WSJ: Beware real estate cartel

[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

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

Exactly. You are also missing the hours she spent on thr brochure, hiring the photographer, doing the paperwork, etc. I spent a summer working for a top agent and there was tons of behind the scenes work. She would often be responding to emails non-stop until 11 at night and start at 6 again the next am. She made it look seamless so her clients didn’t see the million fires going on behind the scenes.

That thread on sketchy sellers on the bay had hundreds of shocked responses. We saw stuff like that a lot and the agent worked to protect the clients and keep it from getting as far down the line as that one did. Not saying there are not some awful agents - there are. I do believe without the good agents you’d have a ton of stuff like that bay house issue. Also, every time I see a settlement w/ a Redfin agent, there are issues and for the most part their clients got a worse deal than if they had paid the full commission and used an agent that actually was tops in their area

[Anonymous]

Anonymous wrote:So long overdue.

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

There are bunch of agents these days that just keep 1% and give you the rest from the buyer's commission. They are still making money so no need for a total of 5-6% commission.

[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.

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.

Yes, I paid for everything but the staging and photos, but it would have taken me a month or longer to get people to come out for the other stuff. That saved me at least $2000 my monthly costs. Worth it to have somebody manage it for me.

[Anonymous]

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

Not unlike the American Bar Association, the American Medical Association, the American Bankers Association, the various teachers unions, and that gem of all AIPAC.

[Anonymous]

Anonymous wrote:

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

Not unlike the American Bar Association, the American Medical Association, the American Bankers Association, the various teachers unions, and that gem of all AIPAC.

Just because there are many other corrupt organizations doesn't excuse NAR and the current super inefficient structure we have for buying/selling homes. End them all.

[Anonymous]

The real estate agent horde is probably the most powerful lobby in town. They are certainly at the top on expenditures. Throw in the number of agents that descend on the Hill and it’s an effective combo. And. They are total utter pigs.

[Anonymous]

https://www.nar.realtor/2020-nar-doj-agreement-regarding-mls-rules

NAR's response. Such drivel

[Anonymous]

It should be easier to sue the agents if you find them doing something fishy. The market should be open and any agent should be free to charge lower commission if possible.

[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.

You had a bad agent? Choose carefully...

[Anonymous]

Anonymous wrote:It should be easier to sue the agents if you find them doing something fishy. The market should be open and any agent should be free to charge lower commission if possible.

They are already free to charge whatever commission they want. Price fixing is illegal.

[Anonymous]

We had a very reputable agent with a presence in our market when buying our house. I liked her and she was informative, but I will admit I didn't see why exactly she deserved all that commission. We found the listings, not her. A few times she emailed us new listings, we'd already seen it on Redfin or CBmove. She helped with the offer paperwork itself and gave us a few names for inspectors and so forth, but that didn't translate into thousands in commission.

I can see how agents are more useful as a seller's agent rather than a buyer's agent so perhaps the commission should be restructured to give more to the seller's agent and less to the buyer's agent.

Even though the overall commission is ridiculously high and does not justify anything approaching 5% of the house value, I have a sneaking feeling that if commissions were cut back to 1-2% as found in other countries, it only results in house prices going up as people will take the savings and add it to the offers on their next house.

During our househunting search, we twice experienced the phenomena of a house being listed one afternoon, we immediately contact the agent who sets up a viewing the next morning, which was the "earliest available time" only to be told the next morning it was already under contract because another agent had managed to get their clients to view the house the night it was listed and sellers accepted their offer. That did leave a bitter feeling as we'd been told the earliest viewing wasn't until the next day. The agent admitted in those cases the buyer's agents and the seller's agents had connections or owed each other favors that they were able to sneak in their clients ahead of the pack and get an offer through. But I was also puzzled as to why the sellers would immediately take their offers without waiting a few days knowing there were surely other interested buyers who wanted to view the house the next day and could possibly make even higher offers.

[Anonymous]

I am an attorney and I have a real estate license on the side. People really fall for the Realtor marketing. I’ve told people I know that I will charge them a lower commission and they still go with a higher priced realtor because they think the person has “connections” in Bethesda or wherever. Little do they know that is total nonsense. Good luck to them!

[Anonymous]

Anonymous wrote:RE agents gets paid crazy amount of commission for having no skin in the game. In addition, I have found them really dishonest and would do anything to get a deal done; no wonder there is no trust in the community.

Everywhere else in the developed word pays 1-2% commission so why we need to pay 5-6%.

+1

"really dishonest" is generous

[Anonymous]

My realtor was absolutely useless. I got all the listings. She got us in with her access, of course, but I found the places online. She submitted our prefer. And then when things got awkward with the sellers (they didn’t do the agreed upon work, still had stuff in the yard and house on closing day, etc) she did NOTHING. The lady at the title company helped us work out a solution by holding money in escrow until they completed the clean out and agreed upon repairs. It made me so mad. And we corked over $15,000 for this “work”. At most, it was worth maybe $300. At MOST.

I agree with OP. Realtors are a scam.

[Anonymous]

Recently listed my condo for sale. First time ive sold a place in a long time. I was kind of shocked that the selling agent doesn't actually show the house to prospective buyers. They list on the MLS and sit back. Okay, so they don't actually do a showing, I figured they would at least get feedback and talk to the buyer/buyer's agent....nope, there's some ShowingTime app which exists for feedback, but out of dozens of showings I think we got 1 to provide comments.

The place wasn't selling, every time I tried to check in with the agent it was, "well the Facebook views are really high so we are doing a great job marketing it!" I understand that agents aren't magic and can't make a sale happen, but it sure felt like the seller's agent wasn't doing jack shit. biggest scam industry that exists.