Yes . What does this mean really to the industry and more importantly to housing market ?? ( I am not a legend in these areas :).Bye Bye gluttonous 6% commission
The 6% commission on buying or selling a home is gone after Realtors association agrees to seismic settlement | CNN Business
The 6% commission, a standard in home purchase transactions, is no more.amp.cnn.com
Such an ignorant statement idk where to begin...
This is what I think will happen and most of it is good news.
Listing agents (like me) are going to make more money.
Buyers agents are in trouble at certain price points (the agent trying to help someone approved for 450k and under now has a huge problem)
A lot of dead weight realtors will leave the indusrtry
The big brokerages like Remax, KW, that have hundreds of agents (at least half of which don't do anything) those agents I think will drop and the numbers will drop
Those most hurt: first time home buyers will need to come up with 2-3% to pay their realtor.
Sellers benefit a little more in most cases because now I can cut down their commission more and put it on the buyer to pay (and that's wha people will do, this already exists in the commercial world)
Listing agents (like me) are going to make more money.
Buyers agents are in trouble at certain price points (the agent trying to help someone approved for 450k and under now has a huge problem)
A lot of dead weight realtors will leave the indusrtry
The big brokerages like Remax, KW, that have hundreds of agents (at least half of which don't do anything) those agents I think will drop and the numbers will drop
Those most hurt: first time home buyers will need to come up with 2-3% to pay their realtor.
Sellers benefit a little more in most cases because now I can cut down their commission more and put it on the buyer to pay (and that's wha people will do, this already exists in the commercial world)
Completely unnecessary for most single-family home sales. AI will be able to do a better job within a few years of providing the required information to sellers and buyers.
😁
Would first time buyers just avoid hiring a realtor and contact the listing agent and express interest in purchasing a home they listed?
The article is mostly hot air. Imo nothing really changed yesterday. However local real estate boards will die a quick death while NAR will bleed membership and be hurt big which ultimately will suck for homeowners and be great for far left politicians who want to control housing and fix prices who NAR lobbys against
Just like the mls would make realtors obsolete and then it was the internet and then it was discount brokers. Youre looking to stir the pot but im not gonna bite here haha. Theres a reason every time I buy a house i try to buy for sale by owners.
Heres a perfect example of the value of a realtor.
I have a client who wanted a 4 bedroom 2500ish square foot house fully done up. Problem is that is $1,000,000 in my area and they were only approved for $800K.
Went door to door in a neighborhood found out there was a vacant house with water damage. A Contractor was trying to rip the seller off and steal it privately for $400K. I brought seller multiple buyers privately, got $525K and hooked up the buyers with a $287K fannie construction loan financing both purchase price and renovation cost ($260K + $27K contingency).
Buyer now gets to custom design their million dollar home for effectively around $800K all in. I will make 5% on this sale. Win-win-win for all parties.
I have a client who wanted a 4 bedroom 2500ish square foot house fully done up. Problem is that is $1,000,000 in my area and they were only approved for $800K.
Went door to door in a neighborhood found out there was a vacant house with water damage. A Contractor was trying to rip the seller off and steal it privately for $400K. I brought seller multiple buyers privately, got $525K and hooked up the buyers with a $287K fannie construction loan financing both purchase price and renovation cost ($260K + $27K contingency).
Buyer now gets to custom design their million dollar home for effectively around $800K all in. I will make 5% on this sale. Win-win-win for all parties.
They would need to pay the listing agent to represent them. listing agent won't work for free. Now imagine if they are calling up 10 different listings agents to see each house. If maybe they were the only offer on the home and paid hard ball they would just represent themselves which would likely nuke the transaction because they're not a realtor and don't know what they're doing.
And to piggy back on this, this is a post I made yesterday on another board having the same argument @T2Kplus20 is trying to start:
I have been cold calling this guy for about a year. Long story short I have a bunch of left over buyers from a listing I just did that went under contract for 450k. I told this seller, lets call him @T2Kplus20 "listen, let me go to your property, you don't need to be there I will show it to people and I think I can get you 425 maybe 450 because its similar to the one I just put under contract" (I wanted to set expectations low for him). These are clients I have picked up over the last year plus a few realtors who did not get the house I just sold for 450. Had 7 people come today. Mix of my own buyer clients and a few realtors.
I showed it for an hour and just got an offer emailed to me for 500k because of the urgency and demand I created. Have another at 440 and expecting one more at 450.
So this guy thinks at best he is going to get 450k which is an amazing price to begin with, I am getting him $50,000 more. According to some ignoramuses I did an hour of work so I shouldn't get paid anything or just for an hour of time and he could've done this himself (according to some).
That is why the best agents make a ton of money and the idiot agents give us a bad wrap.
What do attorneys charge for a closing?
If a buyer says I will offer $400,000 would an attorney charge $8000 to handle the closing and review the contract?
... the above is true for any commission based profession. 80% -20% rule of revenue......it's questioned more when the Agent/salesperson requires a license along with continuing education that would imply competency and public trust...
While your fist point is true, and we know you are in the business, it is a story on a legal settlement and not necessarily clickbait. We negotiated lower percentages in multiple instances.
You may have missed the most useful part of the article, which stated that the hack agents will likely get washed out and the top agents who provide real service will likely benefit and thrive.
That was my exact takeaway. Too many hacks in the industry and they will get washed out by this, which is good for the real and dedicated agents and brokers.
Last I heard, it was $1,500 and up. That is steep for people that don't have a lot of money. We bought a home in Arizona, and IIRC, a title agency closed it for us for a few hundred dollars. I think attorneys are not required in some of the Southern counties in NJ.
Basically if you have a good network and get listings , you will be good ?
Sorry, not impressed. Anyone can look up comps now and market a property in various ways. Sellers have the upper-hand and most don't need a realtor. What you described here was typical middle-man stuff. Also, why mislead the seller?
Its variable. I have seen some attorneys charge double what others do. The attorney is just responsible for paperwork though. They're not going to be there for inspections or pull comps for appraisals or meet town inspectors, contractors etc.
No doubt. I interview agents to join my brokerage a couple times a month and most of the time I decide not even to pitch my brokerage as I hear them talk and want to get them out of my office so I can get back to work. Way too easy to get your license and too many never do a deal...but the good ones are absolutely good and worth every nickel plus some.
That is pretty cheap now tbh. This is another great thing I see with people who think they know everything. We have preferred attorneys that we work with who only do real estate transaction law and charge like $1700-$1800 "no no skoolie I have my guy". Their guy takes 2 weeks to answer emails, makes the deal a nightmare and then on the closing statement I see a charge for $3500.
Lot to digest here
I think if you really know an area . And I mean really know it - you do not need an agent . (Not sure how many people
Really know an area ). But if you are one; you don’t need an agent and will be able to work something out with seller agent
I think as a seller you should use an experienced agent
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Put him on ignore. He pretends to be an expert on many things, when in reality, it's only two things-being wrong and annoying.
I have only ever blocked one person on here, it was this guy who wished my business fail and lose everything because I didn't think we should shutdown when COVID started.
Does this depend on the state of the market at the time?
In a slow market where a buyer sees the home makes a solid offer and tells the listing agent they will pay zero commission what responsibility does the agent have to the seller to get the sale completed since the seller is paying them a commission?
Obviously in a hot market with multiple buyers the situation is different.
He makes drug commercials. Actually, it's more like picks people to make the drug commercials.
you think listing agents are going to make more money? the issue is the MLS, open that up and this goes away
I agree, 2 houses and an investment property and never once talked to an agent. 6% has always been criminally high imho
estimated that between 12-18% of all homes are fsbo now. That is a huge jump from just a decade ago
The issue with fsbo’s is while they “save” on commission they almost always are netting less even when accounting for commissions. ANYONE can sell their own home without an agent, ANYONE. Very few will net more $ though
I'll be honest, that has not been my experience when I've seen them sell where I live. I think they made more than with commission but less overall sale price.
I do think the mkt matters (buyer vs seller mkt) with respects to value of agent
Any good piece of property I have ever bought for myself or my clients has been a FSBO. Every.single.time.
No one uses attorneys down here in OC for closings. Realtors and Title companies handle everything and honestly it goes much smoother.
It’s proven that by using a realtor you will get more $$ for your house. Of course there are exceptions but overall you’re better off
There is none because there is nothing to review. Any issues from home inspection are worked out by the buyer and seller via the realtors
And most people buying a FSBO expect to pay less because they know the seller isn’t paying a commission so it’s all a wash at best
Well, there technically still is an attorney review period however, its just 3 days of nothing since neither party hires an atty and after those 3 days you are officially locked in under contract.
Its interesting. South jersey doesnt use attorneys for the most part and the agents down there swear by it
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