3 ms·
> Where you stand really depends on where you sit. There's really only two seating sections. The one's paying the outrageous commissions or the one's receiving
by koolba 8y ago
> Where you stand really depends on where you sit.
There's really only two seating sections. The one's paying the outrageous commissions or the one's receiving them.
> But I’ve come to see the 3% on each side as an almost market clearing price. It’s really hard work, with low barriers to entry, and significant upfront costs.
The vast majority of the upfront costs are a moat dug by the established players. Everything from mandatory trainings, registration to insurance requirements.
> In a tight market, being a buyers agent can be a blessing or a curse. She’s been working with one client for nearly a year, submitting over 20 offers and going all over the metroplex with nothing to show for it. On the other hand, she’s had buyers who found something within a month. It works out to a decent standard of living, but it takes a long time to develop a pipeline. Most agents quit within a year.
That's the natural pros and cons of sales working on commission. When you're making money it's great. When you're not, it's not. There's nothing special about real estate.
- gamblor956 8y agoEverything from mandatory trainings, registration to insurance requirements. People pay hundreds of thousands of dollars on their homes. It's the single largest transaction of most people's lives. I certainly hope the individuals hired to negotiate and manage these transactions are trained and insured...
- Nelson69 8y agoWhen I last bought a house, I had an agent to show me houses. Then when it came offer time, I actually had my lawyer do the final review and he essentially did the bulk of the negotiation, the agent was simply a mouth piece with access to the databases and someone the other agents would talk to. It was during the 2008 time and I placed a bid on a short sell, my lawyer gave me distinctly different advice than the agent did (a personal friend, no less) the seller made some demands that he wanted in the contract and the agent simply wasn't capable of giving sound advice about it. Probably saved me about $50,000. The big problem is agents are incentivized to have sales in the market. If you sell your house for $100,000 vs $110,000 is could make a difference of months and they're paid nearly the same even though it's a pretty large difference to the seller. To many of the people "helping" you sell, it's better for you to take less money now than 10% more in 3 months. Nevermind the roles they helped play in the big 2008 crisis... And this is a profession that has a claimed "code of ethics"
- gamblor956 8y agoMost people can't afford to have a lawyer go over their home purchase/sales contract. They have to rely on their agent. So some training and insurance is absolutely better than nothing, which is what the comment I was replying to suggested.
- iends 8y agoI’ve been quoted $500 an hour and $750 an hour from various attorneys. I think that’s pretty easy to swing on a $100,000 house.
- gamblor956 8y agoSure, for a single hour. A real estate contract is dozens of pages long, and a good attorney would review all of those. $500/hour for one hour? Doable for most people. $5000+? That changes the economics of buying, especially if we're talking a $100k house, since that $100k is spread out over 30 years but the lawyer's bill is due in 30 days.
- iends 8y agoFor contract reviews I've only been quoted 1-3 hours. Nowhere near $5,000.
- Simon_says 8y agoWhat were the demands the seller wanted in the contract? And what was the bad advice that your agent gave? Just curious.