WSJ: Beware real estate cartel

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:If it were so simple to “disrupt” real estate it would have been done by now. There are reasons Redfin hasn’t become the Amazon of real estate, shuttering all its mom & pop competitors. DH and I are both lawyers and we still use realtors.

Nonsense. Cartels are powerful and corrupt our politicians.

Pharmacists could be replaced by low cost robots now at this point, yet the only reason we continue to need pharmacists is because the law in many places says there must be a human on staff? Why do we need them? Only because lobbyists make politicians write the law stating that a human pharmacist must be present. Pharmacists themselves don't have any special skills that is better than automated dispensing robots. In fact, robots make far less mistakes and have already been shown for going on almost 2 decades now that they're capable of dispensing out billions of doses effectively. Many hospitals and urban areas already use pill dispensing robots, yet pharmacists hang around because of the law.

Same for car salesmen. Why do we have to pay them at all? Why can't we just buy from the company like Tesla? Because of corruption. The car sales lobby tries to prohibit consumers from buying cars from Tesla, because they want to keep their inefficient and dumb model in place so that consumers have to get gouged unnecessarily with a needless third party between purchasing their car and the manufacturer. The only reason we have to buy cars from dealers is because it is the law for many places.

Same for RE. 95% of it can be automated. Virtually 99.99999% of all other countries in the world charge vastly lower fee for RE transactions than the US. The Department of Justice wouldn't be wasting their time if they didn't think it stunk.

This issue is in so many fields. Why do American physicians make so much more money than their counterparts abroad? Was the 30 minute appointment my child had with a specialist REALLY worth $1400? Why does it cost $20 to get stitches in almost any country in the world and $700 in an American ER (not even done by a physician!)?

This is corruption- our country has a corruption problem.

Corruption? How so? I want you to explain the corruption.

[Anonymous]

I am so glad to see this. I also think that the real estate fees are a bubble on top of what a house should cost. I think it should be broken down. Buyer pays 500k for house, 25k for realtors. Fees shouldn’t be combined.

[Anonymous]

I agree that it is corruption. They buy influence in the political process to protect their guild.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:The DoJ is coming after you next:

https://www.wsj.com/articles/warning-to-the-real-estate-cartel-11625783854

Finally, hopefully consumers can get away from this ridiculous system that compensates brokers exorbitant sums of money for only a few hours of work. TBH, a vast majority of the process could probably be largely automated for a $20 fee anyway. Ridiculous US consumers have so much wealth destroyed from insane fees, or are forced to buy less because of fees.

Funny, I did a 5 hour home inspection today with a lawyer who is involved in this case. Guess, I don't have to day anything else, and we will forgot about the twenty plus hours I spent with him at other houses, working out finances, and two previous pre inspections.

Funny how you cherry picked and only highlighted this one transaction. Are you suggesting there are no transactions that take less than 20 hours beginning to end? I’ve purchased/sold several homes both with realtors and on my own with a flat fee attorney. Realtor fees should be by the hour. $750 an hour will motivate buyers to be more precise with their search.

More like 75 cents an hour. We handed our agent the key to our house and she had it painted, floors refinished, deck and some other repairs done, had a new garage door installed, carpet cleaned in the basement, and had windows and house cleaned. She had the house staged and had photos, floorplans, and a tour done. She spent three hours sitting on her ass at an an open house and then made us respond to offers a few days later. She didn’t do anything after that except meet the appraiser, termite inspector, and our movers. She spent maybe a couple hours making sure the movers got everything out of the house and then took all our old paint to the County. She spent a lot of time with the settlement because we were in two places. For that she made over $9,000. She should have gotten $750 for the little she did. My neighbors were all impressed but she didn’t do any of the work

Did you even read your own post?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:The DoJ is coming after you next:

https://www.wsj.com/articles/warning-to-the-real-estate-cartel-11625783854

Finally, hopefully consumers can get away from this ridiculous system that compensates brokers exorbitant sums of money for only a few hours of work. TBH, a vast majority of the process could probably be largely automated for a $20 fee anyway. Ridiculous US consumers have so much wealth destroyed from insane fees, or are forced to buy less because of fees.

Funny, I did a 5 hour home inspection today with a lawyer who is involved in this case. Guess, I don't have to day anything else, and we will forgot about the twenty plus hours I spent with him at other houses, working out finances, and two previous pre inspections.

Funny how you cherry picked and only highlighted this one transaction. Are you suggesting there are no transactions that take less than 20 hours beginning to end? I’ve purchased/sold several homes both with realtors and on my own with a flat fee attorney. Realtor fees should be by the hour. $750 an hour will motivate buyers to be more precise with their search.

For comparison, commercial real estate lawyers with ten years of experience and degrees from Harvard, etc. working on $10-50 million deals usually charge less than $750.

For a real estate agent, $200 is probably more reasonable.

BS. Firms bill out 3rd year associates at $750 per hours. The people who know how to run the deals are 4 figures. .

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:The DoJ is coming after you next:

https://www.wsj.com/articles/warning-to-the-real-estate-cartel-11625783854

Finally, hopefully consumers can get away from this ridiculous system that compensates brokers exorbitant sums of money for only a few hours of work. TBH, a vast majority of the process could probably be largely automated for a $20 fee anyway. Ridiculous US consumers have so much wealth destroyed from insane fees, or are forced to buy less because of fees.

Funny, I did a 5 hour home inspection today with a lawyer who is involved in this case. Guess, I don't have to day anything else, and we will forgot about the twenty plus hours I spent with him at other houses, working out finances, and two previous pre inspections.

Funny how you cherry picked and only highlighted this one transaction. Are you suggesting there are no transactions that take less than 20 hours beginning to end? I’ve purchased/sold several homes both with realtors and on my own with a flat fee attorney. Realtor fees should be by the hour. $750 an hour will motivate buyers to be more precise with their search.

For comparison, commercial real estate lawyers with ten years of experience and degrees from Harvard, etc. working on $10-50 million deals usually charge less than $750.

For a real estate agent, $200 is probably more reasonable.

No lawyer who ordinarily works on $10-50 million RE deals is charging less than $750 for their services (unless you're talking by the hour).

You mind sharing whatever it is you're smoking? It's the weekend, after all...

I’m a 7th year associate at a biglaw refugee boutique and my rate is $750/hr. Suspect PP’s rate is out of date.

Biglaw and boutique are two different things.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:The DoJ is coming after you next:

https://www.wsj.com/articles/warning-to-the-real-estate-cartel-11625783854

Finally, hopefully consumers can get away from this ridiculous system that compensates brokers exorbitant sums of money for only a few hours of work. TBH, a vast majority of the process could probably be largely automated for a $20 fee anyway. Ridiculous US consumers have so much wealth destroyed from insane fees, or are forced to buy less because of fees.

Funny, I did a 5 hour home inspection today with a lawyer who is involved in this case. Guess, I don't have to day anything else, and we will forgot about the twenty plus hours I spent with him at other houses, working out finances, and two previous pre inspections.

Funny how you cherry picked and only highlighted this one transaction. Are you suggesting there are no transactions that take less than 20 hours beginning to end? I’ve purchased/sold several homes both with realtors and on my own with a flat fee attorney. Realtor fees should be by the hour. $750 an hour will motivate buyers to be more precise with their search.

For comparison, commercial real estate lawyers with ten years of experience and degrees from Harvard, etc. working on $10-50 million deals usually charge less than $750.

For a real estate agent, $200 is probably more reasonable.

No lawyer who ordinarily works on $10-50 million RE deals is charging less than $750 for their services (unless you're talking by the hour).

You mind sharing whatever it is you're smoking? It's the weekend, after all...

I’m a 7th year associate at a biglaw refugee boutique and my rate is $750/hr. Suspect PP’s rate is out of date.

Biglaw and boutique are two different things.

You’re confused. I’m saying even at my boutique, that I left biglaw for, I am billing at $750/hr with less than 10 years experience.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:If it were so simple to “disrupt” real estate it would have been done by now. There are reasons Redfin hasn’t become the Amazon of real estate, shuttering all its mom & pop competitors. DH and I are both lawyers and we still use realtors.

Nonsense. Cartels are powerful and corrupt our politicians.

Pharmacists could be replaced by low cost robots now at this point, yet the only reason we continue to need pharmacists is because the law in many places says there must be a human on staff? Why do we need them? Only because lobbyists make politicians write the law stating that a human pharmacist must be present. Pharmacists themselves don't have any special skills that is better than automated dispensing robots. In fact, robots make far less mistakes and have already been shown for going on almost 2 decades now that they're capable of dispensing out billions of doses effectively. Many hospitals and urban areas already use pill dispensing robots, yet pharmacists hang around because of the law.

Same for car salesmen. Why do we have to pay them at all? Why can't we just buy from the company like Tesla? Because of corruption. The car sales lobby tries to prohibit consumers from buying cars from Tesla, because they want to keep their inefficient and dumb model in place so that consumers have to get gouged unnecessarily with a needless third party between purchasing their car and the manufacturer. The only reason we have to buy cars from dealers is because it is the law for many places.

Same for RE. 95% of it can be automated. Virtually 99.99999% of all other countries in the world charge vastly lower fee for RE transactions than the US. The Department of Justice wouldn't be wasting their time if they didn't think it stunk.

This issue is in so many fields. Why do American physicians make so much more money than their counterparts abroad? Was the 30 minute appointment my child had with a specialist REALLY worth $1400? Why does it cost $20 to get stitches in almost any country in the world and $700 in an American ER (not even done by a physician!)?

This is corruption- our country has a corruption problem.

Corruption? How so? I want you to explain the corruption.

When cartels are allowed to price gouge by politicians whom they have bought and paid for- that is the corruption part. We know lobbyists for every powerful special interest group basically write our legislation. This is just corruption brought to by citizens United and a lack of campaign finance law.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:The DoJ is coming after you next:

https://www.wsj.com/articles/warning-to-the-real-estate-cartel-11625783854

Finally, hopefully consumers can get away from this ridiculous system that compensates brokers exorbitant sums of money for only a few hours of work. TBH, a vast majority of the process could probably be largely automated for a $20 fee anyway. Ridiculous US consumers have so much wealth destroyed from insane fees, or are forced to buy less because of fees.

Funny, I did a 5 hour home inspection today with a lawyer who is involved in this case. Guess, I don't have to day anything else, and we will forgot about the twenty plus hours I spent with him at other houses, working out finances, and two previous pre inspections.

25 hours - less than a full week of work

I am not an agent but I saw what our agent did for us, and I can’t imagine doing what she did. I have no interest in becoming an agent but when people talk about agents having it easy, I always wonder why they don’t become agents.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:The DoJ is coming after you next:

https://www.wsj.com/articles/warning-to-the-real-estate-cartel-11625783854

Finally, hopefully consumers can get away from this ridiculous system that compensates brokers exorbitant sums of money for only a few hours of work. TBH, a vast majority of the process could probably be largely automated for a $20 fee anyway. Ridiculous US consumers have so much wealth destroyed from insane fees, or are forced to buy less because of fees.

Funny, I did a 5 hour home inspection today with a lawyer who is involved in this case. Guess, I don't have to day anything else, and we will forgot about the twenty plus hours I spent with him at other houses, working out finances, and two previous pre inspections.

Funny how you cherry picked and only highlighted this one transaction. Are you suggesting there are no transactions that take less than 20 hours beginning to end? I’ve purchased/sold several homes both with realtors and on my own with a flat fee attorney. Realtor fees should be by the hour. $750 an hour will motivate buyers to be more precise with their search.

More like 75 cents an hour. We handed our agent the key to our house and she had it painted, floors refinished, deck and some other repairs done, had a new garage door installed, carpet cleaned in the basement, and had windows and house cleaned. She had the house staged and had photos, floorplans, and a tour done. She spent three hours sitting on her ass at an an open house and then made us respond to offers a few days later. She didn’t do anything after that except meet the appraiser, termite inspector, and our movers. She spent maybe a couple hours making sure the movers got everything out of the house and then took all our old paint to the County. She spent a lot of time with the settlement because we were in two places. For that she made over $9,000. She should have gotten $750 for the little she did. My neighbors were all impressed but she didn’t do any of the work

You're saying this isn't a lot of work to do and arrange? Why didn't you arrange any of these things?

We had moved and I didn’t want contractors on my house until we were out. Again, she did not do any of the work. She only made sure it got done.

[Anonymous]

So long overdue.

1% for seller's agent; maybe ½% for buyer's agent.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:The DoJ is coming after you next:

https://www.wsj.com/articles/warning-to-the-real-estate-cartel-11625783854

Finally, hopefully consumers can get away from this ridiculous system that compensates brokers exorbitant sums of money for only a few hours of work. TBH, a vast majority of the process could probably be largely automated for a $20 fee anyway. Ridiculous US consumers have so much wealth destroyed from insane fees, or are forced to buy less because of fees.

Funny, I did a 5 hour home inspection today with a lawyer who is involved in this case. Guess, I don't have to day anything else, and we will forgot about the twenty plus hours I spent with him at other houses, working out finances, and two previous pre inspections.

Funny how you cherry picked and only highlighted this one transaction. Are you suggesting there are no transactions that take less than 20 hours beginning to end? I’ve purchased/sold several homes both with realtors and on my own with a flat fee attorney. Realtor fees should be by the hour. $750 an hour will motivate buyers to be more precise with their search.

For comparison, commercial real estate lawyers with ten years of experience and degrees from Harvard, etc. working on $10-50 million deals usually charge less than $750.

For a real estate agent, $200 is probably more reasonable.

No lawyer who ordinarily works on $10-50 million RE deals is charging less than $750 for their services (unless you're talking by the hour).

You mind sharing whatever it is you're smoking? It's the weekend, after all...

I’m a 7th year associate at a biglaw refugee boutique and my rate is $750/hr. Suspect PP’s rate is out of date.

Biglaw and boutique are two different things.

You’re confused. I’m saying even at my boutique, that I left biglaw for, I am billing at $750/hr with less than 10 years experience.

I am PP here. I've done these deals for years. I am in-house. I negotiate rates. There are firms that do deals of these size for all sorts of rates. We've paid anywhere from $300 - $1100 per hour. Depends on the work and person.

The $300 guy actually did a fine job on what we hired him for. He's up to $320 now. Seems under market to me. For people who can quarterback a whole big deal you can still get them at about $600 per hour. Midlaw. This was a $200 million new construction deal. Biglaw is more but the people we hired did great and the building went up.

Of course I'm talking hourly. Total bills can be $100k plus, but generally speaking the people we work with earn it.

Anyways, moral of this story is that residential real estate agents are way overpaid.

[Anonymous]

Anonymous wrote:

Anonymous wrote:What are you prattling on about? A “few hours of work?” What are you smoking that gives you such delusions?

GMAFB

We went to open houses allllll on our own accord. Zillow and Redfin made that information easy to find. Our agent showed us two houses during times that weren't during open houses, that was it. We put in an offer on a house after looking at an open house. The RE agent pretty much filled in a boilerplate template for a contract with our names and that was it. There's no way he spent more than 24 hours let alone a full work week worth of work into our purchase. The RE fees for both sellers and buyers will total to something like $30k+. For what? Consumers doing all of the work online and filling out a template offer sheet with a few clicks of a button? The brokers just used rocket mortgage to get us a mortgage.....I could have done that. Almost $40k in added in total fees for almost no added value. The internet has made the RE biz a dinosaur of the past. You can easily find comps and all of the meta data for evaluating properties easily online with a little bit of effort. It's sooooooo ridiculous what Americans pay in fees compared to the rest of the world.

+100. The amount RE agents charge is ridiculous. This needs to come down. Very high commission for doing very little work and there is no education needed to be an agent.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:The DoJ is coming after you next:

https://www.wsj.com/articles/warning-to-the-real-estate-cartel-11625783854

Finally, hopefully consumers can get away from this ridiculous system that compensates brokers exorbitant sums of money for only a few hours of work. TBH, a vast majority of the process could probably be largely automated for a $20 fee anyway. Ridiculous US consumers have so much wealth destroyed from insane fees, or are forced to buy less because of fees.

Funny, I did a 5 hour home inspection today with a lawyer who is involved in this case. Guess, I don't have to day anything else, and we will forgot about the twenty plus hours I spent with him at other houses, working out finances, and two previous pre inspections.

Funny how you cherry picked and only highlighted this one transaction. Are you suggesting there are no transactions that take less than 20 hours beginning to end? I’ve purchased/sold several homes both with realtors and on my own with a flat fee attorney. Realtor fees should be by the hour. $750 an hour will motivate buyers to be more precise with their search.

More like 75 cents an hour. We handed our agent the key to our house and she had it painted, floors refinished, deck and some other repairs done, had a new garage door installed, carpet cleaned in the basement, and had windows and house cleaned. She had the house staged and had photos, floorplans, and a tour done. She spent three hours sitting on her ass at an an open house and then made us respond to offers a few days later. She didn’t do anything after that except meet the appraiser, termite inspector, and our movers. She spent maybe a couple hours making sure the movers got everything out of the house and then took all our old paint to the County. She spent a lot of time with the settlement because we were in two places. For that she made over $9,000. She should have gotten $750 for the little she did. My neighbors were all impressed but she didn’t do any of the work

Aren't you funny. I've bought and sold many houses and have employed different agents for everyone. I have never had an agent do any of these things you've documented. I had to deal with our appraiser who made a serious mistake in our documentation in which he left information on a page related to a different house. My agent did nothing. No one I know has ever had an agent do more than the minimum. Anyone can become a agent.

PP’s description sounds a bit over the top, but last time we sold, our agent took care of hiring painters, somebody to put in new countertops, photos, staging, new carpets, cleaning, re-glazing the tub, and probably other stuff I’m forgetting. We paid her 2.5% of the sale price (the buyer’s agent got the other half). I still think it was a lot for the work put in, but honestly, it would have taken me so much longer to find the right people to do the work and be around for all the appointments. We probably got to market earlier and sold faster because of her work.

They are charging you for it and it is not coming out of their commission. Also, not sure if you know but RE agents get referral fees to get them your business. They are getting paid from both side.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:The DoJ is coming after you next:

https://www.wsj.com/articles/warning-to-the-real-estate-cartel-11625783854

Finally, hopefully consumers can get away from this ridiculous system that compensates brokers exorbitant sums of money for only a few hours of work. TBH, a vast majority of the process could probably be largely automated for a $20 fee anyway. Ridiculous US consumers have so much wealth destroyed from insane fees, or are forced to buy less because of fees.

Funny, I did a 5 hour home inspection today with a lawyer who is involved in this case. Guess, I don't have to day anything else, and we will forgot about the twenty plus hours I spent with him at other houses, working out finances, and two previous pre inspections.

Funny how you cherry picked and only highlighted this one transaction. Are you suggesting there are no transactions that take less than 20 hours beginning to end? I’ve purchased/sold several homes both with realtors and on my own with a flat fee attorney. Realtor fees should be by the hour. $750 an hour will motivate buyers to be more precise with their search.

For comparison, commercial real estate lawyers with ten years of experience and degrees from Harvard, etc. working on $10-50 million deals usually charge less than $750.

For a real estate agent, $200 is probably more reasonable.

No lawyer who ordinarily works on $10-50 million RE deals is charging less than $750 for their services (unless you're talking by the hour).

You mind sharing whatever it is you're smoking? It's the weekend, after all...

I think most of us understood that this was $750/hour. Let’s be generous and say a realtor puts in 40 hours in selling a $1M house, earning a $50k commission. That amounts to $1250/hour. Realtors don’t have nearly the education, experience or knowledge that a lawyer does, but they get away with charging these fees due to their lobby. This has to end.

There should be a small flat fee for this work. It is ridiculous that they suck people's hard earned money like this. It is a cartel and need to be broken. Also, why should seller pay for buyer??