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This is so true, the type of collusion that aka Realtors(TM) engage in should be illegal. I understand why they do it, but that doesn't make it right.
These days, the buyer does most of the work, the internet does most of the selling and much of the paperwork that Realtors(TM) and real estate agents do is automated and thus the workload is far less than it use to be.
Realtors(TM) will go on and on about "how much work" they do, but in reality, you could hire a RE lawyer and have an even more professional prep and review of all documents done for less than the standard 6%. Most sellers, nor buyers understand this.
Things are changing and there are a number of fixed priced brokerages popping up that sell for a very reasonable fixed rate popping up that greatly benefit the seller and ultimately the buyer. In a hot real estate market, homes practically sell themselves, you don't need an agent when bidding wars are going on. I would agree, you may need an agent in a slow market to really market the home and try to get a sale, but as soon as the market is "hot" these wild percentage based commissions are a complete fleecing of both the seller and buyer.
I've had friends use decent fixed prices brokers and they have been happy, particularly in this market. Percentage based Realtors don't like them, and tantrum endlessly and collude to fleece both buyer and seller, but fortunately, the strength of the housing market right now forces their hand. Since they can price a bit more competitively because they are not automatically losing 6% off the top, their homes are priced better than the competition and sales have taken place quickly with both buyer and seller saving money.
Because remember, the buyer in reality effectively pay the commissions because sellers set their price assuming they are taking a 6% haircut to give to a Realtor(TM).
If you could cut that commission, it would provide another point of price negotiation. However Realtors(TM) will defend the commission percentage above all other things.
When salespeople are smug, you know you are getting fleeced, and right now, house salespeople are more smug than they've been in years.
So you experienced realtors' collusion first hand. Realtors collude with each other to increase commissions and therefore house prices. You saw increasing the amount of commission you'd pay as a positive?
I've successfully used a flat fee listing service and would definitely do so again. I found few- if any- realtors who would do more than just list the house on the MLS and take crappy photos.
Yes, I did see increasing the amount of commission as a positive because it resulted in much more activity with showings and led to an offer within a month. This was just our own personal experience. I'm sure many others have had good experiences with discount brokers. Just didn't work for us.
Mike, looks like it started here from what I can tell paging back.
It would appear lovemaine didn't want to pay a 'standard' commission to the agent who sold the house and the agent wasn't getting it from the buyer either. But that isn't the discount realtor's fault.
Seems like this must have been in an area so big and so overrun with similar homes for buyers that an agent could even afford to skip one.
Well, yes, we didn't want to pay the standard 6% commission, which is why we listed with a discount broker. Since we're not real estate experts, we didn't realize that the lower commission would affect showings. This was just from our own personal experience in the area we lived in at the time.
Well, yes, we didn't want to pay the standard 6% commission, which is why we listed with a discount broker. Since we're not real estate experts, we didn't realize that the lower commission would affect showings. This was just from our own personal experience in the area we lived in at the time.
And, it is just as possible that the hidden costs passed on to buyers were a deterrent to showings.
Many buyers cannot (or will not) pay out of pocket to compensate their agent, so they choose to go with the most common model, of burying the costs in the mortgage.
Unfortunate choice of words by the poster.
Of course, there is no such thing as a "discount broker."
I re-read my post, and I'm not sure what words were an unfortunate choice. We're not realtors, and I was just sharing a personal experience. And yes, the realtor we used did bill herself as a discount broker at the time.
I re-read my post, and I'm not sure what words were an unfortunate choice. We're not realtors, and I was just sharing a personal experience. And yes, the realtor we used did bill herself as a discount broker at the time.
There is no such thing as a "discount broker." It is fact.
Some brokers are so weak, they like to use the term to influence impressionable consumers.
Brokers set fees based on business overhead, and needed and desired gross and net profit calculations.
IF you find a broker who fails to follow that approach, you may have found a weak broker who either can only sell rate without quality, or who believes they have a set commission rate that was determined by someone else in the brokerage community.
It may be worthwhile to avoid either.
Ah, the grossly inappropriate things I could say here that would get me banned from CD.
As tempting as it is to goad you on, it would not be the same around here without you!
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