Commissions vary from office to office, and in different parts of the country. The commission percentage for land and commercial property is often higher than the commission due on the sale of a home.
The average in my state for residential single family homes is from 5 – 6 percent, so 8% is not unreasonable for partially developed property, although it may be wise to bargain down to 7.5 – 7% if you can. Depending on where you’re located, the real estate market has slowed or stopped considerably, leaving sellers with unsold properties, whether they are developed or not. Here is a site you may want to look at: http://homebuying.about.com/cs/newagents…
Real Estate Commission Rate For Commercial Property?
I was wondering what the average/reasonable commission rate for a Realtor would be on a piece of semi-developed commercial property but with no actual building structure on it yet. The infrastructure (utility lines and parking) for an office to be built is already in place.
I’ve heard home market commissions are anywhere from 5% to 7%, but I’m wondering if it should be higher since it is a commercial property. Currently the offer is for 8% commission and I was wondering if it should be bargained down to a lower commission rate. If you have any experience with this or know of any websites that would be great.
Thanks for your help!
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3 comments - add yours
Rebecca M
July 7, 2009
Funny Cop Videos
July 7, 2009
Commercial commissions are usually lower because the value of the property is normally higher. However, the rate usually changes depending on how many real estate brokers are involved. For example, a property my team is currently selling will pay out a 4% commission to us if we sell to a self-represented party. If another broker brings us the deal, we drop to 3% and the procurring broker gets 3%.
Weimaraner Mom
July 7, 2009
One it depends on the developer or the Real Estate company that is building the property. Most of our brokers only made 4% depending on the amount of square footage rented. Anything above 40,000 sq ft usually dropped the commission down to 2%. Most Real Estate companies will pay 1/2 upon execution of the lease and the second 1/2 after 6 months or a year.
Commercial properties commission is not necessarily higher than home sales, it all depends on how much the Real Estate company is willing to pay a broker for leasing out their commercial office space.
