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This is new. Sellers get a commission rather than pay one.


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2018 Apr 12, 8:50am   2,982 views  12 comments

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1   HeadSet   2018 Apr 12, 8:54am  

This is nothing new. Many Credit Unions and other institutions have sellers rebates for sellers who use selected brokers.

This post smells like an ad
2   MrMagic   2018 Apr 12, 11:12am  

This is something that has always pissed me off. Why does the seller have to pay the buyers agent (through commissions) for the work that agent does for the buyer? The seller gets hit with the total bill (which gets reflected in the original purchase price). Home prices could be lowered a few points if the sale price didn't have to be padded to cover all the commissions.

Buyers should pay their agents directly, just how they pay their attorney, home inspector, tradespeople, etc.
3   Shaman   2018 Apr 12, 11:17am  

Sniper says
Home prices could be lowered a few points if the sale price didn't have to be padded to cover all the commissions.


This doesn’t actually work. Sellers want top dollar no matter what. Giving buyers a discount never enters into the calculus. Real estate agents are a parasite which attaches to sellers and sucks their cash in return for making the deal go through more smoothly.
4   MrMagic   2018 Apr 12, 11:24am  

Quigley says
Sniper says
Home prices could be lowered a few points if the sale price didn't have to be padded to cover all the commissions.


This doesn’t actually work.


So are you saying no one figures in the commission amount they will pay when deciding on the actual listing price?
5   mell   2018 Apr 12, 12:03pm  

I heard a commercial in the radio about a new online listing site that does all the marketing and pays for inspections and commission is only 0.5 % of the unit's sales price.
6   SFace   2018 Apr 12, 12:11pm  

I have to agree that 6% all in commissions is not commensurate with value provided. And let's be real, buyer/seller fee 100% comes out from the sellers pocket no matter how you call it.

I think Redfin cut to the chase more and have discounted fees, for something more streamlined. but that is without data on how end price is impacted. Maybe a redfin shareholder have more insights?.
7   HeadSet   2018 Apr 12, 1:07pm  

mell says
I heard a commercial in the radio about a new online listing site that does all the marketing and pays for inspections and commission is only 0.5 % of the unit's sales price.


Yes, but when you get the details you will find that 3% is added for the buyer broker. Still, 3.5% beats 6%.
8   Shaman   2018 Apr 12, 1:22pm  

Sniper says
So are you saying no one figures in the commission amount they will pay when deciding on the actual listing price?


What buyer is going to give you list price plus commission? It’ll sell at its fair market price, not that plus another $20-30k in commission. Appraisals are important for loan generation, and banks won’t loan more just to pay a realtor. If the house appraises for $350,000 you can’t tack on another 6% to pay the realtors. That would mean the buyer would have to come up with more down payment to get financed at their expected rate.
Anyway...
9   MrMagic   2018 Apr 12, 1:56pm  

Quigley says
Sniper says
So are you saying no one figures in the commission amount they will pay when deciding on the actual listing price?


What buyer is going to give you list price plus commission? It’ll sell at its fair market price, not that plus another $20-30k in commission.


That's not what I said, please pay attention. Today's listing pricing has a 6% commission already baked in, not 6% tacked on top of the listing price.

Quigley says
If the house appraises for $350,000 you can’t tack on another 6% to pay the realtors. That would mean the buyer would have to come up with more down payment to get financed at their expected rate.


Who said that??

The appraisal price has the commissions also baked in. The TRUE cost/value of the house is the $350,000 MINUS the $20-30K in commission. It's just that all the "sheep" have accepted the fact that they'll pay 6% in commissions as the industry standard, price their house knowing they'll have to pay it, and very few will buck that trend.
10   HeadSet   2018 Apr 12, 2:26pm  

It's just that all the "sheep" have accepted the fact that they'll pay 6% in commissions as the industry standard

Not really sheep as a seller. It is just that the overwhelming majority of buyers are unwilling to do a "For Sale by Owner" because they see the house buying process as too complex and want the "free" services of a agent to walk them through offers, loans, and closing. Plus, there is the ego feed of being driven around and pampered while looking at homes. I have bought and sold 10 homes, and managed to buy 2 of them without a realtor by getting to the seller before they listed. However, despite trying, I was never able to sell a home without listing as it seems everyone who is serious about buying a home reflexively calls a realtor. I was able to get the commission down to 4.5%, though (1.5% to listing agent, but a full 3% to buyer's agent so buyer's agents would actually bring people).
11   MrMagic   2018 Apr 12, 2:55pm  

HeadSet says
However, despite trying, I was never able to sell a home without listing as it seems everyone who is serious about buying a home reflexively calls a realtor. I was able to get the commission down to 4.5%, though (1.5% to listing agent, but a full 3% to buyer's agent so buyer's agents would actually bring people).


I've sold many of my houses, here's the best way to do it if you're the seller.

Contact a Flat Fee broker, who for between $300 -$400 will get the listing on the MLS, Zillow, and tons of other sites, you provide the basic information and pictures. Then, you offer the buyer's agent 2.0 - 2.5% commission for bringing their client to see it. Unfortunately, you have to dangle that carrot for the buyer's agent, and it's the buyer's agent that does the bulk of the work anyway. Listing agents are totally useless.

The reality is, buyers usually find the houses searching the Internet/MLS/Zillow first, then tell their agents that they want to see it. If it's priced right, a good location and shows well, the buyer's agent can't stop the process or redirect the buyer.

Sadly, too many sellers think they "need" to pay 6% to list and sell their houses.
12   FortWayne   2018 Apr 12, 2:57pm  

If I had a dime for every time a realtor showed up at our house asking us if we want to sell I wouldn't need tax cuts.

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