Nonexistent commission is thorny family issue

REAL ESTATE Q & A

March 07, 1993

Q. My older sister and I each inherited a half-interest in my mother's house. Because I had lived in the house with my mom, her will allowed me the option to buy out my sister's half-interest. I took the option and reached a compromise price with my sister -- except for one issue.

My advisers said the price should be reduced by 6 percent, the cost of a real estate sales commission. It makes sense to me, but my sister has balked. Can you help settle this?

A. Sorry, but our advisers side with your sister. Why, they ask, should you get the benefit of a price break for a service that you didn't use? Even if you will be completely responsible for a full commission if and when you sell the home in the future, your sister shouldn't be required to put up half of the cost now.

Frankly, our advisers say they haven't heard of interfamily deals where the sales price is adjusted by the commission of a #F nonexistent real estate broker.

Perhaps your advisers are thinking about family deals where the sales price is reduced by generous sellers, such as parents, who are anxious to save their children as much money as possible while still making a deal at market prices. In these cases, deducting a sales commission not only saves the buyers money, but reduces the property tax assessment of the home. But in these cases, the adjustment is made willingly by a seller happy to help out the buyer.

Condominium sales are on the increase

Q. Are condominium sales slowing?

A. No, they're increasing. Sales of condos increased significantly across the country during the last quarter of 1992, according to a report from the research department of the National Association of Realtors. The strongest gains were in the northeast and

south regions. Sales are now about 15 percent greater than last year at this time.

'93 expected to bring more relocations

Q. Is the recovering real estate market sparking more corporate relocation activity throughout the country?

A. Apparently. A survey by the national RELO Relocation Network shows most relocation professionals believe there will be a significant increase in relocations this year.

Copley News Service

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