Does 1031 exchange mean we have to pay the broker 2 commissions?
I'm selling a property at $2 million. The broker charges 6% commission. If we do a 1031 exchange and I buy another property for $2 million, does that mean they get another 6%? That's an awful lot of money.
[{"id": "fe6ojcb", "text": "It\u2019s as if transactions costs are high in real estate...", "replies": [{"id": "fe6ou2b", "text": "In most cases the seller pays the commission. But yah... Someone who is selling a 2M investment property really shouldn't be surprised by the cost of transacting real estate.", "replies": [], "depth": 2}], "depth": 1}, {"id": "fe6ovlm", "text": "Ok thanks. New to the game.", "replies": [{"id": "fe6p388", "text": "I have to ask. How are you new to the game and have a 2 million dollar building with with enough profit to warrant a 1031? Me smells a shitpost...", "replies": [], "depth": 2}], "depth": 1}, {"id": "fe6p8o8", "text": "Family", "replies": [{"id": "fe6s5m1", "text": "What does \u201cfamily\u201d mean?", "replies": [], "depth": 2}], "depth": 1}, {"id": "fe6q9ad", "text": "If you decide to use the same guy to purchase your next property than yes. That's usually a benefit to getting listings for sale, because often theh will also want to use you to purchase a property once it sells.", "replies": [{"id": "fe6qk19", "text": "Thanks. Can we negotiate on 2nd one? They're getting at least 200k.", "replies": [{"id": "fe6r9tv", "text": "You should ALWAYS negotiate the commission.  If a transaction is particularily easy for my broker I ask for money back.  I also lean on my mortgage broker.  Buying agent tends to be good for 1ish% and mortgage broker an 1/8th point.", "replies": [], "depth": 3}, {"id": "fe6relh", "text": "I would try if I were you. Say hey, if we use you for the purchase side as well, will you cut us a deal on commission? Either he can cut you a deal now selling this building or cut you a rebate on the buy side if its allowed in your state.", "replies": [{"id": "fe6rmzj", "text": "Thanks homie. We signed the listing agreement. But I'll try to negotiate the purchase one.", "replies": [{"id": "fe8qc00", "text": "you don't pay the commission on the purchase side, only on the selling side", "replies": [], "depth": 5}], "depth": 4}], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "fe75bev", "text": "Get a new broker", "replies": [], "depth": 1}, {"id": "fe79m6g", "text": "Unsure what people are taking about here. Yes 6% is high for a $2mm property, should try a and reduce down to at least 5%.\n\nIf it\u2019s a 10-31 you don\u2019t pay 6% to purchase a property, but you do need to read up on it because it\u2019s not as simple as just buying and selling, you\u2019ll have 45 days to identify up to 3 properties and 180 to close on the purchase.", "replies": [], "depth": 1}, {"id": "fe8a2rl", "text": "A 1031 exchange has nothing to do with your commission!! It is set up for the buyer to exchange into a new piece of property and not have to pay capital gains. Talk to your broker and CPA. How long have you been an agent?", "replies": [{"id": "fe8t5dw", "text": "I'm a owner not an agent.", "replies": [{"id": "feac6mu", "text": "Sorry. First they should not charge you a straight 6% that is ver high. Maybe 4%. Some make deals some don\u2019t. I always make deals. I would list for 4% and then 1% on the purchase. Something has to be charged for errors and omissions insurance. Hope that helps.", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "fe8c7k5", "text": "Kind of.   \n\n\nA.) They're probably splitting the commission 50/50 both times with the broker representing the other property, unless they're double-siding the deal.   \n\n\nB.) You won't be paying the commission (or shouldn't be) when you buy, but they'll be paid by the seller.", "replies": [], "depth": 1}, {"id": "fe9wzqr", "text": "What state are you in? Is this a commercial broker or a residential brokerage with a commercial arm. A 6% commission is kind of high if he is planning to double end the deal. Even brokers who offer a buyer broker commission I often see deals cap out around 4%. If he is going to sell the deal and buy your next deal for your 6% is a ton. He shouldn\u2019t be charging you 6% to buy a deal, really you shouldn\u2019t be paying anything to buy the deal unless he\u2019s really working hard to find something for you to put the 1031 money in. There\u2019s plenty of brokers who will happily help you 1031 the cash.", "replies": [], "depth": 1}, {"id": "fea58vf", "text": "Thanks this helps a lot.", "replies": [], "depth": 1}, {"id": "fegivws", "text": "If you're in NY/Connecticut I've used Nestapple to get a broker rebate\n\n&amp;#x200B;\n\n[https://www.nestapple.com/](https://www.nestapple.com/)", "replies": [], "depth": 1}]