5 ms·

It's not that people don't do something worthwhile. It's more a question that is it worth paying 60,000 when selling your house? It's not. At $100 an hour, do y

It's not that people don't do something worthwhile. It's more a question that is it worth paying 60,000 when selling your house? It's not. At $100 an hour, do you get 600 hours out of work of them? No. It's not about market prices, because the cartel (real estate industry) prevents lowering percentages - and they fight to the death any upstart who wants to do it. It should not be a percentage, it should be a fixed rate. A few thousand dollars. Or hourly. Until people can set different rates, or you have the option of fixed rates if that is the preference of agent & buyer it won't be honest.

chrisseaton 8y ago
> It's more a question that is it worth paying 60,000 when selling your house? It's not. So why does anyone use them? Other people must think they bring more value than they cost. And if they're too expensive why aren't people undercutting?
- ak217 8y ago
  They are undercutting. Online brokerages like Redfin and Opendoor are challenging the 6% fee. Their success has led to the "standard" fee now being 5% in many markets, but if you use these platforms on both the seller and buyer side, you may now be able to get down to 2.5%. I expect the fees will continue to drop. As the article points out, the realtor cartel works to de-platform individual realtors who undercut the fee by shutting them out of associations (broker networks) and in some cases removing local MLS access. By law, you have to be a licensed realtor to broker real estate sales.
  - jrs235 8y ago
    I keep seeing people incorrectly using the word 'Realtor'. A Realtor is a member of the National Association of Realtors. Not all real estate agents are Realtors. And not all Realtors are real estate agents (some are appraisers, home inspectors, etc.) The "realtor cartel" will not de-platform individual Realtors as much as they will deplatform non-realtor real estate agents. To get access to MLS you must be a Realtor though. They do not have to be a Realtor to broker real estate sales. They need to be licensed real estate brokers. Being a Realtor is optional. Source: am a non practicing licensed sales person in my home state. I can't do anything without a broker supervising me. Also I am no longer a Realtor, I was when I was an agent for a broker who was and required NAR membership.
    - ak217 8y ago
      Thanks for the correction. I'm not in this industry, so still learning and dialing in my terminology :)
    - dustindiamond 8y ago
      I am able to get MLS access as a licensed real estate agent as long as I am a member of the local board and pay for that membership and MLS access. I am not a realtor. Also, it may be different where you are, but 25% is the standard for referrals (from the buyer or seller side). To me, it seems easier to generate quality leads, and then refer them to a buyer agent.
- Latteland 8y ago
  The reason you must pay the commission comes back to the cartel nature. If you won't pay the 3% to each side as the buyer, then many agents refuse to show the sellers the house. I don't think they ask the buyers, they just don't tell them about it. Then when redfin in Seattle started selling houses for lower commissions, it again was difficult because of buyer agents not wanting to bring their customers to the lower commission redfin houses. Redfin I think experimented with only reducing the commission on the seller side, not the buyer side, to try to break the 6%.
sevensor 8y ago
> the cartel (real estate industry) prevents lowering percentages - and they fight to the death any upstart who wants to do it. Do they? I had a realtor once who worked for 2%. Anecdotally, it didn't seem like she was being run out of town. In retrospect, I'd rather have paid 3% for a realtor who did a better job. That extra percent was not worth the months the property sat unsold.
olyjohn 8y ago
Who is paying $60,000 to sell their house? Most houses and agents aren't selling million dollar houses. There are some, but that's not the majority. Also houses that are priced like that don't have as many buyers, they take longer to sell. They have to market them to the right people, and have connections to sell those kinds of places quicker. People gotta remember, the commission is split 4 ways unless one of the agents is a broker. Most agents themselves are only getting 1.5% People CAN set different rates. Redfin charges a very low percentage compared to others. There are brokerages who charge flat fees, and will just slap your house in the MLS and then call it a day. You wanna list with a discount broker go for it... You can even sell your house yourself! This whole thread reads like a bunch of people talking about tech people. "Oh you just sit at your computer all day surfing the web, why do you make so much?" or "Why pay you so much, I can just set up a website on Wix for $10." Yeah there's some shady shit with the NAR and access to listing services, I'm not disagreeing with it 100%, but the average agent is doing a lot more work than you realize.
- mdorazio 8y ago
  > Who is paying $60,000 to sell their house? Allow me to introduce you to a place called California. In Santa Monica, where I live, median home price is over $1.5M. Yes, median. La Jolla is about the same. Irvine is just shy of $1M. In San Francisco it's over $1.2M median. San Jose is right around $1M. Mountain View is north of $1.7M. Etc. These places represent thousands of homes and average time on market is generally around a month. It's really that insane.
  - Latteland 8y ago
    I am in the Seattle area, where the average home price is slightly above $800k. I'm fortunate to have a house that was a little above that average.
- joshcain 8y ago
  "Why pay you so much, I can just set up a website on Wix for $10." I mean, that's a valid point in the age of Wix and Squarespace. I'm certainly glad I'm no longer in the business of building brochureware sites for small clients. I understand your larger point that we shouldn't be quick to assume a realtor's work is not difficult. However, I think the issue is the buyer doesn't really have the option to forego the buyer's agent service and capture (through a reduced price) the commission that would have otherwise been paid. Not everyone needs a full-service realtor in the same way not everyone needs a bespoke CMS.

chrisseaton 8y ago

> It's more a question that is it worth paying 60,000 when selling your house? It's not. So why does anyone use them? Other people must think they bring more value than they cost. And if they're too expensive why aren't people undercutting?

ak217 8y ago
They are undercutting. Online brokerages like Redfin and Opendoor are challenging the 6% fee. Their success has led to the "standard" fee now being 5% in many markets, but if you use these platforms on both the seller and buyer side, you may now be able to get down to 2.5%. I expect the fees will continue to drop. As the article points out, the realtor cartel works to de-platform individual realtors who undercut the fee by shutting them out of associations (broker networks) and in some cases removing local MLS access. By law, you have to be a licensed realtor to broker real estate sales.
- jrs235 8y ago
  I keep seeing people incorrectly using the word 'Realtor'. A Realtor is a member of the National Association of Realtors. Not all real estate agents are Realtors. And not all Realtors are real estate agents (some are appraisers, home inspectors, etc.) The "realtor cartel" will not de-platform individual Realtors as much as they will deplatform non-realtor real estate agents. To get access to MLS you must be a Realtor though. They do not have to be a Realtor to broker real estate sales. They need to be licensed real estate brokers. Being a Realtor is optional. Source: am a non practicing licensed sales person in my home state. I can't do anything without a broker supervising me. Also I am no longer a Realtor, I was when I was an agent for a broker who was and required NAR membership.
  - ak217 8y ago
    Thanks for the correction. I'm not in this industry, so still learning and dialing in my terminology :)
  - dustindiamond 8y ago
    I am able to get MLS access as a licensed real estate agent as long as I am a member of the local board and pay for that membership and MLS access. I am not a realtor. Also, it may be different where you are, but 25% is the standard for referrals (from the buyer or seller side). To me, it seems easier to generate quality leads, and then refer them to a buyer agent.
Latteland 8y ago
The reason you must pay the commission comes back to the cartel nature. If you won't pay the 3% to each side as the buyer, then many agents refuse to show the sellers the house. I don't think they ask the buyers, they just don't tell them about it. Then when redfin in Seattle started selling houses for lower commissions, it again was difficult because of buyer agents not wanting to bring their customers to the lower commission redfin houses. Redfin I think experimented with only reducing the commission on the seller side, not the buyer side, to try to break the 6%.

sevensor 8y ago

> the cartel (real estate industry) prevents lowering percentages - and they fight to the death any upstart who wants to do it. Do they? I had a realtor once who worked for 2%. Anecdotally, it didn't seem like she was being run out of town. In retrospect, I'd rather have paid 3% for a realtor who did a better job. That extra percent was not worth the months the property sat unsold.

olyjohn 8y ago

Who is paying $60,000 to sell their house? Most houses and agents aren't selling million dollar houses. There are some, but that's not the majority. Also houses that are priced like that don't have as many buyers, they take longer to sell. They have to market them to the right people, and have connections to sell those kinds of places quicker. People gotta remember, the commission is split 4 ways unless one of the agents is a broker. Most agents themselves are only getting 1.5% People CAN set different rates. Redfin charges a very low percentage compared to others. There are brokerages who charge flat fees, and will just slap your house in the MLS and then call it a day. You wanna list with a discount broker go for it... You can even sell your house yourself! This whole thread reads like a bunch of people talking about tech people. "Oh you just sit at your computer all day surfing the web, why do you make so much?" or "Why pay you so much, I can just set up a website on Wix for $10." Yeah there's some shady shit with the NAR and access to listing services, I'm not disagreeing with it 100%, but the average agent is doing a lot more work than you realize.

mdorazio 8y ago
> Who is paying $60,000 to sell their house? Allow me to introduce you to a place called California. In Santa Monica, where I live, median home price is over $1.5M. Yes, median. La Jolla is about the same. Irvine is just shy of $1M. In San Francisco it's over $1.2M median. San Jose is right around $1M. Mountain View is north of $1.7M. Etc. These places represent thousands of homes and average time on market is generally around a month. It's really that insane.
- Latteland 8y ago
  I am in the Seattle area, where the average home price is slightly above $800k. I'm fortunate to have a house that was a little above that average.
joshcain 8y ago
"Why pay you so much, I can just set up a website on Wix for $10." I mean, that's a valid point in the age of Wix and Squarespace. I'm certainly glad I'm no longer in the business of building brochureware sites for small clients. I understand your larger point that we shouldn't be quick to assume a realtor's work is not difficult. However, I think the issue is the buyer doesn't really have the option to forego the buyer's agent service and capture (through a reduced price) the commission that would have otherwise been paid. Not everyone needs a full-service realtor in the same way not everyone needs a bespoke CMS.