Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
Buyer agents are nothing more then another way for real estate agents to make money/split commission
Actually commissions haven't increased with the advent of buyer agents. Before the MLS/Internet/Buyer Agents commissions were generally the same as today but the listing company more often than not sold their own listing and the buyer had no representation. Now, buyers are represented and the total commission paid at closing is usually the same or less than it used to be.
Actually commissions haven't increased with the advent of buyer agents. Before the MLS/Internet/Buyer Agents commissions were generally the same as today but the listing company more often than not sold their own listing and the buyer had no representation. Now, buyers are represented and the total commission paid at closing is usually the same or less than it used to be.
I am fully aware of that but most everything done in the real estate market is for realtors to make commissions more so then for any other reason.
Meaning the agent(s) commissions come first. All else is a distant 2nd.
I am fully aware of that but most everything done in the real estate market is for realtors to make commissions more so then for any other reason.
Meaning the agent(s) commissions come first. All else is a distant 2nd.
Making money is true for business industries. I'm not aware of an industry, even medicine, where people don't want to make a profit. What industries are you aware of where the business doesn't want to be profitable?
I am fully aware of that but most everything done in the real estate market is for realtors to make commissions more so then for any other reason.
Meaning the agent(s) commissions come first. All else is a distant 2nd.
First, can you prove agents put commissions first? That's a bold, broad statement that you can't prove (because it isn't true). You shouldn't try to state it as a fact.
Secondly, of course Realtors are in the business to make money. That's kinda the idea of owning a business.
I am fully aware of that but most everything done in the real estate market is for realtors to make commissions more so then for any other reason.
Meaning the agent(s) commissions come first. All else is a distant 2nd.
This is why I have come to believe that the buyer's agent should be paid a flat fee, NOT a commission -- because that commission is a clear conflict of interest, tempting the buyer's agent to aim for the most expensive house his client can afford, rather than the best house for that client.
This is why I have come to believe that the buyer's agent should be paid a flat fee, NOT a commission -- because that commission is a clear conflict of interest, tempting the buyer's agent to aim for the most expensive house his client can afford, rather than the best house for that client.
I really can't believe that people think this way...
Are you trying to tell me it's NOT a conflict of interest, when the buyer's agent gets paid more if he costs his client more money??
Part of the buyer's agent's job should be getting his client the best possible price. But so long as he's paid on a commission basis, he has an incentive to do the opposite. And while I've met ...well, exactly TWO, in 30+ years... agents who aren't tempted like that, they're rare.
Being paid on a commission basis makes sense if you're the seller's agent; then your job is to max out the sale, and both the agent and the seller benefit. But I fail to see how this mentality benefits the buyer.
And don't tell me it's unfair to the agent, since half your jobs are sales, half buys, by the very nature of the business.
I think this is a great deal of why there are now flat-fee RE agents.
Are you trying to tell me it's NOT a conflict of interest, when the buyer's agent gets paid more if he costs his client more money??
Part of the buyer's agent's job should be getting his client the best possible price. But so long as he's paid on a commission basis, he has an incentive to do the opposite. And while I've met ...well, exactly TWO, in 30+ years... agents who aren't tempted like that, they're rare.
Being paid on a commission basis makes sense if you're the seller's agent; then your job is to max out the sale, and both the agent and the seller benefit. But I fail to see how this mentality benefits the buyer.
And don't tell me it's unfair to the agent, since half your jobs are sales, half buys, by the very nature of the business.
I think this is a great deal of why there are now flat-fee RE agents.
Do you honestly not know that 99% of a realtors business is based off referrals?
If an agent did what you think they do said agent wouldn't be in business for very long.
Furthurmore, it's highly unethical for an agent not to look out for the best interest of his/her client. If somehow it could be proven that an agent did intentionally screw their client to make a few extra bucks they would not be an agent anymore.
Lastly, do you have the slightest idea of how commissions are calculated?
Just as a for instance, lets say a buyers agent finds a client a home for $250,000 and the commission paid is 6%. Immediately the commission is split between the buyers agent and the listing agent. So 6% of $250k is $15,000. Half of that (which goes to the buyers agent is $7500). Now, most agents have an agreement with the company they work for and lets just say in this case the split is 50/50 (sometimes it's 60/40 sometimes it's 70/30). When everything is all said and done the buyers agent receives a $3750 commission on a $250,000 home. Now, lets say that the same agent finds the same buyer a $300,000 home. A $50,000 increase in price translates to a $750 difference in commission.
How many people do you know are so driven by greed would throw away the entire livelyhood over $750?
I believe the reason there are more flat fee agents is because more and more of the general public think that they are getting a better deal with a reduce priced company. Reduced price = reduced results.
... And while I've met ...well, exactly TWO, in 30+ years... agents who aren't tempted like that, they're rare.
How many have you met that you can prove are tempted like that and actually take advantage of their clients?
And are you seriously saying that all buyers are stupid enough to allow an agent to make the final buying decision for the buyer without the buyer reviewing the comps for a property and determining the current value for him/herself?
Quote:
Being paid on a commission basis makes sense if you're the seller's agent; then your job is to max out the sale, and both the agent and the seller benefit. But I fail to see how this mentality benefits the buyer.
I'm actually surprised you make this statement, because usually people who don't understand the Realtors fiduciary duties, and the penalties for violating them, will say that the listing agent will try to get the house listed lower than value "so they can make a quick commission".
Notice it is real estate people jumping to defend their business's way of operating?
I expect used car sales people do the same.......LOL
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
I really can't believe that people think this way...
