I agree - especially for the last few years, when in order to sell a house all you had to do was put in on the market - and then get 10-15-20 offers at or above listing price - no agent deserves a 6% commission for simply getting something listed on zillow or MLS where in recent years, the houses just sold themselves.
> no agent deserves a 6% commission for simply getting something listed on zillow or MLS
Typically 3% is seller agent commission and 3% is buyer agent commission - although in the paperwork it's most likely 6% to the seller's agent and the seller's agent offers 3% to the buyer's agent.
Although 5% total / 2.5% to each realtor is becoming a bit more popular as of recent, based on the listing I browse.
I encourage you to report any behavior you believe to be illegal or unethical to both your local realtor association as well as your state agency. That’s why those organizations exist and we are all better if people are held to professional standards.
More like the selling realtor “forgetting” to take a call from a competing buyers agent and keeping it in-house. It happens all of the time and cost the sellers money.
There’s also many scenarios where real estate folks steer certain ethnicities or religious practitioners away from some areas.
As said earlier, any and all discrimination is illegal/unethical and there are checks in place to prevent it from proliferating. Anyone who is a victim can report a HUD fair housing complaint form, contact their local state's office of fair housing, or contact their local Association of REALTORS® to report an ethics violation.
And people do report:
> The most important finding of this report is that the number of housing discrimination complaints increased significantly in 2021, despite the fact there were fewer agencies reporting complaint data. There were 31,216 housing complaints in 2021, an 8.7 percent increase over the number of complaints filed in 2020. At the same time, there were seven fewer agencies that reported data in 2021 than in 2020. Had all fair housing agencies been able to submit their data, undoubtedly the number of reported fair housing complaints would have been even higher.
I don't understand why people don't negotiate more on this. I paid 3.5% total commission (1.5% listing and 2% buyer agent) on the last 2 homes I sold. One in 2012 and one earlier this year. In both cases the homes sold quickly and above asking.
My understanding is that in some markets if you try to negotiate anything less that 6% you're just blacklisted. They lock arms and no one will accept it.
That’s only true if you are in a competitive market. There is a whole swath of land in flyover country and rural America where it can take awhile to sell a house.
Outside cities, yes, but there also aren't many houses there.
In flyover country, in the cities, it's been "OMG, this house just came on the market four hours ago... quick, send a full offer! Damnit, they already sold it for $20k over asking, again?!?!" for years, only letting up recently.
[EDIT] And I don't just mean like Chicago and Minneapolis, either—any metro area a million or larger, it's probably been like that, and even in some of the smaller ones.
Is that still the case? I feel like rural markets have really boomed in the last few years. At least I'm seeing that in the southeast. Maybe "flyover country" is different.
I mean yes, it's sort of tautological that if you are trying to sell a home in a place very few people want to live, it might be (but isn't by definition!) harder to sell than someplace where a lot of people want to live.
Commissions for the seller's relator are fine, but they shouldn't be based on the full price of the house. This setup encourages quick sales rather than getting the best price. Instead of the realtor earning 3% on a $1,000,000 house, set a base amount at, say, $700,000 and calculate the commission only on the remainder - 10% on $300,000. The same principle should apply to the buyer's agent but in reverse or there should be a flat fee. Their current incentive structure is totally screwed up.
I expect that when it comes time to sell my house, I'll hire a real estate attorney to make sure all the paperwork is in order, and I'll deal with the rest myself. I engaged an attorney when I bought my house, and she was super thorough.
Attorneys are so ridiculously cheap compared to the realtors. In my area there are discount real estate attorneys that will do sales/purchases for $200, and the normal price is like $500 which is nothing compared to the real estate agents getting like $10k on an average home in the area.
I've sold 4 houses "by owner". I didn't even use an attorney for 3 of them - just a title/escrow service who take care of handling the deposit, filing the deeds after the funds transfer is complete etc.
buying a house, I would want an attorney - selling the house, I agree, no need for a realtor or attorney if you are willing to do a bit of work yourself.
You can. It's just a bit of a racket (hence, conspiracy judgment) and nobody will work with you if you only offer a flat rate. Since MLS is mostly limited to Realtors in most markets, you're basically locked out from posting there.
There's ways around it, and flat fee brokers that exist, but you hamper your sales ability. Not an issue when its a sellers market, but can be rough in a buyers market.
There are flat rate realtors where I live. However they are only 50%, the still give the same 3.5% to the buyers agent, but they take for themselves a fixed rate to get you on MLS. I'm not sure if it is a good deal - they still charge high prices relative for what they do for you. (it is cheaper than a full agent, but they also do much less)
You just don't sign a contract where you give a buyers agent commission, although again this limits the pool. Frankly, buyers agents are largely a scam in my view. With MLS, Zillow, Redfin, etc, their 'experience' seems mostly worthless. It certainly is not worth 3% of the cost of a house.
If anything, sellers agents are more useful since they actually offer something valuable to the real estate experience (e.g., listing housing, photos, providing buyers access, etc).
Buyers agents know better how to search the MLS system (though only a few do this). They also line up times to see houses, and take time to drive you to each. So a good buyers agent has spent about 8 hours of time to each buyer, plus expenses. I agree they are getting far too much, but they still are valuable.
All of those things seem to be pretty simple and worth barely of fraction of $2000 per hour (if they actually only spend 8 hours in total? I mean at that point it might make sense to spend 40-80 hours to do the same things yourself instead depending on your income).
Agreed. Add to the fact if you're a seller agent the money is easy. A buyer's agent struggle. AFAIK usually you start out as a buyer's agent and build up a network/reputation before people trust you to sell.
In a seller's market, seems like a buyer's agent should be compensated more because it's more difficult to win bids now.
I’d be willing to pay a percentage above some predetermined price (e.g. if the realtor produces some sort of above market outcome) - but agree, that the value provided does not equal 3-6% of home value
So why downvote me? We've got this already in our buyer's agency agreements - if you as a buyer want to negotiate compensation with your agent, you have the ability to do that. Similarly, in both states where I work, you as a seller have had the ability to choose what, if any, compensation you want to offer to a buyer's broker. None of this is actually that different from how you negotiate (or not) with any other professional - your lawyer, your accountant, your financial advisor, etc.
Negotiation is not an effective strategy when there is active collusion to fix prices. You are commenting on a story where a jury just found that had been systematically done.
> If you're selling a $2M house, you're willing to pay more for someone to get you a good price.
That sounds very last-century... kinda like selling antiques to a pawn shop or consignment store that would take of finding a buyer.
Why does discovery and bidding justify $200k in overhead for the $2MM property? Why does a person need to go out and "find a buyer"?
Without this Realtor conspiracy, surely something like Redfin meets eBay would be more efficient? Posting online is what the cast majority of realtors do anyway, they don't actually "find" buyers... At least until you get to 1%er prices where golf club chats matter
Heck, this racket gates even access to standardized legal forms that states themselves should freely offer.
