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This happened to us, somewhat. We basically found the house ourselves and the process was streamlined enough that the agent barely needed to do anything except schedule dates like inspection, closing, etc. I know they are supposed to protect the buyer and make sure nothing fishy happens, and I’m sure they were doing that in the background (nothing bad happened overall), but boy was it one of the easiest commissions they probably got.
I kind of like having that layer of someone who knows what they’re doing. House purchasing and selling isn’t something we do often, so a knowledgeable person seems like a reasonable investment. Same reason you shouldn’t be your own lawyer.
I do have some qualms about how they get paid. The commission I pay my own agent doesn’t really even bother me that much, although they’re obviously incentivized to get us to buy the most expensive home we can afford. But the commission that the seller pays to the agent for the purchasers disturbs the hell out of me - it’s a pretty clear conflict of interest.
We had a “Buyers Agent” for our last purchase - this is someone that only does buying; they do not sell homes. The idea being there’s less conflict of interest because they’re not trying to sell you a home they have listed (the company he owned did not list homes at all). Great idea, but they still take the commission from the seller, so it’s not perfect. We worked with another agent from a different company for selling the old house.
Except in most instances it’s not the buyer who pays the commission it’s the seller…
well, only if we ignore the fact that this commission is embedded into the price
Texas just changed that.
It doesn’t change the fact they’re getting paid a ton for a comparatively small amount of work.
If you are selling one house, you are usually buying another.
That’s just playing a shell game. The one showing up with money is the buyer. Writing it down on a piece of paper that the money goes to the seller then the realtor doesn’t effectively change anything.
“How did you find this house?” Said to me by my realtor.
That was also before they called and said that there was someone else interested and I should raise my bid… I said to leave the price exactly where it was and still got the house
A good realtor is worth every penny you pay them and in addition buying or selling your home will:
- Listen to and help you manage your expectations.
- Make sure you get a knowledgeable and thorough home inspector.
- Keep you from getting the shit sued out of you for one of numerous mistakes.
- Make sure you fully understand the giant pile of paperwork you’ll be signing.
- Have O&E insurance so if they fuck up the paperwork, it’s on them and not you.
- Go to bat for you if you’re being discrimated against in any way by banks, buyers, sellers or landlords (all of which are rampant).
The problem is that a lot of realtors are good at “shaking hands and taking names” and terrible at everything else or they’re just plain unethical.
Source: wife is a realtor who tells me all kinds of “you’ll never believe the shit [other realtor] tried to pull today” stories.
- Make sure you get a knowledgeable and thorough home inspector.
You say that as if evaluating quality to decide which realtor to hire is any easier than evaluating quality to decide which home inspector to hire.
- Keep you from getting the shit sued out of you for one of numerous mistakes.
- Make sure you fully understand the giant pile of paperwork you’ll be signing.
These two are the job of a real-estate attorney, not a realtor.
I thought they were the same thing except realtors were a specific group you had to pay to be in and have a good record.
Realtors are a specific group of real estate agents. But real estate agents and real estate attorneys are entirely different things: the latter are lawyers while the former are not. Real estate agents are salespeople who search sales listings and give home tours and negotiate deals and whatnot. They have a duty to act in your interest, but they are not qualified or licensed to practice law.
My wife and I had a great realtor and she was worth every penny. Totally agree with this.
Thanks chatGPT.
Assuming this is in the US? Do you not have solicitors who do all the actual legal paperwork?
It’s a less used option. Most realtors have fill in the blank contracts that are generally ok. Real estate lawyers tend to be more expensive up front as you are likely paying 300+/hr to write up a contract. A realtor ultimately takes more, but it’s buried in the shuffle of buying a house.
I’ve never purchased a home but I imagine it’s hard to find a good realtor AND trust them. There may be tons of great realtors who are worth more than their commissions but the bad ones probably say the same things the great ones do AND have basically the same headshot.
I feel like I wouldn’t know if I had a good realtor until after the transaction, if at all, or until I’m fucked.
The only time I’ve used a realtor was to rent a house and I am pretty sure she worked with the listing agent to get me to agree to pay $100/mo more because there were other people wanting to sign for the house. Which, I feel dumb for but didn’t realize until later. But I’ll also never know if that was the case.
You’re absolutely right. You, the client, don’t get to see what goes on the backend so it’s often impossible to know up front who is going to represent your interests and who is going to be more interested in padding their own commission. Zillow reviews are basically useless because all it means is that the reviewer liked their realtor. That’s great and all but “likeability” and quality of work are not the same thing.
There was a lot of media speculation that the recent court case and settlement with the National Association of Realtors would bring commissions down and make terms more favorable, especially for sellers.
I don’t believe that has happened at all. In fact, it’s just helped make an industry known for its opaqueness and underhanded tactics even more opaque and underhanded. As usual, it’s the client who gets the shaft.
If you want to find a good realtor, or avoid a bad one, there are a few things you can do.
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Beware of realtors that aggressively push you toward certain vendors (banks, title companies, etc). If you’re looking at your third house and they’re now asking you for the fifth time if you’ve applied for a mortgage at a specific bank, that’s a red flag. Kickbacks are illegal in both banking and real estate. But some people like to treat those pesky laws like suggestions.
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Beware of dual agency in general, but especially Realtors that are very persistent about it. With dual agency, the same realtor represents the buyer and the seller. It’s not a guarantee that your realtor is going to do something unethical, but let’s be real. Collecting commission from both sides in a real estate transaction is a very clear conflict of interest. But it’s a conflict of interest that is considered acceptable as long as The buyer and seller both approve. You do not have to approve. But you may have to find another realtor depending on who your initial realtor was representing first.
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If a realtor has been in the business for a long time AND is willing to show you rentals, that’s actually a positive sign. Rentals pay shit. Around here if you get $300 - $400, that’s a good rental commission. As the agent you get to keep maybe half of that. Depends on what the split is with your broker. Agents who sell more can negotiate a better commission split. So the rental commission is dog shit and on top of that, landlords and property Management companies are notorious for trying to either weasel out paying the commission or they will drag their feet on it as long as possible.
As the agent, you could easily spend many many hours showing rentals and lose money doing it because rentals are not profitable for agents. Agents that are relatively new to the business will do rentals just to help build up their client portfolio. But if you get an agent who’s been in the business for a while, doesn’t try to pawn you off on another agent, and will take the time to actually show you rentals, they’re not doing it strictly for the money even if they do hope that you’ll remember them if If you ever need to buy a house.
- Call a few local title companies and see if you can get them to tell you what they think of the realtor that you’re considering working with. Title agents spend all day working with real estate agents and they’re the ones who know which agents are on their game and which ones are a shitshow. If you can get them to divulge anything, you may learn something valuable.
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- Its 100% yourself and an additional 4% for nothing.
- The Star Trek template is better
You need a good honest Realtor which is hard to find
What if I don’t need a single service from them?
But the predatory tactics locked my counterparty into signing an exclusive deal with them or (like in some cases) it’s literally the law up use a realtor?
my realators managed the contract and the back and forth there of including with the attorney somewhat. made sure all required things were done in relation to the loan. granted they did get to much in relation to the attorney to me but I liked who I had. hoooweee though I saw some bad ones on the other side of my transactions.
You spelled it out so I’m going to assume you say it that way. It’s realtors. Not realators. I hear people say this all the time and it drives me up the wall. I know I’m being a pedantic little shit.
This feels like a bad use for this meme. Or maybe my brain isn’t making a necessary connection somewhere.
Also sounds like you had a crappy realtor. If you’re using a realtor, get them to work for you, that’s what they’re for. Give them the specs of the house you’re looking for, sure, but they should be calling you with listings, vetting the homes before they show them to you, handling negotiation relays and inspection setups, etc.
Just general advice, yes you pay them, but if they aren’t working for you, pay someone else.
but if they aren’t working for you, pay someone else
My realtor was never on time to a single showing. He never knew the answer to any question without taking time to look it up himself. He couldn’t remember my specifications and his reading comprehension was non-existent as I had to repeat myself many, many times to get any kind of point across.
If I hadn’t gotten my house when I did, I would have dropped him. If I were any other kind of business owner and one of my employees acted like that people would think I was a fucking moron for keeping them on.
Your realtor is your employee. Don’t be afraid to fire them for shitty performance.
I, personally, used a flat fee realtor and pocketed commission (2.5%) that seller provided (minus flat fee), technically, saving ~2.1% of the home price. I’m just sick of realtors who are taking in total ~15 BILLION per year in Canada alone - ah how great it is to take % on market where average price is $650,000. It’s fucked up. They are not that helpful to pay so much.
15b without talking about the number of transactions is meaningless and prices wouldn’t be lower without agents as the person buying is still paying that price, they don’t care who the money goes to.
In an imaginary scenario, if I go to sell my house, and know that I’ve got a 400k loan to pay off and the house is worth around 400k, I’m going to factor in what I have to pay the agents and set it for 420k (assuming 2.5% for both selling and buying agents to split). I’m not going to be walking away from that still owing money to the bank.
The prices always factor in how much will be going to the agent(s). You will not accept a price that is below what you need.
You will sell for whatever buyers are ready to pay for it, buyers don’t need to know how much you’re losing to the agent, they want to know how much is coming out of their pockets and if they can afford the associated mortgage. People don’t sell their house to be charitable, they sell their house and try to maximize profit, if there’s less going to an agent it just means more going to the seller.
Hell, just look at the prices on direct sales vs with agents, people always overestimate the value of their property when selling by themselves.
You won’t sell at all if it doesn’t meet your minimum cash in pocket amount.
There’s certainly something to be said about the inflated price of homes. It used to be that when houses were $200-250, that 3% was a fairly reasonable fee for all the leg work a realtor should be doing (there’s a lot of backend paperwork done in the office). But I’ll agree now that houses are stupid expensive, it’s excessive. It’s also important to remember that the entire real estate industry is purely commission, no one gets paid unless houses sell (everyone from agents, transaction coordinators, title reps, escrow people, etc). My wife is an agent, and when houses aren’t selling, she isn’t making anything, and she works her ass off.
Only 2% where I live (Toronto) but that still works out to over 20k at the average house price. Realtors making bank.
When I bought a house it was just listed on Zillow and I told my agent to make an offer. First day of looking too and I lived across country. They took it and I saw it for the first time 4 months later. Got to get that rate!
The people who I know who are the dumbest have all at some point tried real estate
Sort of makes me wonder when my ex will get into it
I’m paying for the paperwork handling. My ADHD ass is not going through that without it.
I think that the commission should remain at exactly the same percentage but that they should be required by law to do an amount of work that represents it. Like take home the 20k on Monday but then spend Tuesday to Sunday working full time in whichever brothel gets assigned to you by the buyer. Or participating in concurrent human medical experiments or somesuch.
This meme is above my tax bracket
You’re eating too much avocado toast.
If we don’t start saying avocatoast, I’ma freak out
Another avocatoast advocate.
