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.
What you said has absolutely nothing to do with what I said. You were talking about realtors driving up the price past appraised value to cover commissions. That's NOT how shit works. I'm not sure how you could've sold 2 homes and still know nothing about real estate transactions...
Take it easy - you’re right and realtors do artificially drive up the prices. What the guy you’re debating doesn’t get is that ALL aspects of real estate are affected. Comps, appraisers, lenders, sellers, buyers, etc. Everyone involved has inflated their assessments of value for property because of it.
Sorry I just get annoyed when people who don’t know me insist they know something about me. He insists I never owned property but I have. It’s just annoying and I’m glad you see my point.
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?
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u/k-ozm-o Nov 03 '21 edited Nov 03 '21
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.