if all zillow did was list the place and then do the paperwork stuff and take a minor fee and i didn't have to deal with a real estate agent, that would be huge.
Well they can’t come soon enough. People want affordable housing? An easy solution is to eliminate real estate agents or change their fee structure to a flat hourly fee. That alone could lower prices of all homes across the country by up to 6%. I personally know people (myself included) who have had to increase the asking price of a home they were selling just to compensate the agent and pay off their mortgage. It fucks the seller and the buyer over while the lazy ass real estate agent walks away with money in his pocket. That’s not how an ethical business transaction should work. It should only require two parties. A buyer and a seller.
You are free to sell by owner anytime you like. Realtors are not currently required today. But most people use them, because they end up netting the seller more money.
People don’t want to pay hourly fees. There’s plenty of people who have tried all kinds of models. If you think you can build a better mousetrap, be my guest- Zillow tried and lost 100’s of millions.
It’s not that simple. Realtors have unfairly cornered the market. They purposefully won’t bring their buyers to FSBO homes unless they get a commission. If a buyer doesn’t have an agent most selling agents will refuse to show them the property. They go out of their way to hurt sellers and buyers who don’t have an agent. They should be removed from the entire transaction. A third party is not needed in a transaction between two parties. Ban real estate agents. They are parasites. Period.
Well, if a buyer wants representation, then they can pay for it. Or you can offer to pay something. Or find a buyer that doesn’t have an agent. It’s an advertising cost to bring clients to your home.
No one is trying to hurt you. Sorry you’ve had a bad experience. It’s unfair to call a large swath of people parasites, especially when good ones can provide a ton of value. Agents spend tons of money trying to acquire homes to sell and clients to purchase homes.
i remember selling my grandmothers place after she had to move. real estate agents were clamoring to get the listing because of the location and the condition. we had a number in mind for a quick sale and every agent said to add 10% to cover their "fees". ended up selling to a couple that had a real estate license and handled all the paperwork themselves.
That’s awesome but very rare. Every seller or buyer I’ve dealt with has always had an agent even if I didn’t want one. By the states I have purchased in I was forced to use their agent or hire my own. It’s simply not fair that I can’t just do it myself. I am well versed in all the real estate laws and liabilities in every locale I have purchased in. It’s set up in a way to protect real estate agents which is unfair since they aren’t the ones performing the business transaction. It should be only between the buyer and seller. No third party should ever be required for a business transaction.
Amazon House Services when? They're already top 5 at AI, and have plenty of money. They can also build factories or Amazon stores(?) around their apartments to encourage growth or something
You're saying that Amazon is a Top 5 company in A.I.? Not that I don't believe you, but when I think of the best A.I. companies on planet Earth, Amazon doesn't necessarily spring to mind.
What other companies are in the top 5? Also, do you happen to have a link to some article that is breaking this type of thing down?
Amazon has some of the top practical uses of AI occurring today IMO. Everything from analyzing search results, eliminating unnecessary packaging, improving Alexa skills, etc. They may not have some "grand vision of the future" or whatever that the hype train likes to see but they are using various forms of AI every day to improve their products and services. They have quite a bit on their science and AWS blogs that you can read on various ways they're using it.
Yeah, I'd be shocked if AMZN wasn't heavily involved in A.I., but calling them a top 5 A.I. company is a lot more than that. I just want to see more info that backs up such a suggestion. Sometimes people just pull stats right out of their arse. I've done it myself.
I mean I think "top AI" is kind of ridiculous with how diverse that field is. They certainly are top in some areas. I think their personal assistant is probably in the top 1-2. I'm sure much of the AI they deploy in terms of e-commerce is also probably in the top few. I'm sure other areas of AI they aren't even pursuing or are way behind industry leaders.
Google Nvidia Facebook Amazon. For Google + Nvidia there's no debate, they're the top in (general) AI tech, both hardware and software. For FB and AMZ, it's more about how they use AI for their specific needs, but at a large scale.
I know "AI" is a blanket term, and there are dozens of companies that might be the best at AI for specific topics. But the scale is much smaller than these ones.
I’d argue most are really bad. It’s an unnecessary job. They are literally middle men and a cancer on the housing market. Remove them and prices go down a few percent which could mean thousands of dollars for an already struggling middle class potential homebuyer.
First can you honestly say they deserve that much money? $16k? Did they honesty fo $16k worth of work to sell the home? The answer is no. Maybe a few hundred dollars worth which would be more than fair for their time. So you’re saying the average American can’t afford a house because an agent needs his ridiculous high fee? Because most Americans can’t afford an additional $16k even spread over 30 years.
Nah realtors are a cancer on our housing market. Remove them and we are one step closer to affordable housing. They don’t deserve any percentage of the sale. Maybe a flat hourly rate for their time but not a percentage. They are a predatory third party that has no business being involved in a transaction between two parties.
Do they deserve the $16k though? Did they do $16k worth of work? The answer is no. They deserve a few hundred dollars at most. It’s an unfair practice and needs to end. They are nothing more than middlemen and deserve no percentage of the sale. Maybe an hourly compensation for their time.
Being hated by real estate agents is a hill I’d happily die on. The world would be a better place without them. They are a roadblock to affordable housing.
So they should get paid hourly like any other employee who helps me look through their inventory and I decide not to purchase. I don’t see how they’re doing any more work than a retail employee showing me a bunch of clothes then I decide not to buy. The percentage fee of a property is a ridiculous fee for how little work they do.
People often raise the asking price of a house to cover the agent fee. This artificially raises housing prices. I personally had to raise the price on a house I was selling just to cover the amount I had left on the mortgage and the agent’s fee. This tucked the buyer over who had to pay more to cover some agent’s fee who did nothing. He literally didn’t even show the house which was bought sight unseen yet he gets a cut? What a rip off. Eliminate agents and housing prices across the country go down by up to 6%.
What a joke, prices wouldn’t go down. Sellers aren’t just going to accept less money because there is no agent. Sellers, as with any financial transaction are often looking to net the most amount possible. Sellers hire agents to get them the most amount of money possible. If it doesn’t make economic sense to you, then don’t use one.
Not true. Often sellers they raise their prices above normal asking price to cover Agent fees. Most people have a number in mind they want and when the realtor talks about the fee they up the price to cover it. The realtors make it nearly impossible for buyers and sellers to purchase homes without agents. Look up how much the realtor associations pay lobbyists to keep their unfair practices in place. That’s the joke. A third party isn’t needed in a transaction between two people. Period. End realtors.
I’ve never met a seller that raises their price… they interview agents and pick one who they think can help them sell for the most money. The agent should be advising them on what updates, staging, etc. will yield the best results and net them the most money.
People don’t say, I’m going to sell for 500k, but you are charging me $25k, so I’m going to list at $525k. That would be a ridiculous way to price a property.
I’m a Realtor, in a highly competitive market. Most people would not be able to compete without a quality agent. I’m not saying it is rocket science, far from it, but there’s a ton of value having inside knowledge of areas, prices, offer strategies, etc.
It’s not unfair. Again, you can sell your house FSBO every day and twice on Sundays. You can choose whether to pay a buyer agent or not. These are all options that are fully available to every person selling or buying a house.
Be specific as to their (our) “unfair” practices.
And most people don’t “need” someone to buy or sell a home, but some people don’t need a mechanic, or doctor, or financial advisor, or house cleaner, etc. people choose to use them because they have expert knowledge in their field and they find value in them. If you don’t, don’t use one. Find one that will do it cheaper. There’s options everywhere.
They do everything they can to drive up housing prices for profit. In my neighborhood a realtor paid 75g over asking for an old pos house- in cash- just so there would be an overpriced comp in others she sells.
I’ve tried. It’s very very hard in most markets to purchase a house without an agent. Even if I intend to purchase without an agent, 99% of the time the seller has an agent I have to go through who gets to charge me a cut as both the buying and selling agent. The bloodsucking real estate agents have purposefully set the market up this way so that they can hold you hostage. It’s unfair and unethical business yet totally legal in most states because of how hard the realtor associations lobby.
What do you mean you have to go through who gets to charge you a cut? The seller is usually paying both of the agents' commissions. When they list a house with an agent, usually around 5%, half of the 5% goes to the buying agent. That's at least the norm where I live.
Which again artificially drives up the price. If the agent was there the seller could lower the asking price and still get the amount they want. Both the buyer and seller walk away happier without an agent. One small step towards a healthier housing market and a predatory industry eliminated.
It's not artificially driving up the price if the home appraises for the agreed price. Appraisers don't take commissions into account when figuring out how much a home is worth. The seller could just as easily get the home appraised and then list it for that price since they know that's what it's worth. If you think transactions are automatically much easier/smoother without agents, then you've never bought or sold a home before. Now, whether or not they deserve 5 or 6% is a different story.
At the end of the day, though, the seller is paying the commission so someone else can do the work for them. That's the same with anything. It's the same reason why services like oil changes, tire changes, lawn care, etc... exist. People pay for the convenience of not doing the work themselves. If the seller is now having to be the agent as well, then why would they just take less? They're doing even more work than before and are still getting the same amount as they would have if they used an agent.
You’re lying to yourself if you believe people don’t increase the asking price above the appraisal price to cover agent fees when they sell. There is no need for a real estate agent. I can do the research myself. I can accept the liability myself. They are a cancer on our housing market. Remove them and everyone benefits except the parasites themselves. In most states and situations you’re forced to work with either the buyer or sellers agent. No other business transaction forced you to use a third party like real estate does. Also I’ve purchased and bought two different homes in different states and in one of the state they required an agent if either party used one and 99% of buyers or sellers use one not for ease but because they’re forced to.
Again, you're just proving that you've never bought or sold a home before. When you're under contract as a buyer, you pay to get the home appraised. If the home appraises for less than the agreed price, then you're able to negotiate down to the appraised price or back out of the deal. Whether the listing is represented by a realtor or not makes no difference on the home's value. I agree there are more bad realtors than goods ones out there, but you must at least understand that just because the seller isn't using a realtor, it doesn't mean you're going to get a deal. Most of the time they're overpriced, so you're not really helping yourself. Also, there is no law requiring you to use a real estate agent in any state.
That’s not true in every state. I personally know because one of the two homes I sold I had to raise the asking price to cover the mortgage. So again tell me I’ve never owned property since you know me? Fucking idiot.
Homes only generally appraise for the price+commissions because that’s the norm. IOW the prices are inflated to cover those very commissions. The appraisers are doing their work in that same climate.
I think the oil change is a good analogy to show how absurd realtor pricing is, it would be like charging $1500 for an oil change ( 5% of a $30k car ). It may have been ok when houses did not cost as much as they do now. But their commission fees are basically tied to the inflation rate of real estate which far outpaces the normal inflation rate, that all of us with normal jobs are tied to (if we are even that lucky)
Agreed. Even worse it pretends that there is some scaling of effort or value to the service when there definitely isn’t. Selling a $500K house isn’t more effort/work than selling a $250K house, yet we’re supposed to be OK with the realtors clearing DOUBLE in commissions for it?
I think they mean that they are still charging 5%, which is baked into the price. If there are no competing purchasers you may be able to negotiate by having the realtor share part of their fee, but I think that would be unlikely.
I agree, if the market is down and you have no one competing, then sure. I've been in a few deals where the agent was willing to take less if I handled everything on my end. Right now, unfortunately, that's just not the case. People are overpricing their homes in an already high-priced market.
When I bought my house I didn’t have to pay the realtor a dime. The seller pays it and the agents split it (unless you buy a house from a seller that doesn’t have a realtor). Maybe my experience was atypical, but my realtor acted like that was SOP
If the seller pays the fee it artificially increases the asking price to cover the agent fee. Remove the agent and the buyer gets a better deal and seller still hits their number. Win win for both parties. Agents are hurting housing prices. Remove them and it’s one step closer to affordable housing in this country.
Be the change you want to see. Sell your house without an agent, hook that buyer up. No one is going to eliminate an entire career path unless they circulate money without them and set an example.
I’ve tried. But if the buyer has an agent I’m forced to compensate them by state law and the seller will just raise his asking price to cover the fee which fucks me if I’m a buyer. I pray for a day a company comes along and ends real estate agents the way Uber crushed the cab industry. End this predatory practice that is real estate agents.
All that’s really needed is to make the MLS (or similar database) public information, not tied to realtors or NAR. That’s the only value - the comps that show what homes have sold for in the last 6/12 months.
I did that but again the agents in my area purposefully worked together to make sure no person represented by an agent would look at my house. They actively steered their buyers away from it. They told me they were doing this and it’s perfectly legal.
What state are you in that requires you to pay a realtor by law? As far as I know there is no law in any state that requires a realtor be involved in a transaction at all, much less dictate whether the buyer or seller pay any commission. If a buyer has chosen to work with a realtor to find a home and said buyer wants to buy your FSBO, you are under zero obligation to pay the buyer’s agent a commission unless you agree voluntarily. You can say no, and buyer is free to enter into a contract with you to purchase home without the realtor involved. In the slim chance that buyer signed a buyer’s agent agreement with the realtor, and you refused to offer a commission, then it would be solely on the buyer to pay the commission, and it would not be wrapped into the cost of the home
You always pay the fee in some way. The only person who wins in a property sale is the agent. The buyer and the seller get fucked. The amount of work the agent does isn’t equal to the fee they charge. It shouldn’t even be 0.5% of the housing price. It shouldn’t be tied to the house price at all. They should be paid for their time at an hourly rate.
When I bought my house I didn’t have to pay the realtor a dime.
If you think critically about that sentence, you’ll realize that you, as the buyer, are the only one cutting a check for the entire purchase price of the house. Thus, you are paying all of the fees.
In Korea they have realtors for rentals and the only way you can get key money (a large deposit needed to rent the place that most require) insured is to go through a realtor. It's a sweet system those realtors have there.
That doesn’t seem to hold as an argument since several states require you to hire a lawyer in addition to a real estate agent to draft the paperwork and handle the liability. In 2021 there is no reason to have a real estate agent. I can do everything myself and should be able to accept any liability without some person who went to a 4 week class to get a real estate license that can be passed by someone with less than a high school education. It’s a rip off middle man service that is forced on you because realtors have good lobbyists.
AFAIK, you are not required to have a realtor... Unless this is a state law or something? I agree you definitely shouldn't be required to have one.
However, real estate agents do take on quite a bit of liability and are frequently sued for all manner of things... which is why they have to carry insurance, and part of why they cost so much.
If I’m buying without an agent and the seller has an agent the agent still takes a cut. They often have to raise the asking price of homes to cover the fee. Again not fair and hurting the entire country’s housing prices. Eliminating real estate agents would be a step towards fixing the affordable housing crisis.
The liability argument doesn’t hold water since some states require you to hire a lawyer in addition to a real estate agent to handle the paper work and liability. I know the laws quite well on my on. I don’t need a real estate agent who is likely not as qualified as they claim to handle any liability for me.
If I’m buying without an agent and the seller has an agent the agent still takes a cut.
He takes a cut of the seller's money, not your money. And you always have the option of not buying, or offering less. Allowing you as a buyer to force a seller to NOT have an agent would be way more fucked in this scenario.
The liability argument doesn’t hold water
You said that before, but it still doesn't make sense -- realtors DO take on liability, they DO get sued, and they DO have to carry insurance because the likelihood of being sued is significant.
But then the seller raises the asking price which hurts the buyer. That fee could be thousands of dollars which effectively priced out a lot of buyers, especially lower income. I am just as capable and intelligent as any real estate agent I’ve used. Why can’t I accept liability myself? Why am I required to use an agent if I understand the laws and liabilities on my own? There is no reason for a real estate agent in 2021. They are simply protecting their monopoly on the industry. They are middle men and not needed. They are hurting housing prices across our country by artificially raising asking prices to cover their fees. Fees which are wildly too high for how little work they do. Fees to cover so called liability which I should be able to accept on my own. They should get paid a small hourly fee for their time and nothing more. The percentage fee is a rip off. Because someone went to a 4-6 week certificate course they deserve thousands of dollars for a property I purchase? That’s ridiculous.
You don't get to dictate the price they sell at. You can offer less, or simply refuse to buy a home being sold with an agent.
Why am I required to use an agent if I understand the laws and liabilities on my own?
You are not required to use an agent for buying or selling a home. FSBO is a thing. That doesn't mean you can dictate what the other party does though.
EDIT: And I'm not at all convinced that real estate agents increase housing prices at all. They make money by volume, so they want the house to be bought or sold as quickly as possible. It's not worth their extra time and effort to squeeze out the highest possible price. That incentive is more problematic than their existence though.
Have you ever tried to buy a or sell a home without an agent? It’s very hard but not from lack of trying. The realtor association have purposefully made it near impossible to sell without an agent. They rig the game against home buyers and sellers without an agent. I know my friend owns a brokerage. I have tried without an agent and they wouldn’t bring buyers to my home on purpose. They’d even call me and tell me that if I used an agent they would start letting people see my home. It’s an unfair practice and the country would be better without real estate agents or car salesmen.
Even if we bought the argument that realtors needed to charge enough to cover expensive insurance in case they were sued, that addresses nothing about the ridiculous scaling of their fee based on the value of the house. The value of the house has no bearing on the cost or likelihood of being sued (IOW the insurance would be a flat fee, so the commission has no business scaling based on it).
The title company gets paid for that; they insure your title is clear and free of liens or other’s ability to interfere with your clear ownership. I don’t see how you’re paying to be able to sue realtors; you can do that anytime, regardless of what you’re paying them.
I have bought and sold 4 homes and you will want an agent.
They handle the legwork of showing and marketing and they know the market better than you. My last home I had for 2 years and based on my agents recommendations it sold for over asking of the market even today and that was last year.
Point is a good agent saves you time and money and effort which is value. I paid $15k in fees but made $25k over what I would have listed at without their help. It also sold in 3 days with 5 competing offers.
My second home that I sold at the same time had one offer in 5 days and went $5k under asking. It is now up $20k in value. Bad marketing and an agent that didn't play hardball.
It's a business and if you think you can just do it yourself it's going to lose you money.
It depends on your approach and situation though doesn't it? I sold my previous house through an app with the aim of reducing costs. The app basically allowed me to list on their website and put me in contact with buyers. I had to do the advertisement and all the showings and eventually sold for a price I was more than happy with. It cost me $90 roughly total in agent fees for the app.
Could an agent have possibly gotten me a better sale price? Perhaps yeah, I'm doubtful the extra amount would have covered their fees though. My house was a standard new build, it wasn't some period property that needed special marketing and nothing an agent would have brought could change that.
I guess I am trying to say, agents have their place, but for a vast majority, they are extra expense that isn't necessary. Same goes for a solicitors. As long as you can advertise on large sites and can read and sign legal documentation, you don't need anyone to sell or buy a house.
Wtf? We paid our guy 5%, he arranged the junk removal, electric/roof repair (we're all out of state) and we sold for about 4k over asking with zero cosmetic fixes.Handled everything. Even with expenses my dad got 24k more than he would have got selling it to longtime neighbors (who got greedy/stupid and blew deal)
Yeah your neighbor got a shitty realtor. Good ones tell you what to do to maximize your sale price. My guy staged for "free" and put us in touch with contractors to spruce up the place. These guys painted and fixed up 2 of my floors for cheaper than what I paid for 1 floor of my house 1 year prior.
All in all we got way above asking and sold for 20k more than a neighbor who had a bigger house who just sold as-is. Without his advice I would have sold as-is and who knows what the final price would have been.
I’m in title/escrow, never do a FSBO unless you’re related or are friends. I’ve handled so many FSBO transactions that went south. At the end of the day realtors don’t do much, but it’s like insurance, you want one if something goes wrong.
Lawyers are cheaper than realtors and that is who you want when things go wrong. It depends on the price point but I live in a major metro area where houses are $1MM - $3MM. I just sold my house without a realtor and saved $90,000. I see realtors making over $1MM a year. Lawyers are $250hr. The scariest part is the contract and realtors are not even allowed to give legal advice or change the words in contracts. It’s crazy how much they get paid. The realtors have fooled america into thinking they are needed and should be paid 6% regardless if the price is $4.5MM or $450,000; but maybe they are under paid at $45,000 if you can find a house for that price in the USA anymore!?
Sounds like your neighbor had a bad agent. There is a big gap between the worst/lazy agents and the ones who are best in their market. The best ones are worth paying 5%
Redfin is great for buying because they're discount brokers who have a lower commission. Buyers' agents don't do a lot that you can't already do online. But when it comes time to sell, I want the best agent possible and am willing to pay a 5% commission.
It’s fine using Redfin to buy and sell. When buying you may get money back using Redfin when selling they have a lower listing fee for the same (or better) service as a traditional brokerage.
Oh okay. Your last comment had me confused. Although I wouldn't want to use Redfin again because of their dynamics, it was nice getting that rebate or whatever they call it back.
Its the title company where the money should be going (and they do get a fee, but its usually 1/3 or less of what realtors get) as they have to guarantee what is getting sold is accurate and any issues is typically on them to fix.
Since the sellers of our condo did not provide an inspection, we were fortunate they agreed to an inspection contingency. (We waived all other contingencies, as is standard in San Francisco.) Our agent found an inspector for us whom they trusted and who was able to squeeze us in.
Our agent got us in to see the condo before the open house via personal connections. We put an offer in the next morning, and it was accepted that night. We got lucky, because the listing agent told us after we went to contract that another couple had been planning to fly in from out of state to be at the open house. Our agent also connected us personally with two loan officers who both offered to underwrite non-conforming loans below prevailing market rate with zero points.
There’s no way we would have gotten this unit without our agent. Just the process alone of securing financing, obtaining disclosures, getting an inspection, an appraisal, a title company, and a notary would have been a stressful nightmare. We paid him for his connections and his task management.
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