A new class-action lawsuit takes aim at real estate agents and their 6% fee

Post by asdf333 » Wed, Mar 20, 2019, 2:47 AM UTC

BrentOzar wrote: post #253

om3n wrote: post #146

I'm a software engineer, and I started my career at a well known mortgage company in Detroit. Views are my own, BTW. I bought a house a couple years after I started working there, and I wanted the full home-purchaser experience. I used my company's services for everything, and as an employee they hooked me up with a real estate agent (among other things). I was honestly appalled at what little my real estate agent di…

> plus I paid her a 2% commission instead of 3%, and of course not 6% as if she represented me as well. I tried selling my home twice: first with the “normal” approach, using a real estate agent and paying everybody full commission. My agent just didn’t do enough to move the process along. After my contract with her expired, I bid her goodbye. On attempt #2, I listed it myself (for sale by owner) but put in the listi…

Post by ralph84 » Wed, Mar 20, 2019, 2:56 AM UTC

DesiLurker wrote: post #265

om3n wrote: post #146

I'm a software engineer, and I started my career at a well known mortgage company in Detroit. Views are my own, BTW. I bought a house a couple years after I started working there, and I wanted the full home-purchaser experience. I used my company's services for everything, and as an employee they hooked me up with a real estate agent (among other things). I was honestly appalled at what little my real estate agent di…

I see many (likely realtors) defending the fees & the larger model. Here is some back of envelop math I once did to put it in perspective: according to Bob Shiller (of case/shiller fame) it has historically taken about 30 years of work to own a house in steady markets. now on an average people move houses once every 7 years due to labor mobility/family/etc reasons. so roughly 4 housing buy/sell transactions in an ave…

Post by 8ytecoder » Wed, Mar 20, 2019, 3:06 AM UTC

pseudometa wrote: post #25

It blows my mind that the fees are percentage based. The amount of work required for an agent on a 100K house is very similar to that of a 2 Mill house. Presumably the seller agent wishes to get compensation for increasing the value of the house, but for both the seller and buyer agents, the number of deals done far outweighs slight incremental selling prices. In which case, both would prefer to settle on a lower pri…

Post by freewilly1040 » Wed, Mar 20, 2019, 3:10 AM UTC

airstrike wrote: post #250

kevindong wrote: post #74

I'm about to graduate college and move to NYC for a job. The unfortunate norm there is to pay a 15% fee (of the annual rent) to brokers to get a rental apartment. The cheapest the broker's fee gets is one month's rent, so about 8.33% of the annual rent. High end apartments sometimes pay the broker's fee on the renter's behalf [2]. Large apartment complexes sometimes have their own leasing offices, so there's no fee t…

Moved to NYC and paid a broker $8k+ for an apartment I had found by myself on streeteasy, and rent was around $3.5k... To this day my wife and I refer to her as "the parasite". She provided ZERO value other than showing me around the building, which any of the 20-person staff in the building could have done, and in any case certainly doesn't justify paying her more than TWO months' rent

Post by fma » Wed, Mar 20, 2019, 3:15 AM UTC

jessaustin wrote: post #272

kbutler wrote: post #234

Earlier quoted context omitted.

$2M house. 6% commission split 3% to seller's realtor and buyer's realtor. Seller's realtor gets $60K if it sells in 1 month or 1 year, same commission. No sale = $0. First week gets a 10% low offer of $1,800,000. If sale completes, that's $54,000 income for the realtor (.03*1800000). Or, could hold out for a better offer after for some months of additional work to hopefully get an offer for the full $2M, and the rea…

...after for some months of additional work... I'm as suspicious of realtors as anybody, but this scenario here includes a real asshole as a seller. If she doesn't want to sell her house, she shouldn't waste everybody's time by putting it on the market. This sort of "just testing the market" shenanigan raises costs for everyone.