3 ms·
I actually don’t hate realtors. In my jurisdiction, seller pays, so it kind of only feels like 3% to me. I have no idea if that’s economically valid, but when I
by nocoiner 3y ago
I actually don’t hate realtors. In my jurisdiction, seller pays, so it kind of only feels like 3% to me. I have no idea if that’s economically valid, but when I’ve sold a house, I felt like I got my money’s worth on market knowledge and advice. Maybe I just had the fortune to be working with good people.
Possibly I’m a cynic but I suspect Redfin’s endgame here is not to reduce transaction costs but to capture those for themselves instead. Perhaps part of my cynicism is looking at transaction expenses in jurisdictions without realtors - usually there’s some middleman who tends to capture a single-digit percentage of transaction value (either a notary or the government or both or others). Funny how that pattern seems to repeat itself.
- xnx 3y agoRegardless of how it is described or presented, the buyer pays for everything related to a real estate transaction: fees, commissions, inspections, etc. Even when the seller pays, that expenses is ultimately built into the sale price of the property.
- wbl 3y agoNot exactly. It depends on the relative elasticities. You're correct that the cash flow isn't everything.
- nojvek 3y agoYou’re right in that the buyer pays the seller so the seller pays the agents so ultimately the buyer is paying for everything and hoping he will find another buyer down the lane willing to pay more than 6% of the price he paid to at-least not lose what he put in. Houses have a huge transaction cost, unlike say trading cost. Yeah the value goes up and down due to supply and demand but the transaction fees are zero at many internet exchanges now.
- yafbum 3y agoThe question isn't really whether you got some useful service in exchange for your 3%. Monopolies and cartels don't always rob you blind. The question is whether you had a choice and meaningful competition on price.