Do real estate brokers get a commission when they are buying a house themselves?

Flood: when we used a buyer's agent, he was paid out of the listing agent's cut.

In your example, Tom is the one due the commission. He is the listing agent. Sally, acting as a buyer's broker, would be paid separately be the buyer. But, buyer's agents are very rare. Pretty much, every realtor that you deal with is an agent of the seller. Realtors should not get any discounts. Since nearly all realtors are agents of the seller, they have a ficuciary duty to get the highest price. However, that is not the way it really works in reality. Realtors often help each other as a professional courtesy. They might tell a realtor what the lowest number that the seller will accept is. They might allow a colleague to look at the property, and make an offer, before the general public has a chance. And, yes, realtors will waive their commission when dealing with co-workers. Being inside the industry gives you a huge advantage over other buyers.

I'm drifting a little off-topic but I'm always surprised to hear people say things like this: I had the same experience as ROU_Xenophobe when I bought my condo -- I didn't pay my agent but he was paid for his work. You didn't write the agent a check, but you certainly paid some portion of what the agent got. If the total commission paid were 3% instead of 6%, all things being equal, you could have paid 1.5% less for your condo and the buyer could have gotten 1.5% more and you would both be better off. Money lost is the same as money paid. Saying that the buyer doesn't pay the agent is like saying that you don't pay the sales tax because its included in the price.

Yes, Flood, I signed an agreement making my agent my agent.

@ Flood- we just bought a house using a buyers agent, with a contract. She assured us that we wouldn't pay her anything even if we bought a foreclosure or a short sale... she was paid by the sellers. We looked at numerous houses, none of which were ones that she listed. And when we closed, we paid her nothing.

ROU_Xenophobe: Are you sure he was a buyer's agent? Yes. Did you sign an agreement making him a buyer's agent? Yup.

Well, I dug http://www.wra.org/WREM/Jan12/HotlineHighlights/ (scroll to Personal Purchases). It says, essentially, a broker can't get an agency commission for representing oneself, but brokers are in a position to negotiate buyer's incentives (which can effectively act as a discount).

I have bought two houses, once in Maryland and once in Missouri, and both times I signed a contract with a buyer's agent who showed me houses and worked specifically for me. I have had my current house on the market for nearly 10 months and had dozens of showings in that time. Only once has my listing agent (my seller's agent) shown the house to buyers. Every other time it was a buyer's agent. (I am not including open houses, obviously.) When I was working with a buyer's agent in Maryland, we saw a house where the listing agent was working some bizarre game where the sellers were only contracted to pay a total 3% commission, which would go to the seller's agent. My buyer's agent made it clear that we were expected to pay her 3% commission if we'd bought that house. It's been years so I don't remember exactly what that deal was, but I haven't seen it again.

Most agents referred to as "buyer's agents" are still paid on commission, as a percentage of the sale price, which means they have financial incentives to negotiate a sale at the highest possible price. An extra 10k is nothing compared to churning through an extra house a month because you fast-track the seller into accepting a lower price than they otherwise might The truths of these two statements are not mutually exclusive. You're right that agents can increase their income more easily by selling more houses they can by driving up the price of any one house, but both agents still benefit when the price is kept high. The point I was trying to make, and which I initially thought Flood was getting at, is that the 'buyer's agent' contract / relationship really doesn't do much because the incentives remain the same.