Understanding Real Estate Commissions

Real estate commissions and fees are negotiable. There is not a "set commission rate". Each real estate company can determine the commissions/fees that they wish to charge. It's best if you think of the commission as having two separate parts - the listing commission and the selling commission.

Let's look at a traditional real estate transaction as an example:

You list your home for sale with Hober Realty (the listing company) and agree to pay a 6% commission when your home sells. Then Real Estate Co. XYZ (the selling company) brings a buyer to see your house, they fall in love with it and decide to buy it. At the closing you will pay the 6% real estate commission from the proceeds of the sale of your home. This 6% commission will be split between Hober Realty (the listing company) and Real Estate Co. XYZ (the selling company). Each of the real estate companies involved gets 3%.

Hober Realty offers several different commission/fee options for you to choose from. You can review all the various options in the Service Level section. But, remember, we are only discussing our portion of the commission (our 3% listing commission in the above example). You need to remember, that the other company that brings the buyer is still going to want to get paid a commission. That portion of the commission has nothing to do with Hober Realty. But, typically in Georgia you will want to offer the selling company a commission of around 3% as an incentive to bring a buyer to your home. You could offer to pay more or less to the selling company, depending on your circumstances. We can discuss this with you to help you make the right decision. But, you determine the amount you are willing to offer the listing company and the selling company upfront when you put your home on the market.

If the buyer of your home does not have a real estate company representing them, and Hober Realty (as the listing company) must assist the buyer in order to make the sale successful, we will only charge a 2% commission for the selling side. So, in the example above, instead of paying 3% commission to the listing company and 3% to the selling company, since there is no selling company involved, you would just pay the listing company 3% for the listing side and 2% for the selling side, for a total of 5%. Most traditional real estate companies will not reduce the commission when there is not a selling company involved. They would still charge the full 6%.

Commissions and fees are complicated, but you need to understand them when you put your home on the market. If you have any questions, please don't hesitate to send us an email or call our us for more information. We want you to understand and feel comfortable with each step of the real estate process.