NAR - Much ado about nothing? Realtor's Commissions.

[APovi]

NAR - Much ado about nothing? Realtor's Commissions.
Thanks to the many people who have asked me about the proposed changes in Real Estate commissions this summer.
The answer isn't very complicated.
Regardless of the 'rules', Realtors predominantly charge Home-Owners/Buyers a 6% commission based on the eventual sales price of the home.
Some say it's the Seller who pays because the final 'Net-To-Seller' is reduced by, for example $24,000 on a $400,000 sale.
Others say that it's the buyers who pay, because they are paying $24,000 more than they would for a direct "Seller-To-Buyer" sale.
For home buyers and sellers the proposed changes are a simple reminder that you set the commissions.
In the typical transaction, sellers pay a Realtor $12,000 for the simple process of typing the listing info into the local Multi-List.
(This, by-the-way, is less work than an Appraiser does for $500.00).
The other $12,000 goes to which ever Realtor makes the sale.
Is there a significant, mandated to change?
NO!
The plan is to prohibit the Listing Realtor from typing in the commission split they are offering to the Realtor who makes the sale.
That's it!
The other side of the deal is to force buyers to sign an agreement with their Realtor. But that agreement can simply say that their Realtor is being paid, just as they always have been.
Is there any likely positive outcome?
In my opinion there could be if Owners/Sellers would wake up!
Its the selling Realtor who does the work and gets the sale.
A 'Listing Factory' gets a $12,000 fee for a $500 job.
What to do?
When your listing expires, maybe there is.
Ccall a State Certified Residential Appraiser who is also a Realtor.
Give them $1,000 for a basic appraisal and entry of the data into the Multi-List.
Whomever gets you a buyer gets, the (3%) $12,000 commission.
The Seller saves $11,000.
The buyer saves $12,000
Who's the loser?
Not our Home Buyers and Sellers.
That's who we should be protecting isn't it?

[fdpaq0580]

NAR - Much ado about nothing? Realtor's Commissions.
Thanks to the many people who have asked me about the proposed changes in Real Estate commissions this summer.
The answer isn't very complicated.
Regardless of the 'rules', Realtors predominantly charge Home-Owners/Buyers a 6% commission based on the eventual sales price of the home.
Some say it's the Seller who pays because the final 'Net-To-Seller' is reduced by, for example $24,000 on a $400,000 sale.
Others say that it's the buyers who pay, because they are paying $24,000 more than they would for a direct "Seller-To-Buyer" sale.
For home buyers and sellers the proposed changes are a simple reminder that you set the commissions.
In the typical transaction, sellers pay a Realtor $12,000 for the simple process of typing the listing info into the local Multi-List.
(This, by-the-way, is less work than an Appraiser does for $500.00).
The other $12,000 goes to which ever Realtor makes the sale.
Is there a significant, mandated to change?
NO!
The plan is to prohibit the Listing Realtor from typing in the commission split they are offering to the Realtor who makes the sale.
That's it!
The other side of the deal is to force buyers to sign an agreement with their Realtor. But that agreement can simply say that their Realtor is being paid, just as they always have been.
Is there any likely positive outcome?
In my opinion there could be if Owners/Sellers would wake up!
Its the selling Realtor who does the work and gets the sale.
A 'Listing Factory' gets a $12,000 fee for a $500 job.
What to do?
When your listing expires, maybe there is.
Ccall a State Certified Residential Appraiser who is also a Realtor.
Give them $1,000 for a basic appraisal and entry of the data into the Multi-List.
Whomever gets you a buyer gets, the (3%) $12,000 commission.
The Seller saves $11,000.
The buyer saves $12,000
Who's the loser?
Not our Home Buyers and Sellers.
That's who we should be protecting isn't it?

Protec the buyers and sellers? Good! Like a diner. One person takes your order, delivers your plate. Chef/owner does all the work preparing the item. Same effort to order then deliver plain hamburger or steak sand or lobster roll. The kitchen does the critical part along with owner having to invest in all associated costs.
Listing agents do minimal work compared to the buyers agent. Jmho.

[vintageogauge]

A good listing agent knows or gets to know the owners, their habits, how they treated their home, what improvements they made even the small seemingly insignificant ones, they provide quality photography and if the owner is not happy they change the photos, they will advise how to make the home more impressive, help with a little staging or suggest some changes, provide comparable recently sold figures and information on similar homes on the market, set up a realtor open house, as well as public open houses, the prepare the description for the listing, and they provide advertisement. They also show the home to their prospective buyers and those that make contact with them due to the listing and advertising. That is what a "GOOD" listing agent does. Now comes the buyers agent if not sold by the listing agent, he/she brings their client and attempts to convince them that this is the home for them and to make an offer. In my opinion there is value to having a "GOOD" listing agent, they are at least as important if not more important than the buyers agent. Just one man's opinion from past experiences.

[rustyp]

NAR - Much ado about nothing? Realtor's Commissions.
Thanks to the many people who have asked me about the proposed changes in Real Estate commissions this summer.
The answer isn't very complicated.
Regardless of the 'rules', Realtors predominantly charge Home-Owners/Buyers a 6% commission based on the eventual sales price of the home.
Some say it's the Seller who pays because the final 'Net-To-Seller' is reduced by, for example $24,000 on a $400,000 sale.
Others say that it's the buyers who pay, because they are paying $24,000 more than they would for a direct "Seller-To-Buyer" sale.
For home buyers and sellers the proposed changes are a simple reminder that you set the commissions.
In the typical transaction, sellers pay a Realtor $12,000 for the simple process of typing the listing info into the local Multi-List.
(This, by-the-way, is less work than an Appraiser does for $500.00).
The other $12,000 goes to which ever Realtor makes the sale.
Is there a significant, mandated to change?
NO!
The plan is to prohibit the Listing Realtor from typing in the commission split they are offering to the Realtor who makes the sale.
That's it!
The other side of the deal is to force buyers to sign an agreement with their Realtor. But that agreement can simply say that their Realtor is being paid, just as they always have been.
Is there any likely positive outcome?
In my opinion there could be if Owners/Sellers would wake up!
Its the selling Realtor who does the work and gets the sale.
A 'Listing Factory' gets a $12,000 fee for a $500 job.
What to do?
When your listing expires, maybe there is.
Ccall a State Certified Residential Appraiser who is also a Realtor.
Give them $1,000 for a basic appraisal and entry of the data into the Multi-List.
Whomever gets you a buyer gets, the (3%) $12,000 commission.
The Seller saves $11,000.
The buyer saves $12,000
Who's the loser?
Not our Home Buyers and Sellers.
That's who we should be protecting isn't it?

I am not sure how this works today. Assuming a 6% commission is it customary for the listing agent to get 3% and the actual agent that made the sale get 3% ? If the listing agent is the agent that made the sale does that agent get all 6% ? If this is true then your statement about being who is the winner/loser doesn't quite paint the whole picture. Under the new rules if the buyer purchased from the listing agent (let's say an open house walk off the street situation) there would be no buyers agent ? Only 3% would be the total commission. If a significant amount of sales today are made by the listing agent and that agent gets the full commission of 6% now that agent is only entitled to 3%. Is that correct? If so the listing real estate agents are the losers here. Everyone knows ultimately the buyer is paying the commission today - it's baked into the price the seller is willing to accept.

[retiredguy123]

NAR - Much ado about nothing? Realtor's Commissions.
Thanks to the many people who have asked me about the proposed changes in Real Estate commissions this summer.
The answer isn't very complicated.
Regardless of the 'rules', Realtors predominantly charge Home-Owners/Buyers a 6% commission based on the eventual sales price of the home.
Some say it's the Seller who pays because the final 'Net-To-Seller' is reduced by, for example $24,000 on a $400,000 sale.
Others say that it's the buyers who pay, because they are paying $24,000 more than they would for a direct "Seller-To-Buyer" sale.
For home buyers and sellers the proposed changes are a simple reminder that you set the commissions.
In the typical transaction, sellers pay a Realtor $12,000 for the simple process of typing the listing info into the local Multi-List.
(This, by-the-way, is less work than an Appraiser does for $500.00).
The other $12,000 goes to which ever Realtor makes the sale.
Is there a significant, mandated to change?
NO!
The plan is to prohibit the Listing Realtor from typing in the commission split they are offering to the Realtor who makes the sale.
That's it!
The other side of the deal is to force buyers to sign an agreement with their Realtor. But that agreement can simply say that their Realtor is being paid, just as they always have been.
Is there any likely positive outcome?
In my opinion there could be if Owners/Sellers would wake up!
Its the selling Realtor who does the work and gets the sale.
A 'Listing Factory' gets a $12,000 fee for a $500 job.
What to do?
When your listing expires, maybe there is.
Ccall a State Certified Residential Appraiser who is also a Realtor.
Give them $1,000 for a basic appraisal and entry of the data into the Multi-List.
Whomever gets you a buyer gets, the (3%) $12,000 commission.
The Seller saves $11,000.
The buyer saves $12,000
Who's the loser?
Not our Home Buyers and Sellers.
That's who we should be protecting isn't it?
I don't understand your math. How can the seller save $11,000 and the buyer save $12,000? That is $23,000, but a 6 percent commission would be $24,000. Where do you get the additional $12,000 to pay a 3 percent commission?

Also, it seems as though your premise is that real estate agents are pretty worthless at selling houses at higher prices, so that they do not earn their commission. If I believed that, I would never hire an agent.

[JMintzer]

I don't understand your math. How can the seller save $11,000 and the buyer save $12,000? That is $23,000, but a 6 percent commission would be $24,000. Where do you get the additional $12,000 to pay a 3 percent commission?

Also, it seems as though your premise is that real estate agents are pretty worthless at selling houses at higher prices, so that they do not earn their commission. If I believed that, I would never hire an agent.

You missed the part where the inspector (who normally gets $500) also lists the home (and then gets another $500). Both paid for by the seller...

[margaretmattson]

Imo, it all comes down to what a seller is willing to pay an agent. The lawsuit provides for competitive pricing.

Buyers agent? Not all needs one. Anyone can go on MLS and choose the homes you like. You can easily find the price history. Do a drive-by yourself. Why bring a stranger along? Any homes that interest you, call the listing agent(s) to see the interior. Hire your own inspector and use a real estate attorney to close. Both will protect your interests.

I am certain Realtors are going to try and twist the new law to bait those who are unaware. SELLERS will have the final say in how much an agent will get paid. I hope ALL realize this. Enormous pay for showing houses is a thing of the past.

[retiredguy123]

Imo, it all comes down to what a seller is willing to pay an agent. The lawsuit provides for competitive pricing.

Buyers agent? Not all needs one. Anyone can go on MLS and choose the homes you like. You can easily find the price history. Do a drive-by yourself. Why bring a stranger along? Any homes that interest you, call the listing agent(s) to see the interior. Hire your own inspector and use a real estate attorney to close. Both will protect your interests.

I am certain Realtors are going to try and twist the new law to bait those who are unaware. SELLERS will have the final say in how much an agent will get paid. I hope ALL realize this. Enormous pay for showing houses is a thing of the past.
Apparently, the OP thinks that any commision paid to an agent just reduces the amount of money that goes to the seller. If that is true, then a seller would be foolish to pay any commission. Also, regarding a buyer's agent, as a seller, I would never allow a buyer's agent to receive any money from my side of the settlement statement. If a buyer wants to be represented by an agent, the buyer would need to negotiate and pay their own commission or fee.

[margaretmattson]

Apparently, the OP thinks that any commision paid to an agent just reduces the amount of money that goes to the seller. If that is true, then a seller would be foolish to pay any commission. Also, regarding a buyer's agent, as a seller, I would never allow a buyer's agent to receive any money from my side of the settlement statement. If a buyer wants to be represented by an agent, the buyer would need to negotiate and pay their own commission or fee.NOW, there will be that option. This lawsuit places the fees paid (and how) into the hands of the seller. Where it should have always been. Maybe, for sale by owner will be more popular and accepted once everyone understands the new rule.

[msilagy]

There's so much more the listing agent does.....this post is short sided.

[villageuser]

There is so much mis-information in the original post, that it is scary.

[Robyn1963]

You are 100% correct

[Donegalkid]

NAR - Much ado about nothing? Realtor's Commissions.
Thanks to the many people who have asked me about the proposed changes in Real Estate commissions this summer.
The answer isn't very complicated.
Regardless of the 'rules', Realtors predominantly charge Home-Owners/Buyers a 6% commission based on the eventual sales price of the home.
Some say it's the Seller who pays because the final 'Net-To-Seller' is reduced by, for example $24,000 on a $400,000 sale.
Others say that it's the buyers who pay, because they are paying $24,000 more than they would for a direct "Seller-To-Buyer" sale.
For home buyers and sellers the proposed changes are a simple reminder that you set the commissions.
In the typical transaction, sellers pay a Realtor $12,000 for the simple process of typing the listing info into the local Multi-List.
(This, by-the-way, is less work than an Appraiser does for $500.00).
The other $12,000 goes to which ever Realtor makes the sale.
Is there a significant, mandated to change?
NO!
The plan is to prohibit the Listing Realtor from typing in the commission split they are offering to the Realtor who makes the sale.
That's it!
The other side of the deal is to force buyers to sign an agreement with their Realtor. But that agreement can simply say that their Realtor is being paid, just as they always have been.
Is there any likely positive outcome?
In my opinion there could be if Owners/Sellers would wake up!
Its the selling Realtor who does the work and gets the sale.
A 'Listing Factory' gets a $12,000 fee for a $500 job.
What to do?
When your listing expires, maybe there is.
Ccall a State Certified Residential Appraiser who is also a Realtor.
Give them $1,000 for a basic appraisal and entry of the data into the Multi-List.
Whomever gets you a buyer gets, the (3%) $12,000 commission.
The Seller saves $11,000.
The buyer saves $12,000
Who's the loser?
Not our Home Buyers and Sellers.
That's who we should be protecting isn't it?

One baby step above click bait.

[jimbomaybe]

NOW, there will be that option. This lawsuit places the fees paid (and how) into the hands of the seller. Where it should have always been. Maybe, for sale by owner will be more popular and accepted once everyone understands the new rule.

Buying or selling financial products, stocks, bonds at one time generated fees much higher than now, granted a very different industry, even so the communication revolution of the internet has made many changes and that continues, the ability of a seller to list and have wide exposure is going to change the sales model as more and more people sell their own home. I don't doubt that real estate agent can be a great help and do many thing that are not apparent to the seller, but how can events do anything but put downward pressure on the current fee system ?

[MSchad]

NAR - Much ado about nothing? Realtor's Commissions.
Thanks to the many people who have asked me about the proposed changes in Real Estate commissions this summer.
The answer isn't very complicated.
Regardless of the 'rules', Realtors predominantly charge Home-Owners/Buyers a 6% commission based on the eventual sales price of the home.
Some say it's the Seller who pays because the final 'Net-To-Seller' is reduced by, for example $24,000 on a $400,000 sale.
Others say that it's the buyers who pay, because they are paying $24,000 more than they would for a direct "Seller-To-Buyer" sale.
For home buyers and sellers the proposed changes are a simple reminder that you set the commissions.
In the typical transaction, sellers pay a Realtor $12,000 for the simple process of typing the listing info into the local Multi-List.
(This, by-the-way, is less work than an Appraiser does for $500.00).
The other $12,000 goes to which ever Realtor makes the sale.
Is there a significant, mandated to change?
NO!
The plan is to prohibit the Listing Realtor from typing in the commission split they are offering to the Realtor who makes the sale.
That's it!
The other side of the deal is to force buyers to sign an agreement with their Realtor. But that agreement can simply say that their Realtor is being paid, just as they always have been.
Is there any likely positive outcome?
In my opinion there could be if Owners/Sellers would wake up!
Its the selling Realtor who does the work and gets the sale.
A 'Listing Factory' gets a $12,000 fee for a $500 job.
What to do?
When your listing expires, maybe there is.
Ccall a State Certified Residential Appraiser who is also a Realtor.
Give them $1,000 for a basic appraisal and entry of the data into the Multi-List.
Whomever gets you a buyer gets, the (3%) $12,000 commission.
The Seller saves $11,000.
The buyer saves $12,000
Who's the loser?
Not our Home Buyers and Sellers.
That's who we should be protecting isn't it?
Not saying changes are bad, but your over simplification of what realtors do (simple process of typing the listing info into the local Multi-List) is almost laughable. Obviously you have no idea what is involved and required for the profession.

[GizmoWhiskers]

A good listing agent knows or gets to know the owners, their habits, how they treated their home, what improvements they made even the small seemingly insignificant ones, they provide quality photography and if the owner is not happy they change the photos, they will advise how to make the home more impressive, help with a little staging or suggest some changes, provide comparable recently sold figures and information on similar homes on the market, set up a realtor open house, as well as public open houses, the prepare the description for the listing, and they provide advertisement. They also show the home to their prospective buyers and those that make contact with them due to the listing and advertising. That is what a "GOOD" listing agent does. Now comes the buyers agent if not sold by the listing agent, he/she brings their client and attempts to convince them that this is the home for them and to make an offer. In my opinion there is value to having a "GOOD" listing agent, they are at least as important if not more important than the buyers agent. Just one man's opinion from past experiences.
I had a Villages sales listing agent that came recommended by a friend. His house sold itself in a day during the covid gold rush mass exodus to Florida phenomenon. I THOUGHT she was good based on my friend's experience with her. Boy was I wrong. There is no way to know "GOOD".

This villages sales agent realtor attempted to slip in a 6 mos sales contract as if I were oblivious to contracts. She did nothing but trash talk my 3 yr old home in DeLuna at the only open house SHE did.
Note to Village realtors, neighbors do go to open houses to check up on you!

Closing number two she had someone else do for her while she was on vacation. The last of her obligated three, no one showed up to do. She was always a day late on connectivity as well.

It made me sick to pay her commission at closing. She fought with me on price from the get go. Tried to convince me a house at the southern tip of TV new area at the time , which was on the north side of the turnpike at 470 was worth more than one a mile from Brownwood via golf cart. Wake up call... incorrect!!

Glad I stuck to MY guns relative to her obnoxious, condiscending pushiness, I did great. It astounded me that after 5 days she thought I should drop my price. Deeply regretted using her as an agent as the last thing a seller needs is the stress of a useless agent.

The Buyer agent is the one who brought the sale. Who needs a selling agent other than as a data entry clerk for the website. I didn't. Mine was useless! Was glad to hear she was moving out of T V and state. Saves other sellers in T V from a lot of frustration!

[oneclickplus]

FSBO + appraiser + title company is all you need. 6 houses bought / sold since 1984 and haven't paid any realtor commissions as a buyer or seller. 6% commission is ridiculous especially as prices have risen. Would you pay a $3000 commission to sell your used car? There is simply no reason that any party (or parties) should collect $36000 on a $600,000 home sale. That's most of an annual salary for many people.

NAR - Much ado about nothing? Realtor's Commissions.
Thanks to the many people who have asked me about the proposed changes in Real Estate commissions this summer.
The answer isn't very complicated.
Regardless of the 'rules', Realtors predominantly charge Home-Owners/Buyers a 6% commission based on the eventual sales price of the home.
Some say it's the Seller who pays because the final 'Net-To-Seller' is reduced by, for example $24,000 on a $400,000 sale.
Others say that it's the buyers who pay, because they are paying $24,000 more than they would for a direct "Seller-To-Buyer" sale.
For home buyers and sellers the proposed changes are a simple reminder that you set the commissions.
In the typical transaction, sellers pay a Realtor $12,000 for the simple process of typing the listing info into the local Multi-List.
(This, by-the-way, is less work than an Appraiser does for $500.00).
The other $12,000 goes to which ever Realtor makes the sale.
Is there a significant, mandated to change?
NO!
The plan is to prohibit the Listing Realtor from typing in the commission split they are offering to the Realtor who makes the sale.
That's it!
The other side of the deal is to force buyers to sign an agreement with their Realtor. But that agreement can simply say that their Realtor is being paid, just as they always have been.
Is there any likely positive outcome?
In my opinion there could be if Owners/Sellers would wake up!
Its the selling Realtor who does the work and gets the sale.
A 'Listing Factory' gets a $12,000 fee for a $500 job.
What to do?
When your listing expires, maybe there is.
Ccall a State Certified Residential Appraiser who is also a Realtor.
Give them $1,000 for a basic appraisal and entry of the data into the Multi-List.
Whomever gets you a buyer gets, the (3%) $12,000 commission.
The Seller saves $11,000.
The buyer saves $12,000
Who's the loser?
Not our Home Buyers and Sellers.
That's who we should be protecting isn't it?

[JWGifford]

It would be interesting to hear from one of our British neighbors. My understanding is they pay significantly less fees in Britain. Wondering if there is a difference in the level of service. Just curious.

[DrHitch]

Wow...long thread....basically a world of caveat emptor....do your shopping as a seller or a buyer....

What I really want:
1) as a seller, I always do my own home inspection to uncover any problems in advance (DIY fix). Hand that report to the buyer avoids nit-pick price reduction.

2) as a seller, I won't pay 6% in the modern age of online listings. The agent only has to take (sometimes shoddy) cell phone pics and enter onto the MLS. It's more work on buyer's side to setup a search filter

3) as a buyer, I don't need an agent to help me search (some may do). Again, things have changed with realtor.com (don't believe Zillow). I want to deal directly with the seller with minimal back and forth. The title process is now a lot simpler.

Bottom line: the traditional sales model is broken. NAR agents need to change methodologies.

Me? Former manager of real estate software listing business for print media (now a dead market)

[MikeVillages]

The % of the sold price used for the realtor’s commission has always been negotiable and often been based on the market & region.

Hot markets with little supply of desirable homes with rising prices & lots of buyers often have lower commissions. A homeowner should always interview several realtors before signing a contract. During the interview, the homeowner should ask if the commission is negotiable. If the contract includes both buyer’s & listing realtors (as it has been), the commission should be equal between the two realtors. IMO

[defrey12]

Apparently, the OP thinks that any commision paid to an agent just reduces the amount of money that goes to the seller. If that is true, then a seller would be foolish to pay any commission. Also, regarding a buyer's agent, as a seller, I would never allow a buyer's agent to receive any money from my side of the settlement statement. If a buyer wants to be represented by an agent, the buyer would need to negotiate and pay their own commission or fee.

So, if you’re selling your home for “X” and agree to a 6% commission with your listing agent, why do YOU care if s/he agrees to split that commission with someone who brings you a viable buyer? That is, a BUYER’s agent. Your home still sells for “X” and there is NO extra $ out of your pocket. Again, WHY DO YOU CARE !? It’s only fair that s/he gets paid so why do care how—it doesn’t affect you. That buyer probably couldn’t afford your home if they had to come up with another $12000 out of pocket. All this lawsuit does is diminish the buyer pool…especially first-time homebuyers. It is NOT going to make homes more affordable as they claim. Why? Because you’re still going to sell your house for as much as you can regardless of commission!

[retiredguy123]

So, if you’re selling your home for “X” and agree to a 6% commission with your listing agent, why do YOU care if s/he agrees to split that commission with someone who brings you a viable buyer? That is, a BUYER’s agent. Your home still sells for “X” and there is NO extra $ out of your pocket. Again, WHY DO YOU CARE !? It’s only fair that s/he gets paid so why do care how—it doesn’t affect you. That buyer probably couldn’t afford your home if they had to come up with another $12000 out of pocket. All this lawsuit does is diminish the buyer pool…especially first-time homebuyers. It is NOT going to make homes more affordable as they claim. Why? Because you’re still going to sell your house for as much as you can regardless of commission!
Because a seller is paying the broker for legal representation. A buyer's agent does not represent the seller. An agent who is representing a buyer is not required to negotiate the best terms and price for the seller. As a seller, who is paying a 6 percent commission, I want every licensed agent who is involved in the negotiation of the sale to be representing me, the seller. That is what I am paying for. I don't care how the commission is split, as long as all of the commission goes to agents who represent me. And, I don't believe that an agent who represents the buyer is capable of negotiating on behalf of the seller and to get the best price for a house.

[Bay Kid]

Leave it to the media to attempt to ruin peoples livelihood with lies and deceit, then the govern/pres to promote price fixing.

[ellenwelsh]

All this discussion seems to forget the broker. The commission is paid to the broker and the broker splits their “half” with the agent. That split may be 50/50 or not. Many companies work on graduated splits where the agent receives more of their 3% based on cumulative sales. Novice agents may start at 30% of 50% whereas seasoned, high volume agents may be paid as much as 90% of 50%.

[thevillagejr]

You missed the part where the inspector (who normally gets $500) also lists the home (and then gets another $500). Both paid for by the seller...

Depending on the state,
area, company, appraisers do not sell "123 Main Street" and appraise "123 Main Street" it is or could be a conflict of interest.

[Marine1974]

NAR - Much ado about nothing? Realtor's Commissions.
Thanks to the many people who have asked me about the proposed changes in Real Estate commissions this summer.
The answer isn't very complicated.
Regardless of the 'rules', Realtors predominantly charge Home-Owners/Buyers a 6% commission based on the eventual sales price of the home.
Some say it's the Seller who pays because the final 'Net-To-Seller' is reduced by, for example $24,000 on a $400,000 sale.
Others say that it's the buyers who pay, because they are paying $24,000 more than they would for a direct "Seller-To-Buyer" sale.
For home buyers and sellers the proposed changes are a simple reminder that you set the commissions.
In the typical transaction, sellers pay a Realtor $12,000 for the simple process of typing the listing info into the local Multi-List.
(This, by-the-way, is less work than an Appraiser does for $500.00).
The other $12,000 goes to which ever Realtor makes the sale.
Is there a significant, mandated to change?
NO!
The plan is to prohibit the Listing Realtor from typing in the commission split they are offering to the Realtor who makes the sale.
That's it!
The other side of the deal is to force buyers to sign an agreement with their Realtor. But that agreement can simply say that their Realtor is being paid, just as they always have been.
Is there any likely positive outcome?
In my opinion there could be if Owners/Sellers would wake up!
Its the selling Realtor who does the work and gets the sale.
A 'Listing Factory' gets a $12,000 fee for a $500 job.
What to do?
When your listing expires, maybe there is.
Ccall a State Certified Residential Appraiser who is also a Realtor.
Give them $1,000 for a basic appraisal and entry of the data into the Multi-List.
Whomever gets you a buyer gets, the (3%) $12,000 commission.
The Seller saves $11,000.
The buyer saves $12,000
Who's the loser?
Not our Home Buyers and Sellers.
That's who we should be protecting isn't it?
I had a bad Realtors , a married couple . list my house back in Chicago. . Big mistake , should have sold it by owner myself .
First of all they listed my house
on the MLS on a Friday at 10:30 pm and planned for an open house on Sunday. They sent a young man around with flyers Sunday morning about the open house to all my neighbors . So no real traffic of buyers just neighbors not interested in buying for only 2 hour open house . They Over Priced the house , no appraiser. There apparent plan was to do nothing and let other realtors bring a buyer . They never brought one prospective buyer client of their own . Basically didn’t do a lot for me other than pressure me to reduce price by $25,000.
I suggested they go to the monthly realtor association meeting where other realtors , investors, contractors etc meet and network. I was told they couldn’t go .
My house had a VA mortgage ( due to divorce) 30 year fixed at 2.399 % assumable. I sent them contact information on every VFW and American legion in the Chicago area attention post commander alerting them to help a fellow veteran out and assume
a 2.399% mortgage and buy a large 4 bedroom 2 bath house in a
good school district. They told me they couldn’t discriminate????
I would get a text from the MLS
requesting a showing sometimes same day which required 2 hours of prep work on my part .
In the end they started pressing me to drop the price another $25,000 which I replied if you drop
your commission rate and was told they had two kids in college and couldn’t do that , but I could cancel and pay them a fee per our contract which I said no chance of that I’ll ride out the rest of the 6 month contract before I would give them a dime . In the end , it was a good thing my house didn’t sell as I am now I am remarried and every time I pay my monthly mortgage my balance goes down $900 . Like an investment.

[Jcicales]

NAR - Much ado about nothing? Realtor's Commissions.
Thanks to the many people who have asked me about the proposed changes in Real Estate commissions this summer.
The answer isn't very complicated.
Regardless of the 'rules', Realtors predominantly charge Home-Owners/Buyers a 6% commission based on the eventual sales price of the home.
Some say it's the Seller who pays because the final 'Net-To-Seller' is reduced by, for example $24,000 on a $400,000 sale.
Others say that it's the buyers who pay, because they are paying $24,000 more than they would for a direct "Seller-To-Buyer" sale.
For home buyers and sellers the proposed changes are a simple reminder that you set the commissions.
In the typical transaction, sellers pay a Realtor $12,000 for the simple process of typing the listing info into the local Multi-List.
(This, by-the-way, is less work than an Appraiser does for $500.00).
The other $12,000 goes to which ever Realtor makes the sale.
Is there a significant, mandated to change?
NO!
The plan is to prohibit the Listing Realtor from typing in the commission split they are offering to the Realtor who makes the sale.
That's it!
The other side of the deal is to force buyers to sign an agreement with their Realtor. But that agreement can simply say that their Realtor is being paid, just as they always have been.
Is there any likely positive outcome?
In my opinion there could be if Owners/Sellers would wake up!
Its the selling Realtor who does the work and gets the sale.
A 'Listing Factory' gets a $12,000 fee for a $500 job.
What to do?
When your listing expires, maybe there is.
Ccall a State Certified Residential Appraiser who is also a Realtor.
Give them $1,000 for a basic appraisal and entry of the data into the Multi-List.
Whomever gets you a buyer gets, the (3%) $12,000 commission.
The Seller saves $11,000.
The buyer saves $12,000
Who's the loser?
Not our Home Buyers and Sellers.
That's who we should be protecting isn't it?
And I am sure you were compensated in your profession- whatever that was. Do you take into consideration not all buys can just drive by- maybe they are out of state- in this case agent may spend months find a home all the while doing the drive bys - taking videos- maybe taking months to FINALLY make a sale of $12,000, their broker may get half ($6,000), agent then pays taxes, mls fees, errors and omissions insurance and wear and tear ON car gas driving around PLUS this may take a few months to find that house and hopefully make a small commission to feed their family. ??????

[Marine1974]

There's so much more the listing agent does.....this post is short sided.
I would be curious what you think all the things a listing agent is required to do other than hire a photographer , list house on MLS and hold a 2 hour open house ?

[Marine1974]

And I am sure you were compensated in your profession- whatever that was. Do you take into consideration not all buys can just drive by- maybe they are out of state- in this case agent may spend months find a home all the while doing the drive bys - taking videos- maybe taking months to FINALLY make a sale of $12,000, their broker may get half ($6,000), agent then pays taxes, mls fees, errors and omissions insurance and wear and tear ON car gas driving around PLUS this may take a few months to find that house and hopefully make a small commission to feed their family. ??????
Not my problem. Never again would I use a realtor to list my house . I would be willing to pay a buyers realtor agent 2 possibly 2 and a half percent commission.
Think about all the houses that sold in a day when the market was hot and buyers were paying
over asking price . How much work did the listing agent do for $12,000 ?

[retiredguy123]

A seller has a lot of leverage when negotiating a listing contract. I never accept the broker's boilerplate contract. At a minimum, I want a written marketing plan for selling my house, a 3 month contract (not 6 months), and the right to fire the company if I lose confidence in them, with no penalty for doing so. If the broker won't negotiate the contract, I will hire another broker. Also, I want to hire one of the most successful agents in the company. Why hire an inexperienced sales agent when they all charge the same commission? And, I want the agent to recommend the listing price. That should be their job.

[Dlbonivich]

I have found this thread very interesting. I have been a realtor for 27 years. I have always provided excellent service. I make sure as a listing agent that the home is listed properly, meaning that all the laws are followed and all the information is correct. I have insurance that I pay for that insures if I make a mistake that it is on me, not the seller. Many pitfalls that can be fallen into in Florida. Insurance issues, flood zones, sink holes, cdd, housing for 55+. etc. I also believe after 27 years, I know what photos are going to attract a buyer looking at an internet photo in Michigan is going to see and like, and is going to put your house on their list to see. I also believe that working with and compensating a buyers agent is a good thing. I am a great negotiator, when you have multiple offers I am able to professionally guide you through the contracts and help you accept a contract for the best price and one that will make it to the closing table. When you get one contract, I will be able to help you negotiate for your best interest. I know lending, inspections and how to negotiate repairs. I have many people you can rely on to help you get your house ready and to make any necessary negotiated repairs. I do believe many agents may not be doing everything they should be and they may not make it in this new environment. I believe people will still see my value. As a buyers agent, navigating loans, repairs, a different climate, area, insurance, cdd, taxes there are many confusing new things are all my job to help you with. Opening a door is just the beginning. Maybe I am wrong. I can tell you my job is a full time endeavor and each sale is different. I still run in to unique circumstances every week. Makes me believe a novice may not be doing much right. Good luck all. I’m not worried. I believe I am worth my commission.

[frayedends]

I would be curious what you think all the things a listing agent is required to do other than hire a photographer , list house on MLS and hold a 2 hour open house ?

Pricing, preparing, staging, marketing, understanding offers and which are good. That includes knowing fha/va requirements, checking proof of funds, understanding appraisal issues. Negotiating. Making sure dates are met for contracts. Remember you are paying for experience as well as time.

[mcloud]

NAR - Much ado about nothing? Realtor's Commissions.
Thanks to the many people who have asked me about the proposed changes in Real Estate commissions this summer.
The answer isn't very complicated.
Regardless of the 'rules', Realtors predominantly charge Home-Owners/Buyers a 6% commission based on the eventual sales price of the home.
Some say it's the Seller who pays because the final 'Net-To-Seller' is reduced by, for example $24,000 on a $400,000 sale.
Others say that it's the buyers who pay, because they are paying $24,000 more than they would for a direct "Seller-To-Buyer" sale.
For home buyers and sellers the proposed changes are a simple reminder that you set the commissions.
In the typical transaction, sellers pay a Realtor $12,000 for the simple process of typing the listing info into the local Multi-List.
(This, by-the-way, is less work than an Appraiser does for $500.00).
The other $12,000 goes to which ever Realtor makes the sale.
Is there a significant, mandated to change?
NO!
The plan is to prohibit the Listing Realtor from typing in the commission split they are offering to the Realtor who makes the sale.
That's it!
The other side of the deal is to force buyers to sign an agreement with their Realtor. But that agreement can simply say that their Realtor is being paid, just as they always have been.
Is there any likely positive outcome?
In my opinion there could be if Owners/Sellers would wake up!
Its the selling Realtor who does the work and gets the sale.
A 'Listing Factory' gets a $12,000 fee for a $500 job.
What to do?
When your listing expires, maybe there is.
Ccall a State Certified Residential Appraiser who is also a Realtor.
Give them $1,000 for a basic appraisal and entry of the data into the Multi-List.
Whomever gets you a buyer gets, the (3%) $12,000 commission.
The Seller saves $11,000.
The buyer saves $12,000
Who's the loser?
Not our Home Buyers and Sellers.
That's who we should be protecting isn't it?

If you THINK being a listening agent is “simply typing in info to MLS “ is all we do, then you are a highly uneducated individual . You have No idea what regulations rules of conduct, laws, codes of ethics we use and apply and advise sellers how to best sell their homes.
Not to mention the thousands of dollars spent a year advertising promoting our clients homes getting them the best money,deals conditions available. Not to mention vetting want to be buyers with sketchy credit, flimsy lender, letters, and bad deals being written to purchase our clients homes. 90% of a sellers agent Work starts once a contract is presented If you think it’s so easy, get your license and give it a try I’m sure your opinion will change.

[VillagerNut]

Your post is absolutely not the correct information regarding the real estate proposed changes.. It’s obvious you’re not a licensed Florida real estate agent. The commission has always been negotiable. The only thing this agreement is doing is to make it clear of who gets paid how much. Also, it will protect the buyer’s agent to make sure they are being paid for the transaction. If you think the listing agent only enters the listing and that’s all they do, I would love for you to shadow a productive REALTOR one week! Overall the successful REALTORS will make more money because they will be able to show Customers their value. If you have any questions about the agreement, feel free to private message me. Yes I am a licensed Florida real estate agent here.


NAR - Much ado about nothing? Realtor's Commissions.
Thanks to the many people who have asked me about the proposed changes in Real Estate commissions this summer.
The answer isn't very complicated.
Regardless of the 'rules', Realtors predominantly charge Home-Owners/Buyers a 6% commission based on the eventual sales price of the home.
Some say it's the Seller who pays because the final 'Net-To-Seller' is reduced by, for example $24,000 on a $400,000 sale.
Others say that it's the buyers who pay, because they are paying $24,000 more than they would for a direct "Seller-To-Buyer" sale.
For home buyers and sellers the proposed changes are a simple reminder that you set the commissions.
In the typical transaction, sellers pay a Realtor $12,000 for the simple process of typing the listing info into the local Multi-List.
(This, by-the-way, is less work than an Appraiser does for $500.00).
The other $12,000 goes to which ever Realtor makes the sale.
Is there a significant, mandated to change?
NO!
The plan is to prohibit the Listing Realtor from typing in the commission split they are offering to the Realtor who makes the sale.
That's it!
The other side of the deal is to force buyers to sign an agreement with their Realtor. But that agreement can simply say that their Realtor is being paid, just as they always have been.
Is there any likely positive outcome?
In my opinion there could be if Owners/Sellers would wake up!
Its the selling Realtor who does the work and gets the sale.
A 'Listing Factory' gets a $12,000 fee for a $500 job.
What to do?
When your listing expires, maybe there is.
Ccall a State Certified Residential Appraiser who is also a Realtor.
Give them $1,000 for a basic appraisal and entry of the data into the Multi-List.
Whomever gets you a buyer gets, the (3%) $12,000 commission.
The Seller saves $11,000.
The buyer saves $12,000
Who's the loser?
Not our Home Buyers and Sellers.
That's who we should be protecting isn't it?

[Pamalla12]

Obviously this person has no idea what a real estate agent does. There is more than simply putting a home owners home in the MLS and having open houses. It is people like this that cause lot of problems for everyone in our industry to have problems because all of a sudden they think they are experts in everything going on and yet they know nothing. Leave the real estate agents to do there job, just like an accountant knows his job and doctors know there jobs. Would you take your car to a dentist for repairs or your boat to a barber shop to be fixed? Well this is the same and taking information on a site like this from some one who knows nothing about what a professional real estate agent does or spends money on to get your home sold is the same thing!

[rustyp]

I have found this thread very interesting. I have been a realtor for 27 years. I have always provided excellent service. I make sure as a listing agent that the home is listed properly, meaning that all the laws are followed and all the information is correct. I have insurance that I pay for that insures if I make a mistake that it is on me, not the seller. Many pitfalls that can be fallen into in Florida. Insurance issues, flood zones, sink holes, cdd, housing for 55+. etc. I also believe after 27 years, I know what photos are going to attract a buyer looking at an internet photo in Michigan is going to see and like, and is going to put your house on their list to see. I also believe that working with and compensating a buyers agent is a good thing. I am a great negotiator, when you have multiple offers I am able to professionally guide you through the contracts and help you accept a contract for the best price and one that will make it to the closing table. When you get one contract, I will be able to help you negotiate for your best interest. I know lending, inspections and how to negotiate repairs. I have many people you can rely on to help you get your house ready and to make any necessary negotiated repairs. I do believe many agents may not be doing everything they should be and they may not make it in this new environment. I believe people will still see my value. As a buyers agent, navigating loans, repairs, a different climate, area, insurance, cdd, taxes there are many confusing new things are all my job to help you with. Opening a door is just the beginning. Maybe I am wrong. I can tell you my job is a full time endeavor and each sale is different. I still run in to unique circumstances every week. Makes me believe a novice may not be doing much right. Good luck all. I’m not worried. I believe I am worth my commission.

With your vast experience how many actual hands on work hours would you estimate you put into the average sale here in TV in today's environment ? If possible for us laymen could you break that estimate down into major activities. At a very high level - example 4 hours at a closing, 3 open houses = 6 hours, maybe 12 hours total telephone time, etc.

[frayedends]

With your vast experience how many actual hands on work hours would you estimate you put into the average sale here in TV in today's environment ? If possible for us laymen could you break that estimate down into major activities. At a very high level - example 4 hours at a closing, 3 open houses = 6 hours, maybe 12 hours total telephone time, etc.

You want to break it down to hourly pay. It doesn’t work that way. What hourly rate for never having a weekend or vacation off? How about the pay for answering the phone at 6 am for a seller asking some question that had no urgency, or at 10 pm. How about the years of experience you are paying for. Or the marketing the realtor spent money on? Or the pictures she laid out $800-1000 up front out of pocket. How much is it worth for you to never have an uninterrupted meal? To leave date night with your spouse because you have to take this call. To split that “hourly pay” with the brokerage and maybe the referral realtor? I’m not a realtor but my wife is. You folks think it’s such an easy money maker job then go for it. Most people fail in real estate.

[dawabeav]

FSBO + appraiser + title company is all you need. 6 houses bought / sold since 1984 and haven't paid any realtor commissions as a buyer or seller. 6% commission is ridiculous especially as prices have risen. Would you pay a $3000 commission to sell your used car? There is simply no reason that any party (or parties) should collect $36000 on a $600,000 home sale. That's most of an annual salary for many people.

You took the words right out of my mouth.

[Robnlaura]

Well it’s really simple, the selling buyers agent needs to get a commission agreement from any buyer, and include a “fee”
I don’t see anyone wanting to pay a fee to an agent. Now what I do see is companies like Zillow taking over the market of selling homes and marketing themselves to buyers agents who will show homes for a fee they dictate. I predicted this would happen years ago. Altisource back in the last recession had a selling site and a closing company plus it used in-house contracts electronically.
All I see is that expanding.. no one will take buyers out for nothing.

[rustyp]

You want to break it down to hourly pay. It doesn’t work that way. What hourly rate for never having a weekend or vacation off? How about the pay for answering the phone at 6 am for a seller asking some question that had no urgency, or at 10 pm. How about the years of experience you are paying for. Or the marketing the realtor spent money on? Or the pictures she laid out $800-1000 up front out of pocket. How much is it worth for you to never have an uninterrupted meal? To leave date night with your spouse because you have to take this call. To split that “hourly pay” with the brokerage and maybe the referral realtor? I’m not a realtor but my wife is. You folks think it’s such an easy money maker job then go for it. Most people fail in real estate.

First I was just curious - simply seeking an education
Second you just described many jobs in America some of which put their lives on the line

[Robnlaura]

NAR - Much ado about nothing? Realtor's Commissions.
Thanks to the many people who have asked me about the proposed changes in Real Estate commissions this summer.
The answer isn't very complicated.
Regardless of the 'rules', Realtors predominantly charge Home-Owners/Buyers a 6% commission based on the eventual sales price of the home.
Some say it's the Seller who pays because the final 'Net-To-Seller' is reduced by, for example $24,000 on a $400,000 sale.
Others say that it's the buyers who pay, because they are paying $24,000 more than they would for a direct "Seller-To-Buyer" sale.
For home buyers and sellers the proposed changes are a simple reminder that you set the commissions.
In the typical transaction, sellers pay a Realtor $12,000 for the simple process of typing the listing info into the local Multi-List.
(This, by-the-way, is less work than an Appraiser does for $500.00).
The other $12,000 goes to which ever Realtor makes the sale.
Is there a significant, mandated to change?
NO!
The plan is to prohibit the Listing Realtor from typing in the commission split they are offering to the Realtor who makes the sale.
That's it!
The other side of the deal is to force buyers to sign an agreement with their Realtor. But that agreement can simply say that their Realtor is being paid, just as they always have been.
Is there any likely positive outcome?
In my opinion there could be if Owners/Sellers would wake up!
Its the selling Realtor who does the work and gets the sale.
A 'Listing Factory' gets a $12,000 fee for a $500 job.
What to do?
When your listing expires, maybe there is.
Ccall a State Certified Residential Appraiser who is also a Realtor.
Give them $1,000 for a basic appraisal and entry of the data into the Multi-List.
Whomever gets you a buyer gets, the (3%) $12,000 commission.
The Seller saves $11,000.
The buyer saves $12,000
Who's the loser?
Not our Home Buyers and Sellers.
That's who we should be protecting isn't it?
Who’s gonna take buyers out for $1000? So you think it’s ok to tale buyers to home after home for a $1000 bucks? Now I see the guys who started this lawsuit places like Zillow coming up with a program like they have done for years. Selling leads to agents now it will be selling buyers to agents but this time a fee will be paid or some idiot to take people out to see home after home. Good luck..

[Two Bills]

It would be interesting to hear from one of our British neighbors. My understanding is they pay significantly less fees in Britain. Wondering if there is a difference in the level of service. Just curious.

In UK many sellers now use a 'Conveyancing' business.
They take care of all the paper work, list on all the main property selling sites, will send a photographer, and do all the deed work. Cost about $1200 to £2500 according to property.
Seller shows buyers round, in most cases.

Before legislation, the main online property search sites were exclusive to Estate Agents, which made self sell near impossible. Now those sites are open to all.

Estate agents are all negotiable on fee. I have never paid more than 1%. Over 2%, unless a large property, you are getting ripped off. They handle listing, photos, showing buyers round, and most have an in house or local solicitor (lawyer) to handle the deed transfer and money for closing deal. Somewhere between $650 and $1500 as a rough estimate extra for legal work.

Never heard of, or known, anyone to use a buying agent.
Buyers basically look online, see something they like, call the seller's agent, and book a viewing.
Another system gaining popularity, at least where I live, is "offers over £££££££££" then sealed bids on a closing sale date.
These are usually 'doer uppers' or quick probate sales.
Bad properties, those very hard to shift, and near derelicts usually finish at auction.

[miadford@gmail.com]

You all don’t seem to understand who gets what as far as the commission goes:
Let’s just use a sale of $100,000.
For a 6% commission that would be $6000
Let’s even assume that the split between brokers is even. So both sides receive 3%=$3000.
Seller’s broker gets the $3k and then has an agreed upon split with the listing agent and we wi say 50% so the agent then gets $1500 and their broker gets $1500.
The same happens on the buyer representation side.
So if the splits are all even, (which in most cases it isn’t), the real estate agent is splitting any commission they receive 4 ways. And they still have to pay percentages to lead creating companies such as Zillow and many others. So out of $6k, the agent may get to keep about $800.

[vintageogauge]

I had a Villages sales listing agent that came recommended by a friend. His house sold itself in a day during the covid gold rush mass exodus to Florida phenomenon. I THOUGHT she was good based on my friend's experience with her. Boy was I wrong. There is no way to know "GOOD".

This villages sales agent realtor attempted to slip in a 6 mos sales contract as if I were oblivious to contracts. She did nothing but trash talk my 3 yr old home in DeLuna at the only open house SHE did.
Note to Village realtors, neighbors do go to open houses to check up on you!

Closing number two she had someone else do for her while she was on vacation. The last of her obligated three, no one showed up to do. She was always a day late on connectivity as well.

It made me sick to pay her commission at closing. She fought with me on price from the get go. Tried to convince me a house at the southern tip of TV new area at the time , which was on the north side of the turnpike at 470 was worth more than one a mile from Brownwood via golf cart. Wake up call... incorrect!!

Glad I stuck to MY guns relative to her obnoxious, condiscending pushiness, I did great. It astounded me that after 5 days she thought I should drop my price. Deeply regretted using her as an agent as the last thing a seller needs is the stress of a useless agent.

The Buyer agent is the one who brought the sale. Who needs a selling agent other than as a data entry clerk for the website. I didn't. Mine was useless! Was glad to hear she was moving out of T V and state. Saves other sellers in T V from a lot of frustration!

One bad apple, you know the rest.

[rsmurano]

For the ill informed or rookies in the stock market, they still pay loaded funds and high expense funds, this hasn’t changed.

Same goes for the real estate sector. The main objective of the listing agent is to list your home, sit around while someone else sells your home, all while your listing realtor makes 2.5-3%

I sold my last 2 houses by putting them on the subdivisions web page. The house before here, I got 6 calls within a couple of hours wanting to see the house. Friends of residents bought the house, and it was very easy to do. You need to get a couple of forms from a lawyer on the contract, and then the disclosure form. Then you close with a lawyer of yours or your buyers.
With talk of the villages app, Nextdoor, Facebook marketplace, I would think it would be easy. Also placing your house on nyc/LA/San Francisco Facebook marketplace pages.

[retiredguy123]

You all don’t seem to understand who gets what as far as the commission goes:
Let’s just use a sale of $100,000.
For a 6% commission that would be $6000
Let’s even assume that the split between brokers is even. So both sides receive 3%=$3000.
Seller’s broker gets the $3k and then has an agreed upon split with the listing agent and we wi say 50% so the agent then gets $1500 and their broker gets $1500.
The same happens on the buyer representation side.
So if the splits are all even, (which in most cases it isn’t), the real estate agent is splitting any commission they receive 4 ways. And they still have to pay percentages to lead creating companies such as Zillow and many others. So out of $6k, the agent may get to keep about $800.
Note that, if I am the seller, I would not allow any of the commission that I pay at closing go to an agent who has a written agreement with the buyer. To me, that is a conflict of interest. If an agent represents the buyer, they would need to be paid by the buyer.

[Dsritchey]

If I believed that, I would never hire an agent.[/QUOTE]

I don’t use a realtor. The last 3 houses I sold FSBO . Go to a title company they do the paperwork and I control who comes in and out of my house. No lock box on the front door. Easy peasy.

[retiredguy123]

If I believed that, I would never hire an agent.

I don’t use a realtor. The last 3 houses I sold FSBO . Go to a title company they do the paperwork and I control who comes in and out of my house. No lock box on the front door. Easy peasy.[/QUOTE]

I would not hire a broker to do paperwork. The title company always does the paperwork, broker or not. The reason to hire a broker is for their marketing and salesmanship skills. If I believe that I can get the same price in the same amount of time by selling the house myself, I would not hire a broker. I have a lot of skills, but salesmanship is not one of them. I don't think listing a house as a FSBO is a good idea for a lot of people.

[Dlbonivich]

Meeting with the seller, and touring your home. Preparing your market analysis and getting pricing right. Not always so easy. Have to look at other homes sold in the area and determine what is the same and different. Meeting with you to discuss price and explain the listing contract. Checking county tax office and permitting to verify all information. Check flood maps etc…. List home in mls.create online ads to market the home. Advertise and do open houses. I think a lot more than 3 in the current market. Field sales calls review and negotiate contracts with you. Arrange inspection times verify receipt of escrow and be present. Negotiate repairs. Schedule repairs and supervise. Communication with buyer agent in regard to loan status, make sure you are communicating with title and getting any and all paperwork correct. Along with numerous other little details I know just from having 27 years experience. If you think you can put a value on my knowledge so be it. Do you do the same when your car breaks? Or do you pay for mechanic’s knowledge?

[Idahodale]

I loved this thread. The original post was spot on, and correct. I haven't paid a full commission for a house in 20 years (16 houses). The last house I sold (2020), I paid only 2% to the buyers agent for finding the buyer. I listed that house for $395K and sold it in 3 days for $402K. The best agent I have ever used, was as a buyer(2021), and she was wonderful. She treated the wife and I to lunch after we took possession. And I showed my appreciation by handing her $500 in cash for a job well done. But in general, I think the average Real Estate agent has the mental ability of a new cars salesman. After all in a lot of States there is only an 80 hours training course required for licensing. I have even collected the 3% Buyers commission included in the original Sellers contract, as a non Realtor private individual. I bucked the system for 20 years and had a lot of fun and rewards.

[JP]

I think the reason that this has become an issue is the difference in the fee received between a $100,000 sale and a $1,000,000 dollar sale which is $6,000 vs $60,000 for basically the same work. This certainly doesn't seem right.

[frayedends]

For the ill informed or rookies in the stock market, they still pay loaded funds and high expense funds, this hasn’t changed.

Same goes for the real estate sector. The main objective of the listing agent is to list your home, sit around while someone else sells your home, all while your listing realtor makes 2.5-3%

I sold my last 2 houses by putting them on the subdivisions web page. The house before here, I got 6 calls within a couple of hours wanting to see the house. Friends of residents bought the house, and it was very easy to do. You need to get a couple of forms from a lawyer on the contract, and then the disclosure form. Then you close with a lawyer of yours or your buyers.
With talk of the villages app, Nextdoor, Facebook marketplace, I would think it would be easy. Also placing your house on nyc/LA/San Francisco Facebook marketplace pages.

You get 6 offers. One is fha, one is va. One is cash but wants home inspection. One is 5% down but no inspection. You don’t know the market value and have no idea what it will appraise at. The cash offer is low. But the high offer has low cash and you have no idea if the place will appraise to meet mortgage requirements. The FHA is a good offer but is the mortgage amount allowed by FHA in your area? You disclosed that the paint is chopping but aren’t aware that will fail FHA financing. Or maybe you overvalued the house and can’t understand why you have no offers. You looked at other similar homes but didn’t know one had structural damage and one had millions of upgrades.

Yup sounds easy.

[VillagerNut]

Great Post! I agree! There is one other BIG expense that the Customer does not realize about our perceived commission. Even after the 2 way split with 2 Brokers / Agents and even after the commission split with the Real Estate Broker, we then have to pay ALL of our expenses related to that transaction and real estate in general. One of the big expense items is as independent contractors we pay the TOTAL FICA amount of 15.3% instead as an employee we would pay 7.65%. So for every dollar we NET from our Broker, we actually keep 50% (50 cents on dollar) between income tax, FICA and other real estate expenses. Most folks think Real Estate is incredibly easy and profitable. It is far from easy or profitable for 80% of all real estate agents.


You all don’t seem to understand who gets what as far as the commission goes:
Let’s just use a sale of $100,000.
For a 6% commission that would be $6000
Let’s even assume that the split between brokers is even. So both sides receive 3%=$3000.
Seller’s broker gets the $3k and then has an agreed upon split with the listing agent and we wi say 50% so the agent then gets $1500 and their broker gets $1500.
The same happens on the buyer representation side.
So if the splits are all even, (which in most cases it isn’t), the real estate agent is splitting any commission they receive 4 ways. And they still have to pay percentages to lead creating companies such as Zillow and many others. So out of $6k, the agent may get to keep about $800.

[rustyp]

Great Post! I agree! There is one other BIG expense that the Customer does not realize about our perceived commission. Even after the 2 way split with 2 Brokers / Agents and even after the commission split with the Real Estate Broker, we then have to pay ALL of our expenses related to that transaction and real estate in general. One of the big expense items is as independent contractors we pay the TOTAL FICA amount of 15.3% instead as an employee we would pay 7.65%. So for every dollar we NET from our Broker, we actually keep 50% (50 cents on dollar) between income tax, FICA and other real estate expenses. Most folks think Real Estate is incredibly easy and profitable. It is far from easy or profitable for 80% of all real estate agents.

What about those items you wrote off - part of the room in your house as an office, mileage, all those many wine and dine the client events, depreciation on the car, etc. 50% ?

[Randall55]

Obviously this person has no idea what a real estate agent does. There is more than simply putting a home owners home in the MLS and having open houses. It is people like this that cause lot of problems for everyone in our industry to have problems because all of a sudden they think they are experts in everything going on and yet they know nothing. Leave the real estate agents to do there job, just like an accountant knows his job and doctors know there jobs. Would you take your car to a dentist for repairs or your boat to a barber shop to be fixed? Well this is the same and taking information on a site like this from some one who knows nothing about what a professional real estate agent does or spends money on to get your home sold is the same thing!The OP stated the only thing a listing agent does is place a new listing on MLS. I can see the reasoning. Once it gets views, buyers call or email to see the house. More often than not, the seller prepares the home for showings. The buyers agent merely walks through the house with the potential buyer.

For many of us in the Villages this is not our first rodeo. We have bought and sold homes in the past. We do not need someone holding our hand along the way. If selling your home, use VLS to set the price. Type in your model name and review the same style homes currently listed and the asking price. Then, set your price, accordingly. This IS NOT ROCKET SCIENCE.

Negotiate? As the seller, I know my bottom line. No realtor, no matter how good they believe they are at getting the best price, will change that. They merely take all the credit when a seller agrees to a lower price he/she had in her mind throughout the process.

I am with the group who believe a buyer's agent is unnecessary. Like a home you see on MLS? Call the listing agent and work with him/her. There is no need for a middle man. The listing agent will accept your offer or explain why it was declined. You do not need a buyer's agent in the middle causing confusion.

If you are getting a mortgage, the bank will get an appraisal and do ALL the legwork needed to protect their investment. A buyer merely has to show up at closing and sign the paperwork. Again, a buyer's agent will only cause confusion and slow the process.

People use a buyers agent because they ARE FREE. The seller pays their commission. Once a buyer is asked to pay an enormous fee for their service, I believe most will be unwilling. They will simply work with the listing agent and bank with no additional cost to them.

[frayedends]

Again, a buyer's agent will only cause confusion and slow the process.

People use a buyers agent because they ARE FREE. The seller pays their commission. Once a buyer is asked to pay an enormous fee for their service, I believe most will be unwilling. They will simply work with the listing agent and bank with no additional cost to them.

You are way off. I can't tell you how many buyer's would screw up and lose their deposit because they didn't have guidance. Sure there are some smart people that could navigate it on their own. But you would be surprised how many don't pay attention to the contracts. Buyer's agents make the process much smoother.

You figure the seller pays the buyer's agent? Nope, not at all. After all who is the person putting out the money? It's the buyer, every time. The buyer pays their agent indirectly. They pay for the home, the seller takes some of their money to pay their agent and their agent pays the buyer agent. Any cash ultimately came from the buyer. Of course, how that changes after the lawsuit is still anyone's guess.

Also remember, NAR made a settlement. Some brokers had different settlements and some had no settlement. Real Estate Agents don't need to be a member of NAR.

[MightyDog]

1) Buyer's agents make the process much smoother.

2)You figure the seller pays the buyer's agent? Nope, not at all. After all who is the person putting out the money? It's the buyer, every time.



1) I put that in the distinct 'maybe' category. If the buyer's agent is experienced and ethical, they can be helpful. Plenty of them are neither and if they lack in just one of those, the buyer can be in for a hellish time. Buyer's agents can be especially useful for people new to buying real estate - that is for sure.

I've used them but, I especially dislike not knowing what the two agents are communicating to each other. Because I have no idea if I'm being represented accurately and a buyer better stay very close-lipped about particular details that could cost them plenty of the sell side knew of them -- because that info has a good chance of getting to them if it will help facilitate the trade. Same on the sell side -- tell the listing agent only what is necessary to do get the house traded.

I prefer to negotiate directly myself so, no longer use agents on the buy side.

2) I understand the larger point you're making but, it may be confusing to some. Because, quite literally, the commission fees for ALL of the agents involved IS deducted from the sellers proceeds in the final contract.

[Randall55]

You are way off. I can't tell you how many buyer's would screw up and lose their deposit because they didn't have guidance. Sure there are some smart people that could navigate it on their own. But you would be surprised how many don't pay attention to the contracts. Buyer's agents make the process much smoother.

You figure the seller pays the buyer's agent? Nope, not at all. After all who is the person putting out the money? It's the buyer, every time. The buyer pays their agent indirectly. They pay for the home, the seller takes some of their money to pay their agent and their agent pays the buyer agent. Any cash ultimately came from the buyer. Of course, how that changes after the lawsuit is still anyone's guess.

Also remember, NAR made a settlement. Some brokers had different settlements and some had no settlement. Real Estate Agents don't need to be a member of NAR.With homes EASILY ACCESSIBLE to everyone online, there is no need to work with a buyer's agent. It is time to admit and adjust. Other countries have already adapted to the new format.

I will not use a buyer's agent simply because they cause confusion. I will submit an offer direct to the seller. No, is an acceptable response. There will be no haggling from a buyer's agent who doesn't want to lose a commission. I live in a community with cookie cutter homes. Lose one gardenia model I like? Plenty more to choose from. I will simply wait for an owner to accept my offer. Can't do that? Then, I will buy a new construction at a lower price. No sweat off my back.

[OrangeBlossomBaby]

With homes EASILY ACCESSIBLE to everyone online, there is no need to work with a buyer's agent. It is time to admit and adjust. Other countries have already adapted to the new format.

I will not use a buyer's agent simply because they cause confusion. I will submit an offer direct to the seller. No, is an acceptable response. There will be no haggling from a buyer's agent who doesn't want to lose a commission. I live in a community with cookie cutter homes. Lose one gardenia model I like? Plenty more to choose from. I will simply wait for an owner to accept my offer. Can't do that? Then, I will buy a new construction at a lower price. No sweat off my back.

As a potential buyer, who didn't live in The Villages, I think it would've been really monumentally stupid to consider the seller's agent, and not a buyer's agent. Why? Because I don't know which home I want to buy yet, and out of three dozen possible homes, there are at least two dozen sellers' agents representing the sellers of those homes. I'd need to deal with at least 24 agents, just to narrow down my options to a couple or three homes. And then, I'd have to maintain two or three different agents representing those two or three homes, to ensure that I'm looking at exactly what I want to look at, and not just some hype from an eager sales agent.

With a buyer's agent, they do all the leg work on my behalf. They check with those two dozen agents representing up to three dozen properties. They rule out any homes that are absolute deal-breakers for me. They then sift through the rest to provide me with the two or three homes they feel I should actually check on. And all this is done, with me making one or two phone calls to a sales person who is helping ME buy, rather than helping Jimbob Homeowner sell.

Once my agent has done all this legwork, THEN I come down for a visit, and check on those three homes. Maybe I don't like any of them. Maybe one is perfect and I put down a deposit. But rather than spending countless hours, days, weeks even, calling dealing with a couple dozen people I've never met but who want the person THEY represent to profit as much as possible with me paying the bill, I'm dealing with one person - who might or might not get any commission at all (if it's a Villages sales agent), or who might only get a piece of whatever commission is conveyed through the sale.

[Escape Artist]

NAR - Much ado about nothing? Realtor's Commissions.
Thanks to the many people who have asked me about the proposed changes in Real Estate commissions this summer.
The answer isn't very complicated.
Regardless of the 'rules', Realtors predominantly charge Home-Owners/Buyers a 6% commission based on the eventual sales price of the home.
Some say it's the Seller who pays because the final 'Net-To-Seller' is reduced by, for example $24,000 on a $400,000 sale.
Others say that it's the buyers who pay, because they are paying $24,000 more than they would for a direct "Seller-To-Buyer" sale.
For home buyers and sellers the proposed changes are a simple reminder that you set the commissions.
In the typical transaction, sellers pay a Realtor $12,000 for the simple process of typing the listing info into the local Multi-List.
(This, by-the-way, is less work than an Appraiser does for $500.00).
The other $12,000 goes to which ever Realtor makes the sale.
Is there a significant, mandated to change?
NO!
The plan is to prohibit the Listing Realtor from typing in the commission split they are offering to the Realtor who makes the sale.
That's it!
The other side of the deal is to force buyers to sign an agreement with their Realtor. But that agreement can simply say that their Realtor is being paid, just as they always have been.
Is there any likely positive outcome?
In my opinion there could be if Owners/Sellers would wake up!
Its the selling Realtor who does the work and gets the sale.
A 'Listing Factory' gets a $12,000 fee for a $500 job.
What to do?
When your listing expires, maybe there is.
Ccall a State Certified Residential Appraiser who is also a Realtor.
Give them $1,000 for a basic appraisal and entry of the data into the Multi-List.
Whomever gets you a buyer gets, the (3%) $12,000 commission.
The Seller saves $11,000.
The buyer saves $12,000
Who's the loser?
Not our Home Buyers and Sellers.
That's who we should be protecting isn't it?

Who decides on the agent’s percentage, the commission fairy? These fees are arbitrary and were found by the court to be akin to price fixing and collusion. States differ on what the norm is for commission and furthermore brokers can agree to any or no fee regardless of the fake, phony “standard” for a commission. The court ruled that the seller should not be responsible for paying both the listing agent’s commission AND the buyer’s agent. Why should a seller pay anything to an agent who brings a prospective buyer other than a nominal “finder’s fee”?

[MightyDog]

As a potential buyer, who didn't live in The Villages,

With a buyer's agent, they do all the leg work on my behalf.

Once my agent has done all this legwork, THEN I come down for a visit, and check on those three homes.
For an out-of-town buyer, certainly using a buyer's agent makes sense for the reasons you described. I moved in 2015 from one state to another and there was no way not to use a buyer's agent to help me get a property purchased when I was still in the prior state.

Contrast that with a few years later when I sold that property and bought another in the same city but, I was local now so, I didn't use a buyers agent. Didn't need one and found exactly what I wanted myself. It saved me thousands because there's only one agent to pay...the listing agent. I did the same thing several years prior, acting as my own buyer's agent essentially, and was local then also. That transaction also saved me a few thousand.

There are variety of scenarios for people when transacting property so, there is no 'one size fits all' approach. It's just what people are most comfortable with and whether they currently live in the location they are buying or selling in. If they aren't, they'll need help.

[Randall55]

As a potential buyer, who didn't live in The Villages, I think it would've been really monumentally stupid to consider the seller's agent, and not a buyer's agent. Why? Because I don't know which home I want to buy yet, and out of three dozen possible homes, there are at least two dozen sellers' agents representing the sellers of those homes. I'd need to deal with at least 24 agents, just to narrow down my options to a couple or three homes. And then, I'd have to maintain two or three different agents representing those two or three homes, to ensure that I'm looking at exactly what I want to look at, and not just some hype from an eager sales agent.

With a buyer's agent, they do all the leg work on my behalf. They check with those two dozen agents representing up to three dozen properties. They rule out any homes that are absolute deal-breakers for me. They then sift through the rest to provide me with the two or three homes they feel I should actually check on. And all this is done, with me making one or two phone calls to a sales person who is helping ME buy, rather than helping Jimbob Homeowner sell.

Once my agent has done all this legwork, THEN I come down for a visit, and check on those three homes. Maybe I don't like any of them. Maybe one is perfect and I put down a deposit. But rather than spending countless hours, days, weeks even, calling dealing with a couple dozen people I've never met but who want the person THEY represent to profit as much as possible with me paying the bill, I'm dealing with one person - who might or might not get any commission at all (if it's a Villages sales agent), or who might only get a piece of whatever commission is conveyed through the sale. If you are in a rush to buy a home and live in another state, I can understand your reasoning. But for those of us who live in the Villages or nearby, paying a buyer's agent to assist you is a waste of time and money. You can do ALL the legwork yourself. If you are getting a mortgage, the bank will make certain every I is dotted and T is crossed before approving your loan. You pay for each item they requested when you close. Why pay ADDITIONAL money to a buyer's agent? It is double-dipped charges.

If you are paying cash, you would be foolish not to get a real estate attorney and YOUR OWN home inspector. Both are working for YOU. A buyers agent cannot give you legal advice. They also cannot fully inspect a home and give you a detailed report of their findings. A buyer's agent can only supply their opinions. I would rather pay those who can supply FACTS. Fortunately, an attorney and a home inspector is much cheaper than a buyer's agent.

[Robojo]

NAR - Much ado about nothing? Realtor's Commissions.
Thanks to the many people who have asked me about the proposed changes in Real Estate commissions this summer.
The answer isn't very complicated.
Regardless of the 'rules', Realtors predominantly charge Home-Owners/Buyers a 6% commission based on the eventual sales price of the home.
Some say it's the Seller who pays because the final 'Net-To-Seller' is reduced by, for example $24,000 on a $400,000 sale.
Others say that it's the buyers who pay, because they are paying $24,000 more than they would for a direct "Seller-To-Buyer" sale.
For home buyers and sellers the proposed changes are a simple reminder that you set the commissions.
In the typical transaction, sellers pay a Realtor $12,000 for the simple process of typing the listing info into the local Multi-List.
(This, by-the-way, is less work than an Appraiser does for $500.00).
The other $12,000 goes to which ever Realtor makes the sale.
Is there a significant, mandated to change?
NO!
The plan is to prohibit the Listing Realtor from typing in the commission split they are offering to the Realtor who makes the sale.
That's it!
The other side of the deal is to force buyers to sign an agreement with their Realtor. But that agreement can simply say that their Realtor is being paid, just as they always have been.
Is there any likely positive outcome?
In my opinion there could be if Owners/Sellers would wake up!
Its the selling Realtor who does the work and gets the sale.
A 'Listing Factory' gets a $12,000 fee for a $500 job.
What to do?
When your listing expires, maybe there is.
Ccall a State Certified Residential Appraiser who is also a Realtor.
Give them $1,000 for a basic appraisal and entry of the data into the Multi-List.
Whomever gets you a buyer gets, the (3%) $12,000 commission.
The Seller saves $11,000.
The buyer saves $12,000
Who's the loser?
Not our Home Buyers and Sellers.
That's who we should be protecting isn't it?

Its been my experience that the % the realtor gets is negotiable. I've been able to pay less than 6%.

[charlieo1126@gmail.com]

I’ve sold 5 homes here in the villages and quite a few in other places some I sold myself but mostly with agents because I didn’t want to bother with a lot of things you have to do . The five I’ve sold in villages were all 5% commissions , I don’t understand why people were paying 6 I never had an agent that I talked to say no .

[Normal]

And manny, manny say, “ What did the realtor do to warrant a 24K payout?” They didn’t do the title company’s job. They were just middle men.

[APovi]

I am not sure how this works today. Assuming a 6% commission is it customary for the listing agent to get 3% and the actual agent that made the sale get 3% ? If the listing agent is the agent that made the sale does that agent get all 6% ? If this is true then your statement about being who is the winner/loser doesn't quite paint the whole picture. Under the new rules if the buyer purchased from the listing agent (let's say an open house walk off the street situation) there would be no buyers agent ? Only 3% would be the total commission. If a significant amount of sales today are made by the listing agent and that agent gets the full commission of 6% now that agent is only entitled to 3%. Is that correct? If so the listing real estate agents are the losers here. Everyone knows ultimately the buyer is paying the commission today - it's baked into the price the seller is willing to accept.

In fact the Owner/Seller (typically) pays the Listing Office a 6% commission.
What that Realtor does with it is up to them.
Usually, within the Listing Brokerage, that 6% is split/allocated/reserved as 3% for the listing process and 3% for the (eventual) sale).
If another office makes that sale, then the #%'selling' commission is paid to the other/Selling Realty.
And as you ask, the Listing Office retains the 3% Listing Commission.

[APovi]

Protec the buyers and sellers? Good! Like a diner. One person takes your order, delivers your plate. Chef/owner does all the work preparing the item. Same effort to order then deliver plain hamburger or steak sand or lobster roll. The kitchen does the critical part along with owner having to invest in all associated costs.
Listing agents do minimal work compared to the buyers agent. Jmho.

Is this opinion based on experience as a Realtor?
In my 30+ years I've learned that Selling means work: Listings mean money!,

[APovi]

I don't understand your math. How can the seller save $11,000 and the buyer save $12,000? That is $23,000, but a 6 percent commission would be $24,000. Where do you get the additional $12,000 to pay a 3 percent commission?

Also, it seems as though your premise is that real estate agents are pretty worthless at selling houses at higher prices, so that they do not earn their commission. If I believed that, I would never hire an agent.

Sorry for not being clear.
The example was a $400k Sale with a 6% commission. Is that $24K?
The point is that a Seller can pay an Appraiser/Realtor $1,000 and not pay a Listing Realtor $12,000.
Whatever the correct math is, I'd sooner pay out $1,000 than $12,000 for the same work.
(If fact, more work because you'd get confirmation (Appraisal) that your previous List Price is realistic/or not).

[APovi]

Imo, it all comes down to what a seller is willing to pay an agent. The lawsuit provides for competitive pricing.

Buyers agent? Not all needs one. Anyone can go on MLS and choose the homes you like. You can easily find the price history. Do a drive-by yourself. Why bring a stranger along? Any homes that interest you, call the listing agent(s) to see the interior. Hire your own inspector and use a real estate attorney to close. Both will protect your interests.

I am certain Realtors are going to try and twist the new law to bait those who are unaware. SELLERS will have the final say in how much an agent will get paid. I hope ALL realize this. Enormous pay for showing houses is a thing of the past.

The lawsuit, as discussed, has no direct influence on Real Estate Values.
The only immediate effect is that buyers will no longer be able to buy through the Realtor of their choice without first signing an agreement to pay that Realtor
In fact that could mean that the Listing Realtor could keep the whole 6% commission as contracted with the Owner/Seller.
So buyers would be paying their Realtor IN ADDITION to the seller paying theirs.
There's nothing in the proposed settlement which even discourages it and certainly does not ban it.
As mentioned in the original post, Owner/Sellers need to wake up!
Why not pay commissions at market value?
If you did the LISTING PART yourself (All the functions mentioned by various respondents here) what would those professional cost you?
Anyone here think maybe $12,000 ?
I doubt it.

[rustyp]

In fact the Owner/Seller (typically) pays the Listing Office a 6% commission.
What that Realtor does with it is up to them.
Usually, within the Listing Brokerage, that 6% is split/allocated/reserved as 3% for the listing process and 3% for the (eventual) sale).
If another office makes that sale, then the #%'selling' commission is paid to the other/Selling Realty.
And as you ask, the Listing Office retains the 3% Listing Commission.

Thanks - that triggers a few more questions

1 Does the listing agent have to list to MLS
2 How does the listing agent publish MLS
3 Is there a time requirement for the MLS listing to be posted to other MLS agents

Given the listing agent / office gets to keep both sides of the commission if the listing agent sells the same property - would not this be an incentive for the listing agent to "drag their feet" publishing the MLS until feeling out the initial buyers that typically rush to a new listing ?

Many years ago I put a purchase offer on a property which just hit the market. The listing agent called me back and said seller rejected offer. I asked was there a counter. Reply - no. I asked for proof of rejection. The agent said doesn't work that way. The listing agent had a reputation of being on the shady side so I hired a broker. Found out the seller never got the offer. Seller accepted my original offer through the broker I hired and listing agent lost half the commission. To say the original agent wasn't happy would be an understatement. To this day the shady agent won't even make eye contact with me in a very small town.

[Normal]

Why not pay commissions at market value?
If you did the LISTING PART yourself (All the functions mentioned by various respondents here) what would those professional cost you?
Anyone here think maybe $12,000 ?
I doubt it.

Thus lies the real problem. It generally does not cost more to sell a 800,000 house than it does to sell a 400,000 dollar house. Yet sellers were hustled out of 48,000 dollars to sell their 800,000 dollar home. Percentages fortunately will be a thing of the past. Flat rates are already overtaking the market.

FSBO is becoming much more popular and has saved sellers and buyers a boatload of money.

[APovi]

Apparently, the OP thinks that any commision paid to an agent just reduces the amount of money that goes to the seller. If that is true, then a seller would be foolish to pay any commission. Also, regarding a buyer's agent, as a seller, I would never allow a buyer's agent to receive any money from my side of the settlement statement. If a buyer wants to be represented by an agent, the buyer would need to negotiate and pay their own commission or fee.

My understanding is that the relationship between the buyer and their Realtor is not formally disclosed to the seller. So your closing statement would show 3% to your listing office the 3% to the selling office.
The Commission Split is based on an agreement between the Realtors, not the sellers.
In our area (Residential Real Estate) I am not aware of any/many Realtors who retain the 'AGENT) relationship.
Changing to a 'TRANSACTION BROKER' allows them to work with buyers and seller at the same time without the burden of laws of agency.

[Normal]

Perhaps a law needs passed that caps realtor costs? It would eliminate the egregious amounts and or charges on the scale below.

100,000 sale real estate agent gets 6,000 dollars

200,000 sale real estate agent gets 12,000 dollars

300,000 sale real estate agent gets 18,000 dollars

400,000 sale real estate agent gets 24,000 dollars

500,000 sale real estate agent gets 30,000 dollars

Etc.

Instead, sell a home, get a 1,000. Just eliminate the crazy windfall amounts based on percentages that have nothing to do with effort.
The 1 k would reimburse the agent for gas and any hourly charges for effort placed into the sale. In some cases that would be 400 dollars an hour, in others, 50 dollars an hour.

[retiredguy123]

My understanding is that the relationship between the buyer and their Realtor is not formally disclosed to the seller. So your closing statement would show 3% to your listing office the 3% to the selling office.
The Commission Split is based on an agreement between the Realtors, not the sellers.
In our area (Residential Real Estate) I am not aware of any/many Realtors who retain the 'AGENT) relationship.
Changing to a 'TRANSACTION BROKER' allows them to work with buyers and seller at the same time without the burden of laws of agency.
In Florida, an agent cannot serve as a transaction broker without the written consent of the seller.

FLORIDA LAW ALLOWS REAL ESTATE LICENSEES WHO REPRESENT A BUYER OR SELLER AS A SINGLE AGENT TO CHANGE FROM A SINGLE AGENT RELATIONSHIP TO A TRANSACTION BROKERAGE RELATIONSHIP IN ORDER FOR THE LICENSEE TO ASSIST BOTH PARTIES IN A REAL ESTATE TRANSACTION BY PROVIDING A LIMITED FORM OF REPRESENTATION TO BOTH THE BUYER AND THE SELLER. THIS CHANGE IN RELATIONSHIP CANNOT OCCUR WITHOUT YOUR PRIOR WRITTEN CONSENT.

. . . . . . . . . I agree that my agent may assume the role and duties of a transaction broker. (must be initialed or signed) [Florida Stat., sect. 475.278 (3)]

As a seller, I would never provide my written consent to this until there is a signed sales contract with an agreed to price. In fact, as a seller, I do not even want an agent who has a written agreement to represent the buyer to show my house.

[Robnlaura]

You don’t even need a listing agent these days. Plenty of flat fee listing companies out there $99 dollars allows you to list in the mls and that gets sent to Zillow. So there you go problem solved..

[Robnlaura]

Sorry for not being clear.
The example was a $400k Sale with a 6% commission. Is that $24K?
The point is that a Seller can pay an Appraiser/Realtor $1,000 and not pay a Listing Realtor $12,000.
Whatever the correct math is, I'd sooner pay out $1,000 than $12,000 for the same work.
(If fact, more work because you'd get confirmation (Appraisal) that your previous List Price is realistic/or not).

Why pay a listing agent if you think this? Why don’t you pay a listing company and do it yourself? $100 to $500 is what they charge!!

[VillagerNut]

To write off any type of advertising, events, etc. you actually have to spend money. So that money is out the door. Personally I do not want to have an IRS audit, so there are some expenses that I would never take like an home office expense. My choice.


What about those items you wrote off - part of the room in your house as an office, mileage, all those many wine and dine the client events, depreciation on the car, etc. 50% ?

[VillagerNut]

I am really sorry that you encountered an unethical real estate agent. This issue is exactly why this NAR settlement is a very good thing. Because now the buyer in the state of Florida can actually have true representation. Then that would be part of the responsibilities to make sure the Contract is presented to the seller.

Thanks - that triggers a few more questions

1 Does the listing agent have to list to MLS
2 How does the listing agent publish MLS
3 Is there a time requirement for the MLS listing to be posted to other MLS agents

Given the listing agent / office gets to keep both sides of the commission if the listing agent sells the same property - would not this be an incentive for the listing agent to "drag their feet" publishing the MLS until feeling out the initial buyers that typically rush to a new listing ?

Many years ago I put a purchase offer on a property which just hit the market. The listing agent called me back and said seller rejected offer. I asked was there a counter. Reply - no. I asked for proof of rejection. The agent said doesn't work that way. The listing agent had a reputation of being on the shady side so I hired a broker. Found out the seller never got the offer. Seller accepted my original offer through the broker I hired and listing agent lost half the commission. To say the original agent wasn't happy would be an understatement. To this day the shady agent won't even make eye contact with me in a very small town.

[billsr]

No! No! No! An appraiser is not required to be a Realtor. Some of them do have RE licenses and then become Realtors. However, they usually belong to the MLS as an "Affiliate Member". If an appraiser both collected a commission and was paid for an appraisal, it would be a definite conflict of interest. Plus, an appraiser cannot receive payment that is tied to the amount of the sale. That is against the law.

[margaretmattson]

No! No! No! An appraiser is not required to be a Realtor. Some of them do have RE licenses and then become Realtors. However, they usually belong to the MLS as an "Affiliate Member". If an appraiser both collected a commission and was paid for an appraisal, it would be a definite conflict of interest. Plus, an appraiser cannot receive payment that is tied to the amount of the sale. That is against the law.This has been an interesting thread. I believed listing agents would survive. But, now I am not so certain. The wave of the future may be low cost listing services. Has anyone used a listing service? I assume it is FSBO? We sold our previous home to a buyer we knew had interest. Never had to list the home.

[vintageogauge]

This has been an interesting thread. I believed listing agents would survive. But, now I am not so certain. The wave of the future may be low cost listing services. Has anyone used a listing service? I assume it is FSBO? We sold our previous home to a buyer we knew had interest. Never had to list the home.

When this first came out I read that up to 50% of the current agents will most likely get out of the business. I realize that 10% is also up to 50% so it's kind of meaningless but that is what was in print.

[MightyDog]

This has been an interesting thread. I believed listing agents would survive. But, now I am not so certain. The wave of the future may be low cost listing services. Has anyone used a listing service? I assume it is FSBO? We sold our previous home to a buyer we knew had interest. Never had to list the home.
The "listing service" I used in 2017 to sell my house in NC was a very well put-together listing by me on Zillow (which populates overnight onto Trulia, owned by Zillow).

Those two internet spots produced phone calls from agents and interested solo buyers. I got 3 offers in 3 days and took the one from the solo buyer. It closed just fine with zero $ paid to any agents. Never even put a sign in the yard.

I will be doing the exact same thing in the next 2 months and am hoping for similar results. Although, I will pay an agent who brings me a buyer 2.5 % for a closed deal.

Btw, it only works that well in a low supply / high demand market or location. When conditions are the reverse, you need all the help and exposure you can get. I'm familiar with that too - having had a fully-listed house on the market for 5 months in 2008. Simply brutal!

[margaretmattson]

The "listing service" I used in 2017 to sell my house in NC was a very well put-together listing by me on Zillow (which populates overnight onto Trulia, owned by Zillow).

Those two internet spots produced phone calls from agents and interested solo buyers. I got 3 offers in 3 days and took the one from the solo buyer. It closed just fine with zero $ paid to any agents. Never even put a sign in the yard.

I will be doing the exact same thing in the next 2 months and am hoping for similar results. Although, I will pay an agent who brings me a buyer 2.5 % for a closed deal.

Btw, it only works that well in a low supply / high demand market or location. When conditions are the reverse, you need all the help and exposure you can get. I'm familiar with that too - having had a fully-listed house on the market for 5 months in 2008. Simply brutal! Make certain your pictures show your home in the most appealing way. We noticed a home that was sitting for months. We were interested in that area and requested a showing. The online pictures did not do justice for the beautiful home. One sad picture of the LARGE glass enclosed lanai and the description of the home did not mention a remodel.

We gave a well below ask offer. With very little negotiation, our offer was accepted. We feel blessed! The heirs were happy to finally rid themselves of the home. I believe better pictures and description would have brought in higher offers. The listing agent may have been inexperienced or did not want to pay a professional photographer. Maybe, he believed the location alone would sell the home. Definitely dropped the ball on this property.

[Normal]

Make certain your pictures show your home in the most appealing way. We noticed a home that was sitting for months. We were interested in that area and requested a showing. The online pictures did not do justice for the beautiful home. One sad picture of the LARGE glass enclosed lanai and the description of the home did not mention a remodel.

We gave a well below ask offer. With very little negotiation, our offer was accepted. We feel blessed! The heirs were happy to finally rid themselves of the home. I believe better pictures and description would have brought in higher offers. The listing agent may have been inexperienced or did not want to pay a professional photographer. Maybe, he believed the location alone would sell the home. Definitely dropped the ball on this property.

You still have to pay the title company about 1500 bucks to do all the paperwork. But yes, you save a bundle. I wouldn’t even use an agent. It’s free to try it yourself. If it doesn’t sell in a couple weeks, then bring someone in? Anyone can list on Zillow if you own a cell phone.

Affiliated Title Wildwood 352-492-0564
Freedom Title Lady Lake 352-633-5195
Advantage Title The Villages 352-430-1328

All will give you any documents you may need for offers, disclosure and sale. Complete them and turn them in.

[Bay Kid]

The "listing service" I used in 2017 to sell my house in NC was a very well put-together listing by me on Zillow (which populates overnight onto Trulia, owned by Zillow).

Those two internet spots produced phone calls from agents and interested solo buyers. I got 3 offers in 3 days and took the one from the solo buyer. It closed just fine with zero $ paid to any agents. Never even put a sign in the yard.

I will be doing the exact same thing in the next 2 months and am hoping for similar results. Although, I will pay an agent who brings me a buyer 2.5 % for a closed deal.

Btw, it only works that well in a low supply / high demand market or location. When conditions are the reverse, you need all the help and exposure you can get. I'm familiar with that too - having had a fully-listed house on the market for 5 months in 2008. Simply brutal!

Zillow couldn't survive without using the MLS system for comps, which wouldn't be possible without the hard work of Realtors.

[MightyDog]

Make certain your pictures show your home in the most appealing way. We noticed a home that was sitting for months. We were interested in that area and requested a showing. The online pictures did not do justice for the beautiful home. One sad picture of the LARGE glass enclosed lanai and the description of the home did not mention a remodel.

We gave a well below ask offer. With very little negotiation, our offer was accepted. We feel blessed! The heirs were happy to finally rid themselves of the home. I believe better pictures and description would have brought in higher offers. The listing agent may have been inexperienced or did not want to pay a professional photographer. Maybe, he believed the location alone would sell the home. Definitely dropped the ball on this property.
Trust me, sales and marketing are my thing as my FSBO sale in 2017 would attest. I can put up a better listing than half of the agents out there. Because I think like the buyer would, what they want to see and know - that's the key.

I have noticed that there are interesting 'pockets' of opportunity in TV. Like you experienced...an estate sale situation of heirs just wanting to liquidate and not being especially price-sensitive, listings by less-experienced agents (with dialed-out owners) that don't present the property well or are very over-priced resulting in little traffic so, any offer that comes is ripe for getting a good buy, etc. Smart of you to see past the poor listing and find the gem.

[Robnlaura]

All realtors had to list on mls now that doesn’t mean people don’t have side buyers. Selling a home is not so easy to many. Valuations alone are not that easy as well Zillow is always wrong !

[Normal]

All realtors had to list on mls now that doesn’t mean people don’t have side buyers. Selling a home is not so easy to many. Valuations alone are not that easy as well Zillow is always wrong !

Yes, a seller should consult with several listings in the area and comps from their neighborhood. That will give them a much better idea on home sale value. This is particularly easy in The Villages where so many homes are similar. They should/would glean much more from a sale without a realtor too.

[margaretmattson]

All realtors had to list on mls now that doesn’t mean people don’t have side buyers. Selling a home is not so easy to many. Valuations alone are not that easy as well Zillow is always wrong ! I disagree. I find it quite easy to find the value of my property. I go on to trulia and type in sq footage. Then I search the SOLD homes in the Villages the last few months. Find a few similar to mine. Write down the address and price the homes sold for and these are my comps.

I then go onto VLS. Type in my model name. Look at the homes most similar to mine. Write down the address and asking price. Voila! I now have more comps.

I go on the county tax site. Look at the accessed value of my home. Add 25-30% more. I now have what the county believes my house is worth.

Compare all my data and set an ask price accordingly. If a buyer insists I am overpriced, show the recently sold similar homes to him/her. Not much room for argument when they see this information.

[Normal]

I disagree. I find it quite easy to find the value of my property. I go on to trulia and type in sq footage. Then I search the SOLD homes in the Villages the last few months. Find a few similar to mine. Write down the address and price the homes sold for and these are my comps.

I then go onto VLS. Type in my model name. Look at the homes most similar to mine. Write down the address and asking price. Voila! I now have more comps.

I go on the county tax site. Look at the accessed value of my home. Add 25-30% more. I now have what the county believes my house is worth.

Compare all my data and set an ask price accordingly. If a buyer insists I am overpriced, show the recently sold similar homes to him/her. Not much room for argument when they see this information.

This is yet another way to find out your home value. Getting a realtor involved only jacks up your sale price and makes you less likely to sell and way less competitive.
I would rather buy a home for 400,000 than 424,000. Who wouldn’t?

[Bay Kid]

Yes, a seller should consult with several listings in the area and comps from their neighborhood. That will give them a much better idea on home sale value. This is particularly easy in The Villages where so many homes are similar. They should/would glean much more from a sale without a realtor too.

Realtors work for free so many times like this to give advice for sellers to price their home.

[Boomer]

I think the reason that this has become an issue is the difference in the fee received between a $100,000 sale and a $1,000,000 dollar sale which is $6,000 vs $60,000 for basically the same work. This certainly doesn't seem right.


Exactly!

As house prices climb, a realtor’s responsibilities do not change. The percentage based commission is totally unfair. Looks like the cat has been belled. It’s about time.

It will be interesting to see how this all shakes out.

Boomer

[vintageogauge]

This is yet another way to find out your home value. Getting a realtor involved only jacks up your sale price and makes you less likely to sell and way less competitive.
I would rather buy a home for 400,000 than 424,000. Who wouldn’t?

You don't really believe that homes for sale by owner are priced lower than those with an agent. If the market will bring in $424,00 the seller would be a fool to ask $400,000. You gain nothing by buying from an individual owner however the owner gains a lot.

[Two Bills]

You don't really believe that homes for sale by owner are priced lower than those with an agent. If the market will bring in $424,00 the seller would be a fool to ask $400,000. You gain nothing by buying from an individual owner however the owner gains a lot.

A bit like oil prices.
Never known an oil company to undercut the world market price to lower their profit margin.

[Normal]

You don't really believe that homes for sale by owner are priced lower than those with an agent. If the market will bring in $424,00 the seller would be a fool to ask $400,000. You gain nothing by buying from an individual owner however the owner gains a lot.

Better yet, skip the realtor, charge 415,000 and pocket the extra 15k that would have gone to the realtor. The house undercuts the fools that hired realtors and sells quicker.

[MightyDog]

From Comment #93
If the market will bring in $424,00 the seller would be a fool to ask $400,000. Agreed. So, a seller should ask market price and be expecting to negotiate down from there. Both sides of the trade are going to tug to capture that commission margin. Compromise and it'll work.

You gain nothing by buying from an individual owner however the owner gains a lot. This is not true. With the seller not having to pay one or more agents, there is much more negotiating room. I have experienced this more than once on both buy and sell side. It also means that you know, whichever side you're on, what is being communicated to the other person because you are the one speaking for yourself.

From comment #95
The house undercuts the fools that hired realtors... --This is an unfair and inaccurate statement. Almost nothing is equal in real estate transactions including the particulars of the owners or buyers. I like to operate on my own when buying/selling RE but, it is not always possible. In 2017, I bought a house two states away from where I was living and there was no way I could have managed all the details w/o a local buy-side agent. TV has estate liquidation sales where the heirs don't even live in FL - so how are they supposed to do that w/o representation? I could list myriad other circumstance where using an agent, on either side, makes sense.

It's nonsensical and inappropriate to disparage other people for operating within their specific needs or circumstances.