5 ms·

I agree. I live in a small isolated town, and I thought realtors were artificially increasing the home prices (not values, but prices) in the small pool of hous

by japhyr 9y ago

I agree. I live in a small isolated town, and I thought realtors were artificially increasing the home prices (not values, but prices) in the small pool of housing available here. But their local knowledge was invaluable in both buying and selling a home. That said, if a buyer and seller agree on a sale independently of any realtor here, we can go to a local realtor and they'll happily facilitate the sale for a flat fee of around $1000. I've done that once, and had a number of friends who also did so. Most of the realtors recognize that the bulk of their commission comes from the listing and marketing process, and the paperwork is just something they know how to do correctly. $1000 is a fair price for knowing that's all being done correctly and fairly.

ericb 9y ago
You don't need a realtor, fyi, just a good real estate lawyer, which you generally need anyway when buying/selling a house. A lot of the apparent value of realtors disappears when you do the process yourself. source: have FSBO bought, and FSBO sold, and redfin bought, and worked for Coldwell Banker. Getting on the MLS is cheap/easy now with discount MLS listings--I wouldn't do fsbo without it, even though you usually pay buyer's agents.
- ferentchak 9y ago
  Do they make you sign a contract or can you put 3% discount for person to person sale? That way they are paying their agent if they decide to use one.
  - ericb 9y ago
    In the MLS listing, you put the amount of commission you are offering for buyer's agent. Then the real estate lawyer draws up the final contract with that included and it comes out of what you get. For direct person to person, I imagine you can just skip that part. If you put that you are willing to pay 0% commission, I think what will happen is that everyone who is actually relying on their buyer's agent to source houses to look at will not be brought to your property, as there is nothing in it for them. You might lose out on a profitable bidding war, or the one customer who might buy the house coming through by doing that, but you might get an extra 2.5% if it works out.
- opo 9y ago
  >You don't need a realtor, fyi, just a good real estate lawyer, Lawyer prices will obviously be different in different parts of the country, (so maybe a lot cheaper where you are) but I knew someone who arranged a transaction without a realtor and paid a lawyer a lot more than $1,000 to put together all the necessary documents. One thousand seems like a good deal. >...which you generally need anyway when buying/selling a house. You've found it necessary to always consult a lawyer when buying/selling even though realtors were involved? Why? What value did they add?
  - abawany 9y ago
    In my case, there was always a lawyer involved in the contract with a fixed for dealing with documentation, as part of the closing costs. I never explicitly involved a lawyer but have always been intrigued by the idea of doing a FSBO deal with a lawyer generating all of the real estate contracts for a fixed fee.
  - ericb 9y ago
    A house sale is really a large contract agreement with a number of finer points. The legal fees were maybe $750 - 1200 but memory is sketchy on that. There are filings necessary with the state and other items that make it legal, and at least in Massachusetts USA, it is a lot different than say selling a mountain bike. Banks need certain info for loans, there's the deed, etc, inspections, etc. When you are signing your 20th piece of paper, you realize you needed the lawyer. One dirty secret of realtors is that all this work is handled by lawyers, and the impossible-looking parts of a real estate transaction are handled by lawyers who understand it and have it down to a fixed-price cookie-cutter process for their locality. They did "consult" with me a bit and gave some "free" advice, but I just paid the fix price for doc generation mainly.
    - opo 9y ago
      I agree it would be a bit risky to buy/sell real estate without any outside help. My point was just that if you are already using a realtor, it shouldn't generally be necessary to also hire a lawyer.
- bubbleRefuge 9y ago
  Or just a title company. I have twice gone without realtors in transactions. Sales contracts in my state, Florida, have a uniform structure. The title company, if its large enough, probably has a staff attorney. In one case, I was able to escalate issues to the attorney when the seller was tussling with me about changes to the contract. No additional costs other than normal closing fee's associated with title insurance and such.
lighthazard 9y ago
It seems the takeaway from all these comments here is that there needs to be more education in the home buying experience.
- just4themoney 9y ago
  Agents and brokers tend to make the home buying process as complicated and as murky as possible on purpose, job security.
kelukelugames 9y ago
Bulk of commission actually covers prospecting. This is how the Redfin model works. It saves the agents time by funneling customers to them through the website :)

by japhyr 9y ago

ericb 9y ago

You don't need a realtor, fyi, just a good real estate lawyer, which you generally need anyway when buying/selling a house. A lot of the apparent value of realtors disappears when you do the process yourself. source: have FSBO bought, and FSBO sold, and redfin bought, and worked for Coldwell Banker. Getting on the MLS is cheap/easy now with discount MLS listings--I wouldn't do fsbo without it, even though you usually pay buyer's agents.

ferentchak 9y ago
Do they make you sign a contract or can you put 3% discount for person to person sale? That way they are paying their agent if they decide to use one.
- ericb 9y ago
  In the MLS listing, you put the amount of commission you are offering for buyer's agent. Then the real estate lawyer draws up the final contract with that included and it comes out of what you get. For direct person to person, I imagine you can just skip that part. If you put that you are willing to pay 0% commission, I think what will happen is that everyone who is actually relying on their buyer's agent to source houses to look at will not be brought to your property, as there is nothing in it for them. You might lose out on a profitable bidding war, or the one customer who might buy the house coming through by doing that, but you might get an extra 2.5% if it works out.
opo 9y ago
>You don't need a realtor, fyi, just a good real estate lawyer, Lawyer prices will obviously be different in different parts of the country, (so maybe a lot cheaper where you are) but I knew someone who arranged a transaction without a realtor and paid a lawyer a lot more than $1,000 to put together all the necessary documents. One thousand seems like a good deal. >...which you generally need anyway when buying/selling a house. You've found it necessary to always consult a lawyer when buying/selling even though realtors were involved? Why? What value did they add?
- abawany 9y ago
  In my case, there was always a lawyer involved in the contract with a fixed for dealing with documentation, as part of the closing costs. I never explicitly involved a lawyer but have always been intrigued by the idea of doing a FSBO deal with a lawyer generating all of the real estate contracts for a fixed fee.
- ericb 9y ago
  A house sale is really a large contract agreement with a number of finer points. The legal fees were maybe $750 - 1200 but memory is sketchy on that. There are filings necessary with the state and other items that make it legal, and at least in Massachusetts USA, it is a lot different than say selling a mountain bike. Banks need certain info for loans, there's the deed, etc, inspections, etc. When you are signing your 20th piece of paper, you realize you needed the lawyer. One dirty secret of realtors is that all this work is handled by lawyers, and the impossible-looking parts of a real estate transaction are handled by lawyers who understand it and have it down to a fixed-price cookie-cutter process for their locality. They did "consult" with me a bit and gave some "free" advice, but I just paid the fix price for doc generation mainly.
  - opo 9y ago
    I agree it would be a bit risky to buy/sell real estate without any outside help. My point was just that if you are already using a realtor, it shouldn't generally be necessary to also hire a lawyer.
bubbleRefuge 9y ago
Or just a title company. I have twice gone without realtors in transactions. Sales contracts in my state, Florida, have a uniform structure. The title company, if its large enough, probably has a staff attorney. In one case, I was able to escalate issues to the attorney when the seller was tussling with me about changes to the contract. No additional costs other than normal closing fee's associated with title insurance and such.

lighthazard 9y ago

It seems the takeaway from all these comments here is that there needs to be more education in the home buying experience.

just4themoney 9y ago
Agents and brokers tend to make the home buying process as complicated and as murky as possible on purpose, job security.

kelukelugames 9y ago

Bulk of commission actually covers prospecting. This is how the Redfin model works. It saves the agents time by funneling customers to them through the website :)