Originally Posted by APovi (Post 2318003)

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?

Originally Posted by JWGifford (Post 2318188)

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.

Originally Posted by GizmoWhiskers (Post 2318177)

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!

Originally Posted by miadford@gmail.com (Post 2318314)

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.

Originally Posted by Dsritchey (Post 2318332)

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

Originally Posted by rsmurano (Post 2318319)

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.

Originally Posted by miadford@gmail.com (Post 2318314)

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.

Originally Posted by VillagerNut (Post 2318356)

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.

Originally Posted by Pamalla12 (Post 2318280)

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!

Originally Posted by Randall55 (Post 2318372)

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.

Originally Posted by frayedends (Post 2318386)

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.

Originally Posted by frayedends (Post 2318386)

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.

Originally Posted by Randall55 (Post 2318406)

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.

Originally Posted by APovi (Post 2318003)

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?

Originally Posted by OrangeBlossomBaby (Post 2318426)

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.

Originally Posted by OrangeBlossomBaby (Post 2318426)

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.

Originally Posted by APovi (Post 2318003)

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?

Originally Posted by rustyp (Post 2318019)

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.

Originally Posted by fdpaq0580 (Post 2318011)

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.

Originally Posted by retiredguy123 (Post 2318021)

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.

Originally Posted by margaretmattson (Post 2318043)

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.

Originally Posted by APovi (Post 2318589)

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.

Originally Posted by APovi (Post 2318604)

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.

Originally Posted by retiredguy123 (Post 2318049)

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.

Originally Posted by APovi (Post 2318608)

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.

Originally Posted by APovi (Post 2318599)

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).

Originally Posted by rustyp (Post 2318364)

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% ?

Originally Posted by rustyp (Post 2318605)

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.

Originally Posted by billsr (Post 2318988)

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.