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See - here you are showing your cards. The high transactions costs are increasing the price of homes, therefore costing the consumer more money. In a more efficient market, less money is spent of transactions cost, therefore offering more value to the consumer.
I have been looking for a couple months and can't believe how inefficient the real estate industry is. I think part of the reason the fees are so high is due to the time agents spend for which they are not reimbursed. A lot of that is of their own choosing.
Can you elaborate? I don't understand exactly what you mean. I will respond upon clarification.
The contract is between the seller and his/her agent, not you. As unfair as you may feel it is for the listing agent to get the whole enchalada, it is not up to you.
Needless to say, that is one of the reasons why going to the listing agent is a mistake. You get no representation whatsoever, and the listing agent gets everything. Most buyers think that the listing agent is now representing both but they simply become a paper pusher in my opinion. They cannot negotiate on anyones behalf and must simply provide "the fact, ma'am, just the facts".
Since you have no say in what the listing agent is getting, wouldn't it be better for you to utilize a buyers agent to represent you and negotiate for you?
I have been looking for a couple months and can't believe how inefficient the real estate industry is. I think part of the reason the fees are so high is due to the time agents spend for which they are not reimbursed. A lot of that is of their own choosing.
Can you elaborate? I don't understand exactly what you mean. I will respond upon clarification.
I mentioned in an earlier post, but will elaborate.
I am pretty independent and don't like to waste agent's time. Therefore, I look online and in the free real estate booklets that are everywhere to narrow down the possibilities. I've been surprised how often the address and even the price are not listed. Directions seldom are. That means the agent has to field calls from people that won't be interested when they get more info-a waste of his time. In addition, he's probably lost potential customers who don't pursue those without the info, esp price.
I've also had a couple agents who won't give me directions-insisting on meeting me and driving me. Now that wastes their time and gas money if I don't buy. I don't like agents with me initially because I want to get a feel for the neighborhood (restaurants, people on streets) as well as the house. If drive by looks good and i like neighborhood, I'll ask to see inside.
I like the online pics of houses-sure helps narrow things down. i wish there were more-sometimes basement and outside not shown. Even after I've looked sometimes I can't remember which house had the blue tile in the basement floor and more p[ics would help.
Also the offer/counter offer process seems to take a long time. Looks like there could be some bottom line info with agents.
I'd also like a better way of picking agents in unfamiliar places-like where I'm looking now. It seems too much a crap shoot or having different agents go with me to look at houses so I get a feel for them then pick. (Then I've wasted someone's time again.) I don't have an idea for this.
...Also the offer/counter offer process seems to take a long time. Looks like there could be some bottom line info with agents...
If the offer price is within 10% of the listing price the process should go pretty fast. If the home is priced too high above market it'll take longer; and if it's prices at market and a lowball offer comes in it'll take longer.
I personally don't think it's a good idea for the agent to know the bottom line. One reason is that the client could change his mind and not inform the agent, so she's negotiating from a different position now.
Also, knowing the bottom line could prevent some agents from working harder to get the most money for their client.
In some cases, such as where a client will go upside down at a certain number, and doesn't want to do a short sale, and would rather stay in the home, or rent it, then it may be good to know.
I had a home where I was a dual agent and my seller was high on price and adamant about holding the line. The buyer was at the low end of the market value ball park.
It was in the sellers best interest to sell the home because of their circumstances, and the buyer really wanted the home, but wanted to pay today's market value.
I had them both give 48 hours for each counter because I felt that time would help them come together, and that rushing it would probably kill the deal for both of them. There were 5 counters, and a couple of them had extentions of up to 2 days. A deal was finally reached at the price that the very recent sold comps showed as today's market value. No one was rushed, and when the deal was done, both parties were happy.
Well, im out of this discussion. The point of my point was just that I think the agents fees are outrageous. As the buyer the money is comming out of my pocket, so "I" am the one paying the fees. Also, I never said the agent did no work. I dont know how hard or easy it is to be an agent and I dont presume to know. All I said was that they did no work for ME.
...The commission has nothing to do with the purchase price. ...
Do you really believe this, or is it more a matter of phrasing? I agree with your statement that followed ("While you don't want to see it this way, it is the seller who pays the commission out of the proceeds of the sale."), but do you believe that the commission cost truly does not affect the selling price?
It's been my experience (granted, it is likely much more limited than yours and the other active professionals here) that a FSBO will be priced to reflect a partial "split" of what the commission would be and there is often a willingness to accept something between that price and what the net would have been with a realtor.
I know some customs vary by area - for instance, a lease/purchase deal (esp one with credits toward a future DP) are somewhere between rare and non-existent in this area - but I doubt commissions don't come in to play when pricing a home, at least around here.
As the buyer the money is comming out of my pocket, so "I" am the one paying the fees.
Nope. You get the whole house. The seller gets less than all the money.
The seller agrees to trade the house for some money. Most often you (any buyer) puts a % down, but your lender puts the majority of the money into a transaction.
There is no commission without a buyer and a seller. Sometimes the buyer brings no money to closing. Sometimes the seller does. Does that change your line of thought?
Nope. You get the whole house. The seller gets less than all the money.
The seller agrees to trade the house for some money. Most often you (any buyer) puts a % down, but your lender puts the majority of the money into a transaction.
There is no commission without a buyer and a seller. Sometimes the buyer brings no money to closing. Sometimes the seller does. Does that change your line of thought?
A lot of homeowners that are on the verge of default/defaulted or otherwise would love to convey your viewpoint to the lender that since they brought no money to the table, the mortgage note they signed means nothing!
A lot of homeowners that are on the verge of default/defaulted or otherwise would love to convey your viewpoint to the lender that since they brought no money to the table, the mortgage note they signed means nothing!
You're being silly, I get it.
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