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You might have a leg to stand on if commissions were an entirely separate transaction outside of closing. However, it is not. Commissions and closing costs are skimmed right off the top of the buyers money and go into the agents pockets.
agents don't get the closing costs. If there's a "transaction tax" - be it like a sales tax, an excise tax, etc charged to the seller - you feel the Buyer pays that as well?
If so, then why not legally shift all the burden onto the Buyer - reflect it on the HUD/CD?
If you took finance or economics classes at the college level then you should ask for a refund. No competent professor would ever claim that the seller is paying for the commissions in a transaction.
let's say it is a short sale.
You pay $100K for a house. The Bank is owed $100K, and then there's $10K of commission and other closing costs.
How we bought a home (and pretty much everyone else we know did in the last 10 years):
Listing agent staged, took pictures, put online, and stuck a sign outside.
We drove by and then found house on internet. We were cheezed bc our buyer's agent didn't even tell us about it.
Buyer's agent made appointment
and unlocked door.
We said, "Yup. We like it."
Wrote contract. One back and forth.
House sold in a week.
For this they got $50,000 in commission?!!
That's total crap.
Of course everyone should be adequately compensated, but a fixed % regardless of price is stupid.
How we bought a home (and pretty much everyone else we know did in the last 10 years):
Listing agent staged, took pictures, put online, and stuck a sign outside.
We drove by and then found house on internet. We were cheezed bc our buyer's agent didn't even tell us about it.
Buyer's agent made appointment
and unlocked door.
We said, "Yup. We like it."
Wrote contract. One back and forth.
House sold in a week.
For this they got $50,000 in commission?!!
That's total crap.
Of course everyone should be adequately compensated, but a fixed % regardless of price is stupid.
According to people in this forum, the seller paid the commission so you shouldn't be concerned it was $50K. It was "free".
agents don't get the closing costs. If there's a "transaction tax" - be it like a sales tax, an excise tax, etc charged to the seller - you feel the Buyer pays that as well?
If so, then why not legally shift all the burden onto the Buyer - reflect it on the HUD/CD?
The whole closing costs game is a sham designed to separate more money from the buyers pockets and feed the real estate conglomerate.
Quote:
Originally Posted by BoBromhal
let's say it is a short sale.
You pay $100K for a house. The Bank is owed $100K, and then there's $10K of commission and other closing costs.
Who's paying the $10K? The Seller is.
Actually, the seller is coughing up money to clear the mortgage the bank owns.
Quote:
Originally Posted by BoBromhal
so if all we had was FSBO's, the prices would drop ... how much?
There would be significant shift in the market and an increase in transactions once people realize they could buy and sell real estate without tens of thousands of dollars in fees being siphoned to the real estate industry.
Nope, you surmise wrong. I buy at market price - wherever that market price is - and then put tenants in them. I sell a few and buy a few via 1031 exchanges to defer gains. As long as I get my 6 cap net of expenses and my tax depreciation, I am happy. Never thought I was a financial genius except for the paying with cash and never financing part. Took some genius to amass the capital to get started but that was software development genius not financial.
More fast talking nonsense.
Tell us, what economic and financial education do you have besides reading investing forums?
Quote:
A HUD-1 is a form of a balance sheet. Maybe not the balance sheets you are used to using your crayons to complete but a balance sheet none the less. I read the same article you did but I was able to comprehend the argument which you obviously haven’t. I don’t think you will find a listing agent that would state that the buyer pays their commission but I would love it if you could. The MLS *may* have some anti-competitive practices but setting broker commissions isn’t one of them.
Its clear you have no idea what a balance sheet is or how it works. A HUD-1 is a settlement statement. Its not even close the to the same thing.
Here, is City-data MikeJaquish good enough? He seems to be a well respected agent on these forums. He clearly states the buyer pays the commission:
What you are failing to understand is that market value is just that market value. Any commission comes out of market value so the seller is paying the commission by taking a loss on market value. If one accepts your argument that the buyer pays the commission, then the real estate market should be such that the buyer makes an offer and also decides how much commission they want to pay to close the deal. And, furthering that argument, if a seller doesn’t use an agent, then the savings on commission should go to the buyer since they are paying the commission. Nope, not the way it works. The only way your argument holds any water is if you say well the market is inflated by x% to account for costs of sale - maybe then.
What your failing to understand is the current market value is reflected to account for extremely high real estate costs.
What your failing to understand is the current market value is reflected to account for extremely high real estate costs.
I will let you have the last word. I tired of arguing with simpletons years ago. I guess those Econ classes at MIT Sloan that I took while completing my EECS degrees weren’t worth much. I will be sure and let them know.
I will let you have the last word. I tired of arguing with simpletons years ago. I guess those Econ classes at MIT Sloan that I took while completing my EECS degrees weren’t worth much. I will be sure and let them know.
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