How Does Compensation for Listing and Buying a Home Work

By Rebecca Durfey

Rebecca Durfey brings over 20 years of experience in real estate transactions within Maricopa County. Despite managing multiple clients simultaneously, her primary focus is to provide a personalized experience that makes you feel like her sole priority. Rebecca and her team are dedicated to efficiently achieving the desired outcomes for each client they serve.

Asking how compensation has changed from before August 2024 to after August 2024 is probably one of my most common questions. Certainly, at a listing appointment, that’s a question sellers just want to understand, given all the changes.

For a long time, I drew up my own little sheet explaining how it all works. Then I got a little more professional and had an actual flowchart written up, and that’s what I want to walk you through here.

1. Before August 2024, you negotiated the whole apple. When I’d sit down with you back then, we’d talk about the full compensation amount. Once that amount was agreed to, and of course, it’s always negotiable, we’d go through the whole listing together. After listing your home, I’d put it out in the MLS with the amount we’d offer for another agent to bring their buyer back to my listing. You negotiated that full apple, all in one conversation.

2. After August 2024, it was decoupled. Now, during our listing appointments, we sit down and talk only about listing compensation. That means my broker, what we agree to, what you feel my value is, and what I feel I can bring to the table. That’s the compensation we negotiate when we list your property in the MLS. There’s no advertising and no discussion about compensation for the buyer and their agent. That conversation happens somewhere else entirely.

3. The buyer has already had that conversation with their own agent. Before walking through your home, a buyer has had a discussion with their buyer’s agent and signed a contract, with an expectation of what the broker expects them to pay once they find the right home. That agreement is between the two of them. It’s their deal.

4. The addendum arrives with the offer. When an offer comes into my office for your listing in today’s market, that agent will include a seller compensation addendum. That addendum carries the value, whatever amount was negotiated between the buyer and their agent, and it asks you to cover that cost. We may be able to push back on that amount and negotiate it. That’s still on the table.

That’s been the case here for the last couple of years, because our market has struggled, and buyers know they need some help for the home to be affordable. In a buyer’s market, that compensation has shaken out to be a cost similar to what sellers saw before August of 2024, and that’s the expectation I try to create for all my listings.

It may not stay that way. If our market strengthens and we move into a more seller’s market, I think that will be one of the first things negotiated out. There may be a price increase instead, or affordability support handled differently. It always depends on market strength, demand, inventory, and affordability.

So the short version: compensation is still negotiable. It’s just structured differently, and my goal hasn’t changed at all: to get you the best outcome.

I hope that’s helpful. I’m happy to go through all of this with you, flowchart and all, and talk about what compensation looks like today and where it might go next. Call or text me at 623-297-4536, or email me at rebeccadurfey@kw.com. You can find more at rebeccadurfey.com. I’m here if you have any questions about anything at any time.