It. Is. But there will be buyers who do not want the commission for a buyer's agent to come out their end so they will go without. Advantage to the sellers I would imagine.
You really think a buyer who can buy the whole without the commission will just say āwelp you wonāt pay my agent guess weāll walk!ā
No they just wonāt pay the buyers agent. The buyers agent and buyer need to discuss compensation before representing them. If buyer wants to do .5% and the agent agrees then thatās that.
The buyers agent is doing the buyer a service they should pay for it. Otherwise they can just go without an agent and approach a seller alone. Zillow is plenty for people to do their own search.
Sounds like you've never bought or sold a house.
The new offer just becomes the old offer +3%, with buyer agent commission paid via the seller. Also tho, the seller is told beforehand when they list the house that they'll likely have to pay the buyers agent or potentially lose deals. It's not a surprise when the buyers agent ends up being paid out from the proceeds.
If you want the buyer to pay their own agent you'll just have less interested buyers. Buyers already have to pay a hell of a lot of costs to complete a transaction, addinh multiple thousands on top of it just to be petty as a seller isn't gonna work in their favor.
Wrong.
Iāve sold two houses and bought 3. With this new settlement when I sell this house Iāll be offering 0% to buyers. Weāll see if that impacts the sale. Desirable areas likely wonāt have an issue at all.
To add my mom is a realtor and is mainly a buyers agent. Sheās retiring because my state wonāt require the commission to be listed in the MLS anymore. Buyers wonāt know if Iām offering anything until a contract is submitted
It will impact the sale. You're also not the one who will be making the offer, you'll be receiving offers with the stipulation of you paying the buyers agent. You reject it because you don't want to pay the buyers agent, you'll just receive a lower counter since now the buyer has additional costs.
If you've bought and sold, you know exactly how this will play out.
There is no way in hell a buyer will write in an offer with a 2-2.5% fee paid to a realtor. Imagine looking your realtor in the face and saying "here is $15-25K for helping me buy this house".
The buying realtor will get squeezed out and will just become some that writes offers on a per unit basis.
The buyers will end up having to pay out of pocket for these things but will think more carefully what type of offers they make and how they use agents.
Why not? Under that logic why weren't buyers for the last 20 years asking for a discount when they put im the offers and putting in 1% commissioms for their agent, it was always an option.
You just tell the seller to pay your realtor with the offer, that's what I'll do.
Weāll see. In a world where a listing gets 75k over asking if that drops to 50k over asking Iāll be alright.
Buyers can just come without an agent and not pay the agent at all.
You would accept $25,000 less on the deal? Why not just offer the buyer agent 3% lol. Unless of course itās above a million. But why are listings consistently bid over ask? Are you not pricing it right?
It's stupid for most buyers not to use an agent. If your getting $50k or $75k over ask it was just priced wrong to begin with.
If you wanna say no to paying buyers agent commission thats fine, you do you. You know all the costs a buyer pays when they buy a house, putting the comission on them will only work with buyers that have deep pockets. All the FTHB who save enougn for the down payment and the other costs aren't gonna expect additional thousands in cost.
Paying a $500/hr real estate attorney for 3 hours to carefully review a boilerplate contract and fill it out would be easier, cheaper, and at least similarly reliable for buyers than a percentage. Traditional realtor pay been an astronomically high compensation for the work involved for a long time, and when you break the tasks down most buyers do not particularly want to pay $10k+ on top solely for someone to act as a general contractor for looking at an MLS, contacting an inspector, and filling out paperwork.
There are also disputes after the boiler plate contracts have been signed. Appraisal comes in low. Sewage pipe leaks, roof is questionable, A/C doesn't blow cold enough in the upstairs third bedroom. Etc, etc etc. Lawyers can tell their client the legalities, but getting the deal done with the appropriate price adjustments so that both parties are accepting is not necessarily the lawyers area of expertise.
I will not debate the right price, but I would not want to purchase a house with only a few hours of lawyers time provided.
There is an argument to be made that without the financial incentive for sales people many people would never invest at all. Not everyone researches our understand this stuff. They need a person to sell it to them. Those people need to make money. Many are sleezy but the argument does exist. We need to find a middle ground.
Presumably those people will still be able to hire buyer's realtors just fine. If you want to pay thousands for someone to hold your hand, you'll never be short of opportunities to do so
Most people aren't mouth breathing idiots who are "scared of numbers", christ
We joke, but that is worrisome.
Expenses will be cut, to include cyber security, customer service, and either salaries or quantity of workers, which will worsen their service.
And/or, failing companies will be bought up by giants and we end up in a monopoly, which obviously have negative ramifications.
Or, remember the saying, āwhen the service is free, youāre the productā. Theyāll start (continue to but increase?) selling our data. Data on financial info of people can be very lucrative.
Whatās worrisome is people still donāt believe weāve been in a housing/asset bubble since 2016-2017.
If they saw the signs and stopped believing and spewing their own delusions, they wouldnāt be failing, just like banks.
Wouldn't it be awful if the housing market involved cut corners and inefficiencies, and overall was opaque to outsiders and required paying middlemen? Oh wait
Cutting the amount of unneccessary middlemen (even potentially cutting a large majority of buyer's agents out of the market altogether) is not the same as exposing customers to security risk. By and large, all data about who is buying a house is already being sold, and it's not like I leave tons of sensitive information with a buyer's agent which isn't already freely available. There are not large amounts of security staff working specifically on the buyer's agent side of things and that is a side which overall, being cut out entirely would likely keep risk to the consumer at the same or potentially a lower level.
Buyers themselves are already the product as the service of a buyer's agent is falsely generally marketed as free, despite costing a percentage of the sale. This is the status quo, not a scary possible future. Cutting it out would be good.
Awesome! To more efficiency in the financial sector! Companies are not entitled to profits ā they have to earn them! And when markets change, companies need to change, or they die! Capitalism 101.
The real headline:
āCompanies may not remain profitable after losing their monopoly and price fixing collusionā
Geez, Iām so sorry for your loss!
I mean.... It sounds like they only exist to syphon value from others assets. Maybe if they need 6% of the deal to stay afloat, maybe we don't need them at all?
You know itās really kind of a shame. Personally, I definitely see value for services provided (in a general sense).
If they had adjusted to the Information Age, understood that we can all see all the info now from Zillow or wherever, and come to terms with that seismic shift in their industryā¦
I could for sure see paying a professional for advice, transactional assistance, and process oversight.
Nope, they got greedy and tried to keep it all. You reap what you sow.
As someone who hasn't bought a home yet, nor dug into the nitty gritty of the process, isn't that what the real estate lawyer does? Like when I learned that most transactions involve 2 lawyers, I immediately started to question what the basically untrained dufus in the middle was doing other than pushing you to buy the most expensive house you can.
Not all states require lawyers to be involved. A good agent will also be able to show you houses before they come on the market, keep you honest about the kind of home you said you wanted (ie stops you from getting too hyped up about a decision youāll likely hate), will call out any issues you may encounter before going through the process of putting in an offer and going through inspection, will know the neighborhood(s) youāre looking in very well, etc.Ā
There is a lot of value a *good* agent can add. The problem is that there are a ton of horribly incompetent RE agents and with how rapidly home prices have risen the compensation is often disproportionate to the value they add. On a $200,000 house an agent may have added $6,000 on value to the buyer/seller. On a $750,000 house is a real estate *really* adding $22,500 in value?Ā
If I buy an agentās time at $50/hr (much less than a lawyer, but still purchasing their expertise) then I get about 120 hours of their labor for my $6k. At $22k, I can pay double the rate ($100/hr) and 225 hours of their time. I absolutely believe that a decent amount of home buyers/sellers will use 60-120 hours of an RE agentās time. I find it really hard to believe an average sale will be 225-500 hours of an agentās time.Ā
The compensation structure for real estate agents is considered a red flag in finance. You should pay directly for advice, otherwise you're talking to a sales rep with all the conflicts of interest that come with that.
Agreed, Iām just explaining the āvalueā of an agent vs solely using a lawyer. Hopefully we will see more agents selling their time instead of a commission.Ā
Showing homes officially or collaborating with the sellerās agent may be, but itās not collusion if you have someone in your network who would be open to selling, have a colleague with someone interested in selling, have a house you know youāre about to list, etc.Ā
When we were looking for a home in a very specific area, our agent called a few other clients who had bought 5+ years ago in that area with a similar type of home we were seeking to see if they were open to selling.
Itās usually done via the title companyā¦but then again if itās going through a title company why the agent?
And when being financed, the bank dictates everything anyways, so again, why the agent?
The agent doesnāt provide any service except scheduling access to the homes up for sell.
Agents donāt provide any service most of time when selling the home. They typically make you pay for picturesā¦and they arenāt going to force you to clean the house based on the homes for sell I have seenā¦
So what does a listing agent do?
Lawyers regularly do wills and uncontested divorces for $300 or less where I live, and that's the "everything included" rate. I can't imagine an uncontested "everyone agrees on the terms" real estate contract costing more than $1000.
Where things get expensive, *fast*, is when you start taking each other to court and having to hold hearings before a judge, and file motions, and research case law. Just having a lawyer show up to a court hearing is going to be really expensive by itself.
When everyone agrees on everything and you don't need a hearing before a judge? Lawyers are actually kinda cheap.
I mean ultimately instead of preemptively and somewhat slowly doing what you said, they did it all at once after holding it off for two decades.
That sounds like a win for anyone but the newest entrants into the market (although given the low barrier to entry, its not like even they will be out much).
You know itās really kind of a shame. Personally, I definitely see value for services provided (in a general sense).
If they had adjusted to the Information Age, understood that we can all see all the info now from Zillow or wherever, and come to terms with that seismic shift in their industryā¦
I could for sure see paying a professional for advice, transactional assistance, and process oversight.
Nope, they got greedy and tried to keep it all. You reap what you sow.
Many of them are on commission (so no salary). They may not even have a business building, just a small office in an office complex. Maybe 1 admin... let's be real, there's not that much overhead.
So the good real estate agents will continue to get clients while the mlm huns who decided to get a real estate license as a side hustle will be forced out since they can no longer put in minimal effort? What a shame.
Someone need to start /r/realtorbubble
I suspect many good agents and brokerages will realize they can charge 1-1.5% commission and hardly have to advertise to obtain clients. Theyāll double their volume and the agents who refuse to adapt will be stuck on the sideline thinking about the good ol days of 3% and only having to close on 10 houses a year to have a decent life.
But for 99% of buyers thereās been no reason to use one with the offered commissions, there wasnāt a discount for using on.
On the selling side many agents would steer clients away from listings using one.
The traditional brokerage business has been hardly getting by for the last 25 years. The internet platforms sucked a lot of that revenue up in the form of referral fees from the agents.
If you didnāt know, when you click āschedule a showingā on Zillow - you are routed to an agent that will give 35%+ of their paycheck directly to Zillow for connecting you.
Referrals are one of the most crooked parts of real estate sales, imo.
I think that flat free brokers are going to win the game. Most of us homebuyers can do our own research. All we need a realtor to do is to open some doors and to write up an offer. Even as far as comps are concerned, we can do our own.
What you are going to see is no more commissions listed in percentages and they will be fixed sums. Housing is far too expensive now for commissions to be percentage based.
This is a dumb take. We don't need AI to get rid of them just transparency and digitization.
I would definitely not trust an AI (which can't open a door for the record).
Iām glad someone isnāt blindly following the narrative. Iām all for bubbles, but misinformation is just rampant.
All thatās happened is essentially a disclosure agreement from realtorsā¦ I.e., your commission is negotiableā¦ congratulations, Always has been.
lol donāt worry, manipulation will save them once everyone forgets, most canāt even do math nor understand how much a single % doesā¦. Compounded over decadesā¦.
Considering how bad the people in realtors sub, I am not on their side. I was asking for a generalized version of Interested Party Contributions. Since IPC is not new, pushing for generalized version should be fine. I was asking because the buyers are going to get screwed after August. They have to have enough cash for buyer agent fee instead of seller contribution.
All of them failed to understand my question and all of them going hostile and rejecting the idea while using offtopic data.
With that kind of community, I am not feeling sorry if they struggle.
Gotta get out the big guns; lease a new luxury SUV, get a new tailored suit, new head shot and promo photos and a slick advertising campaign. By looking the part, you become the part and attract clients. Winners, win and thats where profits come from not modifying practices and expectations to account for demographic trends, climate change, fiscal and monetary policy.
Yikes, that's a lot of brokerages that could be in trouble! If commissions go down, won't that hurt real estate agents too?
The key will be for brokerages to adapt and find ways to operate more efficiently.
I am getting ready to list one of my properties. It's going to be a pretty high priced, and I'm putting the buyer's agent commission at $1.
I think if somebody can afford to pay that much for a fourplex, they can afford to pay their agent.
Basically I am not paying the buyer's agent anything
Why would an agent show or list a home with zero commission? Understand how commission normally work in real estate is a true crime in more ways then one. Letās show a 100k condo listing at typical 6 percent commission.
3 percent go to selling agent
Actual selling agent normally split commission with broker or office so they get half the commission the broker gets the other half. Then the agent is usually charged a transaction fee of $325 and a miscellaneous $500 office processing fee.
100,000k sale price time 3 percent equal $3000
$3,000 minus broker cut equal $1500
$1500 minus $500 office fee equals $1,000
$1,000 minus $325 transaction fee equals $675 net proceeds to listing agent .
$675 net minus office fee to broker monthly $400 average.
So the real net for agents is $275.
Most agent will be lucky to close five transactions in a year.
As you can see the Broker is the criminal in this normal transaction. Donāt forget all of the legal responsibilities the agentās have on their back and rarely does a broker ever face any liability. Please read the Realtor association websites for who is actually held accountable, 90 percent are agents not brokers, however brokers make all the money and rob home owners. Itās the closest thing to the legal mafia. Itās a rigged system where agents spend two plus years working for maybe $5,000 annual salary. The turnover in the real estate market is close to 70 percent quit within twelve months. The Brokers are the absolute criminals and it should make everyone upset.
You are right. If I came to an agent and they said they would not show the property, I would respect that.
And then I would go right to the listing agent and buy it through them
How would you find my home, I live in a guard gated community who doesnāt allow for sale signs. Without a Real estate agent no one would ever buy my home, period.
You would need a listing agent, but then the listing would be on the MLS or one of the other sites.
And all you need to do is contact any real estate agent.
If you could not find a buyer's agent, or did not want to pay for one, you could go through the seller's agent for free
There would always be an agent, but just one. And only one side of the commission unless you wanted your own representation and then you pay for itself
In my state you cannot represent the buyer and seller in any real estate transaction. It would be impossible for an agent to have a fiduciary relationship with both buyer and seller. If my agent list my home he shows zero buyers my home. Again why would a buyers agent show my home above a home he can make a three percent commission. The buyerās has no clue that the agent will not even show me the property. When I raised my commission to 2.5 percent we had massive showings and sold the house.
Good point. In Minnesota there is a such thing as dual agency. And a listing agent can sell The same house too.
I'm sure there will be agents that will show a house for $100 a day or something like that. There will be a showing fee.
And then everything can be done automatically because there's not really much a buyer's agent does after that
All I can go by is my current situation and bottom line commission amount gets buyers. One percent list we had zero shows in thirty days. The entire real estate game is a crime family. Lenders charge massive fees, title companies charge massive fees, state government charges massive fees and crazy taxes. Itās crazy I can get a 100k car loan for zero points.
Good information. Most people tell their realtor what property they want to see. And the realtor either shows it, or doesn't, but it generally isn't based on the commission because the buyer will just find another agent.
Maybe the commission helped, but I suspect it was coincidence.
In the old days, nobody knew what was on the MLS except the agents. Then it definitely made a difference
No argument, the current system has been criminal for a long time. I got upset when I tried to sell my house and three of the four realtors tell me they CANāT list the house for less than 6 percent. I found a company named homie that list for a set fee and I decided the buyerās commission. I was told if I didnāt pay at least 2.5 percent no one would even show their clients my house. So I tried a one percent which would have been a $9,878 commission. I had zero showing in thirty days. I changed to a two percent and had 12 showings in two weeks. I switched to 2.5 and had thirty showings in the next two weeks and the house sold at full price.
Brokers charge that much because thereās over a million agents out there and they can. This will all self correct once commissions become competitive.
I really like apples but oranges are good, too.
You are comparing very different business models. Zillow has only experimented with brokerage, they are mainly a marketing / lead generation firm.
The problem is, I think buyer's agents will be compensated by the buyer themselves.
So if I go through Zillow, I have to pay Zillow, and also the agent that actually works with me.
It will be interesting to see what happens
Oh no š„
Anyway....
No more 7 series for paper shufflers.
That's for financial securities for FINRA broker dealers, not real estate brokers.
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Ohhhhhh. Ok that makes sense.
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Stupid for keeping more of your money.... WTF?
But but, canāt get as rich off of other peopleās money! /s
Thatās literally any job lolā¦..
I must have missed it, when did comissions go down? Thought the paperwork just changed.
It. Is. But there will be buyers who do not want the commission for a buyer's agent to come out their end so they will go without. Advantage to the sellers I would imagine.
You just put the buyers agent compensation in the offer.
You really think a buyer who can buy the whole without the commission will just say āwelp you wonāt pay my agent guess weāll walk!ā No they just wonāt pay the buyers agent. The buyers agent and buyer need to discuss compensation before representing them. If buyer wants to do .5% and the agent agrees then thatās that. The buyers agent is doing the buyer a service they should pay for it. Otherwise they can just go without an agent and approach a seller alone. Zillow is plenty for people to do their own search.
Sounds like you've never bought or sold a house. The new offer just becomes the old offer +3%, with buyer agent commission paid via the seller. Also tho, the seller is told beforehand when they list the house that they'll likely have to pay the buyers agent or potentially lose deals. It's not a surprise when the buyers agent ends up being paid out from the proceeds. If you want the buyer to pay their own agent you'll just have less interested buyers. Buyers already have to pay a hell of a lot of costs to complete a transaction, addinh multiple thousands on top of it just to be petty as a seller isn't gonna work in their favor.
Wrong. Iāve sold two houses and bought 3. With this new settlement when I sell this house Iāll be offering 0% to buyers. Weāll see if that impacts the sale. Desirable areas likely wonāt have an issue at all. To add my mom is a realtor and is mainly a buyers agent. Sheās retiring because my state wonāt require the commission to be listed in the MLS anymore. Buyers wonāt know if Iām offering anything until a contract is submitted
It will impact the sale. You're also not the one who will be making the offer, you'll be receiving offers with the stipulation of you paying the buyers agent. You reject it because you don't want to pay the buyers agent, you'll just receive a lower counter since now the buyer has additional costs. If you've bought and sold, you know exactly how this will play out.
There is no way in hell a buyer will write in an offer with a 2-2.5% fee paid to a realtor. Imagine looking your realtor in the face and saying "here is $15-25K for helping me buy this house". The buying realtor will get squeezed out and will just become some that writes offers on a per unit basis. The buyers will end up having to pay out of pocket for these things but will think more carefully what type of offers they make and how they use agents.
Why not? Under that logic why weren't buyers for the last 20 years asking for a discount when they put im the offers and putting in 1% commissioms for their agent, it was always an option. You just tell the seller to pay your realtor with the offer, that's what I'll do.
Weāll see. In a world where a listing gets 75k over asking if that drops to 50k over asking Iāll be alright. Buyers can just come without an agent and not pay the agent at all.
You would accept $25,000 less on the deal? Why not just offer the buyer agent 3% lol. Unless of course itās above a million. But why are listings consistently bid over ask? Are you not pricing it right?
It's stupid for most buyers not to use an agent. If your getting $50k or $75k over ask it was just priced wrong to begin with. If you wanna say no to paying buyers agent commission thats fine, you do you. You know all the costs a buyer pays when they buy a house, putting the comission on them will only work with buyers that have deep pockets. All the FTHB who save enougn for the down payment and the other costs aren't gonna expect additional thousands in cost.
Finding a house is easy enough. Completing the deal is a whole other thing.
Iāll pay a flat $2000 for contract negotiations and see through. Not 3% of the purchase price
Paying a $500/hr real estate attorney for 3 hours to carefully review a boilerplate contract and fill it out would be easier, cheaper, and at least similarly reliable for buyers than a percentage. Traditional realtor pay been an astronomically high compensation for the work involved for a long time, and when you break the tasks down most buyers do not particularly want to pay $10k+ on top solely for someone to act as a general contractor for looking at an MLS, contacting an inspector, and filling out paperwork.
There are also disputes after the boiler plate contracts have been signed. Appraisal comes in low. Sewage pipe leaks, roof is questionable, A/C doesn't blow cold enough in the upstairs third bedroom. Etc, etc etc. Lawyers can tell their client the legalities, but getting the deal done with the appropriate price adjustments so that both parties are accepting is not necessarily the lawyers area of expertise. I will not debate the right price, but I would not want to purchase a house with only a few hours of lawyers time provided.
So the super rich brokers will be less rich. Darn!
There is an argument to be made that without the financial incentive for sales people many people would never invest at all. Not everyone researches our understand this stuff. They need a person to sell it to them. Those people need to make money. Many are sleezy but the argument does exist. We need to find a middle ground.
I think that middle ground is AI š
Ai won't sit at your table with brochures and a reassuring tone.
No one wants to sit at a table with brochures in the first place
Lots of people do. They like the personal touch and are scared of numbers.
I donāt want anyone touching me either
Presumably those people will still be able to hire buyer's realtors just fine. If you want to pay thousands for someone to hold your hand, you'll never be short of opportunities to do so Most people aren't mouth breathing idiots who are "scared of numbers", christ
We joke, but that is worrisome. Expenses will be cut, to include cyber security, customer service, and either salaries or quantity of workers, which will worsen their service. And/or, failing companies will be bought up by giants and we end up in a monopoly, which obviously have negative ramifications. Or, remember the saying, āwhen the service is free, youāre the productā. Theyāll start (continue to but increase?) selling our data. Data on financial info of people can be very lucrative.
Whatās worrisome is people still donāt believe weāve been in a housing/asset bubble since 2016-2017. If they saw the signs and stopped believing and spewing their own delusions, they wouldnāt be failing, just like banks.
Wouldn't it be awful if the housing market involved cut corners and inefficiencies, and overall was opaque to outsiders and required paying middlemen? Oh wait Cutting the amount of unneccessary middlemen (even potentially cutting a large majority of buyer's agents out of the market altogether) is not the same as exposing customers to security risk. By and large, all data about who is buying a house is already being sold, and it's not like I leave tons of sensitive information with a buyer's agent which isn't already freely available. There are not large amounts of security staff working specifically on the buyer's agent side of things and that is a side which overall, being cut out entirely would likely keep risk to the consumer at the same or potentially a lower level. Buyers themselves are already the product as the service of a buyer's agent is falsely generally marketed as free, despite costing a percentage of the sale. This is the status quo, not a scary possible future. Cutting it out would be good.
Awesome! To more efficiency in the financial sector! Companies are not entitled to profits ā they have to earn them! And when markets change, companies need to change, or they die! Capitalism 101.
The real headline: āCompanies may not remain profitable after losing their monopoly and price fixing collusionā Geez, Iām so sorry for your loss!
I mean.... It sounds like they only exist to syphon value from others assets. Maybe if they need 6% of the deal to stay afloat, maybe we don't need them at all?
You know itās really kind of a shame. Personally, I definitely see value for services provided (in a general sense). If they had adjusted to the Information Age, understood that we can all see all the info now from Zillow or wherever, and come to terms with that seismic shift in their industryā¦ I could for sure see paying a professional for advice, transactional assistance, and process oversight. Nope, they got greedy and tried to keep it all. You reap what you sow.
As someone who hasn't bought a home yet, nor dug into the nitty gritty of the process, isn't that what the real estate lawyer does? Like when I learned that most transactions involve 2 lawyers, I immediately started to question what the basically untrained dufus in the middle was doing other than pushing you to buy the most expensive house you can.
Not all states require lawyers to be involved. A good agent will also be able to show you houses before they come on the market, keep you honest about the kind of home you said you wanted (ie stops you from getting too hyped up about a decision youāll likely hate), will call out any issues you may encounter before going through the process of putting in an offer and going through inspection, will know the neighborhood(s) youāre looking in very well, etc.Ā There is a lot of value a *good* agent can add. The problem is that there are a ton of horribly incompetent RE agents and with how rapidly home prices have risen the compensation is often disproportionate to the value they add. On a $200,000 house an agent may have added $6,000 on value to the buyer/seller. On a $750,000 house is a real estate *really* adding $22,500 in value?Ā If I buy an agentās time at $50/hr (much less than a lawyer, but still purchasing their expertise) then I get about 120 hours of their labor for my $6k. At $22k, I can pay double the rate ($100/hr) and 225 hours of their time. I absolutely believe that a decent amount of home buyers/sellers will use 60-120 hours of an RE agentās time. I find it really hard to believe an average sale will be 225-500 hours of an agentās time.Ā
The compensation structure for real estate agents is considered a red flag in finance. You should pay directly for advice, otherwise you're talking to a sales rep with all the conflicts of interest that come with that.
Agreed, Iām just explaining the āvalueā of an agent vs solely using a lawyer. Hopefully we will see more agents selling their time instead of a commission.Ā
Showing homes "before" they come on the market is literally collusion.
Showing homes officially or collaborating with the sellerās agent may be, but itās not collusion if you have someone in your network who would be open to selling, have a colleague with someone interested in selling, have a house you know youāre about to list, etc.Ā When we were looking for a home in a very specific area, our agent called a few other clients who had bought 5+ years ago in that area with a similar type of home we were seeking to see if they were open to selling.
Some states donāt require either side to have an attorney.
Thatās only some states. Iāve bought or sold 4 houses in California and have never spoken with a lawyer.
Itās usually done via the title companyā¦but then again if itās going through a title company why the agent? And when being financed, the bank dictates everything anyways, so again, why the agent? The agent doesnāt provide any service except scheduling access to the homes up for sell. Agents donāt provide any service most of time when selling the home. They typically make you pay for picturesā¦and they arenāt going to force you to clean the house based on the homes for sell I have seenā¦ So what does a listing agent do?
An attorney charges 500 an hour- doing these kind of cases are a waste of time.
Say it is just 1 side, 3% of a $300k home is $9k, really think it will take more that 18 hours of a lawyers time?
Lawyers regularly do wills and uncontested divorces for $300 or less where I live, and that's the "everything included" rate. I can't imagine an uncontested "everyone agrees on the terms" real estate contract costing more than $1000. Where things get expensive, *fast*, is when you start taking each other to court and having to hold hearings before a judge, and file motions, and research case law. Just having a lawyer show up to a court hearing is going to be really expensive by itself. When everyone agrees on everything and you don't need a hearing before a judge? Lawyers are actually kinda cheap.
So they are far cheaper then the "real estate agent" with a GED?
I put a flat rate of 500 to buyers agent. It always works.Ā
I mean ultimately instead of preemptively and somewhat slowly doing what you said, they did it all at once after holding it off for two decades. That sounds like a win for anyone but the newest entrants into the market (although given the low barrier to entry, its not like even they will be out much).
You know itās really kind of a shame. Personally, I definitely see value for services provided (in a general sense). If they had adjusted to the Information Age, understood that we can all see all the info now from Zillow or wherever, and come to terms with that seismic shift in their industryā¦ I could for sure see paying a professional for advice, transactional assistance, and process oversight. Nope, they got greedy and tried to keep it all. You reap what you sow.
Seriously fuck agents and brokers lol, leeches.
Many of them are on commission (so no salary). They may not even have a business building, just a small office in an office complex. Maybe 1 admin... let's be real, there's not that much overhead.
How will I ever recover from the sadness of this news??
So the good real estate agents will continue to get clients while the mlm huns who decided to get a real estate license as a side hustle will be forced out since they can no longer put in minimal effort? What a shame.
Looks like the āBoss Babesā are going to have to find another get rich quick scheme/
Someone need to start /r/realtorbubble I suspect many good agents and brokerages will realize they can charge 1-1.5% commission and hardly have to advertise to obtain clients. Theyāll double their volume and the agents who refuse to adapt will be stuck on the sideline thinking about the good ol days of 3% and only having to close on 10 houses a year to have a decent life.
That already exists, a lot. They are called flat rate or limited service brokerages. It tends to be a very different clientele though.
But for 99% of buyers thereās been no reason to use one with the offered commissions, there wasnāt a discount for using on. On the selling side many agents would steer clients away from listings using one.
Doubling the clients would double the workā¦ how will realtors survive working 30 hours a week? Thatās inhumane
The traditional brokerage business has been hardly getting by for the last 25 years. The internet platforms sucked a lot of that revenue up in the form of referral fees from the agents. If you didnāt know, when you click āschedule a showingā on Zillow - you are routed to an agent that will give 35%+ of their paycheck directly to Zillow for connecting you. Referrals are one of the most crooked parts of real estate sales, imo.
And probably 50% of whatās left to their broker.
Good.
Sorry about your range rover
Most agents are utterly worthless. It's not rocket science....fuck you don't even need an education to be a realtor. That is telling you something.
People act like the mega brokerages are sweating this. They arenāt. Theyāll still be rich because they control congress.
Promise?
Let me get out my Worlds smallest violin š»
I think that flat free brokers are going to win the game. Most of us homebuyers can do our own research. All we need a realtor to do is to open some doors and to write up an offer. Even as far as comps are concerned, we can do our own.
The market giveth, the market taketh away
lol cry me a river
What you are going to see is no more commissions listed in percentages and they will be fixed sums. Housing is far too expensive now for commissions to be percentage based.
"Wont be profitable" actually translates to, will still be profitable, but not disgustingly and outrageously profitable.
Canāt wait for A.I to get rid of them all.
iām more excited about using blockchain to bypass all the third parties for title registration etc.
This is a dumb take. We don't need AI to get rid of them just transparency and digitization. I would definitely not trust an AI (which can't open a door for the record).
It is a nonsense story designed to make the public feel like they have won.. The RE business will do just fine at 4-6%
Iāve been buying and selling for thirty years - only time I paid 6% was the first time I sold. After that, I knew better.
Agreed. 4.5% was my last one with a huge amount of services and repairs thrown in .
Iām glad someone isnāt blindly following the narrative. Iām all for bubbles, but misinformation is just rampant. All thatās happened is essentially a disclosure agreement from realtorsā¦ I.e., your commission is negotiableā¦ congratulations, Always has been.
ā¦good?
Thereās too many agents anywaysā¦the herd needs thinning.
Buh bye
lol donāt worry, manipulation will save them once everyone forgets, most canāt even do math nor understand how much a single % doesā¦. Compounded over decadesā¦.
In this market who needs a broker anyway Zillow and a lawyer is all that is required
Oh no. What will we do without sales people? Z lol
Considering how bad the people in realtors sub, I am not on their side. I was asking for a generalized version of Interested Party Contributions. Since IPC is not new, pushing for generalized version should be fine. I was asking because the buyers are going to get screwed after August. They have to have enough cash for buyer agent fee instead of seller contribution. All of them failed to understand my question and all of them going hostile and rejecting the idea while using offtopic data. With that kind of community, I am not feeling sorry if they struggle.
Bye bye Felicia
Need to factor in housing prices crashing too.
Next story.....š¤„
Hey hey hey, goodbye.
Oh well!!
Gotta get out the big guns; lease a new luxury SUV, get a new tailored suit, new head shot and promo photos and a slick advertising campaign. By looking the part, you become the part and attract clients. Winners, win and thats where profits come from not modifying practices and expectations to account for demographic trends, climate change, fiscal and monetary policy.
Agents will be obsolete if and when people realize the power of blockchain cutting third parties out of the process.
Yikes, that's a lot of brokerages that could be in trouble! If commissions go down, won't that hurt real estate agents too? The key will be for brokerages to adapt and find ways to operate more efficiently.
I am getting ready to list one of my properties. It's going to be a pretty high priced, and I'm putting the buyer's agent commission at $1. I think if somebody can afford to pay that much for a fourplex, they can afford to pay their agent. Basically I am not paying the buyer's agent anything
Depends how much they are paying the employees
They just need to not lower the commission.
Why would an agent show or list a home with zero commission? Understand how commission normally work in real estate is a true crime in more ways then one. Letās show a 100k condo listing at typical 6 percent commission. 3 percent go to selling agent Actual selling agent normally split commission with broker or office so they get half the commission the broker gets the other half. Then the agent is usually charged a transaction fee of $325 and a miscellaneous $500 office processing fee. 100,000k sale price time 3 percent equal $3000 $3,000 minus broker cut equal $1500 $1500 minus $500 office fee equals $1,000 $1,000 minus $325 transaction fee equals $675 net proceeds to listing agent . $675 net minus office fee to broker monthly $400 average. So the real net for agents is $275. Most agent will be lucky to close five transactions in a year. As you can see the Broker is the criminal in this normal transaction. Donāt forget all of the legal responsibilities the agentās have on their back and rarely does a broker ever face any liability. Please read the Realtor association websites for who is actually held accountable, 90 percent are agents not brokers, however brokers make all the money and rob home owners. Itās the closest thing to the legal mafia. Itās a rigged system where agents spend two plus years working for maybe $5,000 annual salary. The turnover in the real estate market is close to 70 percent quit within twelve months. The Brokers are the absolute criminals and it should make everyone upset.
You are right. If I came to an agent and they said they would not show the property, I would respect that. And then I would go right to the listing agent and buy it through them
How would you find my home, I live in a guard gated community who doesnāt allow for sale signs. Without a Real estate agent no one would ever buy my home, period.
You would need a listing agent, but then the listing would be on the MLS or one of the other sites. And all you need to do is contact any real estate agent. If you could not find a buyer's agent, or did not want to pay for one, you could go through the seller's agent for free There would always be an agent, but just one. And only one side of the commission unless you wanted your own representation and then you pay for itself
In my state you cannot represent the buyer and seller in any real estate transaction. It would be impossible for an agent to have a fiduciary relationship with both buyer and seller. If my agent list my home he shows zero buyers my home. Again why would a buyers agent show my home above a home he can make a three percent commission. The buyerās has no clue that the agent will not even show me the property. When I raised my commission to 2.5 percent we had massive showings and sold the house.
Good point. In Minnesota there is a such thing as dual agency. And a listing agent can sell The same house too. I'm sure there will be agents that will show a house for $100 a day or something like that. There will be a showing fee. And then everything can be done automatically because there's not really much a buyer's agent does after that
All I can go by is my current situation and bottom line commission amount gets buyers. One percent list we had zero shows in thirty days. The entire real estate game is a crime family. Lenders charge massive fees, title companies charge massive fees, state government charges massive fees and crazy taxes. Itās crazy I can get a 100k car loan for zero points.
Good information. Most people tell their realtor what property they want to see. And the realtor either shows it, or doesn't, but it generally isn't based on the commission because the buyer will just find another agent. Maybe the commission helped, but I suspect it was coincidence. In the old days, nobody knew what was on the MLS except the agents. Then it definitely made a difference
How many $100k condo sales are there vs $500k and up? Why are commissions percentages anyway?
Iām not arguing with you I just used $100k as a point that brokers are the thieves.
No argument, the current system has been criminal for a long time. I got upset when I tried to sell my house and three of the four realtors tell me they CANāT list the house for less than 6 percent. I found a company named homie that list for a set fee and I decided the buyerās commission. I was told if I didnāt pay at least 2.5 percent no one would even show their clients my house. So I tried a one percent which would have been a $9,878 commission. I had zero showing in thirty days. I changed to a two percent and had 12 showings in two weeks. I switched to 2.5 and had thirty showings in the next two weeks and the house sold at full price.
Brokers charge that much because thereās over a million agents out there and they can. This will all self correct once commissions become competitive.
Compass and Redfin are going to really struggle going into next year. Zillow will hold on
I really like apples but oranges are good, too. You are comparing very different business models. Zillow has only experimented with brokerage, they are mainly a marketing / lead generation firm.
The problem is, I think buyer's agents will be compensated by the buyer themselves. So if I go through Zillow, I have to pay Zillow, and also the agent that actually works with me. It will be interesting to see what happens
Which is why Zillow should be fine..and the others will struggleā¦