Anonymous wrote:

If I'm paying someone $200/hour, they better have a lot more letters after their name than "B.A."

As a teacher with an advanced degree (who makes less than half of that), I cannot pay someone with a high school diploma (which is what many of them have) $200 an hour. I don't think it's rocket science to get the RE licensure.

It’s harder than you think and actually involves a lot of weird math

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I was not in a contract to buy a property with my RE agent but the demand for money just keeps on going up. We decided to put an offer on a property that we really like. We verbally spoke before about the fees and commissions and she agreed that there won't be any additional charges. When I saw her contract, there were about $2700 worth of additional fees on top of she getting her commission of 2%(for $1.3M property). She disclosed that additional charges are for documentation, administrative and travel fees to the closing office, etc. I asked her to take it off and she refused so I decided to not use her and found someone who gives some credit back from his commission. I don't understand why these agents need to start charging additional fees when commission is already healthy?

Good for you! I'm doing the same. Turned down two agents who refused to budge on 2% fee. Interviewed 3 others, one offered 1%, one offered hourly rate, and still waiting to hear from the last one. Not sure if this was a coincidence but the two who insisted on 2% were older (60+), the kind of realtors who don't really need the money or worry about building a career, just coasting on established reputation/monopoly in a certain neighborhood. Most younger, mid-profession realtors will negotiate if they dont want to be competed out.

CHANGE IS COMING. THANK GOD!!!

Smart agents will charge the hourly fee without having it contingent on closing. So, if they're charging $200 an hour and they spend 10 hours with them, you will owe them $2,000 whether or not you ever put an offer on a property. That's where I see this settling: Hourly billing like a lawyer, likely with a retainer collected up front.

This will also reduce the casual shopping.

Keep in mind a lot of them will collect that hourly fee from companies relocating employees, etc.

I can't see individual families are agreeing to this. Houses fall through, offers don't get accepted, buyers discover they house is no good after inspection, etc. Buyers with a set amount of money they can afford to spend don't want to see it pissed away during the home search process. Yeah, i'd rather go with the seller's agent and get a RE attorney who I can top into to help me along the way if needed.

+1 I'm not spending a dime on a realtor when I'm looking to buy. Buyers agents are going the way of the buggy whip.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:If I'm paying someone $200/hour, they better have a lot more letters after their name than "B.A."

Well that is what most plumbers, electricians, and other tradespeople charge these days. With that said, all of those people perform services that I cannot perform on my own. Not so for real estate agents.

I can perform electrical and plumbing services in my own house but still pay others to do it. Similarly, I could change my own oil on my car but pay someone else to do it. Heck, most automotive services can be done at home, but we pay mechanics to do them.

That was a bad analogy. You probably could not get a real estate transaction to settlement easily. I realize you THINK you could. But you probably couldn't, especially if anything out of the ordinary happened.

OK, maybe I should have said that I would not feel comfortable doing plumbing, electrical, or car mechanic work. I suppose I could learn any of those things with enough time.

As for getting a RE transaction to settlement, I did do it by myself when I bought my current house about 10 years ago. Had no buyer's agent at all, and didn't rely on the seller's agent for anything (except to agree to give me the commission that would have gone to the buyer's agent). Paper shuffling and calling a few people is all it took. That, to me, is different than the manual labor and skill involved in the trades, but others might feel differently. The great thing is that we now all have the option to determine whether to use a buyer's agent or not, and if so, how much to pay them. It was not necessarily easy for me to get the seller's agent to give the commission to me when I didn't have a buyer's agent, so I'm glad it will be more straightforward going forward.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I was not in a contract to buy a property with my RE agent but the demand for money just keeps on going up. We decided to put an offer on a property that we really like. We verbally spoke before about the fees and commissions and she agreed that there won't be any additional charges. When I saw her contract, there were about $2700 worth of additional fees on top of she getting her commission of 2%(for $1.3M property). She disclosed that additional charges are for documentation, administrative and travel fees to the closing office, etc. I asked her to take it off and she refused so I decided to not use her and found someone who gives some credit back from his commission. I don't understand why these agents need to start charging additional fees when commission is already healthy?

Good for you! I'm doing the same. Turned down two agents who refused to budge on 2% fee. Interviewed 3 others, one offered 1%, one offered hourly rate, and still waiting to hear from the last one. Not sure if this was a coincidence but the two who insisted on 2% were older (60+), the kind of realtors who don't really need the money or worry about building a career, just coasting on established reputation/monopoly in a certain neighborhood. Most younger, mid-profession realtors will negotiate if they dont want to be competed out.

CHANGE IS COMING. THANK GOD!!!

Smart agents will charge the hourly fee without having it contingent on closing. So, if they're charging $200 an hour and they spend 10 hours with them, you will owe them $2,000 whether or not you ever put an offer on a property. That's where I see this settling: Hourly billing like a lawyer, likely with a retainer collected up front.

This will also reduce the casual shopping.

Keep in mind a lot of them will collect that hourly fee from companies relocating employees, etc.

I can't see individual families are agreeing to this. Houses fall through, offers don't get accepted, buyers discover they house is no good after inspection, etc. Buyers with a set amount of money they can afford to spend don't want to see it pissed away during the home search process. Yeah, i'd rather go with the seller's agent and get a RE attorney who I can top into to help me along the way if needed.

Anonymous wrote:If sellers can’t disclose commissions then the only thing that makes sense going forward is buyers just paying buyer agents an hourly fee.

I don’t see anyone functions otherwise.

Sellers can disclose commissions. They just can't advertise buyer agent compensation on MLS.

This means Commission-Based Steering is still a thing, which is why the DOJ/FTC is still pursuing the real estate industry.

I have bought and sold around 8 homes in my lifetime. I think realtors certainly have value, even buyer's agents. Keep in mind that agents who don't own their business usually get about 33% of the fees they charge. 66% goes to their brokerage/company.

Anonymous wrote:

Anonymous wrote:Agent here. Last weekend was the first weekend the commission change became real for agents. I am offering 1% to buyer agents on listings and any additional can be paid by the buyer or negotiated with the seller.

In three multiple offer situations, the three agents who wanted only the 1% commission got the deal. The offers were similar and the sellers took the offers that netted the must to them. Agents were angry but I told them that our industry had done it to them. If they want to succeed, they have to prove their worth to buyers and get paid by buyers.

I think agents, be it on the buyer or seller side, are extremely useless and have no value, especially in a market like ours (houses sell themselves, effectively). They are, effectively (especially in this country given high commissions) leeches on society. So you saying that about other agents is ironic af.

Out of curiosity, if you offered 1% how much did you take? The 2.5 or were you greedy and took 4.

DP: Smart mouth, but do not understand there is no "2.5 or .....4." It is a violation of the anti-trust laws to state there is a standard commission in real estate.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:If I'm paying someone $200/hour, they better have a lot more letters after their name than "B.A."

Well that is what most plumbers, electricians, and other tradespeople charge these days. With that said, all of those people perform services that I cannot perform on my own. Not so for real estate agents.

I can perform electrical and plumbing services in my own house but still pay others to do it. Similarly, I could change my own oil on my car but pay someone else to do it. Heck, most automotive services can be done at home, but we pay mechanics to do them.

That was a bad analogy. You probably could not get a real estate transaction to settlement easily. I realize you THINK you could. But you probably couldn't, especially if anything out of the ordinary happened.

Just stop. The trades require an actual skill. A real estate agent has no skill. If something goes south they are woefully unable to do anything. To limit liability, real estate agents are not allowed to do many of the things that would be useful like permit searches, advice on contract or changes or other legal matters. They are specifically disallowed from doing anything beyond bull crap because they are not skilled or licensed for anything useful.

If I'm paying someone $200/hour, they better have a lot more letters after their name than "B.A."

As a teacher with an advanced degree (who makes less than half of that), I cannot pay someone with a high school diploma (which is what many of them have) $200 an hour. I don't think it's rocket science to get the RE licensure.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:If I'm paying someone $200/hour, they better have a lot more letters after their name than "B.A."

Well that is what most plumbers, electricians, and other tradespeople charge these days. With that said, all of those people perform services that I cannot perform on my own. Not so for real estate agents.

I can perform electrical and plumbing services in my own house but still pay others to do it. Similarly, I could change my own oil on my car but pay someone else to do it. Heck, most automotive services can be done at home, but we pay mechanics to do them.

That was a bad analogy. You probably could not get a real estate transaction to settlement easily. I realize you THINK you could. But you probably couldn't, especially if anything out of the ordinary happened.

PP doesn't have to get the deal to settlement alone. The seller is paying their own realtor to do that and there's a SETTLEMENT company to handle the legal aspects.

Anonymous wrote:

Anonymous wrote:If I'm paying someone $200/hour, they better have a lot more letters after their name than "B.A."

Well that is what most plumbers, electricians, and other tradespeople charge these days. With that said, all of those people perform services that I cannot perform on my own. Not so for real estate agents.

I can perform electrical and plumbing services in my own house but still pay others to do it. Similarly, I could change my own oil on my car but pay someone else to do it. Heck, most automotive services can be done at home, but we pay mechanics to do them.

That was a bad analogy. You probably could not get a real estate transaction to settlement easily. I realize you THINK you could. But you probably couldn't, especially if anything out of the ordinary happened.

Anonymous wrote:Hourly fees won't be this high and buyers will get smart about using them. They will do more of their own HW before reaching out to agents. I don't see any value in them getting even 1%.

Well, of course you think that, because you're one of these internet people who fancy yourself an expert on something and don't think they bring value. But they do. I have no idea what hourly fees will be -- my guess is there will be a range and you'll get what you pay for.

No, I'm not an agent or in any way connected to the industry. It's just annoying when people so rudely assume they know more than people who do something for a living.

Anonymous wrote:If I'm paying someone $200/hour, they better have a lot more letters after their name than "B.A."

I mean, that's just you. Who knows where they'll settle but they have licensure, etc. and it doesn't seem wildly out of proportion what you can expect.

Remember also that they don't get that entire $200. They might net half or less after the split with their brokerage. Although who knows how THAT compensation structure will change.

Hourly fees won't be this high and buyers will get smart about using them. They will do more of their own HW before reaching out to agents. I don't see any value in them getting even 1%.

Anonymous wrote:If I'm paying someone $200/hour, they better have a lot more letters after their name than "B.A."

Well that is what most plumbers, electricians, and other tradespeople charge these days. With that said, all of those people perform services that I cannot perform on my own. Not so for real estate agents.