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

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

#341

Post by shostack » Sun, Mar 24, 2019, 5:01 PM UTC

fatnoah wrote: post #334

philwelch wrote: post #119

Earlier quoted context omitted.

(Disclaimer: I work for a tech company in the real estate industry. Opinions are my own.) > 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. Negotiating a $100,000 purchase or sale is an order of magnitude less lower stakes than negotiating a $2,000,000 purchase or sale. If you're a real estate agent and you're abl…

I have an even more cynical take on things. I purchased a house last summer and played the naive buyer and entered into a dual-agency agreement with the selling agent. Due to the competitive market in the town we were buying in, this was to hopefully give us the tiebreak with competing offers. I have few expectations from a buyers agent beyond opening doors to let us in to view properties and to communicate with the…

Was your hope with this strategy that the double commission would cause the agent to steer the sale to you?

I see things about strategies like this, and then seriously question whether I feel agents in general have enough integrity to warrant leaving me out of the communication process as you propose.

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

#342

Post by shostack » Sun, Mar 24, 2019, 5:04 PM UTC

Gibbon1 wrote: post #193

windexh8er wrote: post #81

Earlier quoted context omitted.

The reality is realtors are well protected in the sale of the home for many reasons that are defined in the legal documentation required and not in the closing process. Given the point I'm curious now of how many individual realtors take the blame in a sale after the fact? It is generally the seller who's on the hook and is directly sued from what I've seen. Maybe this is incorrect but it's rarely the middle man step…

My impression buying a house was the entity holding the bag is the title company. Everyone else involved is just holding out their hand.

Can you elaborate please?

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

#343

Post by speedplane » Thu, Mar 28, 2019, 7:37 AM UTC

makeset wrote: post #314

speedplane wrote: post #305

Earlier quoted context omitted.

> in the US, the buyer's agent is only working for the buyer. They're just paid by the seller (traditionally and stupidly). I just went through this process. While the buyer's agent ostensibly works for the buyer, their main incentive is to get you to close. It doesn't matter if it's a good deal, a bad deal, or whatever. They take 3% so if you overpay or underpay by 10% of the appropriate value of the house that's on…

Not to defend the system, the incentives are clearly not well-aligned, but I also just went through this process had an unexpectedly great experience with my buyer's agent, whom I found through a referral. He was professional, ethical, and actually took his fiduciary duty seriously. He didn't claim to find listings that I wouldn't have myself, but guided my search a bit based on my criteria, gave candid feedback on t…

Maybe I just got a bad buyer's broker (he was a reference from my mother, how could I refuse). My broker would refuse to CC me or BCC me on any communication with the seller's agent, or the co-op board, and when I asked him to forward this communication, he would remove timestamps and the underlying earlier threaded email messages.

It felt incredibly sketchy and unprofessional, but to this day I'm not sure if it was due to ineptitude, trying to provide cover for himself, or worse (maybe by deleting timestamps he could claim he responded faster than he did).

He also made a huge omission. He knew we wanted to renovate the apartment, but we did not get a copy of the alteration agreement until after we signed the contract. I didn't even know what an alteration agreement was, but it was something I felt a good buyer's broker should raise early if he/she knows you're planning a reno.

In the end, the deal did close, I think we got a fair price, but it came with many avoidable headaches and much unnecessary anxiety had our broker been more professional.

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

#344

Post by fatnoah » Tue, Apr 02, 2019, 11:21 PM UTC

shostack wrote: post #341

fatnoah wrote: post #334

Earlier quoted context omitted.

I have an even more cynical take on things. I purchased a house last summer and played the naive buyer and entered into a dual-agency agreement with the selling agent. Due to the competitive market in the town we were buying in, this was to hopefully give us the tiebreak with competing offers. I have few expectations from a buyers agent beyond opening doors to let us in to view properties and to communicate with the…

Was your hope with this strategy that the double commission would cause the agent to steer the sale to you? I see things about strategies like this, and then seriously question whether I feel agents in general have enough integrity to warrant leaving me out of the communication process as you propose.

Yes, that was definitely part of it. In the town we purchased in (near Boston suburb) the median home value is > $1 million, so that extra 2.5 percent is a lot of money.

In our last homebuying experience, we lost two houses to other buyers. In both cases, our offer was higher than the closing price by 5-10% BUT our buyer's agent was from a different agency than the sellers. In both of those cases, the people who got the house were represented by someone from the same agency as the seller.