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I take it this is your first transaction buying a house. You are basing what you think on that and what people are saying online. I can assure you as someone th

by gist 9y ago

I take it this is your first transaction buying a house. You are basing what you think on that and what people are saying online. I can assure you as someone that buys real estate (as investments) it typically isn't that easy, at least in a typical market and for most transactions. And I have been doing this since the 1980's fwiw.

bhandziuk 9y ago
You're right it was my first house. I do believe it is sometimes more complicated. But is the value of a realtor's time to me, as a buyer or seller, really several hundred dollars per hour? Is buying a 600k house really twice as difficult a transaction than a 300k house? Why are they not paid a flat fee?
- dragonwriter 9y ago
  Seller's agents aren't paid a flat fee to align their interest with that of the seller; they want the deal to close at the highest price possible. Why buyer's agents are paid on sale-price-commission is, OTOH, a real question.
  - gist 9y ago
    > Why buyer's agents are paid on sale-price-commission is Once again buyer's agents are a large part of the equation. They have to drive around the actual buyers and waste time showing properties with nothing to show for it often. So the way it works is the people who actually buy (or sell) make more money to compensate for people that do not buy.
    - dragonwriter 9y ago
      But a sales price commission, of all possible completion-based pay structures, makes the interest of the agent misaligned with (opposed to, in some respect) that of the principal.
      - jrs235 9y ago
        Have you read Freakanomics? They find that agents are more interested in closing add getting paid rather than the extra couple hundred dollars of commission a $10000 swing in price gets them. I'd gladly fight to save a buyer I represent $10000 on price even if it "costs" me $200-$300 of less commission.
        smileysteve 9y ago
        But in a sellers market, paying $10,0000 more is aligned with closing the deal AND more comission.

by gist 9y ago

bhandziuk 9y ago

You're right it was my first house. I do believe it is sometimes more complicated. But is the value of a realtor's time to me, as a buyer or seller, really several hundred dollars per hour? Is buying a 600k house really twice as difficult a transaction than a 300k house? Why are they not paid a flat fee?

dragonwriter 9y ago
Seller's agents aren't paid a flat fee to align their interest with that of the seller; they want the deal to close at the highest price possible. Why buyer's agents are paid on sale-price-commission is, OTOH, a real question.
- gist 9y ago
  > Why buyer's agents are paid on sale-price-commission is Once again buyer's agents are a large part of the equation. They have to drive around the actual buyers and waste time showing properties with nothing to show for it often. So the way it works is the people who actually buy (or sell) make more money to compensate for people that do not buy.
  - dragonwriter 9y ago
    But a sales price commission, of all possible completion-based pay structures, makes the interest of the agent misaligned with (opposed to, in some respect) that of the principal.
    - jrs235 9y ago
      Have you read Freakanomics? They find that agents are more interested in closing add getting paid rather than the extra couple hundred dollars of commission a $10000 swing in price gets them. I'd gladly fight to save a buyer I represent $10000 on price even if it "costs" me $200-$300 of less commission.
      - smileysteve 9y ago
        But in a sellers market, paying $10,0000 more is aligned with closing the deal AND more comission.