It is critical for everyone to understand that real estate commissions are 100% negotiable, as are the services home sellers receive for their hard earned money. Home sellers need to interview brokers and ask questions about what they charge and what they do for that money. An educated decision is a wise decision and there is no better way to get informed than by interviewing brokers and asking a lot of questions.
It is also important to recognize that without having access to every single closing statement of every single home sale in Jupiter, it is impossible to know what every seller actually paid in total for commissions. What we do know is what is offered as a co-broke commission through our local Multiple Listing Service. Back in 2009, 77% of single family home sales in Jupiter through the real estate community offered a co-broke commission of 3%. For the purpose of this article, we are assuming that the listing broker was also being paid 3% which would add up to a total commission paid of 6%. Fast forward to 2020 and the percentage of single family homes sold in Jupiter where a 3% co-broke commission was paid is down to less that 22%. Stunning drops, every year, for 11 straight years. A total drop of over 71%.
Why the decline? It’s pretty simple and there is one word that is the main reason. Competition. Back in 2009 there were about 113,000 Florida Realtors who were members of the National Association of Realtors. Last year, the number had swelled to about 186,000. That’s a jump of almost 65%. There are far more Realtors chasing the same business than there were back then. Like banks, restaurants, gyms, grocery stores and just about everything else there is more and more competition chasing the same customer.
And you know what. Commissions are probably going to drop even further unless we see a significant drop in the number of Realtors. Some people will tell you that if you do not pay a higher commission your home will not get the attention it deserves. It’s just not true. Well over 90% of all buyers shop online for a home before calling a Realtor. They do not know, and typically do not care, how much commission is being offered for their business. What does matter is how that property looks and sounds in relation to its price and location. If it looks of interest to a potential buyer they are going to make a call and seek more information and ultimately schedule a showing.
Sellers must be educated, as professional marketing is what will get them the highest price for their home. Asking questions, interviewing brokers and being informed. Again, ALL real estate commissions are negotiable and those seller’s who interview and ask questions improve their odds of ending up with a larger check when they stand up from the closing table.
Paradise Sharks has long recognized the fact that competition is putting pressure on commissions in the real estate industry. We have been doing nothing but building and selling real estate for decades. We believe the strength of America is in its small businesses and we know Paradise Sharks can provide a higher level of customer service for less money to our customers. It’s what we do. We have no franchise fees, we have no broker taking a chunk of our commission at the closing table and we pass those savings directly back to our client’s where we feel it belongs. In their pocket, not ours. It’s as simple as that.
For most home sellers, in the Northern Palm Beaches, Paradise Sharks can list the majority of single family homes for a total commission of 4%. If the home is in superb condition, worth over a million dollars, is vacant, sells in less than a week, or is in a highly desired neighborhood, we typically can lower that maximum commission to 3.5%. You will find the vast majority of co-broke commissions offered on our Multiple Listing Service are currently at 2.5%. We are starting to see some brokers offer a smaller co-broke to the buyers real estate brokerage and if our clients wish to explore that we are happy to discuss those options in greater detail and perhaps even save them additional money.
Paradise Sharks loves interviewing, we love educating and we love saving our clients money while providing a very high level of customer service. It’s our passion. Our homes are selling quickly, we are setting record prices for our clients and we would love to meet with you and discuss your unique situation in further detail. If you are buying, we can also save you a lot of money. Almost all of our buyer clients are getting substantial credits at closing as our little way of saying thank you. Our clients do not even have to ask, we just do it. Our consultations are complementary and easy to schedule by contacting us at 561.308.0175 or firstname.lastname@example.org.