A move toward clarity on real estate commissions paid by buyers and sellers
Ask a recent home buyer how much they paid in real estate commissions and they'll say "nothing." Ask a recent home seller how much they paid in commissions and they'll likely quote a dollar amount or a percentage of their home price.
Greater transparency about commissions is being introduced in some areas of the country and among some real estate brokerages that could change the conversation about how agents are compensated.
Traditionally, the commissions for sellers' and buyers' agents are paid by the sellers out of their profits from the sale of the home. So sellers are the ones who decide how much to offer to the buyer's agent.
Now a few markets are opening the information to buyers, giving them an opportunity to make the compensation for their agents' work part of the negotiations.
In the largely experimental move, buyers can ask their agent to take a lower commission to reduce the overall price of the property or they can ask their agent to provide them with a rebate of some of their commission. But on rare occasions, some brokers say, opening up the commission could result in buyers having to directly pay part of their agents' commission.
Since October, the Northwest Multiple Listing Service (NWMLS) in Seattle has allowed real estate brokerages to publish the amount of the commission being offered to the buyers' agent. The NWMLS policy also removed the requirement that a seller offer a commission to the buyers' agent.
If no commission is offered, the buyers and their brokers can negotiate the compensation. In other MLS systems, such as Bright MLS in the Mid-Atlantic region, some buyers' agent compensation must be offered with the listing, although only agents can see that proposed commission.
Since last summer, Redfin real estate brokerage publishes the buyers'...