If you’re a first-time homebuyer in Austin, you might be wondering, “Who pays the buyer’s agent’s commission?” It’s a common question, and changes in commission structures have made this topic even more relevant to today’s real estate market. Here’s a quick breakdown of how things work.
How Real Estate Commissions Work
In the past, sellers have covered both their agent’s commission and the buyer’s agent’s commission. However, recent changes in 2024 require buyers and sellers to negotiate their agent’s fees separately.
As a buyer, you’ll sign a buyer representation agreement when you first start working with an agent. This document outlines the terms of payment for their services. While this might sound intimidating, the way your commission is paid depends on how your purchase offer is structured.
Who Pays the Buyer’s Agent’s Commission?
It all comes down to what’s negotiated in your contract. Here’s how this can play out:
- Seller Covers the Buyer’s Agent’s Commission:
- If you’re in a competitive buyer’s market, your agent might negotiate with the seller to cover your commission. This is often requested when making the offer, ensuring the commission comes from the seller’s proceeds at closing.
- Buyer Covers the Commission (Partially or Fully):
- If the seller declines to pay the full amount, you may be responsible for covering what’s left. This can be added to your closing costs, included in your loan package (if applicable), or even offset through lender credits.
- Increase the Purchase Price:
- Another creative strategy is offering a slightly higher purchase price to ensure the seller’s proceeds cover the buyer’s agent’s fee. This strategy minimizes your upfront cost at closing without altering your financing terms.
The great news? As your buyer’s agent, we will guide you through these options to find a deal that works best for you and your budget.
How Can You Tell if the Seller is Open to Paying the Commission?
Under the new rules, sellers no longer have to publicly advertise whether they’re willing to cover buyer’s agent commissions via the MLS, the database homes are listed. However, your agent can still include this request in your offer. If the seller refuses, you may still explore options—like adjusting the offer price—to make it work.
The key is clear communication and flexibility at every step.
Why Hiring a Buyer’s Agent is Essential
Hiring a buyer’s agent can save you money and ensure someone is always advocating for your best interests. Here’s how they help:
- Identifying Resale Potential: We will evaluate potential challenges you’ll face when selling the home later. The best time to think about selling a home is before you buy it!
- Negotiating the Best Price: We work hard to minimize your total costs, including the purchase price and commission payments.
- Guidance Through Inspections: We ensure the home inspection process is thorough and uncovers potential issues upfront.
- Avoiding Conflicts of Interest: Unlike the seller’s agent, who represents the seller exclusively, we are 100% dedicated to your needs.
Without a buyer’s agent, you risk paying more for a less-than-ideal property—with no advocate looking out for you.
Work With an Experienced Buyer’s Agent in Austin
At Eleven Oaks Realty, our team has over 60 years of combined experience helping home buyers like you settle into Austin. We specialize in navigating today’s unique market and handling unique fee structures, ensuring you find your ideal home under the best possible terms.
If you’d like to learn more, visit our Austin Home Buyer’s Guide or complete our Buyer Survey. You can also reach out to us at info@11OaksRealty.com or call/text us at (512) 827-8323 to schedule a no-obligation consultation.
Leave a Reply