patrick.net

wow i never heard that idea on this site in the last 8 years.

Dude, you need to get educated before you go down this road.

Even patrick is clueless about this topic in many regards.

It cost me $300 to get a broker license and 'pretend to be a realtor' - i did some deals, saved some money, learned a TON. I suggest you do this and learn the paperwork, legal issues, how it works, why it works this way, etc.

Even patrick wont do that - he wont 'get hands dirty' only wants to code. Sales is just talking to people (so scary!!!!).

BTW the agents are only getting more power. Wait until the NAR lobby gets conforming limit up to 1m - the RE will take off like 2004.

I could list 50 RE sites right now that are trying to get a piece of the RE pie. There are tens of thousands of them out there.

Heres one of 100 issues that will kill your idea: you cant post a listing on your site - you need permission from the broker (not the owner) the broker OWNS the listing legally. So put listings up and the attorneys start to hover over your head. Grok that one. (anyone can code now, so easy, dont think you can shake anything up with coding skills)

I have always been an advocate of getting rid of the middle-man when it comes to real estate. In other words, I would like to see real estate sales more like car sales where the buyer and seller are more actively involved and forced to understand the business.

The problem is that for the common person, real estate has too many details and too much legal implication to take one. People are intimidated by the fact that their home will be the biggest investment they make in their life and they need someone to hold their hand.

But come on, people are becoming realtors in 3 months time. It's not rocket science for gawd's sake.

they should work for handjobs!

in fact we should base the value of the USD on handjobs - its based on nothing now.

one dollar=one handjob

You can go to a bank, stick the dollar and ur wang in the little window and GET ONE!

this will return us to sound money

Realtors are here to stay for the foreseeable future. They are gaining more market share (91% today vs. 89% 7 years ago), not less!

For this reason, I suggest we fix the model, not re-invent the wheel. First, sign this petition at change.org to legally require real estate agents and brokers to respect their fiduciary duties to the client; http://www.change.org/petitions/state-legislators-pass-laws-that-enforce-fiduciary-duties-of-realtors

And check out http://www.neighborcity.com - the only website to rate and rank realtors based on their performance for clients.

@pockyclipsnow - you are exactly right; http://www.techdirt.com/articles/20120521/12223019004/real-estate-listing-services-use-questionable-copyright-claims-attempt-to-block-criticism-agents.shtml

In my opinion, the business model for 6% Realtor commission is simply outdated with websites like Redfin, Trulie, and Zillow.

To my knowledge, the Realtor cannot provide the average buyer with ANY additional listings that are not on these sites.
I suspect there are behind the scenes investor bulk selling etc., but that is a different story. I have asked, no one has come forward for me.

Gasp, yes, in the mid 1990's I was a Realtor for 1 year. At that time, the buyers AND investors needed Realtors to access the proprietary MLS for prospective listings.

Also, at that time, a Realtor could additionally 'know' people and have a competive edge in justifying the 6% commission, besides holding open houses and puttting listings in the print media.

Just simply not that world anymore.

Realtor Burgers? It will also reduce the costs of school lunches. At long last, Realtors are worth something.

http://www.youtube.com/embed/H7wYECUvLE0

Another solution for too many Realtors. Send them to another planet.

http://www.youtube.com/embed/NIufLRpJYnI

Its still legal to sell a FSBO.

But if you try it.... only calls you will get are from:

1. realtors to get your listing - they teach you how to do this in re school
2. non realtors who are lowballer investors who want to buy it and then put it in the MLS where they get top dollar as a flip
3. both of the above in the same savvy agent/flipper so he can save on agent commissions when he sells his flips (these will mostly be chinese people for some reason)

There are about five people in the country right now looking to buy a FSBO. The rest get the 'free limosine service' from a buyers agent to looky loo all saturday and hobnob about granite counters with thier wife's bored housewife realtor friend she smoke pot with in high school.

anyway its hopeless you will only see current trends reinforcing 4eva.
Just get a RE license for $300 and shut up about it already.

PockyClipsNow says

The rest get the 'free limosine service' from a buyers agent to looky loo all saturday and hobnob about granite counters with thier wife's bored housewife realtor friend she smoke pot with in high school.

I've never had a Realtor drive me anywhere. The last one I worked with told me to drive around myself and if I see a house that I like, to call him and he will open it up for me. And for this he wanted his 3% commission.

Right here on Patrick.net!

Encourage, and inform people on FSBO, "For Sale By Owner"

Very popular during the bust in the 70's and 80's.

Identify, and recommend reliable Real Estate attorneys, to draft documents.

Just start a site, to helps people sell FSBO. :) It will work. Owner pays for package, package includes the professional photos, scheduled tours/open houses, standard contracts, maybe some deal with lenders... you just have to automate the tedium.

Most people only buy and sell a few times, like when they buy a car, so most owners just aren't prepared to deal with it themselves.

I think most sellers, just want someone else to do the dirty work of giving the tours.

Contract that out to vetted people like on RedFin, but I'm not sure how redfin works internally..

Ours site HomeByWeb.com is shelved. Beta version run by 3 years showed very limited interest between sellers, not buyers. In fact my recent finding showed that in New Zealand most homes are actually sold this way, without broker.

jvolstad says

PockyClipsNow says

The rest get the 'free limosine service' from a buyers agent to looky loo all saturday and hobnob about granite counters with thier wife's bored housewife realtor friend she smoke pot with in high school.

I've never had a Realtor drive me anywhere. The last one I worked with told me to drive around myself and if I see a house that I like, to call him and he will open it up for me. And for this he wanted his 3% commission.

Would you prefer that they take your email address and send you with tons of listings that are not relevant; simply because they are in your "price range?"

there are three elements to buying and selling a house. notice, appraisal and title. set up a website (of free listings) that is supported by the advertising of appraisers and title companies, contractors, title insurance, etc.

"picket fence" in vermont does very well in the burlington area where the money is.

Sunshine. Realtors, like vampires, shun the day and thrive in darkness. If you can find a way to show how much realtors make per year/transaction/hour actually worked, etc., then public outrage will take care of the rest.

This is the same strategy that is working against public unions. Once everyone found out how much the public pension payouts were, the fit hit the shan!

The other thing the realtors prefer, is that buyers never talk to sellers. Maybe, we could have a website the allows sellers and buyers to talk about existing properties. Maybe even have a offer/acceptance function with full disclosure of all bids? Wouldn't that be nice to know all the bids for both the buyer and the seller? We could call it House-bay, like the realestate version of E-bay.

APOCALYPSEFUCK is Shostakovich says

An economy based entirely on handjobs would be 100x more stable than the demented casino we have now.

You mean like this?:

http://www.theonion.com/video/prison-economy-spirals-as-price-of-pack-of-cigaret,14327/

jvolstad says

Realtor Burgers? It will also reduce the costs of school lunches. At long last, Realtors are worth something.

Soylent Green is Realtors!!

Best advise came from Porky.....
Take the steps necessary to get your RE license and work a transaction or two.

Not only will this site have a deeper dimension based on knowledge, but you'll have first crack at that house you've been waiting for, for how long?

Oh, you'll even be the one receiving the commission, after you've paid your national dues, state license, city license, board dues, franchise fee, errors and emissions insurance, brokers split, desk fee, federal income tax and state income tax.

Indeed, 6% does not happen much. I closed escrow a couple of weeks ago. Took 1.5% to make the deal happen. It was a multiple offer situation. The buyer was an out of towner, so extra work to take care of stuff for them. Current escrow is 2.5% on a total headache short sale with a 169K contract price. Making some money, but no big windfall.

I am not complaining. If I did not want the business, I can turn it down. Just saying for the time and effort that goes in, I would not call it easy money. I am a part timer and have a regular job so I try to provide the same level of service and take the deals that fall into my lap--easy or tough. What I have learned is there are very few easy deals. And more where after many hours put in, they blow up.

ptiemann says

the 6% commission is indeed outdated.

Especially in the higher priced areas like San Francisco Bay Area many properties get a total of 4.5% or 5%.

There are brokerages that advertise 'full service' for 1%. Here is one of them:

http://www.asanterealestate.com/

I dealt with them one time and I won't do it again. You get what you pay for. I would not give them a listing if they would work for 0.001%. Buy maybe other people are more lucky than me.

A few years ago the big banks tried to 'walmartize' the RE agents.

Currenty bofa,wells,etc are not legally allowed to own a RE brokerage directly. They could make a whole lot more selling all their foreclosures themselves, and everyone visits the bank often and that cute teller girl could ALSO help u sell or buy. It would destroy re agency the way it has been.

Guess what happened? The NAR lobby won by pumping millions into DC and getting the 100 million agents to contact thier representatives. You see this is democracy it means the organzied people with $ will always win. The people buying one house every 10 years have no lobby.

Google the campaign they did to 'keep the big banks out of real estate'. They won and so RE is still like it was 500 years ago - you to have contact someones bored trophy wife who is selling her kosher buthers house for him. (Consider RE industry part of the 'buy local' movement - those commissions stay local - if BofA sold them all it would be like going to best buy to buy or sell a house.

Its probably better this way, how else could savy locals game thier clueless neighbors into letting them double dip a pocket listing to an investor who will flip the house using the same agent (its a triple dip and totally common!). But that money goes to Mercedes dealer and the nail salon workers - all local.

Whose still paying a 6% commission to a realtor anymore in high-priced areas? I just got a flyer the other day with a realtor offering only a 2% commission in his sales pitch.

Real estate agents are in competition for very little business now.. (sales volume is still low). If i were selling, I would never take on an agent wanting more than 2% commission... They would have to get me a higher price than market value for me to consider 3%.

Everyone keeps warning out your automatically underwater when you buy because of 6% commissions during resale... Patrick has it is his calculator that way also... I think it's set to 7% actually.

But in reality, everything is negotiable... Now more than ever!

they advertise 2% but also they dont tell you you HAVE TO PAY 2.5% min to buyers agent or no one will chaufuer their buyer to your house.

2+2.5= 4.5%- pretty normal.

Obligatory:

wthrfrk80 says

Soylent Green is Realtors!!

Processing Realtors

http://www.youtube.com/embed/U-m4k6S-rKY

It is very simple, just DO NOT USE THEM. It isn't brain surgery.

And btw, this phrase "Being a developer, I would like to develop a platform to help out the little guys." gives me the creeps. If you mean computer developer I stand corrected, if you mean real estate developer it stands. You aren't clear.

I also wanted to mention off topic, this crap about "Insult Another User" Patrick you better review your map of NJ.

The answer is a graduated commission rate. On the first amount of X$ sale price is the 6% to cover brokers'actual cost and then it decreases, espiecally if it is a double dip and there is only one broker. A bonus is given, say of $500.00 or even 1% of the sale price if a full price (or percentage of sale price)offer comes in or what ever the seller can negotiate with the broker's agent(s).

Although now a days the realtors roll is even more important the commissions have got to come down.

Who agrees to 6% in this day and age? Seriously? 5% max; lower if you're much over $1mm.

The entire reason you can't disrupt this business model with a clever web site is the MLS. If you want to slurp MLS listings and repeat them on your site you have to play by their rules. There's a reason Craigslist doesn't have MLS listings on it.

The business model will continue to evolve. The commission rate is only going to come down because the internet has already dramatically reduced search costs from where they were 15-20 years ago.

Finally, you already don't have to use an agent as a BUYER if you don't want to. Rather than waste your time thinking some slick Ruby Duby is going to get you a better deal, brush up on your negotiating skills, find any half decent lawyer who knows RE transactions (I've found most who do small biz legal work have done a good amount of real estate), and go negotiate yourself. In CA this is easy to do.

There are really only 2 hard parts, both of which will require you be willing to sharpen your sales skill mojo: (1) the listing agent will be difficult to the point where you'll very likely have to figure out how to directly communicate with the seller to force them to put pressure back on their agent. (2) you have to sell-the-seller on a transaction where they lower their selling price to a level that cuts half the 5% (or apparently 6% from reading this thread) out of the agency fee in terms of total dollars, but leaves more gross $ in the pockets of the buyer & seller. Just solve the math backwards and you can get to the sweet spot. Again, you're proposing a deal that's better for the Seller, better for the Buyer, but worst for the agent. And it's only worse for the listing agent because they will be indignant about the fact half the potential commission will go back to buyer & seller ... odd given that normally they wouldn't be getting that anyway unless they worked both sides of the deal. But they will be losing face in the biz, so they won't like it.

I did this twice and ultimately decided I was simply tired of the intensity and drama required. I still use a RE lawyer to double check everything though. Always a good idea. You'd be surprised at what "oopsies" the agents leave in/out.

My husband wrote and owns a complete listing program and it is for sale. With it you can completely avoid the mls and the realtors.

APOCALYPSEFUCK is Shostakovich says

The NAR should be indicted under the Continuing Criminal Enterprise Act for advancing an enterprise based on fraud.

Broker fees should be limited to $25 per transaction, maybe a tip or a handjob if the seller or buyer is pleased and wants to bother.

The ones who got the short end of the stick were the workers who appraised the homes. Lots of them got the axe if they didn't comply by increasing the price of the homes. Maybe they should work with the banks and skip the middle-man (realtors). Association of Appraisers? How's that. Where's my 20%? teehee

How about a business that uses appraisers *and* someone to check the home for potential problems to alert future homeowners (bugs, roofs, appliances, walls, electrical wiring, etc.) so people won't buy so called "money pits". The financing can be done after the first two jobs are completed. The mortgage companies should have the same fees so homeowners don't have to shop around for the best interest rates (and avoid rip-offs). The company should also have CLEAR information so the fine-print information is spelled out more clearly. Former realtors can do the yard work. :)

Randy H

Well said, thanks

You can buy a house with one click from ebay buy it now.

A house sold to a corporation whose only asset is the house can then be purchased as a single share of stock on etrade with a $25 commission.

- in my perfect world

jan says

My husband wrote and owns a complete listing program and it is for sale. With it you can completely avoid the mls and the realtors.

Sight unseen I can tell you this is worth zero dollars. Sorry. MLS is a legal barrier, not a technical one.

The other part of this the Supra Key system. I hate paying dues to NAR, but plain MLS access with out Supra Key access makes working as an agent very difficult.

If we really want to change the system, lets force the use of an open exchange that RE agents must use for the submission of offers. If it is required that the sellers could login at any time and see all of the offers that have been submitted, it would remove a lot of the "shade" from the current situation of agents "loosing" offers until that nice double ender comes in and they tell the seller it is the best offer on the table.

Reader says

I also wanted to mention off topic, this crap about "Insult Another User" Patrick you better review your map of NJ.

I'm pretty sure Patrick didn't create that map.

All this fascination with the MLS makes me wonder if what causes a lot of the scum in the RE industry is understood.

The read side of the MLS is all over this Internet. Surly we know how to go to Redfin and look at listings. The write side can be had for cheap. Check out 4salemls.com.

But until you deal with the dirty issue of places like California allowing dual agency, scumbags will still have it easy. And just outlawing dual agency will not do much. Agents will still "lose" offers until that double ender comes in and just have another agent in the office write it up.

We need an open offer submission system so sellers are guaranteed to be able to see all the offers.

Fannie Mae knows about this problem and has built an offer submission system to try and deal with it. With this system in place, the agent is reduced to marketing the property and pushing the transaction through. No more f&*king with the offers and cherry picking the double ender or the one that offers up the kickback. The seller can now get the best price for the property and the buyer is able to buy in an open marketplace. Slime ball agents can now go and sell used cars at a pay here yard.

realestateinsidernews.com/foreclosure/fannie-mae-homepath-offer-system-update

I am all for getting ride of NAR. They have ruined enough lives with their "always a great time to buy" bulls(*t.

But I am all for keeping the minimal state licensing requirements in place for write access to the MLS or deal in RE for a fee. Take that away and the slime could be even thicker.

There are lazy people in all aspects of industry, you can't blame the entire industry because one guy wanted you to do some drive bys. Being a real estate agent is one of the toughest jobs you can have. Imagine going 6 months plus without making a single dollar, and then when someone cries about a 3% commission being too high, you'll just look at them and say, how much money have you made the past 6 months? How much stress have you dealt with? How many times have your customers called you at 9pm, and you realize that you NEVER HAVE A DAY OFF, and you NEVER HAVE A BREAK FROM WORK? We make big chunks at a time, because normally we make nothing, and we work 24/7 throughout the year, with the hope of having a vacation thrown in there somewhere, where maybe we're not answering the phone all day. Don't misunderstand me, I love my job. But, you clearly do not understand what this job entails, or you would not be so concerned about a measly 3%.

People just simply do not understand. That number that was derived for the commission we earn factors in all of the hours that we work for zero dollars. The majority of real estate agents are not rich, wealthy, snobs that just drive around in a beamer waiting for money to come in. The majority of real estate agents are not these slimy salesmen that fool people into buying houses that they cannot afford. The majority of real estate agents are making enough to just barely scrape by. So you may say, why should I pay more because everybody else fails to close a house? Because that's the nature of the business. You pay our salary, because the reality of the situation is that you need us. Yes, you can PAY for a real estate attorney, but they will cost you more than I will as a buyer, and as a seller they will not help you sell your home, they will not help you understand how the market works, or run comps, or deal with the assholes that put in stupid low ball offers, or deal with all the problems that arise with trying to sell your house.

Opening a few doors and telling people what a great time it is to buy a house is working?