NYC Buyer Agent Commission Rebate Calculator
Purchase Price
Buyer Agent Commission (%)
Rebate Percentage of Commission
Buyer Agent Minimum Earnings
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Glossary
Buyer Agent Commission (%)
The most common buyer agent commission percentage in NYC is 3%. This traditional buyer agent commission figure is most commonly found throughout Manhattan and nearby neighborhoods in Brooklyn and Queens, such as Park Slope, Brooklyn Heights and Long Island City. The buyer agent commission percentage for new developments is almost always 3% and rarely less than 2.5%.
2.5% is another fairly common buyer agent commission rate throughout NYC. Lower buyer agent commission rates, such as 2%, 1.5% or even less, are most commonly found in Southern Brooklyn, Eastern Queens and the Bronx.
The specific buyer agent commission being offered on a particular listing is typically listed in the RLS Broker Database and/or the OneKey MLS, both of which are used by buyer’s agents in NYC to search for and send listings to buyer clients.
Rebate Percentage of Commission (%)
Rebate Percentage of Commission (%) is the pre-negotiated ratio of the total buyer agent commission received which a buyer’s broker has agreed to pay her or his client. For example, a buyer’s agent who has agree to offer a rebate of two-thirds (~66.67%) would provide a buyer agent commission rebate in the amount of $20,000 for a $1m purchase offering a 3% buyer agent commission. Two-thirds of the 3% total buyer agent commission is 2%, multiplied by the purchase price of $1,000,000, which comes out to a buyer agent commission rebate amount $20,000.
Buyer Agent Minimum Earnings
Buyer Agent Minimum Earnings is the pre-negotiated percentage of the purchase price or minimum dollar amount which a buyer’s agent must pocket before agreeing to pay out any form of buyer agent commission rebate.
Buyer agent minimum earnings requirements in NYC are very common due to the high cost of living, elevated operating costs for businesses in NYC and the simple fact that working with every buyer is a time-consuming endeavor, regardless of the specific purchase price. For example, preparing a co-op board package takes the same amount of time for a buyer’s broker regardless of whether the purchase price is $300,000 or $5,000,000.
For example, a minimum earnings amount of 1% of the sale price on a $1.5m purchase means that the buyer’s agent must pocket $15,000 before paying out any rebate. If the total commission paid to the buyer’s agent is $20,000 and the rebate percentage is 50%, the agent would retain $15,000 and the buyer would receive a rebate of $5,000, even though a 50% rebate percentage would otherwise suggest a rebate amount of $10,000 to the purchaser.
Similarly, a minimum earnings amount of $7,500 means that the buyer’s agent must pocket/retain no less than $7,500 before issuing any rebate. If the total commission received by the buyer’s agent is $10,000, the buyer’s broker would retain the greater of $7,500 and pay out no more than $2,500 as a buyer agent commission rebate.
FAQ
How much can I save with a buyer agent commission rebate?
Through Hauseit, home buyers in NYC can save up to 2% and reduce buyer closing costs by requesting a commission rebate with Hauseit. A buyer of a $2 million property in NYC can save $40,000 through Hauseit’s Buyer Closing Credit Program, assuming that the buyer agent commission being offered is 3 percent.
How does a buyer agent commission rebate work?
Sellers in NYC typically agree to pay a fixed total commission upon closing which is meant to be split equally between the listing agent and the buyer’s agent. The most common buyer agent commission in NYC is 3%. Receiving a buyer agent commission rebate means that your buyer’s agent has agreed to credit you back a portion of the commission paid to her or him by the seller. You can save up to 2% (or approximately $30,000 on a typical $1.5m NYC apartment) by requesting NYC’s largest buyer agent commission rebate through Hauseit.
How can I request a broker commission rebate?
You can request a NYC buyer agent commission rebate here. At Hauseit, we pair you with an experienced, local partner buyer’s agent who will not only serve the role as a traditional, full-service buyer’s broker but who has already agreed to discreetly write you a check for up to 2 percent of the purchase price at closing, which comes out of the commission paid by the seller. Hauseit’s partner brokers are traditional brokerage firms and agents based locally in NYC who never openly discount or offer rebates online.
Are buyer broker commission rebates taxable in NYC?
The IRS has issued an opinion letter stating that closing credits and commission incentives provided by real estate brokers are generally not taxable. As a result, you should not expect to receive a 1099 as your closing gift will generally be treated as a concession on price, and thus a reduction of your cost basis. Please consult your tax adviser for more information.
Is it possible to reduce my buyer closing costs in NYC?
Yes. You can reduce your buyer closing costs and save up to 2% on your purchase by requesting a buyer agent commission rebate through Hauseit. Rebates are a legal and non-taxable way to reduce your buyer closing costs while receiving traditional, full-service representation from a seasoned buyer’s agent throughout the purchase process. Receiving a realtor rebate from your buyer’s agent can help you save money on closing costs in NYC which are approximately 4% for condos and houses, 2% for co-ops and 6% or more for new developments, assuming you are financing.