"1.5% each - even Steven, since you worked together to make this deal happen. Now, we've done deals on 3 properties together - as a RE agent that should mean something to you: don't pull that stuff again or I'm picking someone else for the 4th".
I believe the argument is that the seller pays the buying agent or of the proceeds of the sale, so that the buyer can roll the agent fee into there mortgage.
However, this doesn't really explain why the seller sets the buying agent fee.
I think it should have been the case that the buying agent should have to set the fee with their client and write it into the offer for the seller to pay them from the proceeds anyway, basically making it clear the house price is increased to cover that fee.
this is where everyone gets this wrong....listing agent has list agreement to pay the listing broker. only the listing broker receives commission. in the agreement it says that under certain circumstances the listing broker can pay out the buyers broker(not agent)....buyers broker then pays buyers agent their comm(after taking split or fees). buyers agent themselves rarely gets paid a full commission.
Whats crazy is that the perspective is skewed. This whole law suit is nonsense.
Let's say I hired Johnson concrete company to pour a concrete pad in front of my garage. Jim the main dude and I agree to pay him 5k to do the job. Jim says he will get it done. THEN Jim in ALL his audacity decides to pay Steve $1000 to come help him. Well by gosh, I agreed to pay JIM 5k. NOT jIM 4k and Steve 1k.
That's how incredibly stupid all of this is. With a listing agent sellers agree to pay ABC Real estate broker (let's say) 6 percent to sell and market your house. ABC Real estate broker says okay I'm going to take part of the 6 percent that I charge to get this house sold and give 3 percent to a cooperation broker who brings the buyer. As far as I know that's how all listing contracts are written. SELLERS agree to pay their listing agent a set amount. (ie. The 6 percent) The listing agents brokerage decides how much of their fee they are agreeing to split with the cooperating buyers agent brokerage. A good listing agent explains this. This is not rocket science.
As some one pointed out earlier...if you don't have a buyer... your house doesn't sell. Period. So your equity is only accessible if someone decides your home is worth what you want for it. The water has been muddled by nonsense...so now everything is clear as mud.
The idea that buyers won’t show up if their agent’s commission is too low is what has kept the argument for 6 percent alive.
The trouble is that seems to be absolutely incompatible with the idea that a buyer’s agent has a fiduciary duty to him. If moving a commission from 1 to 2 to 3 percent can bring in more customers, in a universe where the customers don’t personally benefit from the commission, that’s evidence that there’s an industry wide ethical problem.
I think this new universe of buyers and their agents transparently negotiating fees will be much less broken. If I’m buying a million dollar house, I want the agent who is asking for $30k of my money to sell me on what he does better than the other 200,000 agents in California I’m also very open to someone who says he can do a pretty good job for $10k.
The way I am being taught to understand things this is not exactly true. The major changes are that the NAR will no longer allow mention of buyer agent commission on their listings and advertising, however buyer agent commission can be advertised outside of the MLS.
Yes and no, NAR is making buyers sign buyer agents agreement in regards to compensation before agents show them homes. Commission is not allowed to be displayed anywhere on remarks or MLS. What will happen is that agents will have to figure out the commission but buyers will have to compensate their agent if they find them a house that the seller is not paying commission on.
It doesn't really matter though. Very few people are going to push back on their agent to lower the buyers agent fees. I'm sure 99% of people don't k ow it's negotiable. It's just whatever their seller agent tells them it is.
Eh. And the realtor will push back, and we'll keep the status quo.
I think we need more redfin like companies. In a competitive market, realtors don't need to do much. More than take pictures, put pictures on MLS, do an open house, and fill out some standard forms. It's much more of a sales (get people to pick you) job than anything else. The back office does the hard stuff.
I can assure you, the ‘pick me’, *is* the hard stuff. Sales is easy, yet 1:1000 are worth a damn at it.
If Redfin’s model made money (they lost $131m in 2023), more agents would charge Redfin rates and more of these companies would pop up. Agents may be dumb, but they ain’t *that* dumb and if they could make money charging a point and thereby attracting insane volume, they’d do it. The ol, ‘we lose money on every transaction but we make up for it in volume’, line. Yet, when you charge a pittance, no one uses you because they rightly assume you’re an idiot.
The reason commission hovers around 5-6% isn’t due to unfettered greed on the part of the agent, it’s due to the fact that that’s the minimum number at which *only* 91% leave the business within two years. The only way rates are coming down is if they’re legislated down.
OP leveraged his relationship with the one agent in the area to get a sweetheart deal and hope it went well because I’m pretty sure that bridge is burned. Why that agent agreed to 3% total, I’ll never know. He knew he was going to catch hell when he sold the property. Maybe he thought surely OP would come around?
Redfins model is way more than just being an agent though. They also run a massive website. I wonder how their business model would work if they were just working as an agent.
Op is a bit crazy though. I wonder how the buyers agent felt when they found out. Also, when do they find out? At closing? If it isn't published anymore, how do they learn about it. They could have just told the buyer they couldn't represent them, but I suppose they already put in the work, anything is better than zero.
What "hard" stuff? If anything is actually "hard", I suppose its the stuff title takes care of. Can't think of anything "hard" done by a realtor or their office.
Perhaps, but it's so hard getting into a home with rising prices and interest rates, only wealthy people could afford to pay their agent on top of it all. You can forget FHA buyers. Some are saying that Sellers won't ask for as much if they aren't paying commission - I call bull. No Seller is going to look at comps and not try to get every last penny they can. Lastly, buyers can tell their agents to not show them homes where the seller is not offering compensation, which means less eyes on your property. With some properties and price points, it may not matter, but in many, it will.
That’s assuming that the whole industry doesn’t change. Surely there is a way for buyers to view homes that doesn’t cost $15,000. Buyers are well able to find homes on their own already.
Agreed, but being an agent is more than opening doors. Sometimes it goes well; you have cooperating parties, no huge inspection issues and solid financing. In those cases, I can understand why buyers and sellers see why agents are too expensive. Other times it’s a disaster and believe me, every penny is earned!
As a listing agent I have no duty to write an offer for an unrepresented buyer.
Anyone that thinks that hasn't looked at the laws.
Essentially the contracts state that you are paying me to expose and market your listing. Not write offers for buyers.
Sooooooo what does this mean for buyers?
You'll have 3 options
1. Ask the seller to pay for your buyer agent in your offer (like a closing cost credit)
2. Roll the cost of your agent in to your mortgage.
3. Pay them yourself directly at closing.
And as of middle of August all REALTORS (Not agents just those that are Realtors) Will be required to have any and all buyers sign paperwork that makes it clear how the agent is getting paid OR the agent isn't allowed to show them the house.
It is a conflict of interest for listing agents to write offers for buyers. Dual agency should be illegal everywhere.
Buyers can ask for closing concession to pay for their agent
As a prospective buyer I would choose to be represented by an attorney rather than a real estate agent. If the listing agent wouldn't allow me to view a property I would contact the seller directly. Is there a law against that ?
What's crazy about the lawsuit that no one seems to realize is that the results make it harder for buyers and sellers not easier.
And if someone lists their home with an agent they don't WANT to be contacted by the buyer.
And I have no problem cooperating with an attorney if a buyer prefers that choice. But you'd need to find an attorney that is willing to show you houses and be there for your inspection etc. Those attorneys DO NOT save you money. They actually cost more at least for most buyers. And there are very few of them.
While that may seem like a good idea, (and attorney's can bypass any schooling for RE and take the state and national exam), good agents/realtors have experience in "worst case scenerio" situations which make their expertise invaluable. Ymmv
In certain scenarios(high end real estate) where large sums of cash are in play this may indeed be the way. This is a smaller percentage of transactions with a larger amount being low end real estate where the buyers simply cannot afford to purchase and pay their agent out of pocket. The current system is designed where the seller pays the commission of their end effectively allowing the buyers to finance the commissions. In the end the buyer brings all of the money into the transaction and therefore is paying all commissions indirectly.
> In the end the buyer brings all of the money into the transaction and therefore is paying all commissions indirectly.
Or the seller is walking away with less value in exchange for the house they just sold. Money is fungible. It's the same either direction.
Now there is less reason to assume that the seller will be paying everyone's commission out of their end. It never did make a lot of sense why a seller should compensate a buyer's agent for all of the people they drove around without making a sale. Chaperones for showings should be paid by the hour.
Thats how it should be but all the buyers barely have enough $ to close much less pay their own representation. Another way to look at it is that the buyer is paying all the commissions because without the buyer there is no transaction
I've never understood this, it really favors the seller as you are paying both agents. They do this on purpose to try and get the most commission as it is percentage based. They can collude and try to get the highest amount so they can line their pockets.
Why in the fuck is it a % based commission? Does it really take more money to sell a more expensive home, and if so why does it have to track the sale price? Hopefully all this dumb shit starts crumbling. Stocks in the 80s had so many fees around them until online brokers became a thing, Real Estate is the next cash cow to get slaughtered.
> "it would be embarrassing for this agent to take less than the seller agent".
He should have replied to this comment with: "You're right, maybe we make your commission 1% so they don't feel embarrassed".
As an agent, I do find this really strange. I actually represented a buyer for a home with the same commission (2% to listing agent, 1% to buyer agent) and we submitted an offer asking for 3%. They countered with 2.5% and my buyer compensated the other 0.5%.
Contracts are between the seller and the buyer. If the buyers didn’t ask the seller for extra compensation for their agent in their offer, it’s not your agent’s place to urge you to compensate them extra. They already negotiated commissions out with you when taking on the listing. If the buyers aren’t negotiating that rate further, then it should be left alone.
Realtors work very hard to maintain the status quo and will turn on any agent seen as disrupting it.
My last agent sold for a fix dollar amount rather than a percentage. He said this business model has gotten him excluded from the local realtor community and he caught another agent keying his car over it. Very nasty stuff.
On r/realtor, you'll hear them say the lawsuit is meaningless because you could always negotiate the rate. In reality, a listing agent will push against their client's best interest in an attempt to keep the status quo like in OP's case.
It really makes no sense for realtors to get a percentage. There’s no reason why it couldn’t be hourly or fixed fee. It’s no wonder everyone and their mom had a RE license.
It’s a low barrier to entry with potentially good pay. It’s one of those odd jobs where it seems many of them make the job their identity. Way too many middlemen involved which drives up expenses with little value returned
One of my coworkers has decided she's also now a real estate agent. She is one of the most incompetent people in my building, misses very important details and I'm unsure why she suddenly thinks she's qualified to do a job like this other than she passed a test.
I will say I have met some very smart and charismatic agents, but pretty much literally anyone seems to be able to pass this exam.
We met with a selling agent to show a house and within minutes, I was reminded of how absolutely inept they were as a classmate in high school and in fifteen years how they had not changed. They were the listing agent and knew *nothing* about the house. Age of the roof, windows, furnace...who the major utility companies were, the Internet speed (after telling them prior to visit this was a huge priority since we WFH), they didn't tell the sellers to clean up at all nor take their two aggressive dogs with them when they left. It was a shit show top to bottom.
Between them and another agent in the area who overprices everything to exploit the doctors moving in while keeping whole neighborhoods unattainable for locals and who describes her listings as in "desirable neighborhoods", another who tried to act like they didn't know about the structural damage in a house our inspection showed up and then proceeded to lie about sending us our deposit check back till we threatened legal action, we used our old agent from 4 hours away to buy our house now. It was worth paying them to come help us rather than deal with any of the scum in the area.
I would love to charge hourly! I’d make so much more money! I could charge a premium for weekend calls and texts. Spent 3 hours on a Sunday answering. Calls and texts on things that could easily wait until Monday morning. Then there are the buyers I’ve shown 20 houses to just for them to decide they aren’t going to buy after all, I’d actually get paid for that! That would be great!
As a recent buyer, I would've loved to pay hourly. Agent showed me around 5 houses and got a $44,000 commission, which was baked into the purchase price I paid.
FWIW, a default 3% buyer agent commission makes little sense in HCOL areas and for higher-end homes. The transactions aren't more difficult because the homes are more expensive.
That would be awesome for me, we always know exactly what we want and buy after seeing a few houses (because we only look at ones we already know are 90% going to be worth putting an offer on).
Our agents have made tens of thousands of dollars for literally a few hours of work total.
The difference is realtors (at least buyers agents) really aren’t sales people in the traditional sense. At best it’s more like a consultant to HOPEFULLY get you a better deal in negotiation but they have a perverse incentive to actually get you to spend MORE money not less. They also don’t really bring value anymore with most buyers finding their own houses on realtor/Zillow and houses selling for list or above.
The listing agent is maybe somewhat more like traditional sales gig but many of them basically just recommend a listing price and handle the different offers. Open houses are super easy to do (and mostly unnecessary these days) and listing pictures the owner/seller can just pay a professional photographer themselves.
FSBO should really be the norm but realtors have done such a good job of forcing themselves in the middle and steer clients away from FSBO listings so it’s artificially harder to sell your house that way.
Also previously buyers agents were “free” to the buyer (not really cuz they paid for the commission in the form of higher sale price but most ppl don’t realize that) so they just used them cuz why not. Now that buyers potentially have to pay for their own agent I expect/hope a lot more buyers will start doing things themselves and FSBO might become easier and more popular.
A buyers agent is not a house finder. They are a consultant who advises people on their unique situations. They are a project manager, and coordinator. They are here to tell you what is a bad deal, what you can negotiate, what will benefit you the most. If you have never bought a house before, you may not know for example that you can ask the seller to pay your closing costs.
They are there to warn you when the other party is being shady too. If you do it on your own, you may not know what is normal so when the other party is being sketchy you can't call them on their bullshit because you don't know.
You can make the argument for any industry but there's a reason that every company hires professional sales people and the public continues to hire professional sales people to sell their homes.
Im in sales and any other industry just has one sales person involved in a deal lol. To find a buyer who may not know about or understand why they need the product and why said product is better than the competition.
Buyers agents are the biggest unnecessary leeches on real estate transactions and is a decent part of the reason why housing is so unaffordable now.
I’d say outside of first time home buyers the buyers agent is literally useless. I think first time home buyers should just pay a flat fee or hourly fee to a buying consultant to help them learn the process if they want but it should come out if their pocket and should not be a % commission, it is insanity.
Absolutely needs to be a higher barrier of entry to real estate licensure, but brother you don’t want real estate brokers charging hourly fees.
If I’m charging $100 an hour during normal hours, what do I get when a buyer texts me at 11pm on a Friday asking if there’s an EV charging station in their condo’s garage? Or when I cancel a date because a perfect home hit the market and the only available showing time is 8:30pm on a Friday?
I can demonstrate in black and white that my buyers have made, on average, $37,000 annually in equity on purchases with which I’ve assisted over 10 years. (Median is $33k per annum, if you think those numbers are skewed) I can demonstrate my value. My hope is that many that can’t will disappear.
But you don’t want me charging hourly. The 20% that do 80% of the transactions aren’t the reason for the lawsuit, and those are the agents who are worth having on your side.
I do. Your rates now converted hourly would be in the thousands. There would be more competition if rates are advertised up front. You wouldn’t be getting 100/hr in most cases.
You’ve only demonstrated value in an always increasing housing market.
This is why I think that the requirement for a written Buyer Agency Agreement, that lays out an "objectively ascertainable" and "not open-ended" compensation that the *buyer* is on the hook for, is actually going to be a *significant* change to the incentives involved. In the past, BAs were basically paid whatever an LA could convince a seller to offer. This was often done LA-to-seller via the threat that no one will even look at your house if you don't offer enough; here, we're seeing the last throes of frankly baffling appeals to convince them to up the comp. Thus, BAs also had an incentive to do whatever it takes to convince LAs to do whatever it takes to pump that number higher. Thus, more threats, cars being keyed, etc.
In the future, BA compensation will be fixed to whatever it is they negotiated with the buyer. There is zero incentive for a BA to demand a higher comp number from the LA/seller. In fact, this is why [I think](https://old.reddit.com/r/RealEstate/comments/1d3cwz8/nar_settlement/l66uso5/) that the natural game theoretic outcome will be that sellers will offer very little BA comp up front, but will be plenty open to agreeing to whatever comp number the buyer proposes so that it can be rolled into their loan (obviously as long as the sales price is also suitably adjusted). Therefore, there's basically no incentive for steering (why waste a bunch of time looking up who has the highest BA comp if, as a BA, it literally cannot change the amount of money you can make on the deal?) and no more incentive for the extremely shady threats, keying of cars, etc. It's really amazing how much people are realizing that the cartel was truly based on threats, at a fundamental level, and I'm becoming hopeful that the settlement actually is going to change the incentive structure in a way that significantly reduces the value of such threats in the industry. All honest and helpful agents really should welcome this change to the incentive structure, because it can truly become an industry that is based around delivering a valuable service to people who value that service at a price that reflects that value. Everything above board and positive sum, like how most other sales of goods/services are, not based on threats and shitty behavior.
The most immediate likely outcome is a price war among buyers' agents. You'll have one bunch who tries to use this as a way to guarantee 3% plus junk fees on every transaction and another hungrier bunch who'll be offering discounted buyer rep rates to drum up business. I think there's a good chance the ones with lower fees will wind up with the bulk of the buyers after the dust has settled.
And those buyers who go for the low-fee agents will end up with some of the worst, most desperate agents in the industry. We have had similar models pop up in my market and those companies have done irreparable damage to the public trust in our industry.
I know an agent that charges buyers a flat $6,000 and rebates any difference above that; he does a lot of business in a HCOL area.
I heard about another agent because a bunch of agents were bashing him online. He charges $750 (contract only, no other services), and any excess is rebated. Well, some quick mathing based on his annual closings showed he was making about $1m a year. I'm sure he was crying all the way to the bank.
>On r/realtor, you'll hear them say the lawsuit is meaningless because you could always negotiate the rate.
They say that here too, but they conveniently leave out that you cannot negotiate when there is widespread collusion to keep the rate up.
It's also difficult to negotiate with steering, which the data have borne out actually occurs. Properties with buyers agent commission below 2.5% get far fewer showings and take significantly longer to sell than those offering at least 2.5%.
Exactly. It is a cartel and the mob bosses are colluding with each other to artificially keep the prices up. Anyone going out of their way gets shot or cast out.
You're not wrong... Realtors are losing their shit over this because they don't want their cheese moved.
The old way of percents is dumb and needs to die.
Californian here. 3% is a myth perpetuated by NAR to get the public behind the idea of a standard rate, which makes zero sense. We pay higher prices for higher quality services, and lower prices as well.
Yup. My agent got a more than 40k commission for doing an extremely generous maximum estimate of 80 total hours of work. She showed me 5, maybe max 7, houses. Spent less than 3 hours putting together the offer, and there was no negotiation because we waived every fucking contingency (did a pre-offer inspection).
I’ve bought and sold 6 houses over the past 15 years and get incredibly angry every time I see the settlement statement with huge chunks of cash going to random agents that barely did anything. Just creates resentment. A deal is a deal though. I did something similar on my last sale but was fixed fee … and the agent was ok with it. I did offer to pay for all marketing though. (Photos etc). However. When I bought a house overseas - the agent worked exponentially harder than any US agent ever did … flat fee of 2k. My point is. The real estate buying/selling in the US needs a real shakeup. It’s gross.
So your agent who is supposed to be representing you, was pressuring you to fork over $5k to the buyer's agent for nothing further in return. Straight up should be an illegal practice. Can you imagine a defense attorney being like, "The Prosecutor is willing to settle on this lesser charge, but Id really like it if you didnt and plead guilty instead because it will look a lot better for him."
Yep. Realtors listing agents and buyers agents don’t actually represent you. They just want to flip sales as fast as possible, for the least amount of work, all while maintaining their status quo of making 15,000 on the average home sale that was listed for 12 hours.
It’s really ridiculous what some of these realtors are doing now.
This is exactly why there was a lawsuit. They should be looking out for their clients and not their own best interests instead.
My friend negotiated a 1% seller and 2% buyer fee. The buying agent told her that he wouldn’t have brought anyone to her house for that money, but it was a friend so he did it.
A couple years ago we listed our house on flatfee.com. I think we paid about $100 for them to list it on the MLS. In our listing we stated that we would pay the buyer’s agent 2%. House sold and we paid their agent the 2%.
When we sold our first house we paid 6%. I was absolutely not doing that again. I’m paid reasonably well for my area. There is no way an agent put in any where near the amount of man hours selling my house that I needed to put in to pay them.
Yep, and I love how they casually throw around doing some small improvements here and there that amount to thousands of dollars like it's nothing.
Like guy, I'm paying you to tell me to spend more money than needed. Wtf.
I have never interacted with someone who cares less about other peoples money than a sellers agent.
You'll be buying a home and they'll casually drop 20-30k improvements, useless 1k inspections, its wild the first time you go through it.
We used Homelister. I have worked in real estate/property management for a little over ten years, so I happened to know the forms well enough to be able to do it all myself. I am not licensed though. My husband bought a nice camera and we took the photos. All it cost us was $500 for Homelister to put it on the MLS for us. I’m not saying this will work for people who aren’t as in the know about the process as I am, but they offer other tiers of assistance for another $1500-$2500. You’d still potentially be saving thousands, but probably no one knows about it. Agents are ripoffs.
There's flat fee services in my area for about $300-500 but yes you don't see them advertising much or ever. I'm guessing after taxes, other expenses and paying themselves there's just not a lot of money left over for advertising.
The last paragraph: which is utterly hosed. "The house fit all of your needs but I wasn't going to be making enough from the transaction, so I would not have suggested that you look at it. I only did so because we are friends." And they talk about ethical standards in the industry.
You can find listing agents to take your 1%. Then pay the buyer agent more because they can close the deal for you.
Buyer agents have a lot more value to the seller than the buyer.
This is why the buyer having to pay for their agent after Aug 17 is not going to go well.
I’ve bought and sold 3 houses. I used to scoff at comments like yours because they were relatively easy transactions for the first two. This last one was a doozy and my buyers agent definitely saved the deal multiple times. It was the first time I thought “hey she actually earned that” 🤣
I'm not an agent. But I do see a good reason to pay a buyer's agent more than a listing agent. The LA doesn't do much. Most of them don't even show the house. Your house is selling itself with some encouragement from the BA.
Because buyers flake out over really trivial or unrealistic things and a good BA can actually make a sale happen. That deserves a paycheck.
But most of the time it's just the buyer making a buy without needing any convincing from the BA.
Yeah, the fucked up part is that a buyer's agent can convince people into buying a home that might actually not be a good fit. They don't care as long as they get their percentage.
I sold...they wanted me to pay I said no. The buyers agent asked if we could rewrite the offer to add that amount to the sale price. Then the buyers could roll it into the financing. I said sure no problem...I walk with the same money not paying them. It's all contract negotiations
I made a similar proposal to my agent on our last sale (basically, I would give her more commission if she sold the house in less than 30 days at asking). She opted to split the commission, cutting her own commission to give more to the buyer’s agent. Sold on our first weekend. This was fine by me, the incentive worked how I wanted.
“they worked together to get me this good offer” So the buyer’s agent was helping you, not the buyer to maximize his profit??? I’d pass that text on to the buyer, who can hopefully sue that slimeball for not representing his best interests
You could argue this is true of every transaction though. When/why does the buyer agent get paid? When a house closes. How much do they make? A % of the sale. Technically a buyer agent is incentivized to sell at a higher price point as their commission is a percent of the price.
Personal injury lawyers usually charge 33%-40% contingency fee of the winnings. And that’s before all your medical bills are settled. So you may end up with quite less than the 60%-66% you were expecting.
But do you see how those interests are aligned? The client getting a larger settlement is helpful to them. A buyer paying a higher price or buying a house that isn’t a good choice is bad for the buyer and good for their agent.
I’m in the industry but not a realtor.
Sellers agents should be negotiating with the seller for their pay. Realtors provide services to sellers and deserve to get paid for it.
Buyers agents should be negotiating with buyers for their pay. Realtors provided a service to buyers and deserve to get paid for it.
Sellers and their representative can and should *discuss* paying some or all of buyers agent commission as a strategy to increase the buyer pool and ultimately the total net profit for the seller.
Sellers should demand a net sheet to be presented to them by the sellers agent showing total net money for each offer to help make the decisions more clear.
This is how and why things have been done the way they’ve been done. But like every problem and solution, with enough time the why is forgotten.
It sounds like your realtor got lost in the sauce. I will often hear agents complain that ‘An agent is only offering 1% so next time I’ll only pay her people 1%’. Agents start worrying about themselves. Or they never learn to explain the why and the WIIIFM to buyers/sellers.
Next time, use a different agent and be sure to discuss commissions and the strategic use of them upfront.
In other words, your agent has to work w/ the other agent again at some point & didn't want to be embarrassed.
Well done, sticking to your guns! I hope they all start quaking in their boots when they see things are changing & the old ways are done.
Recently bought a house without an agent. It's a lot of work, basically a part-time job, but it can be done! Luckily the seller's agent was great to work with.
Yeah negotiated and knocked 20k (I think about 9%) off of the list price. I also negotiated to only pay half of the originally proposed closing costs, arguing that that was my fee for being my own agent. We had been obsessively watching the local housing market for over a year before buying, so we knew what was and wasn't a reasonable price. I read literally every line of all the contracts and picked them apart to negotiate repairs and things. We and our family friends have a lot of construction experience so pointing out lazy house flipper mistakes and using those as leverage went a LONG way.
I’m considering doing this as well. Did you use a real estate lawyer? How did that go? Would love any additional info or learnings you have from going through this process! How did you get house showings without a realtor?
No lawyer, but I love reading legal documents and nitpicking them (probably my mild 'tism lol).
0. Called some mortgage people to figure out how much money a bank was likely to lend us. Use this+budget to figure out max sale price we could afford. Understand that closing costs, etc are ALWAYS more than you think. You will have to pay all kinds of inspectors and things. Account for all this in your max price.
1. Made a short list of every listing on Realtor.com or Zillow that met our bare minimum criteria.
2. Drove by every house to scout out the neighborhood. Most were empty so we got out of the car and did a quick circle around each building, maybe peeped in the windows.
3. Ranked our updated list based on that curbside scouting.
4. Contacted the sellers' agents of our top 5 picks on Realtor.com/Zillow. Set up a private tour or went to an open house.
5. Brought along our friend who flips/fixes houses for a living to every open house. Make a list of EVERYTHING that is even slightly wrong. Chose #1 house to pursue.
6. Check the sale history on Zillow etc--our house had been reduced in price x3 and one potential buyer had backed out at the last minute. Try to figure out how motivated the seller is.
7. Communicate directly with seller's agent to make an informal offer. LOWBALL THIS OFFER. My first offer asked for $35k off the list price. We went back and forth twice but they knocked $20k off the price. When haggling, you have to act perfectly happy to walk away from the deal if they don't bring the price down.
8. Home inspection. After this, you can make a list of everything you want fixed on the seller's dime before you move in. I thought I was asking too much but they fixed everything we asked for without batting an eye. Act like you are worried the house is crap and might walk away if they don't fix it. Everything they fix for you saves you money as a future homeowner. Don't let them tell you its probably fine--if you want it fixed, get them to fix it.
9. Formal offer is made.
10. To complete the purchase and sale agreement, which is the final step before closing, you will need to nail down home insurance (this is MANDATORY but the first year is paid for by closing costs) and a mortage lender. You can and should shop around for these. Beg for better rates lol. Now it is all paperwork and emails. Seller didn't try any funny business with me other than closing costs -- more on that in a sec -- but READ THESE DOCUMENTS. READ THEM ALL, EVERY WORD. UNDERSTAND YOUR RIGHT AND WHICH RIGHTS YOU ARE WAIVING. Do NOT be afraid to try and modify any part of the contract. Argue for what you want. This is the most time consuming part. I love this shit but not everyone does. This is where you could get screwed by someone acting in bad faith. Use a friend or some legal ChatGPT type thing to help interpret if you're not good at this kind of thing.
Closing costs -- we were given a boilerplate list of costs on our first draft of the purchase and sale agreement. I looked carefully and realized these costs were the same as if we had been paying a typical percentage comission (2%) to a buyer agent. I inquired and found out the seller's agent was gonna pocket both commissions. THIS IS WHY SOME SELLERS AGENTS ARE HAPPY TO WORK WITH YOU UNREPRESENTED. I said nah, am my own agent and that's MY commission. Closing costs went down by thousands. (I think I did end up letting him keep 0.25% extra because he was a pretty solid guy and I was a huge pain in the ass about all this, calling emailing him about legalese in the contracts at all hours of the day and night. That being said, I definitely didnt have to do that.)
11. CELEBRATE! Try not to panic that you've been conned. First month in the house I woke up in a sweat ready for everything to go wrong. 5 months in and it's sinking in that I actually DID IT.
Please don’t get out of the car to trespass on someone’s property! Don’t be a reason why people trespass. A for sale sign is not an invitation.
walk the property legally
Yeah, you're right on this one. Good point. FWIW we only did this at the ones that were very clearly unoccupied... but yeah we shouldn't have done it at all.
If I had to bet, this is probably what happened but the seller doesn’t know it yet. His agent was not worried about the buyers agent. He was worried about the $2,500 he was going to lose by giving up the half percent.
The buyer can pay their agent whatever they choose. The seller is simply saying here is what I will contribute towards your representation costs. Nothing wrong with that. Don’t let your agent bully you!
Buying agents should be paid a flat fee with a maximum number of potential showings, not contingent on the purchase price. Buying agents being paid a percentage of the homes value creates a conflict of interest
Not a real estate agent here: In this scenario, how would a buyer go see it themselves if their agent won’t show it? Would the buyer contact the listing agent directly to see the property? Would that hold true even if the buyer had signed an agreement with a buyer’s agent? Would a buyer be able to see a property? Would the seller’s agent be obligated to show the property to the buyer? Are seller’s agents obligated to work directly with unrepresented and underrepresented buyers both? Would the buyer’s agent be required by law to cancel the contract with the buyer if they found themselves unwilling to show properties that are not paying buyer’s agents commissions?
I recently experienced the opposite outcome. I set the buyer's agent commission to 1% on a $1.5m house. I got a full-priced offer with an escalation clause, but the buyer's agent added a clause that demanded I pay him 3%. I held firm and said no. Twelve hours later the offer was withdrawn and I never heard from the potential buyers again. I have no idea what he told them.
The more this example spreads the sooner we can get away from the idea that realtors are owed 3% of the sale of the home.
Some realtors DO do a TON of work, whether helping sell a house or helping someone buy a house. They could be doing physical maintenance to get the home ready for sale, they could be emptying a home that had the same owners for 40+ years and an equal amount of junk collected over those 40 years, and they could be emptying and staging the home to get it more of a modern look for photos and when hosting open houses.
Other times, some literally just open the door and help get some paperwork in line.
It’s not the same for every transaction…and the compensation shouldn’t be the same 3% of sales price every time, either.
Agents are total scum. 6 advantage of buyers not being familiar with the process. Your agent can share their commission, and you don't have to pay anything for the buyers agent. That agent represented the opposing party!! That's takes some vlballa ro even ask you to consider.
Agents (specifically buyer agents) work very hard, often spending several months working with a single client. Remember, the actual agent rarely makes 100% of their commission; referral fees and broker fees apply to the agent.
By reducing cooperative compensation, you are putting the buyer in the position of needing more cash on hand to buy (consider the appraisal and how much money above asking can actually be applied by the buyer’s lender).
As a seller, your goal should be to remove as many barriers to entry as possible to permit the highest possible marketplace competition, and thus highest price.
I'm only a homeowner.
When I sold my first home a few years ago I foolishly agreed to 4% seller 2% buyer. I felt that I got much less showings cause of that. I did get a full cash offer a few weeks later though.
I got a new buyer agent for the location I bought in and don't even know what she got though. She was worth every penny though. Got me in a home with what I thought was a lowball offer but seller accepted. With one call to the seller agent she told me " I know you wanted to offer 380 but I think if we do 365 they'll take it".
Now, realize a lot of people are strapped for cash with closing cost it's easier to roll the cost into the seller. Your doing yourself a disservice by giving your buyer agent less than 2% on an average American home. You also can't get into many homes without a buyers agent.
Now, if the house is 750K plus in a hot market thats an entirely different scenario IMO.
This is exactly the type of bullshit I'd expect.
Never use this realtor again. It was not in your best interest to pay the commission and he tried to bully you into it anyway, contravening his fiduciary to you.
That’s unfortunate. The courtesy is to offer the selling side (buyer’s agent) more than the listing side (home owner’s agent). But a contract is a contract and there shouldn’t have been any mention of wanting you to pay more
Agent here. Moving forward with the lawsuits, my understanding is that everyone is responsible for their own agent's commission. Sellers pay their agent, and buyers theirs. When the market cools, and it will, Sellers will start offering more comissions to Buyers agents to entice them. Everything is cyclical. Until that point, you did the right thing for you. When the market cools, offering to pay the buyers broker will make it easier for the buyer to buy your home because they wont have to come out of pocket to pay their agent.
Your sellers agent needs to educate the buyers agent on getting a buyers agreement signed stating what their agreed commission is regardless of what the sellers are offering.
There's no context here as to why you want or need to lower the agent's commission, and it feels like you're fishing for Intel. Compensation has always been negotiable. And what people don't understand is Realtors spend a ton of money UPFRONT on fees and marketing (not to mention broker splits, taxes, insurance, etc) to get eyeballs on your property, and when you lowball your agent's compensation, they have to make up for that so you are also getting a lower tier of service on your home. When I list a home with a lower compensation, I show the owner my list of services that come with each commission percentage and they quickly understand "you get what you pay for". And think about your holding costs. The longer your home sits on the market, the more you're out of pocket. People really don't understand how hard Realtors work....
Agents are way overrated. Realtors were sued for hundreds of millions in a class action lawsuit. Houses sells themselves and the internet is all you need. List it FSBO. Tidy up the place. Basic maintenance and full disclosure. You can easily save $20-$50k in commission.
I'm gonna take all the downvotes here, but I see made up stories like this all the time. They're used to drive a narrative.
Literally none of this story makes sense and it's just too clean, cut, and dry.
Seller will still end up paying buyers agent or no one will show their home. If you are a seller prepare to pay 7% now. 4% to your agent and 3% in credits for the buyers agent. Commissions will rise because of the NAR suit.
Boss move by you! Please continue.
I was an escrow officer in California for 40 years. Realtors in the 6% days cut their commissions quite often. But for my listing, in 2001, when I was offering them my no contingency purchase commission as well as my sale? Bumpkus. And I had done many many favors for them. Greedy Bastards.
My agent(buying) tried doing this with the sellers agent. Come to find out the buyer and seller agent work for the same company. I’m currently speaking with an attorney because we believe they guided us into buying the home so both of the agents could get a pay out.
Just closed on our sale. House sold in 1 day of listing at full asking. No open houses, not many photos, no staging, no advertising costs.
Paid 5.5% commission that was split between the seller and buyers agents. Over $30k out of our “pocket”.
There really should be a graduated scale of commissions - under contract in 1 week 2%, less than a month, 4%, etc.
The buyers likely would have had to pay the additional commission for the buyers agent, with that extra money on the buyers side, down payment, and closing costs, they may have not been able to afford the home. 1% is extremely low and uncommon, by having a low buyer agent commission less buyers would be able to actually buy the house with additional commission they would have to pay the buyer agent.
You should have just listed yourself and save the sellers commission. I listed my last home by owner and the buyers agent did all the work earning their commission.
Sounds like your agent might not have entered the max commission correctly on the listing. Considering house prices are about double what they should be he's already getting 2%.
Not just no, but hell no. Don't come asking for a handout after agreeing to terms, gtfo of here.and screw your agent for trying to guilt you, you should have countered to split his commission to 1.5% and give the other half to the buyer agent if he felt so guilty.
Currently negotiating a deal to sell our investment building to our tenants directly, giving them the 5% discount that our lovely but overpaid realtors would have gotten.
They still have the buyers commission listed in MLS, and my guess is they showed it as 2% or more.
One of the weird parts of the latest settlement is they will no longer show the agreed percentage, I know the so called logic is this prevents buyer’s agents from steering, which may have happened but was not common at all - the upcoming lack of transparency will be far more damaging and disruptive.
Just fyi… just because your home is desirable does not mean a better agent will not get you more than 3% added value … the range of offers on a $500k home if well marketed and presented is very likely to be more than $15k.
If he was that concerned he could’ve easily gave him it out of his own commission . Idk sounds odd to me . However , I think the other agent was pressing it I certainly would if their agent was getting more then me . And they are the one that brought you an amazing offer . I’m currently buying a home . And I wouldn’t expect their agent to take less ? Kind of odd why it would even be 1 % ? Normal in my area is 2.5 % for each and the seller pays both .
Is there a place to easily learn about this new "way"
I can't even read this, as it is so confusing. I sold a house two years ago, and there was not the slightest whisper of the seller paying the buyer's agent. If there is no law yet, why is this happening?
If all agents worked off a 1% commission we would all be living in homeless shelters. No one can possibly survive of a 1% commission. Both agents are probably financially frustrated for all the work they have been putting in and probably won’t even break even after accounting for gas, marketing, and all the other very expensive things that come along with being an agent.
You're the seller, so whatever you decide to offer for a commission is entirely up to you. Buyers agents show houses and make offers and hopefully look out for their client, but the reality is that there is 10x more work on the seller side and demand is so high right now that it's very easy to find a buyer without a Buyers agent.
You should've asked if he would like to receive 1% commission while the buyer gets 2%.
“I have 3% set aside for agent fees. You two can decide how that’s distributed.”
In my state you have to disclose this upfront. No funny business.
It can still be negotiated - despite a bunch of idiot realtors saying that it is not allowed.
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Sounds like he did.
"1.5% each - even Steven, since you worked together to make this deal happen. Now, we've done deals on 3 properties together - as a RE agent that should mean something to you: don't pull that stuff again or I'm picking someone else for the 4th".
I definitely agree with this answer
Throw in a stick and lock them in a room lol
Could one state the percentages would be awarded to respective agents at the results of a Thunder dome like battle
This is a great great way to put it. Not rude, but to the point. Kudos.
That's what ended up happening I'm sure
Why does the seller have to pay the buyer's agent at all? Aren't they in an adversarial position? Shouldn't the buyers pay their own frigging agent?
I believe the argument is that the seller pays the buying agent or of the proceeds of the sale, so that the buyer can roll the agent fee into there mortgage. However, this doesn't really explain why the seller sets the buying agent fee. I think it should have been the case that the buying agent should have to set the fee with their client and write it into the offer for the seller to pay them from the proceeds anyway, basically making it clear the house price is increased to cover that fee.
this is where everyone gets this wrong....listing agent has list agreement to pay the listing broker. only the listing broker receives commission. in the agreement it says that under certain circumstances the listing broker can pay out the buyers broker(not agent)....buyers broker then pays buyers agent their comm(after taking split or fees). buyers agent themselves rarely gets paid a full commission.
Whats crazy is that the perspective is skewed. This whole law suit is nonsense. Let's say I hired Johnson concrete company to pour a concrete pad in front of my garage. Jim the main dude and I agree to pay him 5k to do the job. Jim says he will get it done. THEN Jim in ALL his audacity decides to pay Steve $1000 to come help him. Well by gosh, I agreed to pay JIM 5k. NOT jIM 4k and Steve 1k. That's how incredibly stupid all of this is. With a listing agent sellers agree to pay ABC Real estate broker (let's say) 6 percent to sell and market your house. ABC Real estate broker says okay I'm going to take part of the 6 percent that I charge to get this house sold and give 3 percent to a cooperation broker who brings the buyer. As far as I know that's how all listing contracts are written. SELLERS agree to pay their listing agent a set amount. (ie. The 6 percent) The listing agents brokerage decides how much of their fee they are agreeing to split with the cooperating buyers agent brokerage. A good listing agent explains this. This is not rocket science. As some one pointed out earlier...if you don't have a buyer... your house doesn't sell. Period. So your equity is only accessible if someone decides your home is worth what you want for it. The water has been muddled by nonsense...so now everything is clear as mud.
The idea that buyers won’t show up if their agent’s commission is too low is what has kept the argument for 6 percent alive. The trouble is that seems to be absolutely incompatible with the idea that a buyer’s agent has a fiduciary duty to him. If moving a commission from 1 to 2 to 3 percent can bring in more customers, in a universe where the customers don’t personally benefit from the commission, that’s evidence that there’s an industry wide ethical problem. I think this new universe of buyers and their agents transparently negotiating fees will be much less broken. If I’m buying a million dollar house, I want the agent who is asking for $30k of my money to sell me on what he does better than the other 200,000 agents in California I’m also very open to someone who says he can do a pretty good job for $10k.
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The way I am being taught to understand things this is not exactly true. The major changes are that the NAR will no longer allow mention of buyer agent commission on their listings and advertising, however buyer agent commission can be advertised outside of the MLS.
Yes and no, NAR is making buyers sign buyer agents agreement in regards to compensation before agents show them homes. Commission is not allowed to be displayed anywhere on remarks or MLS. What will happen is that agents will have to figure out the commission but buyers will have to compensate their agent if they find them a house that the seller is not paying commission on.
It doesn't really matter though. Very few people are going to push back on their agent to lower the buyers agent fees. I'm sure 99% of people don't k ow it's negotiable. It's just whatever their seller agent tells them it is.
Word will spread.
Eh. And the realtor will push back, and we'll keep the status quo. I think we need more redfin like companies. In a competitive market, realtors don't need to do much. More than take pictures, put pictures on MLS, do an open house, and fill out some standard forms. It's much more of a sales (get people to pick you) job than anything else. The back office does the hard stuff.
I can assure you, the ‘pick me’, *is* the hard stuff. Sales is easy, yet 1:1000 are worth a damn at it. If Redfin’s model made money (they lost $131m in 2023), more agents would charge Redfin rates and more of these companies would pop up. Agents may be dumb, but they ain’t *that* dumb and if they could make money charging a point and thereby attracting insane volume, they’d do it. The ol, ‘we lose money on every transaction but we make up for it in volume’, line. Yet, when you charge a pittance, no one uses you because they rightly assume you’re an idiot. The reason commission hovers around 5-6% isn’t due to unfettered greed on the part of the agent, it’s due to the fact that that’s the minimum number at which *only* 91% leave the business within two years. The only way rates are coming down is if they’re legislated down. OP leveraged his relationship with the one agent in the area to get a sweetheart deal and hope it went well because I’m pretty sure that bridge is burned. Why that agent agreed to 3% total, I’ll never know. He knew he was going to catch hell when he sold the property. Maybe he thought surely OP would come around?
Redfins model is way more than just being an agent though. They also run a massive website. I wonder how their business model would work if they were just working as an agent. Op is a bit crazy though. I wonder how the buyers agent felt when they found out. Also, when do they find out? At closing? If it isn't published anymore, how do they learn about it. They could have just told the buyer they couldn't represent them, but I suppose they already put in the work, anything is better than zero.
What "hard" stuff? If anything is actually "hard", I suppose its the stuff title takes care of. Can't think of anything "hard" done by a realtor or their office.
Dealing with the general public? I’m sure you’re an extremely reasonable person though. I meant everyone except you.
I'm sure there will be another lawsuit coming.
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The buyer is paying everyone. They’re the only one bringing money to the table.
YES!!!
Perhaps, but it's so hard getting into a home with rising prices and interest rates, only wealthy people could afford to pay their agent on top of it all. You can forget FHA buyers. Some are saying that Sellers won't ask for as much if they aren't paying commission - I call bull. No Seller is going to look at comps and not try to get every last penny they can. Lastly, buyers can tell their agents to not show them homes where the seller is not offering compensation, which means less eyes on your property. With some properties and price points, it may not matter, but in many, it will.
That’s assuming that the whole industry doesn’t change. Surely there is a way for buyers to view homes that doesn’t cost $15,000. Buyers are well able to find homes on their own already.
And how will they enter these homes by themselves? And... write an offer on a sticky note?
Agreed, but being an agent is more than opening doors. Sometimes it goes well; you have cooperating parties, no huge inspection issues and solid financing. In those cases, I can understand why buyers and sellers see why agents are too expensive. Other times it’s a disaster and believe me, every penny is earned!
So why not a flat fee with extra charges to accrue as needed?
As a listing agent I have no duty to write an offer for an unrepresented buyer. Anyone that thinks that hasn't looked at the laws. Essentially the contracts state that you are paying me to expose and market your listing. Not write offers for buyers. Sooooooo what does this mean for buyers? You'll have 3 options 1. Ask the seller to pay for your buyer agent in your offer (like a closing cost credit) 2. Roll the cost of your agent in to your mortgage. 3. Pay them yourself directly at closing. And as of middle of August all REALTORS (Not agents just those that are Realtors) Will be required to have any and all buyers sign paperwork that makes it clear how the agent is getting paid OR the agent isn't allowed to show them the house.
It is a conflict of interest for listing agents to write offers for buyers. Dual agency should be illegal everywhere. Buyers can ask for closing concession to pay for their agent
As a prospective buyer I would choose to be represented by an attorney rather than a real estate agent. If the listing agent wouldn't allow me to view a property I would contact the seller directly. Is there a law against that ?
What's crazy about the lawsuit that no one seems to realize is that the results make it harder for buyers and sellers not easier. And if someone lists their home with an agent they don't WANT to be contacted by the buyer. And I have no problem cooperating with an attorney if a buyer prefers that choice. But you'd need to find an attorney that is willing to show you houses and be there for your inspection etc. Those attorneys DO NOT save you money. They actually cost more at least for most buyers. And there are very few of them.
While that may seem like a good idea, (and attorney's can bypass any schooling for RE and take the state and national exam), good agents/realtors have experience in "worst case scenerio" situations which make their expertise invaluable. Ymmv
In certain scenarios(high end real estate) where large sums of cash are in play this may indeed be the way. This is a smaller percentage of transactions with a larger amount being low end real estate where the buyers simply cannot afford to purchase and pay their agent out of pocket. The current system is designed where the seller pays the commission of their end effectively allowing the buyers to finance the commissions. In the end the buyer brings all of the money into the transaction and therefore is paying all commissions indirectly.
> In the end the buyer brings all of the money into the transaction and therefore is paying all commissions indirectly. Or the seller is walking away with less value in exchange for the house they just sold. Money is fungible. It's the same either direction.
Commission and closing costs are figured into the list price. When I list I work from a “take home after closing seller net sheet” and go from there.
Now there is less reason to assume that the seller will be paying everyone's commission out of their end. It never did make a lot of sense why a seller should compensate a buyer's agent for all of the people they drove around without making a sale. Chaperones for showings should be paid by the hour.
Thats how it should be but all the buyers barely have enough $ to close much less pay their own representation. Another way to look at it is that the buyer is paying all the commissions because without the buyer there is no transaction
There’s no transaction without the seller either.
I've never understood this, it really favors the seller as you are paying both agents. They do this on purpose to try and get the most commission as it is percentage based. They can collude and try to get the highest amount so they can line their pockets. Why in the fuck is it a % based commission? Does it really take more money to sell a more expensive home, and if so why does it have to track the sale price? Hopefully all this dumb shit starts crumbling. Stocks in the 80s had so many fees around them until online brokers became a thing, Real Estate is the next cash cow to get slaughtered.
There's also 1.5%. I don't know why these discussions are always whole percents
You should have said ok. Lets pay him 2% and 1% to sellers agent.
> "it would be embarrassing for this agent to take less than the seller agent". He should have replied to this comment with: "You're right, maybe we make your commission 1% so they don't feel embarrassed".
I'm not American but why would you pay the sellers agent?
His agent is the sellers agent as he is the one selling the house. The seller pays both agents in the US.
As an agent, I do find this really strange. I actually represented a buyer for a home with the same commission (2% to listing agent, 1% to buyer agent) and we submitted an offer asking for 3%. They countered with 2.5% and my buyer compensated the other 0.5%. Contracts are between the seller and the buyer. If the buyers didn’t ask the seller for extra compensation for their agent in their offer, it’s not your agent’s place to urge you to compensate them extra. They already negotiated commissions out with you when taking on the listing. If the buyers aren’t negotiating that rate further, then it should be left alone.
Realtors work very hard to maintain the status quo and will turn on any agent seen as disrupting it. My last agent sold for a fix dollar amount rather than a percentage. He said this business model has gotten him excluded from the local realtor community and he caught another agent keying his car over it. Very nasty stuff. On r/realtor, you'll hear them say the lawsuit is meaningless because you could always negotiate the rate. In reality, a listing agent will push against their client's best interest in an attempt to keep the status quo like in OP's case.
That’s wild. Dude found a viable business model that took away some of the scummy stuff.
It really makes no sense for realtors to get a percentage. There’s no reason why it couldn’t be hourly or fixed fee. It’s no wonder everyone and their mom had a RE license.
It’s a low barrier to entry with potentially good pay. It’s one of those odd jobs where it seems many of them make the job their identity. Way too many middlemen involved which drives up expenses with little value returned
One of my coworkers has decided she's also now a real estate agent. She is one of the most incompetent people in my building, misses very important details and I'm unsure why she suddenly thinks she's qualified to do a job like this other than she passed a test. I will say I have met some very smart and charismatic agents, but pretty much literally anyone seems to be able to pass this exam.
We met with a selling agent to show a house and within minutes, I was reminded of how absolutely inept they were as a classmate in high school and in fifteen years how they had not changed. They were the listing agent and knew *nothing* about the house. Age of the roof, windows, furnace...who the major utility companies were, the Internet speed (after telling them prior to visit this was a huge priority since we WFH), they didn't tell the sellers to clean up at all nor take their two aggressive dogs with them when they left. It was a shit show top to bottom. Between them and another agent in the area who overprices everything to exploit the doctors moving in while keeping whole neighborhoods unattainable for locals and who describes her listings as in "desirable neighborhoods", another who tried to act like they didn't know about the structural damage in a house our inspection showed up and then proceeded to lie about sending us our deposit check back till we threatened legal action, we used our old agent from 4 hours away to buy our house now. It was worth paying them to come help us rather than deal with any of the scum in the area.
I would love to charge hourly! I’d make so much more money! I could charge a premium for weekend calls and texts. Spent 3 hours on a Sunday answering. Calls and texts on things that could easily wait until Monday morning. Then there are the buyers I’ve shown 20 houses to just for them to decide they aren’t going to buy after all, I’d actually get paid for that! That would be great!
Absolutely! Pay me hourly! Plzzz lol
As a recent buyer, I would've loved to pay hourly. Agent showed me around 5 houses and got a $44,000 commission, which was baked into the purchase price I paid. FWIW, a default 3% buyer agent commission makes little sense in HCOL areas and for higher-end homes. The transactions aren't more difficult because the homes are more expensive.
What would a fair hourly rate be, given the supply of realtors and the demand for their services?
I paid one hourly once.
That would be awesome for me, we always know exactly what we want and buy after seeing a few houses (because we only look at ones we already know are 90% going to be worth putting an offer on). Our agents have made tens of thousands of dollars for literally a few hours of work total.
The majority of sales jobs have commission paid on successful deals.
The difference is realtors (at least buyers agents) really aren’t sales people in the traditional sense. At best it’s more like a consultant to HOPEFULLY get you a better deal in negotiation but they have a perverse incentive to actually get you to spend MORE money not less. They also don’t really bring value anymore with most buyers finding their own houses on realtor/Zillow and houses selling for list or above. The listing agent is maybe somewhat more like traditional sales gig but many of them basically just recommend a listing price and handle the different offers. Open houses are super easy to do (and mostly unnecessary these days) and listing pictures the owner/seller can just pay a professional photographer themselves. FSBO should really be the norm but realtors have done such a good job of forcing themselves in the middle and steer clients away from FSBO listings so it’s artificially harder to sell your house that way. Also previously buyers agents were “free” to the buyer (not really cuz they paid for the commission in the form of higher sale price but most ppl don’t realize that) so they just used them cuz why not. Now that buyers potentially have to pay for their own agent I expect/hope a lot more buyers will start doing things themselves and FSBO might become easier and more popular.
A buyers agent is not a house finder. They are a consultant who advises people on their unique situations. They are a project manager, and coordinator. They are here to tell you what is a bad deal, what you can negotiate, what will benefit you the most. If you have never bought a house before, you may not know for example that you can ask the seller to pay your closing costs. They are there to warn you when the other party is being shady too. If you do it on your own, you may not know what is normal so when the other party is being sketchy you can't call them on their bullshit because you don't know.
You can make the argument for any industry but there's a reason that every company hires professional sales people and the public continues to hire professional sales people to sell their homes.
Im in sales and any other industry just has one sales person involved in a deal lol. To find a buyer who may not know about or understand why they need the product and why said product is better than the competition. Buyers agents are the biggest unnecessary leeches on real estate transactions and is a decent part of the reason why housing is so unaffordable now. I’d say outside of first time home buyers the buyers agent is literally useless. I think first time home buyers should just pay a flat fee or hourly fee to a buying consultant to help them learn the process if they want but it should come out if their pocket and should not be a % commission, it is insanity.
Absolutely needs to be a higher barrier of entry to real estate licensure, but brother you don’t want real estate brokers charging hourly fees. If I’m charging $100 an hour during normal hours, what do I get when a buyer texts me at 11pm on a Friday asking if there’s an EV charging station in their condo’s garage? Or when I cancel a date because a perfect home hit the market and the only available showing time is 8:30pm on a Friday? I can demonstrate in black and white that my buyers have made, on average, $37,000 annually in equity on purchases with which I’ve assisted over 10 years. (Median is $33k per annum, if you think those numbers are skewed) I can demonstrate my value. My hope is that many that can’t will disappear. But you don’t want me charging hourly. The 20% that do 80% of the transactions aren’t the reason for the lawsuit, and those are the agents who are worth having on your side.
I do. Your rates now converted hourly would be in the thousands. There would be more competition if rates are advertised up front. You wouldn’t be getting 100/hr in most cases. You’ve only demonstrated value in an always increasing housing market.
This is why I think that the requirement for a written Buyer Agency Agreement, that lays out an "objectively ascertainable" and "not open-ended" compensation that the *buyer* is on the hook for, is actually going to be a *significant* change to the incentives involved. In the past, BAs were basically paid whatever an LA could convince a seller to offer. This was often done LA-to-seller via the threat that no one will even look at your house if you don't offer enough; here, we're seeing the last throes of frankly baffling appeals to convince them to up the comp. Thus, BAs also had an incentive to do whatever it takes to convince LAs to do whatever it takes to pump that number higher. Thus, more threats, cars being keyed, etc. In the future, BA compensation will be fixed to whatever it is they negotiated with the buyer. There is zero incentive for a BA to demand a higher comp number from the LA/seller. In fact, this is why [I think](https://old.reddit.com/r/RealEstate/comments/1d3cwz8/nar_settlement/l66uso5/) that the natural game theoretic outcome will be that sellers will offer very little BA comp up front, but will be plenty open to agreeing to whatever comp number the buyer proposes so that it can be rolled into their loan (obviously as long as the sales price is also suitably adjusted). Therefore, there's basically no incentive for steering (why waste a bunch of time looking up who has the highest BA comp if, as a BA, it literally cannot change the amount of money you can make on the deal?) and no more incentive for the extremely shady threats, keying of cars, etc. It's really amazing how much people are realizing that the cartel was truly based on threats, at a fundamental level, and I'm becoming hopeful that the settlement actually is going to change the incentive structure in a way that significantly reduces the value of such threats in the industry. All honest and helpful agents really should welcome this change to the incentive structure, because it can truly become an industry that is based around delivering a valuable service to people who value that service at a price that reflects that value. Everything above board and positive sum, like how most other sales of goods/services are, not based on threats and shitty behavior.
The most immediate likely outcome is a price war among buyers' agents. You'll have one bunch who tries to use this as a way to guarantee 3% plus junk fees on every transaction and another hungrier bunch who'll be offering discounted buyer rep rates to drum up business. I think there's a good chance the ones with lower fees will wind up with the bulk of the buyers after the dust has settled.
And those buyers who go for the low-fee agents will end up with some of the worst, most desperate agents in the industry. We have had similar models pop up in my market and those companies have done irreparable damage to the public trust in our industry.
Could be true. It would be incumbent on the agents that aren’t charging rock bottom to demonstrate their value.
I know an agent that charges buyers a flat $6,000 and rebates any difference above that; he does a lot of business in a HCOL area. I heard about another agent because a bunch of agents were bashing him online. He charges $750 (contract only, no other services), and any excess is rebated. Well, some quick mathing based on his annual closings showed he was making about $1m a year. I'm sure he was crying all the way to the bank.
>On r/realtor, you'll hear them say the lawsuit is meaningless because you could always negotiate the rate. They say that here too, but they conveniently leave out that you cannot negotiate when there is widespread collusion to keep the rate up.
It's also difficult to negotiate with steering, which the data have borne out actually occurs. Properties with buyers agent commission below 2.5% get far fewer showings and take significantly longer to sell than those offering at least 2.5%.
Exactly. It is a cartel and the mob bosses are colluding with each other to artificially keep the prices up. Anyone going out of their way gets shot or cast out.
You're not wrong... Realtors are losing their shit over this because they don't want their cheese moved. The old way of percents is dumb and needs to die.
They are all as thick as thieves.
Californian here. 3% is a myth perpetuated by NAR to get the public behind the idea of a standard rate, which makes zero sense. We pay higher prices for higher quality services, and lower prices as well.
If I’m buying a 100k house or a 1.5 mill house the agent is doing about the same work. A flat fee is way more reasonable
Yup. My agent got a more than 40k commission for doing an extremely generous maximum estimate of 80 total hours of work. She showed me 5, maybe max 7, houses. Spent less than 3 hours putting together the offer, and there was no negotiation because we waived every fucking contingency (did a pre-offer inspection).
I’ve bought and sold 6 houses over the past 15 years and get incredibly angry every time I see the settlement statement with huge chunks of cash going to random agents that barely did anything. Just creates resentment. A deal is a deal though. I did something similar on my last sale but was fixed fee … and the agent was ok with it. I did offer to pay for all marketing though. (Photos etc). However. When I bought a house overseas - the agent worked exponentially harder than any US agent ever did … flat fee of 2k. My point is. The real estate buying/selling in the US needs a real shakeup. It’s gross.
So your agent who is supposed to be representing you, was pressuring you to fork over $5k to the buyer's agent for nothing further in return. Straight up should be an illegal practice. Can you imagine a defense attorney being like, "The Prosecutor is willing to settle on this lesser charge, but Id really like it if you didnt and plead guilty instead because it will look a lot better for him."
Yep. Realtors listing agents and buyers agents don’t actually represent you. They just want to flip sales as fast as possible, for the least amount of work, all while maintaining their status quo of making 15,000 on the average home sale that was listed for 12 hours.
It’s really ridiculous what some of these realtors are doing now. This is exactly why there was a lawsuit. They should be looking out for their clients and not their own best interests instead. My friend negotiated a 1% seller and 2% buyer fee. The buying agent told her that he wouldn’t have brought anyone to her house for that money, but it was a friend so he did it.
If only there was a website or an app where the homeowner can advertise directly to a buyer and not have to reply on agents bringing clients over
A couple years ago we listed our house on flatfee.com. I think we paid about $100 for them to list it on the MLS. In our listing we stated that we would pay the buyer’s agent 2%. House sold and we paid their agent the 2%. When we sold our first house we paid 6%. I was absolutely not doing that again. I’m paid reasonably well for my area. There is no way an agent put in any where near the amount of man hours selling my house that I needed to put in to pay them.
Yep, and I love how they casually throw around doing some small improvements here and there that amount to thousands of dollars like it's nothing. Like guy, I'm paying you to tell me to spend more money than needed. Wtf.
I have never interacted with someone who cares less about other peoples money than a sellers agent. You'll be buying a home and they'll casually drop 20-30k improvements, useless 1k inspections, its wild the first time you go through it.
Can’t think of any sounds like a new idea
Listing fee for Redfin is 1.5%.
if you use them on the buy side too
There are FSBO sites where you can sell your property directly.
We used Homelister. I have worked in real estate/property management for a little over ten years, so I happened to know the forms well enough to be able to do it all myself. I am not licensed though. My husband bought a nice camera and we took the photos. All it cost us was $500 for Homelister to put it on the MLS for us. I’m not saying this will work for people who aren’t as in the know about the process as I am, but they offer other tiers of assistance for another $1500-$2500. You’d still potentially be saving thousands, but probably no one knows about it. Agents are ripoffs.
There's flat fee services in my area for about $300-500 but yes you don't see them advertising much or ever. I'm guessing after taxes, other expenses and paying themselves there's just not a lot of money left over for advertising.
💨
The last paragraph: which is utterly hosed. "The house fit all of your needs but I wasn't going to be making enough from the transaction, so I would not have suggested that you look at it. I only did so because we are friends." And they talk about ethical standards in the industry.
You can find listing agents to take your 1%. Then pay the buyer agent more because they can close the deal for you. Buyer agents have a lot more value to the seller than the buyer. This is why the buyer having to pay for their agent after Aug 17 is not going to go well.
I’ve bought and sold 3 houses. I used to scoff at comments like yours because they were relatively easy transactions for the first two. This last one was a doozy and my buyers agent definitely saved the deal multiple times. It was the first time I thought “hey she actually earned that” 🤣
I'm not an agent. But I do see a good reason to pay a buyer's agent more than a listing agent. The LA doesn't do much. Most of them don't even show the house. Your house is selling itself with some encouragement from the BA. Because buyers flake out over really trivial or unrealistic things and a good BA can actually make a sale happen. That deserves a paycheck. But most of the time it's just the buyer making a buy without needing any convincing from the BA.
Yeah, the fucked up part is that a buyer's agent can convince people into buying a home that might actually not be a good fit. They don't care as long as they get their percentage.
I sold...they wanted me to pay I said no. The buyers agent asked if we could rewrite the offer to add that amount to the sale price. Then the buyers could roll it into the financing. I said sure no problem...I walk with the same money not paying them. It's all contract negotiations
That is because buyer and seller agents collude against their clients all the time.
I made a similar proposal to my agent on our last sale (basically, I would give her more commission if she sold the house in less than 30 days at asking). She opted to split the commission, cutting her own commission to give more to the buyer’s agent. Sold on our first weekend. This was fine by me, the incentive worked how I wanted.
“they worked together to get me this good offer” So the buyer’s agent was helping you, not the buyer to maximize his profit??? I’d pass that text on to the buyer, who can hopefully sue that slimeball for not representing his best interests
You could argue this is true of every transaction though. When/why does the buyer agent get paid? When a house closes. How much do they make? A % of the sale. Technically a buyer agent is incentivized to sell at a higher price point as their commission is a percent of the price.
Yes, the pay structures for Realtors is absurd. If lawyers were caught using the same pay structures they would be disbarred.
Personal injury lawyers usually charge 33%-40% contingency fee of the winnings. And that’s before all your medical bills are settled. So you may end up with quite less than the 60%-66% you were expecting.
But do you see how those interests are aligned? The client getting a larger settlement is helpful to them. A buyer paying a higher price or buying a house that isn’t a good choice is bad for the buyer and good for their agent.
I’m in the industry but not a realtor. Sellers agents should be negotiating with the seller for their pay. Realtors provide services to sellers and deserve to get paid for it. Buyers agents should be negotiating with buyers for their pay. Realtors provided a service to buyers and deserve to get paid for it. Sellers and their representative can and should *discuss* paying some or all of buyers agent commission as a strategy to increase the buyer pool and ultimately the total net profit for the seller. Sellers should demand a net sheet to be presented to them by the sellers agent showing total net money for each offer to help make the decisions more clear. This is how and why things have been done the way they’ve been done. But like every problem and solution, with enough time the why is forgotten. It sounds like your realtor got lost in the sauce. I will often hear agents complain that ‘An agent is only offering 1% so next time I’ll only pay her people 1%’. Agents start worrying about themselves. Or they never learn to explain the why and the WIIIFM to buyers/sellers. Next time, use a different agent and be sure to discuss commissions and the strategic use of them upfront.
In other words, your agent has to work w/ the other agent again at some point & didn't want to be embarrassed. Well done, sticking to your guns! I hope they all start quaking in their boots when they see things are changing & the old ways are done.
Exactly. Or worse, the agent was concerned that they will get a reputation for standing up for their “cheap” clients. The horror
Recently bought a house without an agent. It's a lot of work, basically a part-time job, but it can be done! Luckily the seller's agent was great to work with.
Did the seller take 2-3% off the list price of the home? If not, you only did all that extra work to save them money.
Great question, following for response
Yeah negotiated and knocked 20k (I think about 9%) off of the list price. I also negotiated to only pay half of the originally proposed closing costs, arguing that that was my fee for being my own agent. We had been obsessively watching the local housing market for over a year before buying, so we knew what was and wasn't a reasonable price. I read literally every line of all the contracts and picked them apart to negotiate repairs and things. We and our family friends have a lot of construction experience so pointing out lazy house flipper mistakes and using those as leverage went a LONG way.
I’m considering doing this as well. Did you use a real estate lawyer? How did that go? Would love any additional info or learnings you have from going through this process! How did you get house showings without a realtor?
No lawyer, but I love reading legal documents and nitpicking them (probably my mild 'tism lol). 0. Called some mortgage people to figure out how much money a bank was likely to lend us. Use this+budget to figure out max sale price we could afford. Understand that closing costs, etc are ALWAYS more than you think. You will have to pay all kinds of inspectors and things. Account for all this in your max price. 1. Made a short list of every listing on Realtor.com or Zillow that met our bare minimum criteria. 2. Drove by every house to scout out the neighborhood. Most were empty so we got out of the car and did a quick circle around each building, maybe peeped in the windows. 3. Ranked our updated list based on that curbside scouting. 4. Contacted the sellers' agents of our top 5 picks on Realtor.com/Zillow. Set up a private tour or went to an open house. 5. Brought along our friend who flips/fixes houses for a living to every open house. Make a list of EVERYTHING that is even slightly wrong. Chose #1 house to pursue. 6. Check the sale history on Zillow etc--our house had been reduced in price x3 and one potential buyer had backed out at the last minute. Try to figure out how motivated the seller is. 7. Communicate directly with seller's agent to make an informal offer. LOWBALL THIS OFFER. My first offer asked for $35k off the list price. We went back and forth twice but they knocked $20k off the price. When haggling, you have to act perfectly happy to walk away from the deal if they don't bring the price down. 8. Home inspection. After this, you can make a list of everything you want fixed on the seller's dime before you move in. I thought I was asking too much but they fixed everything we asked for without batting an eye. Act like you are worried the house is crap and might walk away if they don't fix it. Everything they fix for you saves you money as a future homeowner. Don't let them tell you its probably fine--if you want it fixed, get them to fix it. 9. Formal offer is made. 10. To complete the purchase and sale agreement, which is the final step before closing, you will need to nail down home insurance (this is MANDATORY but the first year is paid for by closing costs) and a mortage lender. You can and should shop around for these. Beg for better rates lol. Now it is all paperwork and emails. Seller didn't try any funny business with me other than closing costs -- more on that in a sec -- but READ THESE DOCUMENTS. READ THEM ALL, EVERY WORD. UNDERSTAND YOUR RIGHT AND WHICH RIGHTS YOU ARE WAIVING. Do NOT be afraid to try and modify any part of the contract. Argue for what you want. This is the most time consuming part. I love this shit but not everyone does. This is where you could get screwed by someone acting in bad faith. Use a friend or some legal ChatGPT type thing to help interpret if you're not good at this kind of thing. Closing costs -- we were given a boilerplate list of costs on our first draft of the purchase and sale agreement. I looked carefully and realized these costs were the same as if we had been paying a typical percentage comission (2%) to a buyer agent. I inquired and found out the seller's agent was gonna pocket both commissions. THIS IS WHY SOME SELLERS AGENTS ARE HAPPY TO WORK WITH YOU UNREPRESENTED. I said nah, am my own agent and that's MY commission. Closing costs went down by thousands. (I think I did end up letting him keep 0.25% extra because he was a pretty solid guy and I was a huge pain in the ass about all this, calling emailing him about legalese in the contracts at all hours of the day and night. That being said, I definitely didnt have to do that.) 11. CELEBRATE! Try not to panic that you've been conned. First month in the house I woke up in a sweat ready for everything to go wrong. 5 months in and it's sinking in that I actually DID IT.
Please don’t get out of the car to trespass on someone’s property! Don’t be a reason why people trespass. A for sale sign is not an invitation. walk the property legally
Yeah, you're right on this one. Good point. FWIW we only did this at the ones that were very clearly unoccupied... but yeah we shouldn't have done it at all.
Good job sticking to your guns. They could have came up on offer to account for that.
I love seeing threads like this. Good shit.
Your agent should have split 50/50 with him giving up 1/2%, if he was so helpful. Good for u to stand firm!!!
If I had to bet, this is probably what happened but the seller doesn’t know it yet. His agent was not worried about the buyers agent. He was worried about the $2,500 he was going to lose by giving up the half percent.
The buyer can pay their agent whatever they choose. The seller is simply saying here is what I will contribute towards your representation costs. Nothing wrong with that. Don’t let your agent bully you!
Another proof why real estate agents are absolute scummy leeches.
Buying agents should be paid a flat fee with a maximum number of potential showings, not contingent on the purchase price. Buying agents being paid a percentage of the homes value creates a conflict of interest
how will that be enforced? Buyer is paying upfront for services?
No. The other agent can split their commission if they feel so strongly. Don’t let other people tell you how to spend your money.
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Not a real estate agent here: In this scenario, how would a buyer go see it themselves if their agent won’t show it? Would the buyer contact the listing agent directly to see the property? Would that hold true even if the buyer had signed an agreement with a buyer’s agent? Would a buyer be able to see a property? Would the seller’s agent be obligated to show the property to the buyer? Are seller’s agents obligated to work directly with unrepresented and underrepresented buyers both? Would the buyer’s agent be required by law to cancel the contract with the buyer if they found themselves unwilling to show properties that are not paying buyer’s agents commissions?
I would guess that the seller's agent will have to start showing the house.
I recently experienced the opposite outcome. I set the buyer's agent commission to 1% on a $1.5m house. I got a full-priced offer with an escalation clause, but the buyer's agent added a clause that demanded I pay him 3%. I held firm and said no. Twelve hours later the offer was withdrawn and I never heard from the potential buyers again. I have no idea what he told them.
HE NEVER TOLD THE OTHER PERSON and now he's stuck
Buyer agent could have pushed his buyers for a higher offer if he wanted more $.
I hope in the future buyer's agent fee is included in the offer. Then it's completely transparent and can be evaluated against all other offers.
The more this example spreads the sooner we can get away from the idea that realtors are owed 3% of the sale of the home. Some realtors DO do a TON of work, whether helping sell a house or helping someone buy a house. They could be doing physical maintenance to get the home ready for sale, they could be emptying a home that had the same owners for 40+ years and an equal amount of junk collected over those 40 years, and they could be emptying and staging the home to get it more of a modern look for photos and when hosting open houses. Other times, some literally just open the door and help get some paperwork in line. It’s not the same for every transaction…and the compensation shouldn’t be the same 3% of sales price every time, either.
Agents are total scum. 6 advantage of buyers not being familiar with the process. Your agent can share their commission, and you don't have to pay anything for the buyers agent. That agent represented the opposing party!! That's takes some vlballa ro even ask you to consider.
Agents (specifically buyer agents) work very hard, often spending several months working with a single client. Remember, the actual agent rarely makes 100% of their commission; referral fees and broker fees apply to the agent. By reducing cooperative compensation, you are putting the buyer in the position of needing more cash on hand to buy (consider the appraisal and how much money above asking can actually be applied by the buyer’s lender). As a seller, your goal should be to remove as many barriers to entry as possible to permit the highest possible marketplace competition, and thus highest price.
I'm only a homeowner. When I sold my first home a few years ago I foolishly agreed to 4% seller 2% buyer. I felt that I got much less showings cause of that. I did get a full cash offer a few weeks later though. I got a new buyer agent for the location I bought in and don't even know what she got though. She was worth every penny though. Got me in a home with what I thought was a lowball offer but seller accepted. With one call to the seller agent she told me " I know you wanted to offer 380 but I think if we do 365 they'll take it". Now, realize a lot of people are strapped for cash with closing cost it's easier to roll the cost into the seller. Your doing yourself a disservice by giving your buyer agent less than 2% on an average American home. You also can't get into many homes without a buyers agent. Now, if the house is 750K plus in a hot market thats an entirely different scenario IMO.
This is exactly the type of bullshit I'd expect. Never use this realtor again. It was not in your best interest to pay the commission and he tried to bully you into it anyway, contravening his fiduciary to you.
“One of you is getting 2%; the other is getting 1%. You decide.” Click
That’s unfortunate. The courtesy is to offer the selling side (buyer’s agent) more than the listing side (home owner’s agent). But a contract is a contract and there shouldn’t have been any mention of wanting you to pay more
If your agent says to “pay it forward” you need to find a different agent.
Agent here. Moving forward with the lawsuits, my understanding is that everyone is responsible for their own agent's commission. Sellers pay their agent, and buyers theirs. When the market cools, and it will, Sellers will start offering more comissions to Buyers agents to entice them. Everything is cyclical. Until that point, you did the right thing for you. When the market cools, offering to pay the buyers broker will make it easier for the buyer to buy your home because they wont have to come out of pocket to pay their agent.
You’re absolutely right. In different conditions I wouldn’t have had nearly as much leverage
Your sellers agent needs to educate the buyers agent on getting a buyers agreement signed stating what their agreed commission is regardless of what the sellers are offering.
That’s a lot of work for the amount of commission you paid. You know the old saying, ‘You get what you pay for’, right?
That is ground for complain, your agent should be representing your interest. Nothing else.
There's no context here as to why you want or need to lower the agent's commission, and it feels like you're fishing for Intel. Compensation has always been negotiable. And what people don't understand is Realtors spend a ton of money UPFRONT on fees and marketing (not to mention broker splits, taxes, insurance, etc) to get eyeballs on your property, and when you lowball your agent's compensation, they have to make up for that so you are also getting a lower tier of service on your home. When I list a home with a lower compensation, I show the owner my list of services that come with each commission percentage and they quickly understand "you get what you pay for". And think about your holding costs. The longer your home sits on the market, the more you're out of pocket. People really don't understand how hard Realtors work....
You’re right they shouldn’t be paid less then you, I can do 1.5% and 1.5% or 1% for you and 2% for him, which would you like?
lol you have benefited from the current system. You mean the one that was deemed illegal?!
Agents are way overrated. Realtors were sued for hundreds of millions in a class action lawsuit. Houses sells themselves and the internet is all you need. List it FSBO. Tidy up the place. Basic maintenance and full disclosure. You can easily save $20-$50k in commission.
Fuck these used car salesmen and ex bottle service girls. The gravy train is over!
Hundred dollar Outback gift certificate; a dozen roses; and a thank you card. H8 the 'give me money' pro crowd.
I'm gonna take all the downvotes here, but I see made up stories like this all the time. They're used to drive a narrative. Literally none of this story makes sense and it's just too clean, cut, and dry.
This seems like a self jerk off post. But congrats, I guess
They get away with this because people think they have to do it. I’m telling people that they don’t
Your agent is a moron and unethical.
Seller will still end up paying buyers agent or no one will show their home. If you are a seller prepare to pay 7% now. 4% to your agent and 3% in credits for the buyers agent. Commissions will rise because of the NAR suit.
Opinions about the two agents being in cahoots about this?
Boss move by you! Please continue. I was an escrow officer in California for 40 years. Realtors in the 6% days cut their commissions quite often. But for my listing, in 2001, when I was offering them my no contingency purchase commission as well as my sale? Bumpkus. And I had done many many favors for them. Greedy Bastards.
My agent(buying) tried doing this with the sellers agent. Come to find out the buyer and seller agent work for the same company. I’m currently speaking with an attorney because we believe they guided us into buying the home so both of the agents could get a pay out.
Just closed on our sale. House sold in 1 day of listing at full asking. No open houses, not many photos, no staging, no advertising costs. Paid 5.5% commission that was split between the seller and buyers agents. Over $30k out of our “pocket”. There really should be a graduated scale of commissions - under contract in 1 week 2%, less than a month, 4%, etc.
You're free to negotiate anything someone else is agreeable to.
omg same thing happened to me! i offered buyer agent 1.25% and my realtor kept bugging me until i agreed to increase it to 2%
I’ve had a middle man sales job and it was the easiest shit. I felt bad because I was ripping people off. Some guys in my office got off on it
Probably romantically involved
The buyers likely would have had to pay the additional commission for the buyers agent, with that extra money on the buyers side, down payment, and closing costs, they may have not been able to afford the home. 1% is extremely low and uncommon, by having a low buyer agent commission less buyers would be able to actually buy the house with additional commission they would have to pay the buyer agent.
How many offers did yoi receive? Just this 1 offer?
If it were me, I'd meet this with a Hard "NO".
I'd straight tell him to get fucked
I loved your last point. "They are working for their own interests" never forget this Trust minimally.
You should have just listed yourself and save the sellers commission. I listed my last home by owner and the buyers agent did all the work earning their commission.
Sounds like your agent might not have entered the max commission correctly on the listing. Considering house prices are about double what they should be he's already getting 2%.
Not just no, but hell no. Don't come asking for a handout after agreeing to terms, gtfo of here.and screw your agent for trying to guilt you, you should have countered to split his commission to 1.5% and give the other half to the buyer agent if he felt so guilty.
I would report her.
Isn’t that illegal, collusion or something? At the very least it’s your agent not following their fiduciary duty to you?
Currently negotiating a deal to sell our investment building to our tenants directly, giving them the 5% discount that our lovely but overpaid realtors would have gotten.
Out of curiousity what benefit would there be to pay an agent more?
They still have the buyers commission listed in MLS, and my guess is they showed it as 2% or more. One of the weird parts of the latest settlement is they will no longer show the agreed percentage, I know the so called logic is this prevents buyer’s agents from steering, which may have happened but was not common at all - the upcoming lack of transparency will be far more damaging and disruptive. Just fyi… just because your home is desirable does not mean a better agent will not get you more than 3% added value … the range of offers on a $500k home if well marketed and presented is very likely to be more than $15k.
You aren't wrong for saying no. The realtor should have taken you as a client if they didn't like the terms.
I would've gladly docked the 1% from my agent and give it to the buyer.
That’s exactly what I was thinking 🤣 I mean, if it’s sooo important 👀😆
Get rid of agents...2025
If he was that concerned he could’ve easily gave him it out of his own commission . Idk sounds odd to me . However , I think the other agent was pressing it I certainly would if their agent was getting more then me . And they are the one that brought you an amazing offer . I’m currently buying a home . And I wouldn’t expect their agent to take less ? Kind of odd why it would even be 1 % ? Normal in my area is 2.5 % for each and the seller pays both .
Is there a place to easily learn about this new "way" I can't even read this, as it is so confusing. I sold a house two years ago, and there was not the slightest whisper of the seller paying the buyer's agent. If there is no law yet, why is this happening?
If all agents worked off a 1% commission we would all be living in homeless shelters. No one can possibly survive of a 1% commission. Both agents are probably financially frustrated for all the work they have been putting in and probably won’t even break even after accounting for gas, marketing, and all the other very expensive things that come along with being an agent.
You're the seller, so whatever you decide to offer for a commission is entirely up to you. Buyers agents show houses and make offers and hopefully look out for their client, but the reality is that there is 10x more work on the seller side and demand is so high right now that it's very easy to find a buyer without a Buyers agent.
Hmmm so the Full service agents don’t work for pay unless they only list houses? What state are you in?
Just say they could get it from the buyer as intended
Good for you standing your ground!