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Real Estate: BIG changes

Bay Arean said:
It is so rare that something really big rocks the day-to-day. THe end of 6% commissions, among others, is huge. I have always thought this is what attracted so many to be Realtors. Not sure what happens next.

https://www.cnn.com/2024/03/15/economy/nar-realtor-commissions-settlement/index.html

Maybe they’ll start selling houses at Costco. JK, but really…..
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I guess an agreed upon fee up front rather than a percent?

Is it really harder to sell a $5 million property vs $2 million?

Six percent of those numbers are ridiculous in both cases; realtors simply don't work that hard so it has been highway robbery.

$300,000 and $120,000 commissions respectively in those scenarios where $50,000 would likely be far more than fair.

There will be less of them for sure but as I've never sold any RE and always been a buyer, doesn't affect me or anyone I know.

Well, other than the realtor that helped me find my three rentals almost 15 years ago.
 
+1 on the ridiculous commission.

Seller on the hook and being able to negotiate is huge.
 
Not sure if this applies to all brokerages, or only in NAR. A national realtor association?

This wasn't mentioned really in NORBAR (northbay realtors)

.ore info soon hopefully
 
Redfin finally got big enough to compete and now we’re all woke. Commissions have directly affected real estate and coincidentally prop tax forever, in a different way than interest rates. I would think the market for a 2M vs 5M in CA would be a different group. Prolly right about the 7%, but hope not.
 
My friend is a newer RE agent and she gets paid almost nothing, basically functions as a minion for a more senior agent. The whole biz is totally crooked and needs to move to a more transactional, ala-carte model
 
Commissions to realtors has always been negotiable. Anyone who doesn’t negotiate down is a fool.
 
Just an FYI...

"In 2023, the top lobbying spender in the United States was the U.S. Chamber of Commerce, with a total spending of 69.58 million U.S. dollars. The National Association of Realtors spent the second most that year, for a total of 52.4 million U.S. dollars."
 
mercurial said:
My friend is a newer RE agent and she gets paid almost nothing, basically functions as a minion for a more senior agent. The whole biz is totally crooked and needs to move to a more transactional, ala-carte model
Click to expand...

I've always been told that 20% of realtors make 80% of the income. I've never sold real estate but I've been in real estate lending for many years. From what I've seen in order to gain any traction when new you have to sell your soul - holding open houses on Saturdays and Sundays and having to skip family events, paying for signs on grocery shopping carts, bus benches and billboards, making yourself available 24/7 for phone calls/emails/texts.

Then you finally get a buyer who's a crumb off the table of one of the senior guys, someone who filed BK last year and barely has any down payment money.
Or you finally get a listing but the house is a mess and the homeowner is impossible to work with and won't accept any offers.
 
This opens the industry up to the use of Bird Doggers, does it not?
 
greenmonster said:
I've always been told that 20% of realtors make 80% of the income. I've never sold real estate but I've been in real estate lending for many years. From what I've seen in order to gain any traction when new you have to sell your soul - holding open houses on Saturdays and Sundays and having to skip family events, paying for signs on grocery shopping carts, bus benches and billboards, making yourself available 24/7 for phone calls/emails/texts.
Click to expand...

It was kind of funny.

When I was selling my house, and it was a rough sale process, some guy called up and proposed that he should be the selling agent. Fire the team we had. We sign with him, we'd sell it in a week. He was special. He was the guy.

Obviously, I already knew what hoops our agents were jumping through (and it was pretty legion).

I told him. "If you want to sell my house, bring me a buyer."

He hung up.

Maybe he planned to put one of those big inflatable gorillas on the roof.
 
Bay Arean said:
It is so rare that something really big rocks the day-to-day. THe end of 6% commissions, among others, is huge. I have always thought this is what attracted so many to be Realtors. Not sure what happens next.

https://www.cnn.com/2024/03/15/economy/nar-realtor-commissions-settlement/index.html

Maybe they’ll start selling houses at Costco. JK, but really…..
Click to expand...

5% is more regular here in California- split between the listing agent and the buyer's agent.

I dont expect much change in Real Estate besides more carefully worded contracts.
 
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berth said:
It was kind of funny.

When I was selling my house, and it was a rough sale process, some guy called up and proposed that he should be the selling agent. Fire the team we had. We sign with him, we'd sell it in a week. He was special. He was the guy.

Obviously, I already knew what hoops our agents were jumping through (and it was pretty legion).

I told him. "If you want to sell my house, bring me a buyer."

He hung up.

Maybe he planned to put one of those big inflatable gorillas on the roof.
Click to expand...

That guy could lose his license that way. Big no-no.
 
We've sold several rentals and never paid full commission! A realtors number one goal is to get a listing, then get it sold fast as possible. We just negotiated a lower commision. 6% is ridiculous in a hot market with crazy home prices. Might be diffrent in depressed markets with lower home prices!
 
ST Guy said:
Commissions to realtors has always been negotiable. Anyone who doesn’t negotiate down is a fool.
Click to expand...

Well call me a fool. I have always tried to be comprehensive when financing and re-financing etc. Never paid mortgage insurance, never had an impound account. But I thought the 6% was inviolate.

Always something to learn. That they bothered to announce it is something? Maybe?
 
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I have a south bay friend who uses the same buyer's real estate agent for multiple purchases, the agent would suck up the entire 3% commission and then return 1.5% to buyer as a rebate.

So the old scheme was actually a backdoor discounting mechanism for some savvy buyers.
 
greenmonster said:
Then you finally get a buyer who's a crumb off the table of one of the senior guys, someone who filed BK last year and barely has any down payment money.
Click to expand...

In the case of my friend, she brought several buyers that basically came from her network, and she still had to give 2/3 of the commission to her senior partner.
 
mercurial said:
My friend is a newer RE agent and she gets paid almost nothing, basically functions as a minion for a more senior agent. The whole biz is totally crooked and needs to move to a more transactional, ala-carte model
Click to expand...

I have always felt it was a slimy industry. When every C/D student from high school ran out to get their real estate license as a side hustle, It sorta confirmed my gut feeling. :laughing
 
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