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  • It’s becoming more popular for agents to charge less than the standard 5-6% commission rate or charge the standard rate but offer cash back incentives in the form of rebates.


  • Studies show that the average discount off the standard commission rate is more than 40%.


  • Factors contributing to these savings are: lower for-sale housing supply and the emergence of discount programs or brokerages such as Redfin.


There’s a perception that homeowners have had for quite some time: you will always be charged the standard commission rate depending on the market. With the real estate industry becoming so competitive nationwide, that is no longer the case. Increasing investments into high-tech brokerages, low inventory levels and and the decline of full service agents have contributed to this  concept.


According to statistics, six out of ten people who sold a home in 2015 got a discount on the commission paid out their realtor. Furthermore, almost 50% of home buyers last year saw a rebate of $100 or more. Of all home sellers and buyers last year, 37% saw a rebate or refund of $500 or more. It safe to say that the trend is going towards offering a rebate or incentive to entice more clients to use your services.


Another survey of more than 2,000 people who bought or sold a home in 2015 shows that industry is becoming more dependent on technology rather than their local agent. More than half of the clients surveyed either found their home or found information on their home on the web.. This shows that brokerages are becoming more tech savvy to get things done cheaper and more efficiently.


Commission rates has actually been increasing over the last ten years. In 2005 the average rate was (5.02%) while in 2015 the average rate was (5.26%). In 2015 residential homes sales totaled $64.3 billion up nearly 6 billion in the last ten years. Growing commission rates in addition to an increase in rebates and refunds to homeowners and buyers has contributed to higher real estate home sales year after year.


There are underlying factors that have directly contributed to this new trend:


  • FSBO’s accounted for 10% of nationwide home sales


  • 23% of people selling 1 million dollar and up homes took the FSBO approach to save some money on the sale


  • 54% of people who sold without a full service agent did so to save money


In  today’s world, everyone is trying to save a buck here and there. Homeowners and buyers are no different. With the real estate industry being so competitive, realtors must come up with new methods to generate a sustain a solid pipeline of clients. Creating unique cash back incentives and rebate programs upon successful closings is one way to stay ahead of the competition and keep your clients satisfied!