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Started By
Message
re: National Association of Realtors agrees to end 6% commissions
Posted on 3/15/24 at 11:15 am to TejasHorn
Posted on 3/15/24 at 11:15 am to TejasHorn
Found this in a WSJ article:
That's a big hit. Will impact my sister who's a newish realtor without an established customer base.
WSJ
quote:
The rule changes make the industry newly vulnerable to the forces of technological change that have driven down fees for travel agents and stockbrokers. The current standard commission—5% to 6% of the purchase price, split between the seller’s agent and the buyer’s agent—is among the highest in the world.
The changes also require many real-estate agents that work with buyers to sign agreements with their clients about what services they will provide and how much they will be paid.
If fewer buyers use their own agents, that could push some agents out of the industry and lead to a decline in NAR’s membership. NAR has 1.5 million members, known as Realtors. Ryan Tomasello, a real-estate industry analyst with Keefe, Bruyette & Woods, has predicted that the lawsuits could eventually lead to a 30% reduction in the $100 billion that Americans pay annually in real-estate commissions and reduce Realtor head count by more than half.
That's a big hit. Will impact my sister who's a newish realtor without an established customer base.
WSJ
This post was edited on 3/15/24 at 11:18 am
0
Posted on 3/15/24 at 11:16 am to Dawgfanman
My house listed and had a purchase agreement done within a week. 1 open house and a handful of showings. They walked through the house and told us how to arrange furniture. Communicated with buyers agent a few times. And was present at the closing.
All this “hard work” and both got 2.5% on a $350k sell……
Factor in closing costs on your next buy, most people lose money on moving it they haven’t lived in the house for years.
All this “hard work” and both got 2.5% on a $350k sell……
Factor in closing costs on your next buy, most people lose money on moving it they haven’t lived in the house for years.
Posted on 3/15/24 at 11:16 am to billjamin
quote:
Can't wait for the thirsty housewife realtor posts to get even more thirsty. Let me sell you house y'all!
Marry the house, date the realtor
Posted on 3/15/24 at 11:17 am to TejasHorn
quote:
The 6% commission, a standard in home purchase
This was never the standard
Posted on 3/15/24 at 11:25 am to Tarps99
quote:That's ridiculous. I've sold two homes and bought two others all without any realtor. It's not that difficult and certainly not worth 15k.
15k per transaction
Posted on 3/15/24 at 11:28 am to PeteRose
quote:quote:So on an average 300k house, the homeowner is on the bill for 30k not counting potential repairs and closing costs? Are you out of your mind?
A realtor who is established and provides exceptional service should be able to charge 10% for it.
I think y’all are way too focused on the 10% example and are missing his larger point:
quote:
There shouldn’t be a set standard or rate.
He’s right. Commissions should be based on the value that the realtor provides, not fixed by the industry.
Right now (as I understand it) there’s basically a standard 6% commission on all listings, and the seller’s agent pre-determines the “split” to the buyer’s agent when they list the property. But the seller pays the full 6% regardless, and the split is basically a kickback from the seller’s agent to the buyer’s agent.
It’s a fricked up system that is bad for competition (but good for realtors) in multiple ways. Instead, there should be two deals - one between the seller and his realtor, and another between the buyer and his realtor.
Kickbacks from the seller’s agent to the buyer’s agent shouldn’t even be legal as it creates a conflict of interest where the buyer’s agent is incentivized to look for the best commission (based on property value x split %) rather than the best property. It probably makes more sense for buyers’ agents to use a flat fee system or even a system where the commission % drops off as property value increases, to incentivize the best deal. Either way the market should determine the best pricing method, not NAR.
Meanwhile sellers’ agents should be able to charge more if they’re really fricking good at their jobs, or forced to charge less if they are worth less. The seller’s agent (and by extension the seller) shouldn’t have to pay a kickback to the buyer’s agent to get them to pitch the property. Again, this shouldn’t even be legal.
It sounds like this will all change assuming the settlement gets approved by the judge.
Posted on 3/15/24 at 11:30 am to LSUGUMBO
You will pay at most around $500 for quality real estate photography. That in of itself is probably the most important factor when listing your home, outside of accessing MLS database. Being able to have your info out there in 2024 and beyond is how people will find your house. You really don't need someone to sell your house online because there are people who will look form a computer to find it. And again, I think that's why people have problems with realtors. 2% on $200k is $4,000. And for what is the realtor doing? Nothing that can't be figured out by an average person who uses google on "how to FSBO".
Posted on 3/15/24 at 11:31 am to Weekend Warrior79
quote:It's because they don't REALLY care about getting you a higher price. All they care about is doing ANY transaction.
I thought it was strange the percentages weren't flipped to incentivize her to try to get a higher price, but this is what I envision their commission rates moving to.
Posted on 3/15/24 at 11:32 am to Weekend Warrior79
quote:
Market value was $135k, we sold for $120k.
Cheapest condos in my area are $300,000.
I want to cry
Posted on 3/15/24 at 11:32 am to TejasHorn
Realtors are not a necessity and people selling homes should do everything possible to not use one on both buyer and seller side. Waste of money.
Posted on 3/15/24 at 11:36 am to mattz1122
quote:
National Association of Grifters
How are they grifters? They aren’t tricking anyone into paying them something they weren’t aware of. You know what you’re getting into with a realtor, no?
Posted on 3/15/24 at 11:37 am to TejasHorn
I've always talked about this. Why on earth would you as a realtor not lower your percentage to move more volume and get more clients?
Posted on 3/15/24 at 11:39 am to TejasHorn
Good, maybe the huge amount of unemployed realtors can fill in the huge teacher and nurse shortages we have. Contribute more instead of screwing over working families.
Posted on 3/15/24 at 11:41 am to Limitlesstigers
quote:
Good, maybe the huge amount of unemployed realtors can fill in the huge teacher and nurse shortages we have. Contribute more instead of screwing over working families.
Gatekeepers (with good reason for nurses) will ensure those careers are always in a shortage. Teacher shortage could be fixed by a combination of actions on the part of state DOEs and universities.
Posted on 3/15/24 at 11:41 am to Limitlesstigers
quote:Teachers and Nurses require education. Realtors are mostly plugs with no formal education and their little certificate.
Good, maybe the huge amount of unemployed realtors can fill in the huge teacher and nurse shortages we have. Contribute more instead of screwing over working families.
Posted on 3/15/24 at 11:42 am to TejasHorn
Here's what you need to know:
--Realtors are largely indifferent to getting you a good price. They hide behind the nominal logic of it (higher price means more for me!) But the reality on the ground is ANY transaction is great for them. (Quick example - $500K home @ 3% = $15K. $525K home that they really busted their arse to get you that price = $15,750. I'll leave it up to you to decide if these lazy corrupt assholes want to really put their shoulder to the wheel for you for an extra $750.
--Based on first bullet point, you can see that the best set up is to pick what I call a "deaf dumb and blind" amount (that is ANYONE could sell the house for this) and give them maybe 1% on that in order to do functionary items like paperwork, etc.) In this example, let's say that amount is $450K. Then, you can give them an iterative 2% for the next $50k above that, 3% above that, etc.
--The ridiculous trope that "the seller pays all the fees" used by the buyers' agents needs to continue to be exposed for the dishonest claptrap that it is. The buyer writes 100% of the transaction checks, so it's entirely clear that they should not be indifferent to the fees.
--In a more balanced market, once can make a rational case for both agents adding SOME value (not 3%). But in one-sided markets (super hot or super cold), it should be abundantly clear that both sides do not and cannot. e.g. in a crazy sellers' market, listing agents provide next to no value.
--This is a cartel that has been amazingly durable - surviving internet 1.0 and 2.0. It will not survive the AI boom
--Realtors are largely indifferent to getting you a good price. They hide behind the nominal logic of it (higher price means more for me!) But the reality on the ground is ANY transaction is great for them. (Quick example - $500K home @ 3% = $15K. $525K home that they really busted their arse to get you that price = $15,750. I'll leave it up to you to decide if these lazy corrupt assholes want to really put their shoulder to the wheel for you for an extra $750.
--Based on first bullet point, you can see that the best set up is to pick what I call a "deaf dumb and blind" amount (that is ANYONE could sell the house for this) and give them maybe 1% on that in order to do functionary items like paperwork, etc.) In this example, let's say that amount is $450K. Then, you can give them an iterative 2% for the next $50k above that, 3% above that, etc.
--The ridiculous trope that "the seller pays all the fees" used by the buyers' agents needs to continue to be exposed for the dishonest claptrap that it is. The buyer writes 100% of the transaction checks, so it's entirely clear that they should not be indifferent to the fees.
--In a more balanced market, once can make a rational case for both agents adding SOME value (not 3%). But in one-sided markets (super hot or super cold), it should be abundantly clear that both sides do not and cannot. e.g. in a crazy sellers' market, listing agents provide next to no value.
--This is a cartel that has been amazingly durable - surviving internet 1.0 and 2.0. It will not survive the AI boom
Posted on 3/15/24 at 11:43 am to BilbeauTBaggins
quote:
And again, I think that's why people have problems with realtors. 2% on $200k is $4,000. And for what is the realtor doing? Nothing that can't be figured out by an average person who uses google on "how to FSBO".
You could say this about almost any industry? Why should I pay a contractor 20%+ to build a deck, I can just google building a deck and get it done myself right?
Its not always that easy.
The biggest issue with Real Estate that I don't know the answer to is its not a 9-5 M-F. You guys complaining about the commission are justified but who is going to show a house at 7pm on a friday night and 9am on a Sunday morning? The shite hours are worth something, and unfortunately that's a lot more than most people are willing to admit.
You want to close a deal this Sunday evening before the deadline Monday? How much do you think a lawyer would charge to make his arse come in and get it done? lol
Posted on 3/15/24 at 11:47 am to TejasHorn
Realtors are trash for the most part. For every decent one, there are about 50 shitty ones. The worst are the husband/wife teams.
Posted on 3/15/24 at 11:48 am to frequent flyer
Ignorant statement “frequent flyer”
Do you know how many deals Realtors “work” that never close?
Get all the way down to the wire & funding falls thru, inspections crush the deal?
Negotiations, offers, counter-offers, everyone is stressed out mea I g buyers and sellers.
And basically, the Tealtor doesn’t truly have any time off. Being that most clients want to “go see house” on weekends when they are off of work and/or “after work”.
Look, most Realtors are some pretentious pricks, but to say that they “don’t work” or they don’t work for their money when is just ignorant and/or stupid!
Do you know how many deals Realtors “work” that never close?
Get all the way down to the wire & funding falls thru, inspections crush the deal?
Negotiations, offers, counter-offers, everyone is stressed out mea I g buyers and sellers.
And basically, the Tealtor doesn’t truly have any time off. Being that most clients want to “go see house” on weekends when they are off of work and/or “after work”.
Look, most Realtors are some pretentious pricks, but to say that they “don’t work” or they don’t work for their money when is just ignorant and/or stupid!
Posted on 3/15/24 at 11:50 am to BigPerm30
quote:
Or they could do like most every countries and charge an hourly rate for their services depending on how much you use them.
Man you would lose 80% of realtors. The fact of the matter is they are paid an asinine amount of money per hour
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