Real Estate Crash thread

[Conundrum]

He didn't. I don't pay for market watch and was able to click the link and read the article.

[RootSkier]

Something like 98% of houses are now found by the client themselves just looking online. How is this concept of paying realtors 6% still a thing?

I have been wondering this for going on 15 years now.

[dan_pdx]

On the one hand, realtors seem to get paid a lot for the work performed. On the other hand, gotta respect any industry that has managed to resist disintermediation so effectively. I guess I'd rather have real estate agents making a living than see the owner of Redfin become a billionaire.

Also, though I'd be tempted to skip using a realtor for an in-town move, I'm currently planning a move to WA (specific location TBD), have talked to a couple of real estate agents (thanks Oftpiste) and have to say that having someone with intimate knowledge of the local knowledge is pretty valuable and worth paying for, especially given that you're going to spend hundreds of thousands of dollars and be living there for years.

[AdironRider]

On a 500k house, does it really require spending 30k to tell you your house is in the good part of town or to pull a couple comps from the mls?

I think the issue is most people don't actually know that they are being fed one giant pile of bullshit, that and somehow it is legal for realtors to prevent a homeowner from listing their house themselves on the mls.

This should cost a couple grand, at most.

[Falcon3]

My realtor was easy to deal with but yeah, beyond a couple of emails between her and the sellers agent, and filling in pre-made offer forms, she didn’t do much to earn her cut.

I found all the homes we looked at, and the title company and broker did about 3x the work the realtor did. How that warrants such a large cut is beyond me, especially in a market where the number of agents outnumbers available homes by about 4:1.

[dan_pdx]

That's an interesting chart. I skimmed through the house price methodology, and I may have missed something due to speed reading, but I think those prices are national averages. So...on average, the US is reasonably affordable, but that doesn't make me feel any better about the housing market out West.

X

[Toadman]

That quote alone should be grounds for public execution. That's just as egregiously tone-deaf as saying that healthcare is a luxury good.

Well, depending on the location, housing prices constitute a luxury good. Maybe it was a bit flippant to make that comment, or as you say "tone-deaf", but that's America for you; home of the homeless, land of the indebted.

[wooley12]

Bought and sold 2 houses, Each time I showed the home to the buyer AND had a realtor. But I'm not special like all of you are with your exceptional life skills. And was not looking at a house as a purely a monetary investment like most here. The marriage counseling that came with the fee had some value.

[Danno]

On a 500k house, does it really require spending 30k to tell you your house is in the good part of town or to pull a couple comps from the mls?

I think the issue is most people don't actually know that they are being fed one giant pile of bullshit, that and somehow it is legal for realtors to prevent a homeowner from listing their house themselves on the mls.

This should cost a couple grand, at most.

This isn't the first time we've discussed this, and in general I agree that many transactions don't warrant the commission. But some do.

That said, the MLS is a private entity, shouldn't they be able to do what they want and allow whatever listings they want? As you swing conservative/libertarian/republican/whatever label you want, why on earth would you suggest that it shouldn't be legal for the MLS to choose how and what listings it accepts?

[wooley12]

Myopia

[AdironRider]

This isn't the first time we've discussed this, and in general I agree that many transactions don't warrant the commission. But some do.

That said, the MLS is a private entity, shouldn't they be able to do what they want and allow whatever listings they want? As you swing conservative/libertarian/republican/whatever label you want, why on earth would you suggest that it shouldn't be legal for the MLS to choose how and what listings it accepts?

Maybe because in the real world, one doesn't fit lockstep into one parties agenda 100% perfectly. Crazy concept I know for the moderators here who consistently chase certain posters around based on perceived political beliefs.

In almost any other market, one can decide to sell whatever they chose in any myriad of venues, without a cabal of professionals specifically going against their legal duty to work in their client's best interest. The MLS, and realtor's refusal to entertain houses that don't give them their 6% cut, is pretty much a cut and dry perfect example collusion, but you know, keep scoring those sick burns!

[RootSkier]

Zillow picks up FSBOs so you can FSBO your house and anyone looking at Zillow will see it. Advertise 2.5% for the buyer agent and agents might even show it and write an offer for it.

We found our last house on craigslist and the buyer was offering that and we made a full price offer minus the 2.5% and got it. No realtors were fed in the transaction at all. It is possible.

All that said, this is about LISTING houses. If you are buying there is essentially no down side to using a realtor.

[Self Jupiter]

FSBO’s have been able to list on MLS for ~10y in MA

[Greenstateofmind]

Our realtor’s professional relationships made our deal. It’s the Wild West out there. We ran into several hotshot newbie seller agents that were all over the place. In the end the sellers agent and our agent (both reputable in local circles) earned their keep in finding a deal in all this madness

[skaredshtles]

That's an interesting chart. I skimmed through the house price methodology, and I may have missed something due to speed reading, but I think those prices are national averages. So...on average, the US is reasonably affordable,

It really is - just look at nearly ANY place in the Midwest. Houses are cheap as shit.

But there's a reason for that...

[Dantheman]

I FSBO'ed a condo in early 2008. "Listed" it with a sign out front and a free KSL ad. Buyers also had no agent. Got the price we wanted and the title company handled everything, it was easy.

[4matic]

I just sold house for 3% total commission. Seller agent earned his 1% by helping me get 550 sf added to my county assessor record. Easy money.. He said with inventory so low you don't have to worry about the Realtor mafia not showing for less than 2.5% seller commission. If you have a house with no issues you really don't need a listing agent. There are company's like Homebay that offer transaction coordination for like $2k.

I'm thinking about using Redfin as buyer agent in California. I like that you can schedule showings online using their support agents so you aren't chained to the schedule of single agent.

[4matic]

FSBO’s have been able to list on MLS for ~10y in MA

You can list on MLS through a discounter for around $200 and therefore not classified as FSBO.

Homebay transaction coordinator:

https://www.homebay.com/tips/transaction-coordinator/

[4matic]

Agent and I requested a "Property Characteristics" record from the county and it shows the bonus 550 sf added in the 60's so they gave me a bathroom and 550 additional.




A county agent called me to discuss the request. She said Google Earth was showing 350 additional which I said was low but I would accept it. She gave me the full request. Pays to be nice?

[Danno]

Maybe because in the real world, one doesn't fit lockstep into one parties agenda 100% perfectly. Crazy concept I know for the moderators here who consistently chase certain posters around based on perceived political beliefs.

In almost any other market, one can decide to sell whatever they chose in any myriad of venues, without a cabal of professionals specifically going against their legal duty to work in their client's best interest. The MLS, and realtor's refusal to entertain houses that don't give them their 6% cut, is pretty much a cut and dry perfect example collusion, but you know, keep scoring those sick burns!

I wasn't going for a sick burn, and you clearly have a persecution complex. The notion that moderators are chasing you around based on political beliefs is pretty fucking silly. In any event, your political views are well known, I am not sure why you think asking you the question based on those often stated views, when you state something that seems inconsistent, is somehow out of bounds. In any event, you can sell in any venue you choose that lets you sell there. Craigslist can refuse to allow listing of certain things, ebay can refuse listings of their choosing, so can the MLS. That's called private businesses doing what they want. I think to a large extent it's a racket that often provides no value to the buyer or the seller (and that's why these low cost listing/selling options exist) but I am not sure why it should be illegal. What is your argument, divested of hyperbole and complaints about phantom moderator persecution? What would the law look like that opened up the MLS to anyone, and opened up selling real estate? How would you structure the market? Would there be agents? How would they get compensated? Would there be any regulation?

[4matic]

My local MLS butchers high quality photos. That's where Zillow and Redfin help. Not that it matters that much if the photos are good..

[AdironRider]

I wasn't going for a sick burn, and you clearly have a persecution complex. The notion that moderators are chasing you around based on political beliefs is pretty fucking silly. In any event, your political views are well known, I am not sure why you think asking you the question based on those often stated views, when you state something that seems inconsistent, is somehow out of bounds. In any event, you can sell in any venue you choose that lets you sell there. Craigslist can refuse to allow listing of certain things, ebay can refuse listings of their choosing, so can the MLS. That's called private businesses doing what they want. I think to a large extent it's a racket that often provides no value to the buyer or the seller (and that's why these low cost listing/selling options exist) but I am not sure why it should be illegal. What is your argument, divested of hyperbole and complaints about phantom moderator persecution? What would the law look like that opened up the MLS to anyone, and opened up selling real estate? How would you structure the market? Would there be agents? How would they get compensated? Would there be any regulation?

Please, my politics has literally nothing to do with bullshit realtor 6% fees, yet you, the moderator, decided it was of upmost importance to a conversation about realtors.

Ultimately the MLS is not the criminal here, it is the realtors refusing to show buyers properties that don't pay them more (despite their license and contractual obligations to do so). The MLS is pretty damn complicit in this exercise, but it does seem they are open to at least entertaining FSBO listing there now. 10 years ago that was a non starter.

I think it will be interesting to see if 4matic's point about the lack of inventory changing the realtor fee scenario has any long lasting effects.

[4matic]

Please, my politics has literally nothing to do with bullshit realtor 6% fees, yet you, the moderator, decided it was of upmost importance to a conversation about realtors.

Ultimately the MLS is not the criminal here, it is the realtors refusing to show buyers properties that don't pay them more (despite their license and contractual obligations to do so). The MLS is pretty damn complicit in this exercise, but it does seem they are open to at least entertaining FSBO listing there now. 10 years ago that was a non starter.

I think it will be interesting to see if 4matic's point about the lack of inventory changing the realtor fee scenario has any long lasting effects.

FSBO is not an accurate acronym. MLS requires you offer a buyer agent commission; that's the only difference.

[Conundrum]

I refuse to do work that would pay me less than the work I'm currently doing. I think most people are like that. Not sure why realtors should be any different. Now, I agree, 6% of what houses are going for these days seems excessive. But, if realtors can justify that money to their customers, they'll probably keep doing what they're doing. Maybe the market won't bear that forever...who knows?

[Ted Striker]

I was literally about to write the same thing.