Dirt Merchants - questions about hiring a realtor

[liv2ski]

Reading through this, if the market is tough, be sure the property is at least listed in the local MLS and pay the buyers agent the 3% you mentioned, so that buyers are made aware of the property for sale by their agent. If in MLS, it will also pop up on all the websites like Zillow, etc. Brokers around here will just list the property in the MLS for around $1k.

[Rideski]

What year was the 3% 3% invented and what were median home prices then?

[liv2ski]

What year was the 3% 3% invented and what were median home prices then?

A long time ago. I started in RE biz in 1984 and the average price in the area I worked was about $130k for a 3 bedroom SFR at the time.

[4matic]

Easy to get MLS listing for $300 or less and offer 2 or 2.5% commissions. It won’t deter traffic if you have a nice place.


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[liv2ski]

If clients have a tough to sell property, then 3% helps get the realtor attention. If it is nice, then the clients will see it on the web, ask to see it and the agent will have to take what is offered.

[old goat]

3% to buyer’s agent? 3% is on the premium end of the range down here in Massholeville. Curious what is commonly paid put up there. Obviously our prices are higher.

What iceman said. I’d be surprised if they asked you to pay for it, IME.

My son bought a house in a new condo development in Sacramento, where 6% for the realtor(s) is standard. His college friend/real estate agent guided him to the development; the realtor doing the marketing gave him a measly 1/2% although I suppose he could have given him nothing. I guess paying the buyers agent is based on the theory that you scratch my back now, I scratch yours later, but the standard 50/50 split or any other split is not legally required? Varies by state I know. My son's agent did most of the heavy lifting in getting things through escrow; seller's realtor just sat around and handed out brochures.

[Rideski]

I did some googling to see when it started and didn't find an answer. It's older than me for sure. But google "6% real estate commission" and there's dozens of blogs, in addition to a few news stories by CBS, NBC, etc. There's a 20/20 from a decade ago. It's a racket. No way I'm paying anything even remotely close to that again.

[Peruvian]

I did some googling to see when it started and didn't find an answer. It's older than me for sure. But google "6% real estate commission" and there's dozens of blogs, in addition to a few news stories by CBS, NBC, etc. There's a 20/20 from a decade ago. It's a racket. No way I'm paying anything even remotely close to that again.

The concern is if you don’t pay the 6% as the seller, your agent isn’t going to provide much service (won’t post ads, won’t provide open houses, etc).

[liv2ski]

I did some googling to see when it started and didn't find an answer. It's older than me for sure. But google "6% real estate commission" and there's dozens of blogs, in addition to a few news stories by CBS, NBC, etc. There's a 20/20 from a decade ago. It's a racket. No way I'm paying anything even remotely close to that again.

You say that, buy the funny thing is in my hood of $2.5M average price homes, the sellers pay 2% to the listing agent and 2.5% to the buyers agent all day long while I advertise my commission schedule is at least 50% lower and nobody calls me. I do everything they do (likely more) but due to lack of name recognition, no one calls. It is very puzzling to me.

[Rideski]

Obviously lots of factors at play. If a person lives in an area where homes aren't selling, or they make so much they don't care, etc, etc, sure buy some help. Around here homes are getting snapped up days after listing for full price if not more. Last Spring average was 7 days on market for homes .5-1mil.

Mount your own fucking skis or install your own fan belt are good analogies. I work in business, so the idea of marketing my home isn't daunting. Even if it was, for $120,000 to do one transaction, you can hire a marketing person and retain legal help for the contract. All that is a moot point of course with companies like redfin and others coming into play. Clearly I'm not the first person to think this has gotten out of hand.

I don't begrudge someone making a living mounting skis, working on cars, or selling homes. But it's using the fear angle to coerce people into thinking it mandatory that's annoying. I see people out there struggling to get by having saved and saved for years looking forward to a little cash out on the house and then lose most of it when the house was going to sell in 2 days anyway. Add to that I got a market analysis on mine, and I know he was lowballing. He wants to leave like 80k on the table at least. Why? So it will sell fast of course.

[Kinnikinnick]

OP,

How about just doing your own research on Zillow and with the assessors office and then try the FSBO, rather than interviewing brokers (stop saying realtor - that’s just a stupid industry lobbying group) in bad faith just to get the free work of their market value estimates.


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[liv2ski]

It is no big deal to ask a few agents for market opinions. Just tell them you're going to FSBO to start. They will keep in contact with you in case you don't sell in the time frame you wanted to.
Just looking at sites like Zillow is silly. It is much better to get a few CMA's from agents and look at their comps and adjustments to the final value to see how you think your home measures up.
You could pay $500 for an appraisal, but again, that is one persons opinion and from my experience, an appraiser will try to hit a higher value on a sale when there is a buyer willing to pay a silly price. My most recent listing comped out at about $860k to $880k, so we value range listed it at $860k to $889k and the buyer offered $895k to get it due to multiple offers. I don't know how the appraiser hit the value and the underwriter bought it, but that is what I am saying about appraisals and value opinions. It isn't an exact science and what someone will pay for it is the greatest measure of present value.

[RootSkier]

stop saying realtor - that’s just a stupid industry lobbying group

Except that in lots of places, you have to be a Realtor (TM) to participate in the MLS.

Talk about a fucking racket.

[Ted Striker]

Do make sure you get that paint color and cabinetry just right.

I guess the rug really didn't tie the room together.

[Peruvian]

OP,

How about just doing your own research on Zillow and with the assessors office and then try the FSBO, rather than interviewing brokers (stop saying realtor - that’s just a stupid industry lobbying group) in bad faith just to get the free work of their market value estimates.


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Yeah - the argument with the Mrs. is essentially over at this point. She won.

Happy wife - happy life, and all.

[Rock Knocker]

My neighbor was FSBO for almost two years and had a litany of why he wasn't selling (BIL set him up with the wrong FSBO service, picky buyers asshole home inspectors etc). He was the kind of guy who wouldn't allow a key-box and needed an appointment two days in advance to look at the house. He probably followed the people around too.

He moved and the house went on the general market, and sold in three days for $30K over asking.

[XXX-er]

It is no big deal to ask a few agents for market opinions. Just tell them you're going to FSBO to start. They will keep in contact with you in case you don't sell in the time frame you wanted to.
Just looking at sites like Zillow is silly. It is much better to get a few CMA's from agents and look at their comps and adjustments to the final value to see how you think your home measures up.
You could pay $500 for an appraisal, but again, that is one persons opinion and from my experience, an appraiser will try to hit a higher value on a sale when there is a buyer willing to pay a silly price. My most recent listing comped out at about $860k to $880k, so we value range listed it at $860k to $889k and the buyer offered $895k to get it due to multiple offers. I don't know how the appraiser hit the value and the underwriter bought it, but that is what I am saying about appraisals and value opinions. It isn't an exact science and what someone will pay for it is the greatest measure of present value.

I think this ^^ it doesn't take much for an agent to do a 1 hr walk thru and give an opinion on what they think the place will go for, cuz they know what all the houses in the area look like cuz looking at houses is what they do ...they know the market

Maybe if the agent doesn't act like an asshole when the house owner decides to list because this shit is nerve wracking and they have no idea what they are doing they will list with the agent who helped them so they should consider it a sales call

I have always seen market value vs appraised value as market is what an agent walking thru thinks he can get you which is usually higher than an appraised value which is by an acredited appariser that a bank will use to decide if/how much money to lend you which is usually lower

Localy a lot of the dirt merchants in town have quit I believe its cuz recenltly the law became that an agent can no longer reperesent a seller and buyer at the same time in BC, office fees are 1500 per month all them expenses they can't make a go of it . even before that law I asked a buddy why she quit and she said " I couldn't stand the people "

[Ted Striker]

Except that in lots of places, you have to be a Realtor (TM) to participate in the MLS.

Talk about a fucking racket.

Of course it's a racket, but so are most things. He can tilt at windmills or sell their house.


@Peruvian,

My wife is a dirt merchant, and my brother and I used to have a business that involved buying and selling RE. The debate on whether or not brokers add value, earn their commissions, are full of shit, etc., is frankly a waste of time. In a warm to hot market your property will sell no matter what, and in a cool market only the best deals move.

If you get a CMA from a broker, expect to be hounded by them for the listing. You are the fish. As for the price, what you will get is a range, not a number.

As for FSBOing it, the first question that pops into my head is how badly do you need to sell? And how do you value your spare time? If your market is cool, the majority of calls you get will be from agents trying to get the listing. But I think you know that.

If you don't want to pay 6%, there are agents who will list for 2.5/2.5 Or you could use redfin.

[Peruvian]

As for FSBOing it, the first question that pops into my head is how badly do you need to sell? And how do you value your spare time? If your market is cool, the majority of calls you get will be from agents trying to get the listing. But I think you know that.

If you don't want to pay 6%, there are agents who will list for 2.5/2.5 Or you could use redfin.

I need to clarify that our FSBO plan is not to put it out there to the general public (ala-Trulia posting, etc) but to our circle of contacts to share with their circle of contacts.

[4matic]

In California we have Rex and HomeBay as cheaper alternatives. Both look interesting. I like the idea of Rex. Rexhomes.com


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[Ted Striker]

I need to clarify that our FSBO plan is not to put it out there to the general public (ala-Trulia posting, etc) but to our circle of contacts to share with their circle of contacts.

That's good. Everyone should do that.

When I would look at FSBOs from craigslist and classifieds, it was usually either someone who was waiting for a sucker, or a lonely old man.

[4matic]

I need to clarify that our FSBO plan is not to put it out there to the general public (ala-Trulia posting, etc) but to our circle of contacts to share with their circle of contacts.

ThePLS.com does that...sort of.


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[cravenmorhead]

We also have Redfin here; not sure if they cover your area, but they do lower listing fees as well.

[VTeton]

You say that, buy the funny thing is in my hood of $2.5M average price homes, the sellers pay 2% to the listing agent and 2.5% to the buyers agent all day long while I advertise my commission schedule is at least 50% lower and nobody calls me. I do everything they do (likely more) but due to lack of name recognition, no one calls. It is very puzzling to me.

Dont advertise based on price. Build your brand. Make you tube videos, get your face out in the public volunteering not on a park bench with dirty asses on them.

People selling 2.5M houses want the best broker not the cheapest.

Selling your services on price is a losing business model. Someone will always undercut you.

Always pay buying brokers their 2.5%.

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[4matic]

The buyers % is always 3% with Redfin so in today’s market of 5% total you really don’t save much with Redfin.


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