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Most agents do not own multiple houses and certainly don't buy them at auction.
Most investors who buy a lot of homes are not usually licensed Brokers / Agents.
I'm not sure whether Rambo and evilcart would make a great real estate transaction together, or an awful one. But their communicate would be reasonable well and since all their hate and envy is towards the real estate profession in the US, I am sure it would be smooth.
I'm not sure whether Rambo and evilcart would make a great real estate transaction together, or an awful one. But their communicate would be reasonable well and since all their hate and envy is towards the real estate profession in the US, I am sure it would be smooth.
It's interesting/sad when commission-adverse principals become so focused on commission avoidance that the one getting screwed doesn't even notice it.
The OP and several others think that real estate agents are rolling in money, they took from the buyers and sellers.
Lets look at the facts. The average listing and selling salesman makes 1.5% per sale (listing sold). Median income for real estate agents is about $40,000. This is gross income, and by the time they pay all their expenses they make about $30,000 a year. Boy is that a huge salary by today's standards. The lowest 25% of agents will earn about $20,000 after all their expenses. Yes the agents have expenses. The top 25% earn about $60,000 and above after deducting expenses.
Real Estate sees 80% of all people starting work as an agent, failing out of the business due to not making enough money to live on. Many never even make a sale or have a listing sold, so after they run out of their savings, they leave the business. Good agents will sell 9 properties in a year.
No matter what your means of making a living, you earn what your job is worth. A brand new Petroleum Engineer just out of college earns $100,000 salary and they will compete to hire him. On the other hand there are people just out of college shocked when they find the profession they have trained for and gone in debt for, only average about $30,000 to $30,000 a year. Real estate agents are the same. They are not getting rich as you think, with an average after expense income of about $30,000 to $35,000 for the median income for Real Estate Salespeople.
Yes some make great money, but those make their big money on something rather than sell houses. I entered the business in 1972, and stayed in it till I finally retired. I specialized in commercial/investment real estate. I sold my first apartment house (3 year old building) my first day in the business. I sold the identical one next door two days later. The next work week I worked, I exchanged a 16 unit 5 year old quality apartment house for the down payment on a large irrigated farm. So I was off to a good start and made the Million Dollar Club in my first 2 weeks. Million Dollar Club was agents that sold one Million Or More in property in one year. It is a lot easier to do today, than back in 1972 when few did it due to the much higher prices today. I worked as an investment adviser for my clients, and handled their accounts more like a stock broker handles theirs than just being a real estate salesman. I succeeded because I had 20 years big ticket sales behind me, and went to real estate and financial classes at a major university to learn the business for 1 year before I went into the Real Estate Business.
Commission will depend on the size of the sale, and the difficulty in selling the property.
Average person that does not understand the business, have no way of knowing a 6% commission is not standard. In the fields I worked in, I made more 10% commissions than I did 6%. Real estate exchanging as one of my specialties, where you may have as many as 7 properties involved in a running exchange is a higher commission field, as it takes someone with a lot of knowledge to be able to pull them off, and takes a lot more work than selling houses. They take a lot more work and knowledge than selling a home for a personal residence. When dealing with properties in several states, and sometimes even involving property in other countries, instead of a commission, I acted as a principal and was dealing in my own account.
Why is real estate (selling/buying) become a bonanza for real estate brokers, not for a buyer/seller. Real estate brokers who have no steak in your home end up eating big piece of home appreciation pie (50 percent or more...) if you are selling or end up paying lot more than its real worth if you are buying.
Either way, it is a loose - loose situation for both sellers and buyers. The same scenario from home builders who skyrocket the new home prices under false pretense of bright future and creating a false heaven on the earth!
This is crazy and not making any sense to me. Whether you are selling/buying an existing home or a new home, why is it consumer getting a stick at the end? Is anything can be done?
2009 - 2012 realtors in my area were buying up (no, snapping up) foreclosures at 4 bits to the dollar, closing off the best bargains to the public; then subsequently trading them back and forth among themselves like baseball cards, making hundreds of thousands of dollars in the process in just a few years. There really should be a class action lawsuit that essentially puts any realtor or real estate company involved broke unlicensed and out of business. That would be a lot of them in my area. What these clowns were pulling off is about the biggest fraud I've ever seen.
2009 - 2012 realtors in my area were buying up (no, snapping up) foreclosures at 4 bits to the dollar, closing off the best bargains to the public; then subsequently trading them back and forth among themselves like baseball cards, making hundreds of thousands of dollars in the process in just a few years. There really should be a class action lawsuit that essentially puts any realtor or real estate company involved broke unlicensed and out of business. That would be a lot of them in my area. What these clowns were pulling off is about the biggest fraud I've ever seen.
Most Realtors could not get the loans to be able to buy up and deal property this way, as only the top Realtors make enough money to deal in property except one at a time small properties. When they buy one, they want to get the maximum price, and thus get the profit. And Realtors do not trade properties back and forth between themselves like baseball cards as you say. There would not be a profit in doing so, because when the agent that had purchased a property would be charging top money for the property, not selling at a discount that another Realtor would buy it from him/her.
A Realtor has the legal right to buy and sell property in their own account. A Realtor has responsibility to their client and only to them. Their own buying and selling of property would not be illegal and subject to a class action suit, unless they were harming a person or company that they are representing. When a foreclosed property is put on the market, the public has the same right to submit bids on them as anyone else acting on their own behalf. The lenders, will often not even make decisions on bids from anyone, for a period of time, to see if the potential buyers want to increase the bids over the asking price. Agents buying property in their own name, is not something done in the dark of night. This means that the Realtor is going to have to give the best and highest profit bid to the mortgage company. The lender got more of their investment back, than if it was sold to any other buyer.
To prove that they could not get the financing, tell me how many properties can a person buy when the median gross income for Realtors is only just under $40,000 and the net income after all expenses is not much over $30,000 per year. How many people today, can even buy a home to live in and finance it when they have a $30,000 per year income. Buying and selling real estate for a profit, is a big money game, and not one for $30,000 a year workers of any type.
It is amazing what some of the public think working as a Realtor agent/broker is such a big profit field. It is for a few, but not for most of them. Eighty percent of all people that go into real estate sales, fail out due to not making enough money to live.
Let us know when you are ready to compare the rest of the EU industries, cost of living and prices to those in the USA. You may not like our system or process here, but you are free to go home anytime you choose.
are you suggesting I move back to NY? or perhaps you got confused and thought that just because I see beyond our borders I must be a European...
But don't worry you are completely free to go through life believing the USA is the world leader in everything.......
It isn't a cheat. You are trying to compare two totally different systems and don't understand why they aren't the same. You are the one cheating. So where in the EU did you sell your home. I'll look up their system of real estate and break down the math for you again.
No. I am comparing two systems that do exactly the same thing.
I am comparing a real estate transaction in the EU with one in the USA.
The USA has much higher real estate fees than most other countries. Why? well because RE lobbies at every level. THe US RE industry spends more lobbying various levels of government than almost any other group in the USA. Oil beats RE, and once or twice Tech has beaten RE.
When you spend tens of millions padding the accounts of members of government each and every year, it is very hard to pass any restrictions on the power of the MLS and NAR.
No. I am comparing two systems that do exactly the same thing.
I am comparing a real estate transaction in the EU with one in the USA.
The USA has much higher real estate fees than most other countries. Why? well because RE lobbies at every level. THe US RE industry spends more lobbying various levels of government than almost any other group in the USA. Oil beats RE, and once or twice Tech has beaten RE.
When you spend tens of millions padding the accounts of members of government each and every year, it is very hard to pass any restrictions on the power of the MLS and NAR.
That isn't why. The NAR is a very powerful lobby organization. I don't disagree with that, but that isn't why fees are the way they are. So again, tell me in what country you sold your EU home, and I'll break it down for you on why fees are higher than where you sold.
Based on the chart Mike shared, the US is kind of in the middle of the EU countries. Obviously some on the list aren't in the EU, but we are still about halfway in the pack if you just look at the EU nations on the list.
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