Compare real estate markets and find out how real estate agents are paid


What is a comparative market analysis?

This is a report that shows recent sales of nearby homes that are comparable. A comparable is usually denoted by a home in the same neighborhood with similar square footage (size) of the house, number of rooms, number of bedrooms and bathrooms, and size of the property the house sits on. The report usually lists the price the house was offered at, the price it sold for, and the date of the sale.

While this report is often considered the gold standard for determining both sale price and offer price, in today’s quickly changing market the information may be outdated by the time the buyer sees it. In the current climate, any home sale before the last sixty days probably will not accurately reflect the true market price.

How are real estate agents paid?

Real estate agents are paid a commission that is calculated on the selling price of the home. Actually that commission is negotiable.

Currently the commission ranges from about 6% to 8% of the selling price of the home, but it depends on the individual agent and what is considered standard in your part of the country. The most common is a four-way split of the commission between the real estate office that lists the home, the seller’s agent who works at that office, the buyer’s agent, and the real estate office that the buyer’s agent works for.

Do I need a lawyer to handle my real estate transaction?

Some buyers and even sellers are reluctant to obtain an attorney to help them in this, which may be the most expensive and most complex deal they will ever make, because they fear it will cost too much. It is much like doing your own surgery because a specialist is just too expensive.

So let’s deal with the cost up front. This country has many attorneys in all states. Some of these professionals handle real estate transactions as a routine manner, and in the past there have been many of these transactions to handle. The attorneys who routinely work with real estate can usually quote you a fair price for their work. It is usual for a potential client to call several attorneys to ask about the attorney’s experience with real estate transactions, what the charges will be for his or her particular case, and what exactly the attorney does for that amount. Attorneys do not do real estate closings for free; like you, attorneys must work for a living.

If you do not know of an attorney who handles real estate transactions, ask your real estate agent, your insurance agent, your banker, the mortgage company, or your friends. If you still cannot find an attorney, call the local bar association for a referral. It is said that real estate attorneys are worth every penny to the buyer in the case where the home sale has problems.

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Note: This article was sent to us by: Wayne Byss at 06072010

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