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No the buyer shouldn’t expect the seller to lower price by 6%. TMV is TMV regardless who is selling it. Or buy it at the negotiated price and there shouldn’t be any discounts expected because there is no agent involved. If I were to sell a property FSBO and a buyer expected a 6% discount because I’m FSBO I’ll gladly show him the door. If I’m priced at market value take a hike.
Well stated .. SOME folks have trouble with this concept it seems.
This company has a lot of hidden costs and is full of gimmicks, but it goes back to people’s frustration with the poor performance of their agent. People are going to look for ways to shave off paying full commission, especially to an agent who hasn’t done much for them. They will go looking and find sites like this.
Over time, the real estate industry will evolve and change. I think, there will be more a la carte services for those who want them. People will opt for more diy services and possibly a lower broker’s fee. Not everyone needs to be guided every step of the way by a full service agent. Zillow and Realtor make it easy to find homes and read about them yourself and paperwork is done with docu sign, which is better than spending an hour in an office initialing a huge stack of papers. There will always be people who are intimidated by the house buying/selling process, but others will be willing to do more legwork themselves in order to save money. I’m ok with paying commission to a good agent, like the one who gets top dollar for the house and makes the process easy. Agents who don’t do much and still have their hands out for a commission check, are irritating. They are the ones who would make me look for a steep discount broker.
over time, the real estate industry HAS evolved and changed. Imagine that just 20 years ago or so there was no internet distribution of listings. no zillow. no realtor.com
there are a wide range of service/fee models already. A Seller can pay anywhere from $0 (pure FSBO) to 7%+ and everywhere in between. One thing that hasn't worked yet is "fee for service"/ a la carte. The subset of folks willing to lay out their cash for a $500 - 1000 fee (a "deep discount" entry only firm) + about $100/hr agent engagement - and do it UPFRONT, not at closing - hasn't been large enough. Maybe that changes.
But it's already available.
People need to compare agents, and their specific plans and history, before choosing them.
over time, the real estate industry HAS evolved and changed. Imagine that just 20 years ago or so there was no internet distribution of listings. no zillow. no realtor.com
there are a wide range of service/fee models already. A Seller can pay anywhere from $0 (pure FSBO) to 7%+ and everywhere in between. One thing that hasn't worked yet is "fee for service"/ a la carte. The subset of folks willing to lay out their cash for a $500 - 1000 fee (a "deep discount" entry only firm) + about $100/hr agent engagement - and do it UPFRONT, not at closing - hasn't been large enough. Maybe that changes.
But it's already available.
People need to compare agents, and their specific plans and history, before choosing them.
The real estate industry has evolved and will continue to change. You’re right that Zillow and Realtor have changed the way we find listings. In ten or twenty years, new changes, websites and ideas will happen. My guess is that people will become more savvy and less afraid of the real estate process. Kind of like people opting to use Turbo Tax instead of an accountant.
I bet the FFS catches on in the future, but many people do resist putting cash up front. Somewhere, a smart person will come up with an idea to better market this, or roll more of the costs into closing.
As far as today’s real estate, I’ve learned about looking for agents with CRS credentials as well as ASR and ABR. You mention comparing agents, well CRS agents are at the top of their peer group, not a discount broker, but if they can really live up to doing the best job possible, they’re worth it. Trusting someone with your investment worth hundreds of thousands of dollars is scary when you think about it. An agent selling thirty houses a year with fifteen or twenty years experience, is far more reassuring than a cheap discount broker. Otherwise, with a 150k condo, look for discounts. A lot depends on the situation.
Retired 30 year real estate broker. It is a barnicle business. Agents tie themselves to a broker who pays their MLS fees and their signs and their business cards, etc. They in turn, get a listing and charge what the broker says to charge. If you are truly working real estate as a business....you the agent, pay all the fees, a fee to the broker to work under his franchise agreement, you pay mega advertising fees and then maybe you can justify that $60,000 commission. Agents do not need all of the pie, just some of it. And it is never the deal you do but the number of deals you do that makes sense.
No the buyer shouldn’t expect the seller to lower price by 6%. TMV is TMV regardless who is selling it. Or buy it at the negotiated price and there shouldn’t be any discounts expected because there is no agent involved. If I were to sell a property FSBO and a buyer expected a 6% discount because I’m FSBO I’ll gladly show him the door. If I’m priced at market value take a hike.
I never understood the logic behind this line of thinking. It's like someone who just put new tires on their car before selling it, so they think the price should be jacked up by the cost of the tires.
I've bought and sold any number of ways, FSBO, fee for service, realtor, etc. Just because I'm not selling with a broker doesn't mean that 6% goes away - it either goes to a broker or into my pocket. The money doesn't evaporate.
No the buyer shouldn’t expect the seller to lower price by 6%. TMV is TMV regardless who is selling it. Or buy it at the negotiated price and there shouldn’t be any discounts expected because there is no agent involved. If I were to sell a property FSBO and a buyer expected a 6% discount because I’m FSBO I’ll gladly show him the door. If I’m priced at market value take a hike.
Quote:
Originally Posted by MortonR
I never understood the logic behind this line of thinking. It's like someone who just put new tires on their car before selling it, so they think the price should be jacked up by the cost of the tires.
I've bought and sold any number of ways, FSBO, fee for service, realtor, etc. Just because I'm not selling with a broker doesn't mean that 6% goes away - it either goes to a broker or into my pocket. The money doesn't evaporate.
RM
Yeah. In the current brutal sellers market, sellers can adopt this mentality.
Swing back 10-11 years, and buyers will call the tune.
Of course, no one pays 6% anymore, do they? It's just the stuff of legends, right?
The problem with RE agents are the ones who receive the full 3% of costs for selling more expensive homes. Why should a RE agent who sells less expensive homes receive LESS commission for doing the work? Also, why should an agent in a Seller’s market receive top dollar for doing such little work?
Ask these questions of the agents you want to hire. All these terms are negotiable!
Sometimes busy markets are not actually easier. Sometimes the ones you think are going to be easy turn out to be hard. Sometimes the ones you think will be harder aren't. You just never know til it's over whether it's going to make some money or nothing at all. The key to us making any money and staying sane is trying to give the same level of service no matter what and hope the average still pays the bills.
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