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Honestly, this is a baffling decision as it's not mandatory to hire an agent and if you do comissions are negotiable. I, as an agent, if I don't like the amoun the job is paying, don't have to take the job. If a seller or buyer doesn't like what I charge, they don't have to hire me.
In regards to home prices: What a seller pays in commission doesn't affect the fact they always have and always will sell their home for as much as they can. I thought it should have been very simple to defend the structure and make the argument that home prices aren't inflated by commission. Go ask 100 agent represented sellers if they'd have charged 6% less if they didn't have an agent, and 100 FSBO's if they asked for 6% less because they didn't have an agent, and tell me what the yes/no response percentages are. If the commission is lower the seller may keep a little more but they'll still sell for as much as they can.
Aside from that, here's a little history lesson. Back in the day, the seller hired an agent to assist with the sell of the home. Buyers would go through the listing agent and typically didn't have representation. Buyers complained and the system evolved where buyers could hire an agent and the listing agent would share the commission. They didn't charge more, just shared what was already the usual commission. Now with more agents and models, the average commission is lower than it was back in the 70s/80s/90s/ This evolution also led to the invention of MLS (MLS was created, paid for, and owned by agents) to make it easier to advertise and co-broke with the buyer agents, which again benefitted the consumer. Sellers are not paying more, buyers are represented, and it made it easier to sell a home. Now we'll likely be going backwards, but it will probably hurt buyers the most.
And with all that being said, I don't understand how this lawsuit was lost by the defendants. From reading a few summaries, it sounds like the attorneys for the defendants did a very poor job. So here we are, the RE will be set back decades and we'll go back to caveat emptor, and the cycle resets. Those who forget history are doomed to repeat it. However, if this gets rid of agents and I don't have to pay co-brokes, or as much in co-brokes I'll probably make more in the end. All that being said, I'm truly baffled how this case was lost. Of course, by the time this reached the Supreme Court, I anticipate the decision will go the other way. I'm sure it was easy to find 8 people who hate REA and had a bias.
The basis of the suit is the requirement by MLSs, with NAR and member brokerages on board, that requiring MLS sellers to "pay" and to make payment through their listing agent to a successful buyer's agent is anti-competitive, that sellers should not have to "pay" the buyers agents' fees.
Sellers already have the option of just offering whatever they want to the buyer's broker. If the MLS stops requiring buyer's broker compensation seems farfetched to think most sellers will just start offering nothing as long as their competition is offering something. Unless they make the MLS prohibit any buyer's broker compensation nothing meaningful will change.
Why aren't all sellers already just offering 1% or $1? They have that option.
Sellers already have the option of just offering whatever they want to the buyer's broker. If the MLS stops requiring buyer's broker compensation seems farfetched to think most sellers will just start offering nothing as long as their competition is offering something. Unless they make the MLS prohibit any buyer's broker compensation nothing meaningful will change.
Why aren't all sellers already just offering 1% or $1? They have that option.
Because too many buyers agents are openly saying they will not show the house.
And, listing agents will not take the listing and invest in photos, marketing, and time for a seller offering a $1.00 cobroke.
But, that may be where we are headed, if buyers can be convinced they will pay a buyers agent out of pocket. I am skeptical that that will happen.
I've always thought real estate commissions were waaay too high for the time they spend, & for what they do...most of the time.
I hope these lawsuits bring down commissions for home buyers, and home sellers...both.
When I buy, I don't use an agent if I'm familiar with the area, or buying a pre-owned home.
Sometimes new home builders will give concessions to buyers agents, they wont give to a buyer w/o an agent. So, first I go in w/o an agent, & when the building asks me if I'm working w/ an agent I reply I'm inerviewing some at this time. Then the next day (you must act fast because there are 72 hour rules in some places) I ask an agent to see if they can get me a better deal (net) before I sign anything.
When I sell, I use a discount listing broker, & do much of the deal myself. They get me on MLS & lots of other sites for a small fee, & provide me the legal docs I need, & a internet lockbox. I saved $17,000 on my last sale doing it this way.
I have not paid full commission on any deal for 30+ years. My first 2 transactions I paid full commission to learn the ropes.
3 things to know however...ALWAYS use a Real Estate Attorney, hire your own building inspector, if you are buying in Florida for the 1st time, use a Buyers Agent. There's too much to know in FLA due to Tropical Storm exposure to go it alone the 1st time.
I think in most cases, people pay waaay too much in real estate commisions because they are lazy, & don't know how easy most of it is, & are not confident in their negotiating skills.
I've always thought real estate commissions were waaay too high for the time they spend, & for what they do...most of the time.
I hope these lawsuits bring down commissions for home buyers, and home sellers...both.
When I buy, I don't use an agent if I'm familiar with the area, or buying a pre-owned home.
Sometimes new home builders will give concessions to buyers agents, they wont give to a buyer w/o an agent. So, first I go in w/o an agent, & when the building asks me if I'm working w/ an agent I reply I'm inerviewing some at this time. Then the next day (you must act fast because there are 72 hour rules in some places) I ask an agent to see if they can get me a better deal (net) before I sign anything.
When I sell, I use a discount listing broker, & do much of the deal myself. They get me on MLS & lots of other sites for a small fee, & provide me the legal docs I need, & a internet lockbox. I saved $17,000 on my last sale doing it this way.
I have not paid full commission on any deal for 30+ years. My first 2 transactions I paid full commission to learn the ropes.
3 things to know however...ALWAYS use a Real Estate Attorney, hire your own building inspector, if you are buying in Florida for the 1st time, use a Buyers Agent. There's too much to know in FLA due to Tropical Storm exposure to go it alone the 1st time.
I think in most cases, people pay waaay too much in real estate commisions because they are lazy, & don't know how easy most of it is, & are not confident in their negotiating skills.
So, when the agent spends 100 hours with a buyer, showing multiple houses, writing multiple offers (including the attendant research), jumping when callled at mealtimes, and on evenings and weekends, and giving good guidance, how much should the agent gross and net?
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