Buyer’s agent commissions don’t get you a better price
We know the the MLS is the best way to get your home in front of all the buyers. We also know that 100 years ago, the MLS was intended to be a way for brokers to ‘share’, ‘their’ commissions amongst themselves.
As a home seller, you are told by agents that it is impossible to divorce the two concepts, and that if you sell your home in the MLS, it can only be done with a conforming buyers agent commission of 2.5 to 3 percent. If you protest, they will tell you that if you don’t list your home with the conforming commision, that other agents will not show their customers your home.
And 30 years ago, they might have been right. The Internet didn’t exist and buyer’s found out about what was for sale from their agents. [steering anectedot?] But fast forward to today-- the Internet does exist and buyers find homes directly themselves.
Therefore, the old commissions are no longer necessary to get your home sold at a good price. There is no way for an agent to ‘hide’ your listing and as we mentioned previously, a well priced listing will sell itself.
Don’t believe us? There is only one MLS in the country that publishes their buyers agent commission as part of their standard property detail report, the Boston MLS (need spec). Using data from this MLS, Jia and Pathak did some original research on these commissions in their research at MIT entitled “The Impact of Commission on Home Sales in Greater Boston.” They found that the amount of commission had no effect on the final sales price.
And that just happens to be how everyone else in the world sells houses as well.