New Commission -3%

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Who would want to be a realtor anymore?

1% of $1,000,000 is still $10,000! After a split with the broker (assume 75%), you do 1-2 a month and you can make $100,000 a year with a job that only requires a high school diploma. Being an agent is about networking and who you know, not what you know.

- former agent

This. As much as real estate agents and their fees annoy me, I recognize that our society still needs to find ways to employ the less educated. Otherwise we'll get a collection of underemployed morons storming the capitol again.

No...they can use their fancy vehicles to be Uber drivers. Life is about adjusting..to survive.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Thank goodness for this change. We are one of the few countries with such high commissions.

The fact a seller has been required to pay for the buyer’s agent is bizarre and messed up. Try explaining that to someone in another western country. HOW does that make sense? It doesn’t.

A buyer should be hiring his or her own agent and welcome to pay whatever it is they want or the agent charges.

Actually, sellers of assets having to pay a finder's fee is a pretty common concept.

That’s what the sellers commission is. The seller lists the property and processes any offers.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:So we are about to list our house and have a listing agreement (not yet signed) giving our agent 5%, split with the buyer's agent. Should I counter now with 4% in light of this NAR ruling? My inclination is to give 4% and tell her to split it however she wants.

4% is pretty standard even now.

Why are you guys so afraid of your agents? Offer 2% to be split between the buyer and seller agent. At current prices, that's a lot of money already.

OK, so play that out ...

2% is 1% each.

For an agent, that might be equal to 0.44% after a 50/50 split and the 6% haircut the brokers take off the top (agents typically only get 94% of their split).

So you sell your house for $1 million. The agent now pockets $4,400 from that. Out of which they have to pay for any marketing, staging (unless you pay separately for that), and pay taxes and their own license fees etc. So maybe their net is $2,500.

But that's a million dollar house. Now do it on a $500,000 house. Now it's $1,250.

I'll let you tell me if that's a fair amount or not. I guess it depends on how many hours they spend on the sale.

The market comprising the consumers of your services decides what your services are worth. If you provide services worth 5K, they are worth 5K. If you provide services worth $1,250, they are worth $1,250. You decide if the compensation is "fair". If not, find a new job.

The point is -- absent NAR cartel-ing the industry -- the real estate industry will function like every other comparable industry driven by macroeconomic forces.

And my point is that it will be a while before we see what new compensation model takes the old one's place. But I do think this probably won't play out the way you think -- either transactions may get more rocky or agents will find some different way to get their money. Hourly rates, maybe, but pay-as-you go. Or maybe fee-for-service -- want an open house? That'll be $500... Every trip to the house to let in an inspector? $200/hour. Every e-mail replied to? $200/hour, billed in 8 minute increments like a lawyer... Who knows. Remains to be seen.

Open houses are pointless, they are just used my realtors to market themselves to future customers

You don't need a realtor to stage, you can find someone else to do it

Why should you need to rely on buyer's agent to open house for inspection? That is an artificial restriction. The buyer and inspector and seller can agree to entry terms.

[Anonymous]

Anonymous wrote:And my point is that it will be a while before we see what new compensation model takes the old one's place.

Your post broke down compensation and asked if the compensation was "fair". I was responding to what you wrote.

Anonymous wrote: But I do think this probably won't play out the way you think

You seem to be reading more into what I actually wrote. How specifically do I "think" I will "play out" based specifically on what I wrote.

(I provided no specifics, only economic generalizations)

Anonymous wrote:either transactions may get more rocky or agents will find some different way to get their money.

But we've already established that right? That's how "other comparable industries" operate. Service providers compete for consumers with differing compensation agreements (differing ways to get money).

Anonymous wrote:Hourly rates, maybe, but pay-as-you go. Or maybe fee-for-service -- want an open house? That'll be $500... Every trip to the house to let in an inspector? $200/hour. Every e-mail replied to? $200/hour, billed in 8 minute increments like a lawyer...

But we've already established this right? These are examples of differing competitive compensation agreements. Like "every other comparable industry".

Anonymous wrote:Who knows. Remains to be seen.

Every other comparable industry can be described as a "Who knows. Remains to be seen" market; competition drives unforeseen pricing changes and offerings and choices.



I feel like you are trying to make another point, but are struggling to communicate it.

[Anonymous]

This seems crazy, but can you offer some %age buyer's commission to some, but not all?

I guess the burning question is does the presence of a buyer's agent (receiving a commission) drive up the price more than the buyer's commission?

I suppose they only way to test is to offer a buyer's commission to some, but nothing to others and see how the offers look.

[Anonymous]

So will buyers agents go away?

Can't purchasers do their own searches on zillow etc and have the sellers agents open the doors to the houses?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:So we are about to list our house and have a listing agreement (not yet signed) giving our agent 5%, split with the buyer's agent. Should I counter now with 4% in light of this NAR ruling? My inclination is to give 4% and tell her to split it however she wants.

4% is pretty standard even now.

Why are you guys so afraid of your agents? Offer 2% to be split between the buyer and seller agent. At current prices, that's a lot of money already.

OK, so play that out ...

2% is 1% each.

For an agent, that might be equal to 0.44% after a 50/50 split and the 6% haircut the brokers take off the top (agents typically only get 94% of their split).

So you sell your house for $1 million. The agent now pockets $4,400 from that. Out of which they have to pay for any marketing, staging (unless you pay separately for that), and pay taxes and their own license fees etc. So maybe their net is $2,500.

But that's a million dollar house. Now do it on a $500,000 house. Now it's $1,250.

I'll let you tell me if that's a fair amount or not. I guess it depends on how many hours they spend on the sale.

The market comprising the consumers of your services decides what your services are worth. If you provide services worth 5K, they are worth 5K. If you provide services worth $1,250, they are worth $1,250. You decide if the compensation is "fair". If not, find a new job.

The point is -- absent NAR cartel-ing the industry -- the real estate industry will function like every other comparable industry driven by macroeconomic forces.

And my point is that it will be a while before we see what new compensation model takes the old one's place. But I do think this probably won't play out the way you think -- either transactions may get more rocky or agents will find some different way to get their money. Hourly rates, maybe, but pay-as-you go. Or maybe fee-for-service -- want an open house? That'll be $500... Every trip to the house to let in an inspector? $200/hour. Every e-mail replied to? $200/hour, billed in 8 minute increments like a lawyer... Who knows. Remains to be seen.

Open houses are pointless, they are just used my realtors to market themselves to future customers

You don't need a realtor to stage, you can find someone else to do it

Why should you need to rely on buyer's agent to open house for inspection? That is an artificial restriction. The buyer and inspector and seller can agree to entry terms.

Our realtor sucked. She wouldn't take us to houses so we needed those open houses.

[Anonymous]

WHy did Biden change the rules?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:So we are about to list our house and have a listing agreement (not yet signed) giving our agent 5%, split with the buyer's agent. Should I counter now with 4% in light of this NAR ruling? My inclination is to give 4% and tell her to split it however she wants.

4% is pretty standard even now.

Why are you guys so afraid of your agents? Offer 2% to be split between the buyer and seller agent. At current prices, that's a lot of money already.

OK, so play that out ...

2% is 1% each.

For an agent, that might be equal to 0.44% after a 50/50 split and the 6% haircut the brokers take off the top (agents typically only get 94% of their split).

So you sell your house for $1 million. The agent now pockets $4,400 from that. Out of which they have to pay for any marketing, staging (unless you pay separately for that), and pay taxes and their own license fees etc. So maybe their net is $2,500.

But that's a million dollar house. Now do it on a $500,000 house. Now it's $1,250.

I'll let you tell me if that's a fair amount or not. I guess it depends on how many hours they spend on the sale.

Agents do not typically make 94% of their commission. It is signifcantly less than that.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:
"Now, I bet some shady sellers' agents will try to avoid presenting un-represented buyers' offers"

Why would an agent NOT present an offer from an unrepresented buyer? What would be their motivation to do that?

NP it creates ethical considerations (yes, believe it or not, there are ethics, even regulations governing real estate agents). Dual agency, etc.

Moreover, it creates more work for THEM if they have to handle both the buyer and the seller. There will be even less incentive to do that now.

What ethical consideration are you talking about? The agent has an ethical obligation to present all offers. The listing agent does not have an obligation to to write an offer for an unrepresented buyer though. Depending upon the state, in some cases the agent cannot represent a buyer and can only do ministerial acts.

Do you really not understand how dual agency creates ethical issues? How one agent can't really represent both sides in a transaction?

https://www.rockethomes.com/blog/home-buying/dual-agency

No shit. The initial post I made asked why a listing agent would not present an unrepreseted buyer's offer to the sellers. It had nothing to do with dual agency.

[Anonymous]

Anonymous wrote:WHy did Biden change the rules?

LOL you're an idiot. Biden didn't do squat; the courts ruled against NAR on anti-trust grounds. NAR is entering into a nationwide settlement.

This has nothing to do with Biden. It would've happened if Trump was still POTUS. TBH, Trump probably hates realtors and the 6% model since they are an expensive nuisance. Every developer would prefer direct sales and cutting out middlemen.

[Anonymous]

Anonymous wrote:Looking to sell my house in Fairfax. It is $1M+ and spoke with a few agents. I have been quoted 3% total commission for buyer and seller agent by 4 different relators. I mean it's great but is this the trend anyone else is seeing as well?

ask for a total of 2%

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:
"Now, I bet some shady sellers' agents will try to avoid presenting un-represented buyers' offers"

Why would an agent NOT present an offer from an unrepresented buyer? What would be their motivation to do that?

NP it creates ethical considerations (yes, believe it or not, there are ethics, even regulations governing real estate agents). Dual agency, etc.

Moreover, it creates more work for THEM if they have to handle both the buyer and the seller. There will be even less incentive to do that now.

What ethical consideration are you talking about? The agent has an ethical obligation to present all offers. The listing agent does not have an obligation to to write an offer for an unrepresented buyer though. Depending upon the state, in some cases the agent cannot represent a buyer and can only do ministerial acts.

Do you really not understand how dual agency creates ethical issues? How one agent can't really represent both sides in a transaction?

https://www.rockethomes.com/blog/home-buying/dual-agency

No shit. The initial post I made asked why a listing agent would not present an unrepreseted buyer's offer to the sellers. It had nothing to do with dual agency.

Realtor to realtor: "Scratch my back and I'll scratch yours."
Would likely prefer to sell to a buyer with an agent in order to (1) lessen the work for the sellers' agent in hand-holding the buyer and (2) keep money flowing to the buy-side agent ecosystem. Every agent who sells is also an agent who is buying for another client. To the extent you can promote the norm of buy-side agent fees, the better it is for all parties.

It's similar to agents who steer clients away from Redfin properties or Redfin buyers. You don't promote someone who wants to disrupt the model through lower fees.

[Anonymous]

Anonymous wrote:

Anonymous wrote:WHy did Biden change the rules?

LOL you're an idiot. Biden didn't do squat; the courts ruled against NAR on anti-trust grounds. NAR is entering into a nationwide settlement.

This has nothing to do with Biden. It would've happened if Trump was still POTUS. TBH, Trump probably hates realtors and the 6% model since they are an expensive nuisance. Every developer would prefer direct sales and cutting out middlemen.

It's actually one thing everyone can agree on - left wing, right wing, progressive, libertarian (CATO) think tanks publishing research on how the real estate industry is anti- American Consumer.

Remarkable when you think about it: politically a country can be this divided, but the real state industry has managed to bring everyone together in solidarity over a collective hatred for the real estate profession.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:
"Now, I bet some shady sellers' agents will try to avoid presenting un-represented buyers' offers"

Why would an agent NOT present an offer from an unrepresented buyer? What would be their motivation to do that?

NP it creates ethical considerations (yes, believe it or not, there are ethics, even regulations governing real estate agents). Dual agency, etc.

Moreover, it creates more work for THEM if they have to handle both the buyer and the seller. There will be even less incentive to do that now.

What ethical consideration are you talking about? The agent has an ethical obligation to present all offers. The listing agent does not have an obligation to to write an offer for an unrepresented buyer though. Depending upon the state, in some cases the agent cannot represent a buyer and can only do ministerial acts.

Do you really not understand how dual agency creates ethical issues? How one agent can't really represent both sides in a transaction?

https://www.rockethomes.com/blog/home-buying/dual-agency

No shit. The initial post I made asked why a listing agent would not present an unrepreseted buyer's offer to the sellers. It had nothing to do with dual agency.

Realtor to realtor: "Scratch my back and I'll scratch yours."
Would likely prefer to sell to a buyer with an agent in order to (1) lessen the work for the sellers' agent in hand-holding the buyer and (2) keep money flowing to the buy-side agent ecosystem. Every agent who sells is also an agent who is buying for another client. To the extent you can promote the norm of buy-side agent fees, the better it is for all parties.

It's similar to agents who steer clients away from Redfin properties or Redfin buyers. You don't promote someone who wants to disrupt the model through lower fees.

LOL. You are totally clueless. The listing agent has to present all offers to the sellers and your hypotheses are nothing more than uneducated speculation. Agents steer clients away from Redfin properties? False. Listing agents having to hand hold unrepresented buyers, false. Every listing agent is also a buyer's agent, false. Promoting the norm of buy-side agent fees, wrong. Nice try dude but you have no idea what you are talking about as is true of 90% of people on this site. Kind of like the post where no one could figure out what a cash buyer is. SMDH.