Renter Agent Compensation

Compensation for "no-fee" and "fee" apartment rentals in Boston

Many newcomers and visitors often don't understand what standard procedures are for paying a Realtor after an apartment has been found and documents are being signed. Here are some answers to common questions regarding this issue:

What are regular rates to pay an agent that finds an apartment for you?

According to Massachusetts Real Estate Law, there is no standard 'policy' on how to pay a real estate agent. Generally agent fees usually run from one month to a half month, but for private luxury rentals fee's can run as high as high as two months. Other scenarios can result in a flat $1,000 fee or a percentage of monthly rent. Overall, you'll find the 'standard' rate to be one month.

What do you pay for a "no fee" apartment?

No fee or nofee apartments are exactly as they sound. You're expected to give nothing to the agent that finds your apartment, simply because the landlord pays the fee instead of you (the tenant). While sometimes landlords are willing to pay only half months rent, you'll find that the realtor or agent will require the other half from the tenant or renter.

Both cases are 100% legal and result from varying situations. If a landlord is desperate to fill a vacancy, they might offer to pay the full fee. If the apartments are flying out the window like hot cakes, they'll allow the realtor to demand the whole fee from the tenant. Either way, if you plan in advance and look at 4-6 apartments, you'll probably find a good deal.

Are you ever suppose to tip an apartment agent?

Tips are by no means required, and depend 100% on self preference. Surely more often then not real estate agents do not receive monetary tips. But sometimes they do, and it's always appreciated. For example, if you've decided to rent an apartment from that agent, then they're about to get paid for thier work so concensus says no tip is necessary. But on the other had if they've been hauling you around the enter state and you decide not to rent...then they're down $10-20 in gas, and just wasted a whole day when they could have rented to someone else, or potentially two people in that time.

What laws protect tenants from real estate agents that demand high compensation rates?

Agents and Brokers can charge whatever they like, but the natural economic laws of supply and demand typically keep rates low and within reason. If you feel like the compensation is too high, don't hesitate to contact the landlord directly, or the "managing broker" of the company. Sometimes this will help, but in all fairness, the agent is working for you. It requires a great deal of knowledge, networking, and communication to be current with the real estate industry. Sometimes people go over the heads of the agents themselves, which is frowned upon by agents. The broker is the person that oversees the general operations of the real estate. All agents must legally work underneath a broker, unless of course they are a licensed broker themselves.

It should also be mentioned that agents cannot legally discriminate against any potential renters or buyers. In other words they cannot say 'no' to one qualified tenant over another on the basis of race, color, handicap, gender, appearance, etc. Landlords can be more picky, but when it comes to real estate professionals, they must allow everyone equal opportunity.