U
nderstanding Real Estate Commissions in Arkansas

    Buying or selling a property in Arkansas involves understanding real estate commissions to manage your budget effectively and negotiate successfully. In 2024, new changes have been introduced to improve transparency and help you make informed decisions about real estate fees.

    Current State of the Arkansas Housing Market

    Before delving into real estate commissions in Arkansas, let's first take a look at the state's housing market.

    - Median Home Sale Price: $258,100

    - Housing Supply: 15,005 (+25.6% YoY)

    - Homes Sold Above List Price: 16.5% (-3.9 pts YoY)

    Understanding Real Estate Commissions in Arkansas

    Real estate commissions are fees paid to agents by either homebuyers or sellers for their services in completing a transaction. These fees are settled at closing and are usually a percentage of the sale price of the property.

    Who pays the commission?

    Previously, sellers covered the commissions for both their own agent and the buyer's agent from the proceeds of the sale. However, as of August 17, 2024, buyers must now agree to their agent's fee in writing before starting home tours.

    While buyers still have the option to request that the seller cover their agent's commission during the offer process, the new rule introduces variability in how much sellers might pay for a buyer's agent. This fee is entirely negotiable and can differ depending on the agreement between the buyer and seller.

    Average Real Estate Commission Rates in Arkansas

    In Arkansas, real estate commission rates can vary significantly based on the details of the transaction and the agreement between the parties. Although there are common expectations for these rates, they are entirely negotiable. This means buyers and sellers can collaborate with their agents to establish a commission structure that meets their specific needs.

    Factors such as the location of the property, current market conditions, and the services provided by the agent can all affect the final commission. This flexibility allows both parties to negotiate and adjust fees to align with their budget and objectives. Below is a detailed overview of example commission rates based on median home prices in some of Arkansas's largest cities:

    - Little Rock: $245,000 - $3,675 - $7,350 - $12,250

    - Fayetteville: $370,000 - $5,550 - $11,100 - $18,500

    - Fort Smith: $188,500 - $2,828 - $5,670 - $9,425

    Negotiating Real Estate Commissions in Arkansas

    Absolutely! There are no federal laws in the U.S. that dictate commission rates, so agents may be open to negotiating lower fees based on the specifics of the transaction, the services required, and the nature of your relationship with them.

    When negotiating real estate commissions, consider factors such as the agent's level of service, their marketing strategies, and their local market expertise. Sellers might have the opportunity to negotiate reduced rates if their property is highly sought after or likely to sell quickly. Additionally, if the same agent represents both the buyer and the seller in a dual agency, there could be potential for further fee reductions since only one agent is involved.

    Tips for a Successful Negotiation

    - Compare multiple agents and their commission structures before choosing.

    - Discuss performance-based incentives, such as offering a higher commission for a faster sale or better final price.

    - Leverage your property if it is in a desirable area, as agents may be willing to accept lower commission.

    Arkansas Real Estate Commission FAQs

    - What are the changes to real estate commission? Two major updates have transformed the handling of real estate commissions. First, as of August 17, 2024, buyers are required to agree to their agent's fees in writing before starting any home tours. Second, the advertising of these fees has shifted—buyer agent compensation can no longer be shown on MLS listings in many markets. Learn more about the real estate commission changes here.

    - How do the changes impact buyers in Arkansas? Buyers must now sign an agreement with their agent specifying the commission rate before they tour homes. Despite this, you can still ask the seller to cover your agent's fee as part of your offer.

    - How do the changes impact sellers in Arkansas? Sellers will continue to negotiate with their listing agent regarding the compensation offered to the buyer's agent, if any. Sellers will review and negotiate any requests related to agent compensation during the offer process.

    - How do you find a real estate agent in Arkansas? If you're ready to start buying or selling a home, Redfin is here to assist you. Get in touch with a Redfin agent today to get started.

    - How can you avoid fees? Selling a home without an agent in Arkansas can save on commission fees, but for sale by owner (FSBO) transactions require more effort from the seller, including handling marketing, showings, and paperwork.

    *Listing fee subject to change, minimums apply. Any buyer's agent fee the seller chooses to cover not included. Listing fee increased by 1% of sale price if buyer is unrepresented. Sell for a 1% listing fee only if you also buy with Redfin within 365 days of closing on your Redfin listing. We will charge a 1.5% listing fee, then send you a check for the 0.5% difference after you buy your next home with us. Learn more here.