Housing Crash Forum
Email exchange sent in by a patrick.net reader:
From: Buyer
Sent: Friday, June 19, 2009 12:54 PM
To: karinc@prucal.com
Subject: Looking for buyer’s agent to submit bid on peninsula single-family home
Good afternoon!
My wife and I have identified a MLS-listed single family home on the peninsula we’d like to make an offer on. We’ve obtained pre-approval from Bank of America for financing (with 20 percent down) and would like to submit an offer next week…
If you’re interested in working on a fee-for-service model — in which you would refund to us the commission and we would pay you by the hour at competitive rates — please let us know. (The benefit is that you would be guaranteed payment, in the same way as a lawyer or accountant would be, even if our offer falls through and no deal can be reached.)
Thanks,
Buyer
————————————————-
Karin Cunningham wrote:
I don’t believe you, scammer!
Karin Cunningham
Prudential California Realty
Office: 650-871-3624
Cell: 650-438-3504
————————————————-
From: Buyer
Sent: Friday, June 19, 2009 1:08 PM
To: kcunningham@Prucalbayarea.com
Subject: Re: Looking for buyer’s agent to submit bid on peninsula single-family home
Karin,
Oh, I’m entirely serious. Redfin is doing this halfway by refunding part of the commission; why not all of it?
I hope you don’t mind if I publish your response online. It’s hilarious. Welcome to the world of the Internet, disintermediation, and the Loss Of The Cherished Six Percent! It couldn’t happen to a more deserving industry.
-Buyer
————————————————-
Karin Cunningham wrote:
You have no idea how hard I work and the hours I put in to assist my buyers in finding a suitable home, getting the appropriate financing, educating them on short sales, bank owned, and trusts. Not to mention accompanying them in their termite and home inspections to be sure that they are getting a good home, reviewing and making sure all disclosures are provided so they don’t get screwed and I shouldn’t forget, I need to get paid for the good work I do!
Why don’t you ask your dentist for a discount? Maybe he’ll fill your teeth half way and leave the rest for you to fill!
Karin Cunningham
Prudential California Realty
Office: 650-871-3624
Cell: 650-438-3504
————————————————-
From: Buyer
Sent: Friday, June 19, 2009 1:27 PM
To: kcunningham@Prucalbayarea.com
Subject: Re: Looking for buyer’s agent to submit bid on peninsula
single-family home
Karin,
You misperceive reality. Allow me to educate you.
First, you claim I “have no idea how hard” you work. But lawyers and accountants work as hard or harder and are paid by the hour. Lawyers also have to actually go to school for three+ years, not just take a weekend class or two.
When a lawyer advises on a million-dollar or billion-dollar deal, she doesn’t get a cut of it. Why makes Reators(tm) so special — besides what the U.S. Department of Justice’s antitrust division describes as a policy that “threatens to lock in outmoded business models and discourage discounting?”
Second, if you accompany buyers to termite and home inspections on a fee-for-service model, you’d get paid for it.
Third, if a dentist fixes your teeth, he doesn’t demand six percent of your bank account.
-Buyer
————————————————-
Karin Cunningham wrote:
I don’t get paid 6% of anyone’s bank account! In fact, when someone buys a home, my company gets paid half, then I get a portion of that which I have to pay taxes on myself at the end of the year. So doctors, lawyers, and accountants make way more than me. Maybe they work harder! I don’t know!
You entered my computer with an offer that sounded really awful since I work full time on commission to make sure that I do a great job for my clients and the community that I work in. Your “reality and education” are a lot different than mine. I guess that’s what makes the world go ’round!
Good luck!
Karin
Karin Cunningham
Prudential California Realty
Office: 650-871-3624
Cell: 650-438-3504
————————————————-
Subject: Re: Looking for buyer’s agent to submit bid on peninsula single-family home
Date: Fri, 19 Jun 2009 14:03:50 -0700
From: Buyer
To: kcunningham@Prucalbayarea.com
You’re quibbling: Realtors(tm) together tend to get about 6 percent of a sale price because of the commission structure. Whether it goes to you or your company is immaterial from the customer’s perspective; on the sale of a $1M house, Realtors(TM) get paid around $60K.
This is an outdated and outmoded arrangement that the Internet will change; Redfin already is doing this, and more buyers will choose real estate attorneys or fee-for-service agents, especially when they’re finding and visiting properties on their own and researching comps on their own. (Alas, seller’s agents may exist for a little while longer.)
I entered your computer with an offer to pay you by the hour for services rendered. If you think you’re somehow too good to work by the hour, feel free to reject it. And enjoy your incipient unemployment check.
-Buyer
The Realtor(tm) never replied to the last message.
51 comments on “Agent Refuses To Work By Hour”
Add a comment about "Agent Refuses To Work By Hour"
Joined: 3 Aug 2007
Posts: 6
Comments: 51
I like the idea of hourly pay, but…
Why we need R.E. agent in the first place, when there were no internet, when those houses’ information were locked down, or the R.E. agent have some good connection that will make a good deal …
Same as shoes makers, who going to tailor make or repair their shoes?
Old-professional Type of job will be vanished, just a matter of time.
Joined: 1 Jun 2009
Posts: 0
Comments: 12
Actually, not all lawyers perform their services for an hourly rate. Plaintiff’s lawyers primarily work on a contingency fee basis ( percentage of the recovery, if there is one).
Assuming this email exchange is real, her responses did her no good. She should have simply replied to the first inquiry, “No thanks. I work exclusively on a commission basis.”
Joined: 17 Jun 2007
Posts: 1
Comments: 120
She does work hard for the NAR, not for the buyers and sellers. Their business could better be run and regulated on CraigsList.org.
Joined: 24 Jun 2009
Posts: 0
Comments: 1
Here’s a thought: if that 6% is so brain dead easy, why doesn’t everyone do it? Why not take that weekend class and rake in the big money yourself? Seriously, it is sooo easy, right?
How the numbers really work: 6% on a typical non-bubble state home: $150k x .06 = $9,000. Split 50/50 ($4,500) with the two different broker agencies involved. Average split between agent and broker: 60/40 yields $2,700 gross to the agent. Out of that comes anything spent on advertising, gas, a myriad of fees, etc.. In the end, a profession not worth doing for most people (being a broker and taking the split from many agents is probably the better choice).
Like it or not, the majority of people need someone to manage the sale and the transaction, and better yet, they need someone to sue if things go wrong. Being that someone is always going to command some $$$, one way or another (agents as we know them may go away, but in reality, they will just take another form).
Joined: 4 May 2009
Posts: 205
Comments: 204
What cracks me up is the Realtor who tells me that they are working in my best interest. Right…..
Hourly is the way to go. I can look up listings on the Internet myself. The listing agent is more then happy to open up a house for me to view. The forms for making an offer are standard.
The snotty e-mail from the Realtor is so typical when they do not get their way. Money!!!
Joined: 30 Apr 2007
Posts: 0
Comments: 3169
Just a thought.
Even Sonsini is offering FREE term sheet generator online, why should buyer’s agent get any money at all? I can understand that seller’s agent may need to work hard to get the $$$, and I am not opposed to paying the saleman (which the seller’s agent is). But buyers’ agent? Such a profession should have never existed.
What you need is, a really really good inspector. Then, the rest of the terms are fairly easy, if Sonsini can come up with a generator of term sheet for more complicated business deals, I can tell you that terms sheets for one-to-one real estate transactions are far easier to generate. The variables are simpler. The pay of the inspector should be raised, and he should be rewarded on finding faults, the more faults he finds with the current house, the higher his pay.
Joined: 4 May 2009
Posts: 205
Comments: 204
http://www.prucalbayarea.com/officeDirectory/office/14
Check this long list of Realtors. What is it that they do? I might suggest that they get a real job.
Joined: 20 Nov 2007
Posts: 8
Comments: 186
Sunnyvale, CA
Please show me any house in decent neighborhood, less than 700K in bay area. Now do the math. They dont deserve that much. Why not work by hour, if you think you have so much work?
Joined: 22 Apr 2009
Posts: 1
Comments: 13
It’s funny. Using the internet every night I check for new pre-forclosures. REO’s etc and call my realtor sometimes to enlighten her on properties I have found for myself, then ask her to open the door for me for $15,000 (500K houses around here). She jokingly says “What do you want” exasperatingly when she answers her phone seeing my caller ID. I usually say, “I want you to do your job.” Then I give her the address.
I did do all of the courses for Broker but didn’t take the test if for no other reason than (LAZINESS) and possible litigation, since brokers can be held to a higher level of responsibility in transactions.
Joined: 22 Apr 2009
Posts: 1
Comments: 13
Oh yea, on a $150K house like the example above, 6% works out to be somewhat reasonable. On a 500+K house like most around here, I think 6% is a bit steep!
Joined: 24 Aug 2007
Posts: 161
Comments: 2818
Your exchange was beautiful, hilarious, and hopefully will bring the realtor nothing but grief & disdain. Karin Cunningham wrote:
“You have no idea how hard I work and the hours I put in to assist my buyers in finding a suitable home, getting the appropriate financing, educating them on short sales, bank owned, and trusts. Not to mention accompanying them in their termite and home inspections to be sure that they are getting a good home, reviewing and making sure all disclosures are provided so they don’t get screwed and I shouldn’t forget, I need to get paid for the good work I do! Why don’t you ask your dentist for a discount? Maybe he’ll fill your teeth half way and leave the rest for you to fill!”
Oh, where to start? Getting them the appropriate financing? She’s not a banker or mortgage broker. She’s not a professional educator, which takes years of schooling, yet she’s “educating them on short sales, bank owned, and trusts.” It would be super cool if she would use her education to develop her writing and grammar skills. “Not to mention…” Oh, but she did mention! A professional inspector who’s licensed and bonded should be performing such inspections, not a saleswoman. “Reviewing & making sure all disclosures are provided so they don’t get screwed and I SHOULDN’T FORGET.” No, she shouldn’t forget, but since she’s only a realtor and not a lawyer her knowledge of disclosures certainly wouldn’t pass a smell test.
She needs to get paid for the work she does? She should get a real job, one with dental coverage. Comparing her salesjob to a highly trained profession such as that of a dentist is an example of the overblown egos realtors carry around.
LMAO
Joined: 29 Oct 2007
Posts: 0
Comments: 175
Cupertino, CA
Not sure why a flat fee couldn’t be charged - after all, if she charged a flat fee to act as your agent, she would get paid whether or not the deal went through.
Here is one fee structure from a real estate attorney’s office:
“Flat Fee - This is for serious buyers only that are certain they are going to buy a home. So if you are definitely buying a house, this option saves you thousands. You pay a flat fee, and we return the full commission we receive from the Seller . . . to YOU. Here’s an example: On a $400,000 home that we receive a $12,000 Seller paid commission . . . your flat fee is just $7,500 plus out of pocket expenses. At closing, we write you a check for the $12,000 we received from the Seller, so you just pocketed $4,500 cash. On a million dollar home at a 3% commission, you receive $22,500 cash. Your flat fee includes 25 hours or our time. Additional blocks of time are available at the same fee.”
More here on his office fees for real estate transactions:
http://www.floridahomes.pro/Menu
The 6 percent needs to be put to sleep.
~Misstrial
Joined: 24 Jun 2009
Posts: 0
Comments: 1
I think real estate agents should receive 100% of all sales. Why should the seller enjoy all the wealth. Treat agents like the FED takes care of banks.
Joined: 24 Jun 2009
Posts: 0
Comments: 1
While both sides of this argument sound legitimate. The argument is quite simple this is capitolism at it’s best. The seller has the right to hire at his own risk someone who would be satisfied with what he wants to offer as compensation.
Why lawyers and accountants needed to be injected into this debate was stupid. Vetenarians and chiropractors are doctors. Such as paralegal understand and can consult you on law. But I wouldn’t hire the Vet, chiropractor or paralegal to do a liver transplant? In closing there is company out there perfect for you there called, “Help You sell”, designed to give you the level of expertise just perfect for people like you Mr. seller!!!!
Good luck with your sale.
Joined: 24 Jun 2009
Posts: 0
Comments: 2
It seem incredibly odd to me that Realtors defend the 6% commission by pointing out that their agency takes half. If the realtor REALLY pays the cost of advertising, flyers, listing, etc., then exactly what does an agency firm do to earn its half of the 6%? Half your “hard earned income” in exchange for a desk, phone, and computer station does not seem like a smart business decision.
Oh wait, I forgot the agency probably distributes those insightful NAR economic reports….
Joined: 4 May 2009
Posts: 0
Comments: 2
One of the things that is keeping me on the fence, that has prevented me from buying a house so far, is the perception I have of this being a rigged game.
Except for the buyer (me), it is in everybody’s interest that a house is sold at the highest price possible. From the agents and their commissions, to the lenders and their interest, to the government and its property taxes.
It seems that everyone is out to get you !
And the worst thing is, these folks are all perpetuating an imperfect market and feel entitled to their earnings !
Joined: 21 May 2009
Posts: 4
Comments: 475
Frugal - you said it. I, too, have the means to purchase, and have had, but refuse to subsidize a screwed-up system that everyone seems to want to keep screwed-up. The snag is, renting is becoming tricky, thanks to the investors/landlords from the bubble years who are charging high rent, while they pay a minimal monthly fee on their ARM, waiting for the right moment to seize upon a chunky profit margin as their equity supposedly climbs. That’s the case around here, anyway. And the really nifty thing is, Texas is a non-disclosure state, so a prospective renter cannot check Zillow for when the house sold last, which helps establish if it was a bubble-investor sale.
Anyway you slice it, it sucks. But I’d still rather take my hits renting than put my hard earned money in the pockets of any of the three parties you mentioned - REA, Lenders, GVMT - and let’s add one - greedy owners.
Joined: 24 Aug 2007
Posts: 161
Comments: 2818
I used to work for the evil empire (realtors, many years ago when I was young & dumb). The realtors have to work under a broker, can’t be independent. So half their commission (or more) goes to the shop they work for. From what I remember, the realtors are charged extra stuff but much of their advertising is covered. They get a desk, referrals from cold calls, receptionist, etc. They don’t get to keep everything paid in the commission. But then again, they’re not worth it.
Joined: 24 Jun 2009
Posts: 0
Comments: 2
not all realtor are against that arrangement. I would be happy to work for some one as long as we both believe it is equatable. I have started a mini Redfin on my own and do a sliding scale of how many home we see. I also have a no risk listing plan. I would love feed back from customers. I want business form people like you. It is a business transaction. I’m a broker. that is how I make money brokering deals.
check us out www.UberRealty.com and UberRealty.info
Joined: 8 Jun 2007
Posts: 24
Comments: 167
Egg Harbor City, NJ
Realtors that have brokers licenses get to keep the whole commission. Why don’t all realtor’s then just get a broker’s license then and cut out the middle man? There are special requirements that the National Association of Realtors makes to make it more difficult. A realtor has to work under another broker for a set period of time before they can take the test to become a broker. Think of it like an electricain’s license. Any joe can work for an electrician as an helper and install electrical wiring, they work under the electricain license and the license electrician is liable if say the helper wires something wrong and burns a house down. After 5 years the helper and take the electrician’s test and get there own license. I guess ultimitely is there is a major legal problem with a settlement, the broker is liable if the realtor screwed up.
In a way I could see the realtor’s point. If you went to a realtor and said I want to hire you help me find a house, you can bill me for the time involved and we get a kick back on your commission when we buy. This works out good for the realtor, he takes his clients to dozen of houses working 40, 60 or even 80 hours for his clients, before they find the perfect house. He works for the clients enough hours to be worth is effort and when they buy he still gets something for closing the deal. Although it’s nice to get that commission check, if he can find something wrong with the deal, he steers his clients away from the house and continues to get paid as they look for another house. using this method, the realtor has more incentive to try and get the best deal for his clients. Using the old commission only method, there’s no payday if there no deal, so there no incentive to make sure the buyer is getting a good deal.
But to walk thru the door and say I already found a house, will you work for me on an hourly rate, isn’t a good deal for the realtor. Since they know the house they want already, where isn’t very many billable hours involved. It’s like walking into a lawyers office, and tell him I already wrote up this contract, I just need yout to bill me for 5 minutes to put your signature and stamp of approval on it. Or get to a doctor and tell him I already diagnosed myself, I just need you to bill me the 5 minutes it’s going to take you to write me a perscription.
Joined: 30 Sep 2008
Posts: 0
Comments: 110
I love the “broker” excuse. So since Tony Soprano wants a 50% cut, I have to shell out $15k to Paulie Walnuts? Fuck you!
Joined: 24 Jun 2009
Posts: 0
Comments: 1
So, instead of griping about the useless realtor commission, how about some real life tips on how to not use one in a purchasing transaction? Anyone?
I am first time buyer, looking for a REO property. Obviously, I get my foreclosure listings from foreclosurepoint.com and MLS listings from realtor.com. I also found a real estate attourney who handles all the legal paperwork, etc, for an hourly fee. From what I understand, a broker is required in a transaction, correct? Is it just any one broker, or two brokers? Brokers commission seems to be baked into the transaction, correct? Is there any way not to pay brokers commission? Had anyone purchased property without having to pay these outrageous fees? Thanks,
Joined: 24 Jun 2009
Posts: 0
Comments: 2
A broker is not required in a transaction. You can find a for sale by owner and use an attorney for closing the Transaction. If the House is listed in the MLS it is most likely listed with a broker or agent that has sign a listing agreement with the owner. When entitles the listing agent and the selling agent to a commission if the property sells.
A good Broker/agent can save you money if you work out a deal ahead of time.
A broker does not just open Doors and lets you walk throught. once a offer turns into a contract. A competent broker/agent will meet all inspectors (home inspectors, appraisers environmental inspectors ect.) at the property and make sure everything is what it should be.
If you are selling a property and willing to do the showing and negotiation their are limited service companies out there that will put you in the mls for a fee. You can then offer a smaller or larger commission to a buyers agent.
A Broker is licensed in the whole state not just a portion of it. If any of you all have questions that i can help you with please contact me and I will do what i can to answer your questions.
I am also frugal and try and help my client save as much as the can.
Joined: 1 Jun 2009
Posts: 4
Comments: 65
In today’s environment of reduced equity, a 5-6% commission sting can be devastating to the seller.
One way to start fixing this is for people to shop for Realtards(R) that are agreeable to a sliding commission scale based on price.
5% $300,000 Total Commissions: $15,000 (still too much)
4% $400,000 Total Commissions: $16,000 (still too much)
3% $500,000 Total Commissions: $15,000 (still too much)
The higher priced “homes” (remember, Realtards(R) never call them houses) take longer to sell, but the Realtards(R) are generally working with fewer buyers, so they do not deserve double or triple the take when compared to lower priced houses.
Or just cap the commission at a specific price: 5% for up to $300,000.
I once sold a place through a Realtor that agreed to a 4% take. I asked if this would reduce the number of possible buyers (fearing that perhaps the buyers agents would not want to show a place that they would only earn a 2% commission). He said not to worry - 2% on a $500,000 would be plenty enough motivation for an agent. This was back in 2005 and the house sold in a week, so each agent scored a $10,000 gross take with very little effort.
THAT WAS $20,000 OF THE EQUITY I HAD IN THE PLACE!
Joined: 2 Jun 2009
Posts: 0
Comments: 36
That’s hilarious!
I’m always amazed at the number of RE agents that post replies here. Get a clue: most people think you are scum.
Techgromit: in the real world that is exactly how it works. I draw up a contract, hand it to my lawyer and he sends it out. He makes $400.00 for reading a one page document and the cost of a stamp. I get a great lawyer overseeing what I write at a price I can afford. He gets $400.00 for five minutes work.
It’s called capitalism - try it some time.
Joined: 26 Aug 2007
Posts: 15
Comments: 224
“… reviewing and making sure all disclosures are provided so they don’t get screwed … ”
Um, it’s called a lawyer, not a Realtor. I have bought and sold two houses and paid for a lawyer at closing. They were paid approximately $350.
Joined: 24 Jun 2009
Posts: 0
Comments: 5
In Freakonomics, there was a study that showed realtors would hold out for higher prices on their own home for sale, but recommend their clients take a lower offer because their split of the commission was so little anyway, that to hold out for higher was only worth another $50 or so. The takeaway is always the same, everyone works in their own self interest - always.
Joined: 24 Jun 2009
Posts: 0
Comments: 1
Start by saying I am not in the real estate business at all.
Thought it was unfair and hurtful to list the real estate agent’s name and email address while
not listing the person who wrote the email “buyer” and making him/her anonymous.
Either both names/emails should be put on the web or protect both parties. Especially the agent
as this is her work in a very difficult economy. No need to expose her like this when she hasn’t done
anything improper or part of any fraud. She is just doing her work at the going rate of all her peers.
This is just awful!
Joined: 22 Jan 2009
Posts: 0
Comments: 4
I notice no one mentions the inconsistency in that this supposed buyer rails against the 6% fee yet wants the seller to pay it to the Realtor and then wants the realtor to refund it to him.
Why doesn’t he just ask the seller to reduce the price and do a For Sale by Owner? Because he wants to use the realtor’s services but is so arrogant he demands for himself the commission the seller is willing to pay the realtors.
Joined: 3 Apr 2005
Posts: 429
Comments: 1230
Menlo Park, CA
FrugalSam, that’s exactly why I started this site. The uncomfortable feeling that it’s in everyone else’s interest to maximize the price at my expense. It’s like there’s a snare set in the woods and bunch of hunters are all quietly cooperating, hoping to get the stupid little bunny rabbit to step into the snare so they can each get their cut of meat.
Another analogy: in college I went to Barcelona with a friend who could speak Spanish. One evening we were sitting in a small plaza as it was getting dark, and he suddenly looked around and told me that the other 10 people apparently casually strolling in the plaza were all cooperating theives and checking us out and chatting with each other about how best to robs us, picking pockets or violence, etc. I really got the willies and we got out of there.
In America, real estate is just like that: “Let’s all abuse the naive buyer.” Even our own government is in on it in a huge way.
Joined: 20 Jun 2007
Posts: 3
Comments: 1372
All this talk about “don’t need a realtor, I can use a lawyer/title company” misses the point. Once you have a buyer, closing is a simple process. The realtors actual job is to find a buyer, helping with closing is just a convenience.
Obviously, you found buyers on your own, which is the only reason for not needing a realtor. How did you do it? I would love to know how to market a house to get the attention of the average buyer, who despite first looking on-line and at newspaper ads, always seems to end up calling a realtor. I still have two more houses I will want to sell in the next few years.
Joined: 24 Jun 2009
Posts: 0
Comments: 1
Patrick;
Do you have a link on your page that gives buyers all the info/hints/gotchas that are needed to make an intelligent and safe home purchase. I’ve purchased sole 6 houses over my lifetime and cringe to think how much money just went to commissions - it’s absurd.
Thanks for all the interesting info you provide on a daily basis.
Joined: 19 Sep 2007
Posts: 0
Comments: 42
Realtors are Jerks & Bitches!
Well, about 89% are = FACT!
Take it from an X-realtor from Hawaii and California!
They are lower than “used auto sales” and 1 step above “time share sales”.
I deactivated my Real Estate License because I’m embarrassed to say I have 1.
Joined: 19 Sep 2007
Posts: 0
Comments: 42
Oh, any my Auto Lic. Plate means:
A= Big Internal Rate of Return, an Investment & Finance Formula to calculate investment returns!
B= Big Lover of IRR
or
C=Big Love IRR
Joined: 24 Jun 2009
Posts: 0
Comments: 1
If someone(being the home owner or even listing agent) REALLY wants to sell a house there will be a good deal made as long as you dont let anyone screw you. If the house isnt worth what they want for it….dont buy it…simple as that….IT WILL SIT ON THE MARKET. Then be reduced. The Inventory is endless in most areas. keep looking until you find a deal. screw the agent
Joined: 12 Jun 2009
Posts: 1
Comments: 7
Brentwood, CA
Man, what a cheap way to try to go, what about the LIABILTY would you wave the LIABLITY that the AGENT takes on? by the hour, Why don’t you just get a Real Estate Lawyer and have them submit the offer? DAH.. that takes care of it.. you have your by the hour, and your lawyer… I am available but I charge 20,000 dollars on hour, for that you will get what you are paying for. No doubt about it. It is that or free, you sound so pathetic I must say, and I am NOT PRO REA so this is something to turn me off the way that does. WOW, Some people, Don’t you know about Karma?
Joined: 22 Apr 2009
Posts: 1
Comments: 13
Oh yea,
Karma says give $15,000 away to someone I called for openning the door and then filling in the offer (ten more minutes), then faxing it to the sellers. I agree. That should boost my Karma right on up.
Joined: 25 Jun 2009
Posts: 0
Comments: 1
First, 6% commissions are largely a thing of the past. It’s been 5% for years all over California. The other costs involved for all Realtors and brokers include insurance, license fees, and income taxes. And buyer, why should this Realtor give you a kickback on money that the seller, not you, has agreed to pay to the listing agent? And why didn’t you just present the offer yourself? Who else do you ask for kickbacks from?
Joined: 20 Jun 2007
Posts: 3
Comments: 1372
You guys remind me of the joke about the economist and engineer trapped in a deep pit. The engineer devises ways to use available rocks, sticks, and dirt to build a way out, while the economist just assumes a ladder.
Each one of your arguments just assumes a ready buyer. Finding a buyer is by far the hard part. Lawyers, title companies, dowloaded forms, etc., are all useless without a buyer, and do nothing to find one.
If anyone has sold FSBO please share how you did it. I sold 3 of my houses during the bubble years and was unable to get a buyer FSBO, but sold each house within hours after listing. (I did get a discount in the commission, though).
Enough with the “can do my own paperwork” nonsense. Tell me how you found the buyer.
Joined: 26 Jun 2009
Posts: 0
Comments: 1
I sold a house I inherited thru “FSBO” 3 months ago……….
Put it online on 2 different and popular FSBO RE websites…..and bought a couple of small newspaper ads……….total cost $920……..same thing a POS realtard does.
I priced it $10K below the comps and it sold in 45 days…..my lawyer charged me $750 to do the legal due diligence and title transfer. I wrote up the offer and negotiated the deal myself in about one hour, after two showings to the buyer. Fielded about 10 phone calls and didn’t even have an open house.
$1,670 totalcost and a couple of hours of my time…..versus $15,000 of realtard commission to do the same thing……
Joined: 26 Jun 2009
Posts: 0
Comments: 1
>>Tell me how you found the buyer.
Pay $250 for a “Flat Fee” listing in MLS. That’s how you do a FSBO.
Joined: 28 Jun 2009
Posts: 0
Comments: 2
Hire your own inspector for a few hundred dollars.
Hire your own appraiser for a few hundred dollars to do a drive-by if you’re not comfortable coming up with comps off redfin, zillow, etc.
Hire a real-estate lawyer to make your initial offer and handle the counters for a few hundred dollars. They know a lot more about law than agents. Some have flat-fee deals where they’ll review up to $X contracts for $Y.
My wife and I have bought property without an agent. It’s not a big deal provided you’re buying in a market that’s not so hot you need to know about properties before they come on the market .
We’ve sold several properties without agents. It’s not a big deal provided you’re in a location which gets traffic. Fix the property up appropriately (affordable carpet you’d live on versus rental; little details like new towel racks and wall plates in a 25 year old property) but nicer than the competition, price it right, stage it, and it’ll sell as fast as agent-represented properties with more money remaining in your pocket.
Joined: 26 Jun 2009
Posts: 1
Comments: 3
Realtors must think they live on another planet. Realtors will utterly resist hourly rates, as it would expose how little they do for what they’re paid, or conversely, how obscene their current remuneration model is. In some cases, it would translate to thousands per hour, a rate even a high-flying attorney would be glad to receive.
I had a fair idea what the seller’s realtor was going to make when I bought my property in February. After much negotiation, he stated that the vendor couldn’t accept my ‘ludicrous’ offer, and besides, they simply didn’t have the $ to make a zero close at that price. Tough, I said, take the difference out of your commission, which he ultimately did.
Sales people in booms/bubbles start to believe they’re great at what they do, when in reality they’ve become mere order-takers. There’s no better example of this than the real estate industry, whose very raison d’être is tenuous at best.
Joined: 24 Aug 2007
Posts: 161
Comments: 2818
I was pre-approved by my mortgage company for a purchase. I then had the chick type up the amount of down payment required for my fsbo, along with payment, closing costs, etc. I made a FSBO brochure, complete with photo of the house and highlights of the place. I placed them in a clear envelope on the mailbox post.
I placed an ad in the local paper - they were running a special with a highlighted ad for $100 per month (cheap by that city’s standards). Since it was acreage, I posted info about the sale online on horse property sites, and local feed stores. I told all of my neighbors and posted a flyer at work. Granted, it was a seller’s market at the time. But the mls advertises it the same - the home info is placed on the mls and nothing else happens from there. Open houses don’t draw in buyers out here. Realtors don’t make a difference, unless they’re driving buyers around. But they don’t drive them around - they drive them to homes they’ve found. Buyers can find them the same way.
Most banks have signs outside advertising their REO’s. You can go inside and, if you buy without a realtor, they’ll discount it. They have a real estate department but they don’t generally charge that pesky fee.
Right now, if you search the interweb for homes in a certain area, you can easily find all the homes listed both mls & fsbo. I just helped a friend find a home, no realtor, discounted due to no commission. It’s easily done. As a seller, you have to be willing to sell the place yourself meaning showing it, answering calls. But your time is worth more than the commission. And since you have to have your home showing ready at all times, it doesn’t matter if you have to show it yourself.
Joined: 20 Jun 2007
Posts: 3
Comments: 1372
I am glad you had more success with FSBO than I did, makes me more hopeful.
I used the same techniques several of you mentioned, with the exception of noemail’s “Pay $250 for a “Flat Fee” listing in MLS. That’s how you do a FSBO.” But if you put your house into the MLS, don’t you have to offer 3% or so to the selling agent? You save on the listing fee, but the buyer’s agent will want her co-op fee.
Joined: 24 Aug 2007
Posts: 161
Comments: 2818
If you place a flat fee listing, I believe you can set your own commission if you like. But if you’re using the mls, the realtors probably won’t show your home unless you cough up $
Joined: 19 Jul 2009
Posts: 0
Comments: 1
If the OP didn’t need the services of a buyers agent, I don’t understand why they didn’t go directly to the listing agent. It would have been far less expensive and they could have made an offer.
Joined: 30 Sep 2008
Posts: 0
Comments: 110
Because typically the listing agent will then eat up the 6% commission by themselves and will try to stop you from negotiating a 3% reduction in sale price for a 3% commission to the seller (which is what they’d get if you used your own agent). That is because they are selfish pieces of dog excrement.