Using an agent does not cost more than 'buying it yourself.'

This is probably one of the most misunderstood principles of real estate. Because most people don’t buy and sell homes daily, they may not have a clear understanding of how real estate agents are paid, what their services cost, or how they are contracted.

How much does it cost to have an agent represent me when I buy a property?

Nothing. When a seller lists his or her home, he or she agrees to pay a commission to the listing broker, who in turn (by putting it on the MLS) agrees to split that commission with a buyer’s agent—no matter how low the offer or sale price.

Should I have a buyer’s agent, or can I just work with the listing agent?

Either one. If you are comfortable disclosing your situation to the listing agent/broker, working with them is perfectly acceptable. In this case, the listing agent/broker will represent both you and the seller, and he or she will become a limited agent. The listing agent/broker becomes ‘limited’ in their ability to disclose to their seller anything regarding your ability to purchase, and also ‘limited’ in disclosing information to you about what their seller is willing to accept. If you choose, instead, to use a buyer’s agent, the cost will be no different, but you will have someone representing you who is exclusively dedicated to your interests and required by law to keep them confidential, rather than an agent who represents both you and the seller and is required by law to limit both of those relationships.

Commission is a contract between a seller and his or her listing broker.

The commission for selling a home is agreed on in the Listing Agreement, which is a contract between the seller and the listing broker (not the agent). Commission agreements between seller and listing broker are always negotiable. The listing broker agrees to pay the buyer’s agent. By listing the property on the MLS, the listing broker agrees to pay any agent who is a member of the MLS a portion of his or her listing commission if the agent brings a qualified buyer whose offer is accepted. Typically, the commission is split 50/50, but other splits can exist.

Can a buyer request that the commission be changed?

Occasionally, buyers are under the impression they can call a listing agent and request that the commission be re-negotiated. They may believe that if they work directly with the listing agent, they can change or eliminate the commission altogether. The Listing Agreement, which outlines the commission structure, is an agreement between the listing broker and the seller. The buyer is not a party to that contract and has no ability to negotiate the commission. Any agent representing the buyer in the transaction, whether it be a limited listing agent/broker or a buyer's agent, is entitled to the full commission.

What if I include the commission change request in the offer or REPC?

Commissions are never addressed in the Real Estate Purchase Contract (REPC). The REPC is a contract between buyer and seller. The commission is addressed in the Listing Agreement, which is a contract only between listing broker and seller. The buyer is not a party to that contract, and has no ability to negotiate the commission.