I used to have several Realtors for Clients. Fired them all! Yes, 95% of them are pond scum. Mortgage brokers are almost as bad, but realtors really chap my ass!!! Arrogant shitheads!!!!!!!!!
But they are worthless for the most part. If the public was given access to the database for listing, instead it being self-regulated away from public access, 90% or more of realtors would have to find a real job. I have some experience in real estate, and I noticed two key traits. First of all, it's a brain numbing industry, little mental stimulation, just a used car salesman mentality. Second. it is full of scumbags, no loyalty, litte honesty. Most real estate investors of any real caliber dislike dealing with realtors and try to avoid them.
I would rather be a bum than a realtor. At least I would have a sense of decency. Most RE people are crooked in some way anyway, then again many stockbrokers are as well. But hey that's the way things are , everyone's fighting for their piece of the cake.
Does anyone else not think,irregardless of the fact that 99% of realtors are total scumbags,that 5-6% is a pretty steep fee to charge to sell your house? Maybe if they hadn't have been so greedy during the boom and cut their fees in half seeing as they were selling absurd amounts of property for absurd prices,people trying to sell now might be able to take more of a drop if they weren't getting stung by the realtor.No wonder people are dubious about buying a house,when the time comes to move it on its got to have appreciated by 5-6% just to break even. Apparently in the UK you can sell a house and the commissions will be as little as 1% of the sale price!
5-6% is a steep fee. But in any business deal it is not unusual for the person bringing the money to the table to get a fee of 5-7 %. In the case of the sale of a house you are bringing a buyer and their money for 2.5 to 3%. You could argue the buyer's brokers are underpaid. When people are new to an area an educated skilled buyers agent is easily worth the 3% to the seller. You have no idea how many buyers are liars. As a lawyer I thought real estate fees were too high until I tried to sell my own house. The truth is that price and the MLS and the internet put your house in front of potential buyers -- but buyers still want agents to get them the right house. (most of the time) In my opinion skilled seller's agents deserve about 5-7 grand for managing the typical transaction and dealing with sellers. Buyers agents easily earn the 2.5 to 3% they earn. I think they deserve 60 to 70% of the transaction fee. If you think realtors are overpaid - join them. If you do you might see things a bit differently. "Client" acquisition can be very stressful for the unskilled. Product knowledge is also important or your friends will not be of any use to you. If you set up a good pipeline and have good execution you can then be overpaid. Most agents fail. I also think NAR should take the heat because there are lot of unskilled agents calling themselves experts and specialists and everything else. The regulatory body should show some pride and prevent agents from making making unproven marketing claims.
These beefs about how you are getting screwed by Realtors is bullshit. Nobody is forcing you to use a Realtor to buy or sell a home. You can work directly with a buyer or seller any time you want. If you don't want someone driving you around and filling out legal docs (which you do NOT pay for as a buyer), then do it yourself. If you don't want a Realtor representing your home in a sale, then do it yourself, and deal directly with all the idiots who want to walk around your home and hassle you for months over price. Where's the problem? Bitching about Realtors being part of the problem with the housing market is like slamming short sellers for problems with the stock market. It only displays your ignorance about the industry.
I give the people in the Bloomberg article total cool points for the creativity of their scam. What a country!
Transaction fees for every other asset class have dropped drasitically with evolving technology and deregulation. With technology today realtors add the least amount of value and get the biggest piece of the transaction due to an antiquated, monopolistic model. Why do many still need a closing service and an attorney if realtors add so much value? True real estate professionals should work like any other professional, on a retainer and hourly system to have the best interest of their clients at hand. Additionally should have higher education and liscensing standards. Presently, an ever increasing underlying price of real estate is the primary means to upward income for realtors and skews any incentive for accurate price discovery in the process.
LOL! If you think for a moment that a typical home buyer or seller is going to pay a Realtor a retainer or hourly fee, you're smoking crack. Most Realtors would love that system because it will compensate them for the thousands of hours they devote to deals that never close, and wasting time and gas driving buyers around who really have no intention of buying. My wife is a successful Realtor here in Scottsdale, and I can tell you that it is most often a very tough business where one can work for weeks with no outcome. Even with her good income, I have no doubt that she'd prefer to be paid a professional fee by both her sellers and buyers. But it will never happen.
true - in an up market mistakes are covered - in a down market you need skilled attorneys to get the contracts correct. Not just bozo attorneys but ones how know what they are doing. In my opinion less than 20% of the Realtors and 20% of the attorneys really know how the transactions should work. Price discovery is easy - by the time a buyer sees 5-10 comparable homes they know what the asking price should be. it is the appraiser job to make sure asking prices and closed prices are consistent. Realtors rarely have any say in the final price. The market does that. If a realtors "buys" a listing by pricing too high - the realtor will have wasted everyones time and money in a a down market. An up market makes up for over pricing with time. Price and showings sells homes. You want to get as many potential real buyers to see your house. That is the whole key to the process. Individually price and luck may sell houses. But anyone involved in the system - who really thinks about the price pyramid comes to conclusion - it is all about luring agents with real buyers to show your house. That is the whole point - you want the strongest pool of ready willing and able buyers to see your property. At that point - paying a commission to buyers agents is cheap. If you or your sellers agent don't do that - the probability is that you did not net as much as you might have netted.