When it comes to buying or selling one home in Michigana good knowledge of the structures of real estate committees is essential. Changes implemented in 2024 aim to increase clarity and improve the flow of information about these reimbursements. These updates are intended to promote transparency and enable more informed decisions.
This guide explains how real estate commissions work in Michigan and what you should consider for your next real estate deal, whether you first home buyer or have experienced the process before.
Current State of the Michigan Housing Market
Before examining committee structures, it is helpful to understand the current situation in Michigan housing market:
| Median sales price of a house | $270,000 |
| Housing supply | 36,677 (+7.1% year-on-year) |
| Houses sold above list price | 35.9% (-6.3 points annually) |
Understanding real estate commissions in Michigan
What are real estate commissions?
Real estate commissions are the fees paid to agents responsible for facilitating the purchase or sale of homes. These costs are usually calculated as a percentage of the final sales price of the property and are paid at close.
Who pays the commission?
Traditionally, sellers had the responsibility to pay for both broker commission and the buyer’s brokerage costs. However, as of August 17, 2024, buyers must now purchase a agreement detailing their agent’s commission before they can start touring the houses.
While buyers can still negotiate for the seller to cover some of these costs, the commission is now more flexible and fully negotiable.
Average real estate commission rates in Michigan
Commission rates in Michigan can vary depending on factors such as location, market conditions and the agent’s service offerings. Below you will find an overview of typical commission costs in some countries Michigan’s largest cities:
| City | Median sales price of a house | 1.5% real estate commission | 3% Real estate commission | 5% Real Estate Commission |
| Detroit | $96,395 | $1,446 | $2,892 | $4,820 |
| Grand Rapids | $282,338 | $4,235 | $8,470 | $14,117 |
| Warren | $205,000 | $3,075 | $6,150 | $10,250 |
At Redfin, we offer competitive rates and offer seller matching listing fees as low as 1%*. While buyer costs may vary by location, we strive to keep them affordable so your home stands out in the market.
Can You Negotiate Real Estate Commissions in Michigan?
Absolute! Commissions in Michigan are open to negotiations. Real estate agents may be willing to adjust their rates based on specific details, such as the nature of the transaction, the appeal of the property and the services they provide.
When entering into negotiations, consider the agent’s knowledge of the local market, their marketing approach and the condition of your home.
Tips for a successful negotiation
- Talk to multiple agents: It is wise to consult different brokers to compare their services and commission rates.
- Consider performance-based incentives: Offer bonuses if your agent can sell your house quickly or for a price above the listing.
- Take advantage of the strengths of your real estate: If your home is in a desirable location or in high demand, you may have greater negotiating power to negotiate lower costs.
Michigan Real Estate Commission Frequently Asked Questions
What are the new real estate commission rules in 2024? Two major updates have been introduced this year:
- Buyers must now sign a document specifying their agent’s commission before touring the homes.
- In many markets, buyer agent commission information is no longer visible in MLS listings.
Read more about the changes in the real estate committee here.
How will the changes impact Michigan buyers? Buyers in Michigan must now agree in writing to their agent’s commission before looking at homes. However, they still have the option to negotiate with sellers during the bidding process to cover some or all of these costs.
How will the changes impact sellers in Michigan? Sellers must now decide, with the guidance of their agent, how much they are willing to contribute to the buyer’s agent commission. This amount will be definitively determined during the bid negotiations.
How do you find a real estate agent in Michigan? Whether you are buying or selling in Michigan, Redfin Agents are available to guide you every step of the way, ensuring you have a complete understanding of the transaction process.
How can you avoid costs? Yes, it is possible to avoid commission costs by selling your home without the help of an agentcommonly known as a For Sale By Owner (FSBO) transaction. However, you are responsible for all aspects of the sale, including marketing, negotiations and paperwork.
*Listing fees are subject to change, minimums apply. Any real estate agent fees that the seller may wish to cover are not included. The listing fee will be increased by 1% of the sales price if the buyer is not represented. Only sell at 1% offer fee if you also purchase from Redfin within 365 days of closing your Redfin offer. We charge a 1.5% sales fee and then send you a check for the 0.5% difference after you purchase your next home from us. More information here.
