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6% is a lot on a $1m. But, it is better than 33.33% on a quick $1m settlement.
Commissions are more negotiable than ever. But like everything else a minimal commission is going to.lead to minimal service
Eh try doing it once and then see how it goes. I know a lot in the space and it takes more work than many think. The good ones are worth it. Same argument could be made for things attorneys do that many people see as they could’ve done themselves.
I've done it and there is way more to it than people know. Its a lot of work.
Ironic. People feel the same way about attorneys. Sincerely, a current attorney and former Realtor.
They’re not “automatic” anywhere. My old firm gave one of our clients a substantial discount on commission in order to win his business.
Rising Star
Having been in real estate law for 20 years and having bought and sold a few homes personally - no, it is absolutely worth shopping for a good agent. Could you save on the commission? Absolutely. Can you negotiate the commission on either side? Yes, and you definitely should (seriously, why didn’t you negotiate this?!).
Being mad about commissions afterwards just looks dumb though.
You don't have to use them anymore
I was a legal assistant for 45 years and have sold 2 properties without an agent- for sale by owner. Very simple, download the Purchase Agreement from the state real estate commission board and check online for clear title. The title agent’s office does the rest.
Literally everyone thinks this
It’s irritating because once I pay the 6% commission out, I actually lose money on my house. Like what was the point.
I approached the owner (who lived somewhere else) of the house next door to mine to make a FMV offer on the property, which was accepted. No realtor involvement, and no commission to be due. Between the day we signed the contract and the date scheduled for closing, the seller died. Of course, that put a hard pause on closing. A realtor became involved in selling decedent's other real estate, and tried HARD to mess up my deal, in order to worm herself into another commission.
I do real estate transactions and I didn’t use an agent when I bought my house. I told the seller’s agent I wanted 1% of the buyer commission credited to closing costs and he could do whatever he wanted with the rest. He credited it to the Seller. Even as a real estate attorney, there were times I wished we had an agent, but I still don’t think the cost is worth it and at the time we were buying our house, I don’t think we would have been able to get our house without that extra 2% credit to the Seller. Having done it once, I’d feel even better going without an agent if buying another house.
I’d caution if you aren’t going to use an agent as the buyer, that you should be ready to draft any contracts etc. yourself and the realtors will want you to use the realtor forms because that is all they know how to use. The Seller’s agent might offer to do it for you, but I wouldn’t bank on that and not really fair to ask them to do it if you aren’t going to pay them.
When I’m selling my house, I plan on using an agent. I don’t have time to list it, market it, do showings/open houses etc., but I’d still try to negotiate their commission down to at least 5% total between buyer/seller agent.
I don’t know what about my comment makes you think any of these things are relevant or indicated by my post.
Everything did go in the contract. It was all in the contract and on the closing statement. I received the 1% credit from the seller towards closing costs, so not sure at all what you think was missed.
I also drafted the OTP. You do realize that real estate agents are permitted to do dual representations and do so all of the time. It is a crazy conflict of interest but they are allowed to do it.
Of course I understand that buyers don’t pay the agent costs, but by not having one, I save the seller on the commission, which effectively increased our offer price by 2% that I didn’t actually have to pay.
I have bout 7 homes over the years (prior military). I stopped using them after the 3rd home. It’s so hard to find a quality one to justify the costs. As long as you know the right inspections to get (buy side) and fill out the purchase forms, super easy from buy side. Probably a little more involved from the sell side, but doesn’t justify the 6% (negotiate down to 4.5-5%)
*bought
*could’ve but *didn’t*
just do it yourself then
See response to comment no. 1
We’ve been made to bill the actual time- maybe the realtors can do the same?
But you didn’t. You paid a service to outsource it.
Read response to comment no. 1
Do you have access to the PSA and disclosure docs that the realtor association produces for each state? Are you able to show the property 15-20 times? Do you have access to specialized home repair vendors?
I’m sure it can’t be difficult to find. When I was house searching, the selling agent was never present. Just a lockbox that the selling agent gave you the code to.
Can’t be that difficult. Nor is it.
If you aren't in the real estate industry and you could've done what your realtor did, you hired the wrong realtor. If you paid one agent 6% for one side of the deal, you didn't do your research. If you paid one agent for representing both sides, you didn't do your research. It sounds like more of a you problem than a realtor problem.
I have a GREAT agent in NYC who charges only 1% and he’s worth every penny. But generally agree they are a complete waste of money and should avoid
Pro
Real estate agents are not a TOTAL waste of money. Like all professionals, they fulfill a consumer need. It's not a need that everyone has though, so you might not see their services as valuable, and thats okay, but they can be invaluable to others. Now, experience and knowledge are key factors in making the services valuable. Like many service related professions, like ours..., some people will see value and others don't. It doesn't mean that it's a total waste of money. If you've had personal experience where you feel like you wasted money on an agent, then you either could have done it yourself, your agent wasn't any good, or your ignorance proceeds you and you didnt see a lot of behind the scenes work that was done on your behalf.
I handle residential real estate transactions, buyers and sellers, and I still hired an agent when I bought my house. It was a highly competitive market, they handled setting up early showings, they knew the current trends in competitive offer writing that helped us get an edge, they knew things about houses that I didn't know like potential issues with homes, conditions, costs to maintain certain irregular home systems, etc. This isn't stuff attorneys know. I ended up with a dream home for a steal... in a competitve market!
Ouch. Although I can admit Iv'e felt this way, I've also felt guilty since I work on a contingency. If your comment is honest, then why didn't you do it? You either didn't have the time or skill. Realtors do more than you think. They screen a lot of bad applicants and prepare. They do research. Yes, when the market is hot, the house sells itself. However, there are alot of i's to dot and t's to cross as well so you don't fall into a pitfall of bad deals, broken promises, and defaulted loans. realtors are worthwhile if you find the right one.... just like attorneys.
Agreed.
I thought the same thing when I sold a quadplex in. Brooklyn a few years ago. But I wasn’t going to be there for open houses, list it, show it, etc. especially because I no longer lived in New York. Even as an investor myself, I realized it’s easier for them to do their job. But I did feel very stupid when the company that actually bought it had called my office when one of the tenants mentioned that it was for sale. Hindsight, right?
Erh, in hindsight only. Just take the money, be humble and feel grateful!