7% on the First $100,000 and 3% On the Balance of the Sale Price (7 and 3)
Buyers and Sellers of Homes For Sale By Owner want the same thing – The 7 and 3 Commission.
Sellers want to COLLECT THE 7 and 3 COMMISSION from a Buyer
Buyers do not want to TO PAY A 7 and 3 COMMISSION to a Seller
Collecting a commission included in the sale price of a home is the number one reason some sellers try the For Sale By Owner route.
7% on The First $100,000 and 3% on the Balance of the sale price is pretty typical commission in Calgary for Full Time, Full Service, Experienced Real Estate Professionals.
The easy way to Calculate Calgary Real Estate Commissions is to apply 3% to the full price and add $4,000.
As an example $500,000 times 3% =’s $15,000 plus $4,000 =’s $19,000
The $19,000 in Commission on a $500,000 sale is generally split 50/50 between the Buyers Realtor and the Sellers Realtor®.
Out of the $9,500 each Realtor receives, they have to pay taxes and expenses just like everybody else that works for a living.
Sorry I got off the topic a bit. Let’s get back to For Sale By Owner Homes.
Usually, someone figures the house across the street just sold for $500,000, so they should be able to get $500,000 without a Realtor.
So they plant a For Sale by Owner sign on the front lawn and wait for people to line up.
Only people don’t line up, all the serious Buy Now home buyers are too busy looking at MLS® Listed Homes with Realtors.
So the for sale by owner homes gets the leftovers, bargain hunters, unqualified lookers and dreamers.
Wait a minute – all of a sudden they do get a serious qualified buyer.
Here’s what the buyer is thinking. If these people want $500,000 and the MLS Value is $500,000, then they should be able to save $20,000
That’s the same $20,000 dollars the seller wants in their pocket.
So the negotiations begin, and it could go smooth, but chances are someone is going to get emotional over a few dollars and nothing gets done.
Or it gets sold at $480,000 and nobody gets the commission. And if something goes wrong – here come the lawyers’ fees.
One other thing – Buyers are not influenced or enticed to For Sale By Owners on the prospect of saving $10,000 or $20,000.
To a buyer that only represents a $50 to $100 a month added to a mortgage payment.
It’s not like all of a sudden a buyer has the extra lump sum cash in their pocket.
Don’t get me wrong – I understand why a Home Seller would want to Collect the MLS Commission from a Home Buyer.
Without doing some in-depth research it appears to be the way to go. But if it was, don’t you think everybody would be doing it?
Try it – Call me 403 831 0842 Jerry Charlton – I’ll give you all the help you need – FREE of CHARGE
Here’s a link to a Free Website for Calgary For Sale By Owners just fill out the info and post your listing instantly. Free – No Obligation