10 Reasons Why a Seller Would Want to Pay a Buyer’s Agent Commission

1. It’s Customary: The practice of Sellers paying the Buyer’s side of the commission in the U.S. real estate market goes back more than 100 years and offers multiple advantages for Sellers – from attracting more Buyers to potentially fetching higher selling prices and ensuring a quicker sale.

2. Seller Experience: In fact, when the Seller bought their home, their Buyer’s agent commission was very likely covered within the terms of the sale. They did not pay for it separately.

3. Appeal to a Wider Range of Buyers: By covering the commission, the property is more attractive to Buyers who might not be able to afford the extra expense. Buyers may choose to see properties based on whether or not their commission is covered.

4. Increased Showings: The majority of Buyers come from Co-op agents – 90% of listings are sold by Cooperative agents. Covering the Buyer’s Agent commission will attract more Buyers and Agent Showings.

5. Reduced Financial Burden on Buyers: This approach makes properties accessible to a wider pool of Buyers, some of whom have limited cash for upfront costs. It’s tough enough for Buyers to come up with the down payment and closing costs. If they have to pay a commission on top of that as a separate expense, that may take them out of looking at certain homes.

6. Potential for Higher Selling Price: Because Buyers don’t need to reserve funds for commission, they might be willing to offer a higher purchase price.

7. Faster Sale of Property: By removing the extra financial burden on Buyers, Sellers often enjoy quicker sales, reducing the time their property spends on the market.

8. Simplified Negotiation Process: With commission costs off the table, negotiations can often be streamlined.

9. Enhanced Seller Reputation: Sellers who cover commission costs are often viewed as more cooperative and motivated, traits that can attract serious and qualified Buyers.

10. Buyer’s Agent Compensation is Contingency Based: Buyers will likely ask for the Seller to pay the Buyer’s commission when they write up an offer. But the Buyer’s agent only gets paid if the transaction closes. And the money will typically come from the Buyer’s loan.