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We bought our home in 2010. That was the first time for me and hopefully the only time. We love our home. We signed stuff that I didn't know existed. If you were to hand me the stacks of paperwork that went into buying our home I wouldn't know where to start. So much easier having the realtor guide us through the process. Some things had a deadline attached to them. I prefer to have someone else take care of deadlines for me or at least have someone that I know I can deal with help me with them.
I am positive that anyone can do the work. It would take time to learn the business though. Do you want to lose out on a home sale if you are still learning the business? I mean would you represent yourself in a court of Law?
Interesting you bring up comparing a Realtor/real estate salesperson to a Lawyer. This is clearly not the same thing. The education needed to become an attorney can't be compared to what is necessary for a realtor. For an attorney you need at least for 4yrs of under grad plus at least 3 of law school..plus passing the BAR ...which I'm just guessing is much harder than the real estate exam..
I don't think selling a home on your own and representing yourself in court are even close to the same thing. Also realtors aren't attorneys so they can't act as attorneys in any way shape or form.
You mentioned buying a house , but with buying a house you aren't paying them commission so of course almost everyone will use a realtor for that. But for selling it's a different story ...that big fat commission comes out of your profit.
If you are worried about paperwork, why not have a real estate attorney review the stuff? Or a paralegal?
Would a real estate paralegal or attorney not be as qualified or more qualified than a real estate agent?
If you are an experienced investor or frequently move you can work a transaction yourself as a seller. However, for the average seller there are many pitfalls. A potential buyer can show up with a "pre-approval letter". These used to mean something. Today they don't have any indication whatsoever that the buyer will be able to complete the transaction. You will be out time and money, lose other valid buyers and irritate buyer brokers who actually represent qualified buyers.
An experienced broker will avoid these pitfalls. It is in his interest because he doesn't get paid until the deal actually closes.
"Technology has made access to all of the information that was formerly only available through word of mouth and MLS systems at least partially available to the public."
Begs the question...
Is at least some portion of the information totally available to the public? Or is it all only "partially available?"
Beyond pricing almost everything is fully available if you take the time to look for it. Pricing is still only partially available, seller concessions, and non-disclosure states are a major problem. I hope those things are changing, and since I would pay for an appraisal if I were selling with or without an agent not particularly pertinent to me. It is definitely true that agents gain from keeping the market opaque, just to survive and to make it easier for those that don't have good intentions to operate. While Redfin, Zillow, Trulia, et al may not be complete in what they provide, the MLS doesn't have complete information on FSBO and agents are extremely reticent to provide their clients with full information from the MLS when they work on commission. I think we are reaching the point where the additional incremental information agents have been able to keep from the public may not be necessary outside of non-disclosure states.
I think there can be legitimate value added by a real estate professional, I don't think they will provide it for either side of the transaction, as a group as long as the predominant compensation method remains commission. I would be looking for ala carte services with an agent that can provide professional level credentials and certification (NAR endorsed certifications will count against more generally accepted credentials in my scoring system). Your related post high school degrees, any non-sales/marketing professional licenses, certification or apprentice programs you have been through all count towards your professional credentials.
Beyond pricing almost everything is fully available if you take the time to look for it. Pricing is still only partially available, seller concessions, and non-disclosure states are a major problem. I hope those things are changing, and since I would pay for an appraisal if I were selling with or without an agent not particularly pertinent to me. It is definitely true that agents gain from keeping the market opaque, just to survive and to make it easier for those that don't have good intentions to operate. While Redfin, Zillow, Trulia, et al may not be complete in what they provide, the MLS doesn't have complete information on FSBO and agents are extremely reticent to provide their clients with full information from the MLS when they work on commission. I think we are reaching the point where the additional incremental information agents have been able to keep from the public may not be necessary outside of non-disclosure states.
I think there can be legitimate value added by a real estate professional, I don't think they will provide it for either side of the transaction, as a group as long as the predominant compensation method remains commission. I would be looking for ala carte services with an agent that can provide professional level credentials and certification (NAR endorsed certifications will count against more generally accepted credentials in my scoring system). Your related post high school degrees, any non-sales/marketing professional licenses, certification or apprentice programs you have been through all count towards your professional credentials.
"...and agents are extremely reticent to provide their clients with full information from the MLS when they work on commission."
This is not my experience, nor my modus operandi. I see agents continually digging for information for their clients, as do I.
Are you saying all agents, some agents, most agents?
Commission or flat rate or a la carte are all irrelevant to expectations and delivery of ethical effort.
Are you saying all agents, some agents, most agents?
Commission or flat rate or a la carte are all irrelevant to expectations and delivery of ethical effort.
No not all agents, but most agents. It will continue to be true of most agents as long as commission remains the primary compensation plan, and the majority of agents continue to see themselves primarily as salespeople. If an agent is forthcoming with full information and neutral they would benefit from full transparency and a move toward a professional services model and compensation system. None of these issues are unique to real estate, they exist and are a major problem across all industries where full time permanent commissioned sales is accepted, and work against our economic best interest.
Professional services won't be a cheaper solution for all consumers, but it will save most money. If it were to become predominant it would cause a significant thinning of the agent herd. The change has been slow because it can't be driven by regulation (which has been very effective in protecting agent income), or try to politically protect either side ("buyer's" agency was a misguided attempt to protect consumers that was perverted to prolong the current bad system). Consumers have to take a direct, active and confrontational role in the change.
We were getting ready to list our house in Chicago burbs in the Spring.. had a "pre-moving sale" .. specifically to spread news were were about to list. Sold it to an old neighbor! Market was starting to heat up at the time. It was the easiest sale ever.. we even let them move their stuff in day before closing.
No not all agents, but most agents. It will continue to be true of most agents as long as commission remains the primary compensation plan, and the majority of agents continue to see themselves primarily as salespeople. If an agent is forthcoming with full information and neutral they would benefit from full transparency and a move toward a professional services model and compensation system. None of these issues are unique to real estate, they exist and are a major problem across all industries where full time permanent commissioned sales is accepted, and work against our economic best interest.
Professional services won't be a cheaper solution for all consumers, but it will save most money. If it were to become predominant it would cause a significant thinning of the agent herd. The change has been slow because it can't be driven by regulation (which has been very effective in protecting agent income), or try to politically protect either side ("buyer's" agency was a misguided attempt to protect consumers that was perverted to prolong the current bad system). Consumers have to take a direct, active and confrontational role in the change.
"...not all agents, but most agents..."
Have you determined that it is 51% of agents, 95% of agents, or a different ratio? If different, can you quantify a "most agents" percentage?
And a factual source to support your determination?
"("buyer's" agency was a misguided attempt to protect consumers that was perverted to prolong the current bad system). "
This contention is in significant, material error.
Buyers' agency is a vast improvement over the listing agent/subagent system where two sellers' agents ganged up on buyers, or where the sub-agent "worked with" buyers, while employed to advocate for the seller, and ignoring that legal responsibility.
While the common compensation model is indeed a bit goofy, it is not a determining factor in agent ethical behavior or buyer success.
I can only share from my side of the transaction, which is providing financing to either the sellers of a FSBO (for their next home) or the buyers of a FSBO, and hands down, the most expensive mistakes I have seen have been on the FSBO seller's side.
Mistakes like being on the hook for the mortgage 5 years after they sold the home. Or unknowingly agreeing to pay for $16,000 more in closing costs for the buyer than they thought they were.
When you hire an agent, you are hiring their experience and knowledge. You hire them for knowledge you can't find in a forum. Are there successful, money-saving FSBO's? Absolutely. But if I had a handful of far from successful FSBOs, I suspect problems are a bit more widespread.
"How long will it take me to fulfill the requirements to get my license either online or by correspondence?"
"The average time for a student to complete all of the requirements in one of the real estate programs is from six to eight weeks. This is from the day you enroll to the day you take the state license exam."
Is this 6-8 weeks of knowledge worth paying 10s of thousands for?
It seems like it would be worth it for a lot of people to take the real estate classes and just not get licensed in order to gain the knowledge. Yes I know that there are many experienced agents out there , but wouldn't a new agent have the same 'knowledge' as someone that took the real estate classes and spent a few hundred dollars and a couple months of less?
A couple of months time seems like it would be worth it for a lot of people. It could also be done around a job.
Also couldn't a real estate attorney make sure that situations like the above would not occur , unknowingly agreeing to pay $16,000 in closing costs,etc?
I am still exploring all options including hiring a buyer's agent as well. The point of me posting isn't to try and proof anyone wrong , but to explore alternatives and get other's feedback and experiences.
I don't expect any real estate sales professionals to agree with the idea of listing a house on the MLS For Sale By Owner. They work on commission and this directly impacts their bottom line.
I wouldn't be surprised if there is some fear and uneasiness in any change in the status quo that they have enjoyed for many decades.
Their lobbyist organizations spend many dollars to make sure the status quo exists as well.
This is an interesting read showing how the lobby has fought to keep the status quo even if it costs homeseller's thousands of dollars.
Why is a 8 year old editorial relevant today?
Zip has ceased offering rebates.
No one has to hire a brand new licensee if they on want to.
A brand new licensee is trying to build a business with the assistance of an established brokerage.
Does the cost of running a real estate business cost more, or less, or similar to other real estate businesses?
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