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Jury Finds Realtors Conspired, Awards Nearly $1.8B in Damages

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Re: Jury Finds Realtors Conspired, Awards Nearly $1.8B in Damages

#111

Post by defen »

pc86 wrote: post #65
ransom1538 wrote: post #19

Earlier quoted context omitted.

Just sell it / or buy it yourself. It isn't hard by any stretch. You can use a $200 listing broker on a MLS site. That is the big secret. Then it gets on zillow,redfin, etc automatically.

In many states that just means the other agent gets all the commission instead of splitting it with your agent. You don't get any of it, and it isn't discounted anywhere.

The agent's commission is irrelevant. That just means the buyer needs to make a higher offer to be competitive with someone who is not using an agent.

Re: Jury Finds Realtors Conspired, Awards Nearly $1.8B in Damages

#112

Post by nicholasjarnold »

RHSeeger wrote: post #59
rubymancer wrote: post #7

There's not much to the article. > KANSAS CITY, Mo.—A federal jury on Tuesday found the National Association of Realtors and large residential brokerages liable for about $1.8 billion in damages after determining they conspired to keep commissions for home sales artificially high. > The verdict comes in the first of two major antitrust lawsuits that target decades-old industry practices and seek to drive down commiss…

I bought a few years back and we didn't really use an agent to find the house at all. Looking into it, I found that a certain percentage of the sale amount goes to pay the agent(s); 6% I think. If there are two agents, they each get half. If one person doesn't use an agent... the other person's agent gets it all. The person without an agent doesn't get to keep their half... it just all goes to the other agent. Wtf...…

I used an attorney specializing in real-estate to represent our side of the house during my first home purchase. We subsequently reduced the bid by 3% with an explicit note about why (no buyer's agent commission to pay). The seller's agent was a broker and was apparently motivated because they accepted our deal along with fixing a list of little items uncovered during inspection. We paid our lawyer a $2-3k iirc.

I'll never know if that broker got 6% from the seller or took 3% to close the deal, but our strategy worked: I paid 5 figures less for the home than what was being asked for at a time when houses were selling for over asking price in this area.

It's worth a shot I guess. 2 warnings: Some seller's agents will get very pissed at you (b/c this and other things like Redfin's 1% is disrupting their cash cow and they're not stoked about it). It might be difficult to find an attorney since most RE attorneys focus on commercial deals.

Re: Jury Finds Realtors Conspired, Awards Nearly $1.8B in Damages

#113

Post by hn_throwaway_99 »

pc86 wrote: post #65
ransom1538 wrote: post #19

Earlier quoted context omitted.

Just sell it / or buy it yourself. It isn't hard by any stretch. You can use a $200 listing broker on a MLS site. That is the big secret. Then it gets on zillow,redfin, etc automatically.

In many states that just means the other agent gets all the commission instead of splitting it with your agent. You don't get any of it, and it isn't discounted anywhere.

That is really not how it works, and goes to show there is at least some value in agents, as they do know how the process works.

The "standard" in the US is that the sellers pay 6% commission, with 3% going to their listing agent, and 3% going to the buyers agent. If, as a buyer, you show up without a listing agent and don't demand 3%, it is totally reasonable, and quite common, to ask for a 3% price discount since you have no agent. Any sensible seller would take your offer as it means they are getting the same amount of money.

I'm not saying this always "works", but sometimes people act like these are rules that are set in stone, as opposed to things you can negotiate for.

Back in the early 00s I went with a discount listing agent who only charged 1%. They recommended I still give 3% to the buyers agent, but I said fuck that, and only offered 2% (market wasn't crazy strong but also wasn't weak), and the buyer's agent accepted that. So all in I sold my house for 3% instead of 6%, which I thought was totally fair given the amount of work the agents did.

Re: Jury Finds Realtors Conspired, Awards Nearly $1.8B in Damages

#114

Post by poulsbohemian »

Spooky23 wrote: post #35
judge2020 wrote: post #21

Earlier quoted context omitted.

> no agent deserves a 6% commission for simply getting something listed on zillow or MLS Typically 3% is seller agent commission and 3% is buyer agent commission - although in the paperwork it's most likely 6% to the seller's agent and the seller's agent offers 3% to the buyer's agent. Although 5% total / 2.5% to each realtor is becoming a bit more popular as of recent, based on the listing I browse.

Remember there’s no professional responsibility for realtors, so they do shady shit like shop the house internally to keep the full 6%.

I encourage you to report any behavior you believe to be illegal or unethical to both your local realtor association as well as your state agency. That’s why those organizations exist and we are all better if people are held to professional standards.

Re: Jury Finds Realtors Conspired, Awards Nearly $1.8B in Damages

#115

Post by notaustinpowers »

_ea1k wrote: post #106

The problem isn't just realtors, it is that the whole system is designed to maximize transaction costs. Who cares how much the attorney and loan paperwork cost when they are only 1-2%, you are already paying 5-6% to realtors, ~.5-1% in repair costs, and often a part of the buyer's closing costs too? But if you think about that wholistically, that means sellers are paying 8-10% of the cost of a house every time they s…

A huge hurdle with trying to cut costs is because of NAR themselves, and local Realtor Associations. Any Realtor is with NAR and a local Association, which heavily restricts what they can do. Not being in a local Association can remove your access to the MLS, reducing your visibility to other agents, and remove your access to the state-specific legal forms.

Add in closing attorneys and home inspectors being brought in-house to reduce costs, it can be a very expensive start-up cost that would require lots of capital to achieve. Zillow/Opendoor got REALLY close, but they stopped (Zillow) or, like you said, lowball offers because they're fronting all of the backend costs that used to be spread across 4 or 5 different services.

Re: Jury Finds Realtors Conspired, Awards Nearly $1.8B in Damages

#116

Post by ska »

onlyrealcuzzo wrote: post #92
stuff4ben wrote: post #5

Commission based on home value is a joke. Realtors should earn a flat-rate.

If you're selling a $2M house, you're willing to pay more for someone to get you a good price. On the flip side, no one is going to pay $5k to sell a $30k house. Flat rates don't make sense. Maybe you think the percentage is too high.

Maybe the percentage should be laddered, or there should be a floor.

Re: Jury Finds Realtors Conspired, Awards Nearly $1.8B in Damages

#117

Post by ethbr1 »

_aavaa_ wrote: post #89
majormajor wrote: post #70

Earlier quoted context omitted.

> I bought a few years back and we didn't really use an agent to find the house at all. Looking into it, I found that a certain percentage of the sale amount goes to pay the agent(s); 6% I think. If there are two agents, they each get half. If one person doesn't use an agent... the other person's agent gets it all. The person without an agent doesn't get to keep their half... it just all goes to the other agent. Wtf.…

> Some selling agents refuse to do this because it's pretty shady, but definitely not all. This is a blatant conflict of interest. My god.

It's only a conflict of interest if either the seller or the buyer expect their agents to negotiate price for them.

Generally agents steer well clean of that, for legal and time reasons.

A realtor is there to put properties in front of you / put your properties in front of others, and then close the deal when you tell them which property you're interested in.

Volume pays realtors, not price-over/under-replacement.

Re: Jury Finds Realtors Conspired, Awards Nearly $1.8B in Damages

#118

Post by Kirby64 »

bluGill wrote: post #18
Kirby64 wrote: post #8

Earlier quoted context omitted.

You can. It's just a bit of a racket (hence, conspiracy judgment) and nobody will work with you if you only offer a flat rate. Since MLS is mostly limited to Realtors in most markets, you're basically locked out from posting there. There's ways around it, and flat fee brokers that exist, but you hamper your sales ability. Not an issue when its a sellers market, but can be rough in a buyers market.

There are flat rate realtors where I live. However they are only 50%, the still give the same 3.5% to the buyers agent, but they take for themselves a fixed rate to get you on MLS. I'm not sure if it is a good deal - they still charge high prices relative for what they do for you. (it is cheaper than a full agent, but they also do much less)

You just don't sign a contract where you give a buyers agent commission, although again this limits the pool. Frankly, buyers agents are largely a scam in my view. With MLS, Zillow, Redfin, etc, their 'experience' seems mostly worthless. It certainly is not worth 3% of the cost of a house.

If anything, sellers agents are more useful since they actually offer something valuable to the real estate experience (e.g., listing housing, photos, providing buyers access, etc).

Re: Jury Finds Realtors Conspired, Awards Nearly $1.8B in Damages

#119

Post by francisofascii »

RHSeeger wrote: post #59
rubymancer wrote: post #7

There's not much to the article. > KANSAS CITY, Mo.—A federal jury on Tuesday found the National Association of Realtors and large residential brokerages liable for about $1.8 billion in damages after determining they conspired to keep commissions for home sales artificially high. > The verdict comes in the first of two major antitrust lawsuits that target decades-old industry practices and seek to drive down commiss…

I bought a few years back and we didn't really use an agent to find the house at all. Looking into it, I found that a certain percentage of the sale amount goes to pay the agent(s); 6% I think. If there are two agents, they each get half. If one person doesn't use an agent... the other person's agent gets it all. The person without an agent doesn't get to keep their half... it just all goes to the other agent. Wtf...…

Yep, I learned that the hard way when we bought our first house a long time ago. I naively thought I would be a more attractive buyer because they don't have to pay my agent. There ended up being two other offers. Anyway, I remember seeing in the closing documents the amount allotted to their agent, the full 6%. Wtf, indeed.
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