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Almost no one pays a 6% real-estate commission except Americans

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Re: Almost no one pays a 6% real-estate commission except Americans

#251

Post by lotsofpulp »

jperras wrote: post #210
stephencanon wrote: post #59

Earlier quoted context omitted.

We’ve bought two houses, sold one, bought a lot to built a house for my parents. We’ve never hired a real estate agent. The seller had an agent for the first transaction, none of the other counterparties had an agent. Paying a lawyer by the hour to handle things is simpler, cheaper, and a random lawyer is dramatically more competent than a random agent (the most complex transaction ended up costing us maybe $4k in la…

Canadian here. Sadly, it's common practice around these parts for buyer agents to completely ignore listings that don't have a selling agent attached; it's their form of industry protectionism. As a result you end up losing out on a large surface area of buyers who rely on their buying agent to find properties, which puts you at a disadvantage.

Websites have obviated the utility of a buyer’s agent “finding” houses for 90% of buyers.

Setup alerts for the type of house you want, draw the geographic boundaries on Zillow, and spend 2 minutes looking at the listing and maps to find out everything an agent would have been able to tell you.

Re: Almost no one pays a 6% real-estate commission except Americans

#252

Post by rgbrgb »

closeparen wrote: post #238
mcoliver wrote: post #216

This comment is focused on USA. Some people need or want an agent, some people don't. For the majority the checklist for buying a home is fairly straight forward and could be automated with checklists, yelp, Plaid/UWM, and DocuSign. But not all. The bigger issue that I think almost everyone can agree on is the standardized percentage thing. Being an agent should be a flat negotiated fee or billed like the trades per…

The title company is the one who sends and receives wires and executes the nuts-and-bolts transfer of ownership. You could imagine fintechs getting into that space even with traditional agents, and you could imagine title companies catering to for-sale-by-owner.

Title companies are already pretty efficient and relatively cheap... not a lot of margin or process to improve with technology.

Re: Almost no one pays a 6% real-estate commission except Americans

#253

Post by briffle »

stephencanon wrote: post #59
ssharp wrote: post #21

I don't know how much value agents added over the past few years, navigating bidding wars, pocket listing access, etc. but I've never understood the justification for spending so much money on these fees. The last time I sold a house was 2011, when the housing market was still down from the 2008/09 crash. I talked with multiple agents and never got a sense of them doing much to push the house other than listing it on…

We’ve bought two houses, sold one, bought a lot to built a house for my parents. We’ve never hired a real estate agent. The seller had an agent for the first transaction, none of the other counterparties had an agent. Paying a lawyer by the hour to handle things is simpler, cheaper, and a random lawyer is dramatically more competent than a random agent (the most complex transaction ended up costing us maybe $4k in la…

If you were in the US, most likely the Sellers agent then kept the full 6% fee unless you negotiated it down on that first transaction.

Re: Almost no one pays a 6% real-estate commission except Americans

#254

Post by ugh123 »

Multiplayer wrote: post #172

In coastal California the commission situation becomes ludicrously lucrative to the top agents. This week a home in my community sold for $25,0000,000. One of my friends had the buy side, another had the sell side. The buy side agent will be involved in ~200,000,000 in transactions this year, a down year. In this community there are plenty of transactions north of $20,000,000. He just did another and had both sides o…

>They ended up selling ads to Realtors rather than opening up a new way for owners to sell their homes directly.

Doesn't it always go that way with goals like that?

How many times have we seen "automated recruiting" platforms pop up, only for them to pivot a year later into selling access and ads directly to recruiters.

The market for "middle-men" seems to always be thriving when there's little to do and much to gain.

Re: Almost no one pays a 6% real-estate commission except Americans

#256

Post by j45 »

jperras wrote: post #210
stephencanon wrote: post #59

Earlier quoted context omitted.

We’ve bought two houses, sold one, bought a lot to built a house for my parents. We’ve never hired a real estate agent. The seller had an agent for the first transaction, none of the other counterparties had an agent. Paying a lawyer by the hour to handle things is simpler, cheaper, and a random lawyer is dramatically more competent than a random agent (the most complex transaction ended up costing us maybe $4k in la…

Canadian here. Sadly, it's common practice around these parts for buyer agents to completely ignore listings that don't have a selling agent attached; it's their form of industry protectionism. As a result you end up losing out on a large surface area of buyers who rely on their buying agent to find properties, which puts you at a disadvantage.

Canada is typically 7% commission on the first 100k and 3.5% on the balance.

As average prices have increased commission has also gone up.

Realtor fees are high for their low level of digital literacy and competency.

Realtors will be disrupted by tech folks who take a simple licensing exam and make software work for the customers.

Running anything more than a basic level of search is usually impossible for Realtors.

It’s this old realtor exchange which has more than had its clock tick past expiry.

A software dev buddy had some decent parameters (distance to school, work, family, etc) and it seemed to boil Realtors brains to find a way to map this.

It was more about making a sale.

It was almost to the point where my friend almost was going to become a realtor to get access to the data to run his own searches. He calculated getting a license was cheaper than the commission.

Realtors are like lawyers, too many don’t know everything but act like they do.

The ones who specialize and actually are experts are worth it.

Most sales are not that specialized

Re: Almost no one pays a 6% real-estate commission except Americans

#258

Post by [deleted] »

stephencanon wrote: post #59
ssharp wrote: post #21

I don't know how much value agents added over the past few years, navigating bidding wars, pocket listing access, etc. but I've never understood the justification for spending so much money on these fees. The last time I sold a house was 2011, when the housing market was still down from the 2008/09 crash. I talked with multiple agents and never got a sense of them doing much to push the house other than listing it on…

We’ve bought two houses, sold one, bought a lot to built a house for my parents. We’ve never hired a real estate agent. The seller had an agent for the first transaction, none of the other counterparties had an agent. Paying a lawyer by the hour to handle things is simpler, cheaper, and a random lawyer is dramatically more competent than a random agent (the most complex transaction ended up costing us maybe $4k in la…

[deleted]

Re: Almost no one pays a 6% real-estate commission except Americans

#259

Post by j45 »

MarkusWandel wrote: post #241
j45 wrote: post #214

Earlier quoted context omitted.

There is insurance on real estate transactions for a reason. Not exclusive to realtors. Many realtors works take a consulting fee too navigate things. Try.

I never understood Title Insurance. Isn't the whole point of a lawyer handling the transaction to look for potential gotchas? As opposed to just rubber stamp it and let the insurance handle it if something does come up?

One case is titles don’t transfer instantly. If there’s a backlog and something happens during then, insurance can help with that:

Beyond that getting a lawyer to handle a sale doesn’t seem much different with or without a realtor. They have their own liability insurance.

Realtors def help navigate the market agent they are competent in it.

Re: Almost no one pays a 6% real-estate commission except Americans

#260

Post by iterminate »

Multiplayer wrote: post #172

In coastal California the commission situation becomes ludicrously lucrative to the top agents. This week a home in my community sold for $25,0000,000. One of my friends had the buy side, another had the sell side. The buy side agent will be involved in ~200,000,000 in transactions this year, a down year. In this community there are plenty of transactions north of $20,000,000. He just did another and had both sides o…

> The irony? High end home sales require much less work/effort than low end. Far fewer showings. No open houses, ever.

That's true of most work. Software engineering is much less work/effort than a minimum wage job. The higher you go, the easier it is.

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