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I am not disagreeing with you either on most people not speculating. Every transaction has overheads. But I'm just talking about house flipping, or even when u

I am not disagreeing with you either on most people not speculating. Every transaction has overheads. But I'm just talking about house flipping, or even when upgrading from one house to another, 41% of any money I, as an individual could use towards the new house, kids education or whatever, going as a transaction overhead is simply crazy, and almost extortionist given how monopolistic this is in the US Re: Day trading - That would be REIT and related instruments.

poulsbohemian 3y ago
> I'm just talking about house flipping Realtor here - if you are house flipping, you are in a unique category and not really a member of the general public. You should either get your real estate license (if you believe you are able and willing to market property yourself) or you should find a dedicated agent partner with whom you have a negotiated rate. But also consider that as an agent, my out of pocket costs to market your example property could easily be $1000, plus my brokerage (assuming I'm affiliated and it isn't my own brokerage) also is taking their 40%+ cut of my commission, so I'm not making nearly as much as you think -- which is why especially on a house priced at the lower end of the spectrum I need to keep my commission % higher.
- neeleshs 3y ago
  Commissions are fine, they are transaction overheads. This doesn't still justify taking a 40% cut on any upside I have when I upgrade my house. This is not necessarily targeting an individual broker, but the system as it is set up right now, with no real innovations happening.
taeric 3y ago
As my sibling post says, if you are house flipping, you almost certainly work out a way to not have a full realtor fee. Either by being said realtor, or otherwise working out a deal. I've known several people that would do this. And I'm still fairly confident in my claim that you would really only do this if you had the capital otherwise. Upgrading a house is another odd one. Most of the upgrades you would do that go with "get a new house" are all size and location related. You might give some pause to the fees involved, but probably not much. My point on day trading is that transaction fees don't seem to stop people with excess cash to go off and speculate in the market. They won't be as high as realtor fees, of course, but the overall stakes are also not nearly as high. That said HELOC and similar tools also really highlight just how bad most people's financial considerations are with home values. Refinancing to get a lower rate is a laughable idea when you consider the fees that went into that effort. And that doesn't stop many people at all from doing it. (Not to mention the ones that reset their timelines...) All of that is to say, I still have my doubts that any of the myriad of fees involved in the process are what stops speculation.

poulsbohemian 3y ago

> I'm just talking about house flipping Realtor here - if you are house flipping, you are in a unique category and not really a member of the general public. You should either get your real estate license (if you believe you are able and willing to market property yourself) or you should find a dedicated agent partner with whom you have a negotiated rate. But also consider that as an agent, my out of pocket costs to market your example property could easily be $1000, plus my brokerage (assuming I'm affiliated and it isn't my own brokerage) also is taking their 40%+ cut of my commission, so I'm not making nearly as much as you think -- which is why especially on a house priced at the lower end of the spectrum I need to keep my commission % higher.

neeleshs 3y ago
Commissions are fine, they are transaction overheads. This doesn't still justify taking a 40% cut on any upside I have when I upgrade my house. This is not necessarily targeting an individual broker, but the system as it is set up right now, with no real innovations happening.

taeric 3y ago

As my sibling post says, if you are house flipping, you almost certainly work out a way to not have a full realtor fee. Either by being said realtor, or otherwise working out a deal. I've known several people that would do this. And I'm still fairly confident in my claim that you would really only do this if you had the capital otherwise. Upgrading a house is another odd one. Most of the upgrades you would do that go with "get a new house" are all size and location related. You might give some pause to the fees involved, but probably not much. My point on day trading is that transaction fees don't seem to stop people with excess cash to go off and speculate in the market. They won't be as high as realtor fees, of course, but the overall stakes are also not nearly as high. That said HELOC and similar tools also really highlight just how bad most people's financial considerations are with home values. Refinancing to get a lower rate is a laughable idea when you consider the fees that went into that effort. And that doesn't stop many people at all from doing it. (Not to mention the ones that reset their timelines...) All of that is to say, I still have my doubts that any of the myriad of fees involved in the process are what stops speculation.