I had my house listed with a real estate agent for 4-1/2 months. The commission was 5.6%. This contract expired the end of 2008 but it states that commission is owed if there is a sale 180 days from the ending date.I don't think I want to renew the listing right now as we didn't have much interest and no offers. Also, does this seem to be a normal contract? By boyfriend thinks I got screwed on the commission fee.
What that language usually refers to is if the agent comes in with a buyer within that 180 days they can still get their commission - or if someone they showed it to originally (prevailing cause) ends up buying it from your or another realtor after their contract has expired. It should not refer to ANY sell of the property after the expiration of their contract and they would have to be able to prove 'prevailing cause'. That's fairly normal language, but 180 days seems to be a bit long. Either way, you normally would not have to worry about having to pay them for any typical sale through another realtor or otherwise after their contract has expired. 5.6% is a fairly low commission rate as the national average is 6% and in our area it is 7%. I don't think you got screwed on the commission amount. It would always be a good idea to have an attorney look at the contract to make sure, but common practice in most areas would reflect my comments above.
I assume you mean that you owe him a commission IF someone who looked at it during the listing period buys it within 180 days following the listing termination, correct? If so, that seems like a very long time to me. I never put more than 30 days in a listing agreement. But I don't know how real estate companies operate in your area. You think 5.6% is taking advantage of you? In our area, outside Washington, DC, 6% is the most common listing commission. There are discount brokerages who charge less, but then they do considerably less to help sell your home - which is a recipe for disaster in our current market. There are also homes listed at higher commissions. I'm helping a client close on a home next week that was listed at 8%. Offering a higher commission was a smart move by the sellers because it created a lot of interest in their home, which was in a neighborhood where several other homes were also on the market. There is no one 'right' commission for any area. But generally, the lower the commission is, the less the listing realtor is willing to spend trying to sell it.
