of this year, that number had dropped to an amazing 29%. In September, it fell further to 28%. Perhaps the 6% commission in Jupiter is not dead, but it isn’t being paid be a vast majority of home sellers. It has fallen so far that the “typical” commission is certainly looking to be more like 5%.
If you are even thinking about selling a home, please remember that the commission paid is only part of the story. What the broker is doing to professionally market that home is really more important so education is the key. Interview at least three brokers and ask a lot of questions. Paradise Sharks would certainly be honored to be presented the opportunity to earn your business and you can reach us anytime at 561.308.0175 or firstname.lastname@example.org. We love your questions.