When buying or selling a home, you may choose to work with a real estate agent. But who is responsible for paying the commission? This depends on the specific situation.
What Is a Real Estate Agent's Commission?
The commission is the fee a real estate agent earns for their services in facilitating the purchase or sale of a property. It is typically calculated as a percentage of the final sale price but can also be a fixed fee.
The Buying Agent
If you hire a buying agent to assist you in purchasing a property, you, as the buyer, are responsible for paying the commission. A buying agent helps you find a suitable property, negotiate the price, and finalize the purchase agreement. The commission for a buying agent usually ranges between 1.2% and 1.8% of the purchase price.
For example, if you purchase a home for €300,000 and the commission rate is 1.5%, you will pay €4,500 to the agent.
The Selling Agent
When selling your home and hiring a selling agent, you, as the seller, are responsible for paying the commission. A selling agent assists in setting the asking price, promoting your home, organizing viewings, and negotiating with potential buyers. The average commission for a selling agent is around 1% of the sale price.
If your home sells for €400,000 and the commission rate is 1%, you will pay €4,000 to the agent.
The Rental Agent
If you wish to rent out your property, you can also hire a real estate agent. In this case, you, as the landlord, are responsible for the commission. However, if you are a tenant and hire an agent to help you find a rental property, you, as the tenant, will be responsible for the fee.
Alternative: Fixed-Rate Fees
Commission costs can be significant, especially for higher-priced properties. For this reason, some people prefer working with an agent who charges a fixed fee instead of a percentage. This approach offers greater transparency and can be more cost-effective. At KIJCK. Makelaars, for example, we offer a fixed fee of €3,950,- including VAT for our services, regardless of your property's sale price.
Conclusion
Who pays the commission depends on who hires the agent. As the buyer, you are responsible for paying the buying agent, and as the seller, you pay the selling agent. Consider whether you prefer a percentage-based commission or a fixed fee. This way, you’ll know exactly what to expect and avoid surprises.