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As long as the seller understands my offer price won't be what he wants it's fine. Personally I feel every party should have their own paid representation. I'm willing to bet house prices and commissions will drop.
(Now I completely understand how the world works)
Here is my problem. I have multiple properties some are in the 500k range others are in the 1.2 mil range. Any if the properties going on the market will sell fast as they are remodeled, no issues and will pass ANY inspection. Any small repairs I am willing to do without any problems. So let's go forward and say both close without any issues in 30 days. Buyers were qualified etc no issues. The agents had no more no less effort for either property to sell
Why should I pay double the commission (money wise) when the agents did not have to do any more work to sell the higher priced house. There was no more paperwork filled out, no additional run around crazy screaming.
If I were to sell it would be far easier to hire a agent to simply help look over the paperwork. Buyer gets a few paid for hours of consultation paid by the seller. Ok I can do that. Maybe a few consultation phone calls billed out. I offer to pay all closing costs if we get a price both agree to.
Buyer gets his own loan I get my own title and escrow.
If the buyer needs to be babysat he pays you. Remember I'm paying all the closing costs. He can afford to pay you something
Buyers have bought into the misleading, NAR-supported lie, "Buyers Agency costs you nothing."
So, they don't want to hear it.
And, too many buyers are cash-strapped, and MUST finance their commissions. They have no other choice, and our typical lending models do not offer buyers that capability.
So, we play the shell game.
What you don't see, and maybe should not have to see, is the effort a buyers' agent may put in before arriving at your property.
I may work 40-50 hours at your property, but have spent much more than that in pursuit of property, research time, consultation time, etc.
The fat checks that you see often cover a whole lot of time. Again, that is hard for you to apply specifically to your transaction. So it is a good thing that Dad (buyer) gives you cash for their Mother's Day Gift (Buyers Agent commission.)
The Scurrilous Godless Commies at CFPB would do well to promote transparency and basic economics, rather than support the lie in labeling commissions as a unilateral seller expense.
Ah such altruistic commissioned agents.
An agent can certainly point things out that the buyer might want to follow up with an inspector.
But bottom line, your license does not extend to these areas AND there is an inherent conflict between being held accountable to note these things when your commission is based on a closing of a sale to begin with. Maybe it worked out in this case but surely you can see the obvious conflict - and that's why there are separate licenses - the inspector is supposed to be independent. You are not.
No, there isn't a conflict of interest. Buyer agents don't care which house they sell a buyer. They just want to sell them A house so it makes good business sense to find them a good house in their price range. So in Oregon, we get trained on all sorts of issues. Here is the list of where our continuing education credits must come from.
Principal broker or property manager record-keeping
Principal real estate broker supervision responsibilities
Principal broker or property manager clients’ trust accounts
Agency relationships and responsibilities for brokers, principal brokers, or property managers
Misrepresentation in real estate transactions
Property management
Advertising regulations
Real estate disclosure requirements
Real estate consumer protection
Anti-trust issues in real estate transactions
Commercial real estate
Real estate contracts
Real estate taxation
Real estate property evaluation, appraisal, or valuation
Fair Housing laws or policy
Managing a real estate brokerage
Business ethics
Risk management
Dispute resolution
Real estate finance
Real estate title
Real estate escrows
Real estate development
Condominiums
Subdivisions
Unit owner or home owner associations
Timeshares
Water rights
Environmental protection issues in real estate
Land use planning, zoning, or other public limitations on use
Real estate economics
Real estate law or regulation
Negotiation
The Oregon real estate agency disagrees with you on what they want us to know. They want us to know a lot. We have to do 15 hours a year in these topics. They cover everything from how to identify a failing septic field, radon, mold, flood plains, etc (all go under consumer protection). So they are aware that it is in the best interests of consumers to have agents that know the basics on a lot of different issues.
Quote:
Originally Posted by IC_deLight
Traditionally the agents always represented the sellers. Of course the buyers did not realize this. The concept of buyer's agent and seller's agent didn't show up in Oregon until the 1990s. The purpose was to put the buyers on notice of who the agent really represented. Agents still played games and wouldn't submit the mandatory disclosure until near closing. Maybe that situation has changed - but the bottom line is that the agents (and broker) are interested primarily in successfully closing a transaction because that's how they get paid.
I've been an agent for 13 years and the disclosure has always been required at first contact in Oregon AND in the real estate contract the buyer has ALWAYS been required to sign stating they got a copy of it, when they write an offer. So worst case is at the time of the offer. Which wouldn't be in compliance with the law, but isn't right at closing either.
Quote:
Originally Posted by IC_deLight
You're right. Most buyers don't want to waste their hard earned money. That's one reason why at least some states have mandatory seller disclosures. The sellers are required to disclose certain information. But you are trying to operate in an area where you aren't licensed to provide the "service" you think you are providing.
Not at all. It is called basic knowledge. California agents are required to fill out a red flag checklist, as a matter of fact. Same thing. The Oregon real estate agency expects us to know the basics on a lot of different things.
You are naive if you think the seller disclosures are this incredible document. Most sellers don't realize that their LP was recalled, or they don't realize that their electrical panel has issues. They don't mean to not disclose, but they only disclose their actual knowledge which sometimes isn't very much.
Quote:
Originally Posted by IC_deLight
....and do you also play an attorney and provide legal advice when you believe it would be "bad customer service" (as opposed to against the law) to refrain from doing so?
It isn't hard to not play attorney. We have set forms that we use. I have a company attorney clear any clause that I want to generate for my agents to use in an addendum. Easy peasy.
Quote:
Originally Posted by IC_deLight
You are correct about the insurance aspect. Are you licensed to sell insurance coverage? Should you be liable to anyone if you i) fail to inform the buyer that it is in a flood plain, or ii) incorrectly tell a buyer that it is in flood plain when it is not?
Yes, agents in Oregon could be held liable for not telling a client a home is in a floodplain. It is expected knowledge, just like not telling a client a home is in an Historic District.
Quote:
Originally Posted by IC_deLight
That information might be useful for negotiation strategies but that is resolved by offering a lower price, not by offering a higher price that contemplates the repairs being done. If you can see all of these problems then offer a lower price to start off with.
You sound like a buyer with the means and time to deal with repairs. Not all buyers want that. You get that not everyone is you, right? People have different needs and financial situations that require different negotiation strategies.
Quote:
Originally Posted by IC_deLight
T The point here was to note there is an inherent conflict in having an agent who makes a commission based on a percentage of the sales price to be expected to provide information outside his/her scope of representation that is contrary to the agent's interests. The agent's interests are not aligned with the client's interests. At a minimum there is the appearance of a conflict if not an actual conflict. That's why the inspectors and the appraisers are independent and get paid irrespective of whether the transaction closes.
Business math 101. It is in the agent's best interest to discuss any obvious issues with clients because that is how you get repeat business. When you are knowledgeable and protect your clients, they will refer other people to you. When you get referrals from past clients, you don't have to spend as much money marketing yourself. If you don't spend as much money marketing yourself, you have higher profits. You seem confused because you don't understand that if you align yourself with your clients, you make more money. You don't understand how competitive real estate is and how much money agents have to spend advertising themselves to get business. Even if you remove the moral issues and only do it for money, this is basic math. Taking care of your clients gets you more money in the end because you get referrals.
...
Business math 101. It is in the agent's best interest to discuss any obvious issues with clients because that is how you get repeat business. When you are knowledgeable and protect your clients, they will refer other people to you. When you get referrals from past clients, you don't have to spend as much money marketing yourself. If you don't spend as much money marketing yourself, you have higher profits. You seem confused because you don't understand that if you align yourself with your clients, you make more money. You don't understand how competitive real estate is and how much money agents have to spend advertising themselves to get business. Even if you remove the moral issues and only do it for money, this is basic math. Taking care of your clients gets you more money in the end because you get referrals.
This is the concept that confuses so many people.
They cannot comprehend why anyone would not grab the quickest buck they can, with no long view of their world, their business.
I'm looking at home costs and it is a huge cost for a seller to have an agent and a smaller cost for the buyer. It looks like fees can be 6-8% for the seller, which is huge. Tack on 3% closing costs to buy and suddenly a home doesn't look like such a great investment. So if my home is worth 300k, then I can expect 30k in transaction costs. Basically 3 years rent to break even for just those costs. Has anyone ever sold without an agent?
We have and it worked out fine. You have to have a certain personality in order to deal with realtors. Some people have it...others don't. (Lets just leave it at that.... either you know what I mean or you don't...I'm not going to go on, on, on about it)
Of course, asking the question if agents are worth it on a real estate forum...you're going to get a very biased opinion. No real estate agent on here is going to say they aren't worth it. In case you haven't noticed based on responses....we seem to have the lion's share of the most awesome realtors in the country who flock to this site. It does beg the question why they have so much extra time to get on here if their services were truly warranted the 6%-8 % percentage that is the norm.
Last edited by beckerd2; 04-20-2017 at 12:36 AM..
Reason: edited
We have and it worked out fine. You have to have a certain personality in order to deal with realtors. Some people have it...others don't. (Lets just leave it at that.... either you know what I mean or you don't...I'm not going to go on, on, on about it)
Of course, asking the question if agents are worth it on a real estate forum...you're going to get a very biased opinion. No real estate agent on here is going to say they aren't worth it. In case you haven't noticed based on responses....we seem to have the lion's share of the most awesome realtors in the country who flock to this site. It does beg the question why they have so much extra time to get on here if their services were truly warranted the 6%-8 % percentage that is the norm.
This whole argument is academic. The future is unknown. But today, we ARE worth it because y'all keep paying us to BE worth it. The Internet has destroyed many types of businesses, and one day may usurp ours. BUT NOT TODAY. Today, the market, aka reality, says we are worth it, and is paying us accordingly. That's just a fact. It's not me saying it, it's not the "authorities" saying it, it's not the know-it-alls saying it, it's not the experts saying it. You can progmasturbate the future, but the future is unknown. TODAY WE ARE HERE, and TODAY WE ARE WORTH IT, and TODAY WE HAVE PROOF. I am getting calls, I am doing the job, I am getting paid. With little objection or debate. From very smart people. Are real estate agents worth it today? Reality says yes.
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It does beg the question why they have so much extra time to get on here if their services were truly warranted the 6%-8 % percentage that is the norm.
