Posted on 03/22/2024 9:18:35 PM PDT by where's_the_Outrage?
The way people buy and sell homes in the U.S. may be about to change, following a landmark settlement proposed by the nation’s top real-estate-industry group.
But that may not make things easy for home buyers, one mortgage-company CEO says.
The settlement proposed by the National Association of Realtors, which will go into effect in mid-July if it’s approved, would require that listings on the NAR-run Multiple Listing Service — a database of homes for sale — no longer have a field showing how much buyer’s agents will earn in commissions on the sale.
In other words, buyer’s agents won’t be offered compensation up front.
Although fees for real-estate agents are technically negotiable, they typically run from 4% to 6% of a home’s sale price, depending on local market customs. Home sellers traditionally pay these commissions, which are typically split between the buyer’s and seller’s agents.
The outcome of the settlement, if approved, would “be pretty disruptive,” said Greg Schwartz, CEO and co-founder of Tomo, a digital mortgage lender. “I’m concerned about first-time home buyers that are cash-strapped,” he told MarketWatch in an interview.
(Excerpt) Read more at marketwatch.com ...
That said, sellers needed access to the MLS so they used agents. But a lot of buyers need agents help to navigate the home buying requirements. Glad to see it can now be put on the buyers shoulders.
Having bought properties over 10 times I don't feel I need a lot of help, but to buy my current home I was basically forced to accept the 6% commission scheme even though I already had financing and insurance set up.
Realtor.com has made them obsolete.
No, it is amazing the stupid people out there.
A lot of people cannot sell or buy a home without some common sense to guide them. They need a relator.
Squatters aren’t paying squat%
That aside, it seems the old real estate agent model may be headed for obsoletism. Replaceable by AI and online boilerplate.
Unless their lobbyists can convince regulators otherwise.
Let’s see if they add fees...like for advertisement, open houses, sign rental....all kinds of cr** they can dream up...
I expect a lot of pushback on these commissions.
Unfortunately there are too many people believe that it is their right to own a home because white privilege discriminated against them.
30 years ago, my stepfather wanted to sell their home by himself....Realtors refused to show the house to their clients....If he had the tools we have today, he might have pulled it off...
In 2018 I bought a for sale by owner home. I had a real estate agent and she was pissed I didn’t negotiate a commission for her. I told her you did not find that house nor did you show it to me, what makes you believe you are entitled to a commission? Moreso there was no buying agreement in writing.
The reason my stepfather knew the realtors refused was the one that had the clients he knew would buy the house...Their house they were renting was EXACTLY like my stepfather’s house 3 blocks away... He told my stepfather after the sale....
My college roommate was a year out of law school living in a new starter home when his wife found a house of her dreams. It was a bad market and houses weren’s selling - so he told several realtors that he wasn’t going to list it with anyone, but he wanted $X clear out of a sale and the first one to bring him an offer that resulted in that much to him could have everything over that amount as their commission. The house sold in 10 days and the realtor made about 2.5% and was happy to get it.
The internet has replace 80% of what realtors do, it’s long past time to end this commission grift.
Everyone has their opinion.
I have found the realtors I have dealt with to be honest, informative and of invaluable help before, during and, perhaps most importantly, after the transactions were completed in recommending honest, competent tradesmen and service people in my new home area.
But, to each his own.
I was renting out an apartment in NYC.
The agent by mistake sent me photos of all the Cashier’s checks the new tenants had to give him. I WAS SHOCKED! It was the asking rent times 4.
On top of that, if they renewed the lease they would have to pay him 10% of the rent per month.
Insane!
When my stepfather and mother bought the house,it was 45 years ago and only 25,000..tough part of town BUT,silicon valley became a huge thing and my parents home was only a couple of miles away....sold it for 280,000....Their mortgage was 250.00 a month.....It has sold three times since then and is now selling for 1.1 million dollars....Still the same house..3 bedrooms and one bathroom.....
Commission is negotiable. We paid 5% to sell my mother’s house. I do believe a house that is not selling, the real estate agent should drop the commission to as low as possible in order to sell the property. I am ok with them charging a commission, but I live in a state where there is no set commission. It can be whatever you agree on.
How about a sliding commission rate depending on the price of the home?
The real estate agent does the same work for a home in California where the average price is $800,000 as they do in another state where the average is $300,000 or less for single family home.
“...used to be that access to the MLS required both the buyer and seller to use an agent,”
I sold real estate for 28 years. That was never the case. I usually listed homes for 4.0%/5.8%. 4% if I sold it myself, 5.8% if another agent brought the buyer. The other agent would get 2.8%, I would get 3%.
We sold our home because a realtor drove a couple to see a listed home in our neighborhood. They came by themselves later to see our home and purchased it.
We sold our home because a realtor drove a couple to see a listed home in our neighborhood. They came by themselves later to see our home and purchased it.
When I bought and sold a house, both times the seller’s agent split the commission with the buyer’s agent. My understanding was that, if the buyer had no agent, or if the seller’s agent and the buyer’s agent were the same person, that agent would receive the whole commission.
But, even though everyone says the seller pays the commission, we could look at it another way and say the buyer pays it. Yes, the seller pays the commission from the proceeds of the sale, but the buyer is the one coming up with the money.
Now, this settlement sounds like it makes the seller and buyer negotiate separately with their agents. Either way, the buyer is the one paying both agents when he buys the house.
That’s exactly what happened to brokerage commissions for stock sales.
I’m surprised this change didn’t happen in the real estate industry decades ago.
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