How Do Realtors Get Paid for Rentals?
It’s true — realtors don’t only work on property sales. In fact, realtors can be invaluable for both landlords and tenants during the rental process. But how do realtors get paid for rentals, and who is responsible for hiring their services?
The Role of the Realtor in Rental Properties
There are many different ways in which realtors lend their expertise to landlords and potential renters looking to make a deal. Realtors will typically meet with landlords to communicate about the rent amount that the landlord wants to charge, what they’re looking for in an ideal renter, and any specifics about the property that applicants should know about.
Realtors will also typically handle all property showings and act as a go-between for the landlord and potential tenants during the lease-signing phase. In many cases, the realtor will even help the landlord draw up the lease to make sure no important details are left out.
How Do Realtors Get Paid for Rentals and Not Sales?
In most rental situations, realtors are hired and paid by the landlord in order to help them find the best possible tenants. However, some renters will use a realtor to find the optimal rental property for them. Sometimes, realtors will even offer their services to renters for free in the hopes that the renter will come back to them for help with purchasing a home in the future.
How Do Realtors Get Paid for Rentals on the Market?
You may be wondering, exactly how do realtors get paid for rentals when they help a landlord or renter find the perfect tenant or property? There are a few different ways that realtors can get their cut of the deal. This payment can come either from landlords or tenants, depending on who solicited the realtor’s services.
The Buyer Is Charged a Fee
Based on norms in certain areas, some realtors will simply charge a percentage of rent from the first month once the new tenant has moved into the property in exchange for their services.
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A Percentage of the Lease Amount
A realtor’s commission can also be determined by how much the landlord is charging in rent per year. For example, some realtors will charge 10% of the lease over a year-long period as their commission for making the “sale.”
A Month’s Rent
Another common way for realtors to get paid is to simply charge one month’s rent on the property as their commission. This is usually simpler than figuring a percentage of a year’s total rent according to the lease agreement.
How Renters Benefit from Using Realtor Services
Working with a realtor can be extremely beneficial for renters, especially if they find themselves within certain circumstances. For example, if you are searching for housing in a high-demand area and have specific budget requirements, a realtor who has lots of experience working in that area will be able to find something suitable for you much more easily than you could.
This type of arrangement can also be extremely beneficial if the renter is on a tight schedule and needs to find a new place to live in a short amount of time. Realtors can use their expertise in the local market as well as their industry connections to find the perfect fit for their client, which might not even be listed on public home rental sites.
How Landlords Benefit from Using Realtor Services
Landlords benefit from working with realtors in many of the same ways that renters do. Many landlords have experience in purchasing property but not in finding tenants for that property, and that’s where realtors can provide valuable advice.
Realtors are great at working with people and getting the right applicants interested in your rental property. They’re also well aware of local laws and regulations affecting rentals in your area and can help you draft a thorough and fair lease agreement.
Source: PayRent
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