4 years ago we started doing what you recommend agents should be doing today. My company is an Agent 2.0 machine and we are having an extremly difficult time with other agents lying, coniving and doing everything in their power to discredit us. REMAX sued us and it goes on and on.

Can we talk?

steve@rehava.com

Ciao.

twitter @rehava

Until then, hire someone who knows what they’re doing. And by the way, half of that goes to the buyer’s agent.

The internet has simply broadened the reach of any marketing campaign, which is key to getting the best price. The more potential buyers, the higher the potential of getting a price close to value. After all any home’s value is only worth what someone is willing to pay for it.

People need to push back on the 6% to realtors who keep saying ‘it’s only 6%’. That’s fine as a percentage of sales price. But the commision comes out of a sellers EQUITY. So 6% on a $500,000 is ‘only’ $30000, but if the seller has a $400000 mortgage that’s 30% of their equity (THIRTY PERCENT!!!!)

My wife and I have been looking for new homes for a few months now. Interestingly enough, it seems that new home builders will give the BUYER anywhere from 3-4% for *not* bringing a real estate agent to the deal. I have no idea why they do this but it is a nice little incentive either way.

I’m confident that we’re going to see more and more fo-sale-by-owner types of things in the future. Especially since many companies are beginning to offer tools to help sellers list and advertise their homes on their own — one example, http://cellulist.com

To truly get top dollar, one must focus on “marketing” which is exposing the property to as many people as possible and let the market determine what is the real value by the offers one receives. Real estate agents are not marketers… they are sales people. They move from transaction to transaction and have no real benefit to get you an extra $20,000 for you home (what they make an extra $1,200?).

The public uses agents because it’s the only way they know to “get into” a home they like and in about 64% of the time, they found it themselves. The NAR and REALTORs have brainwashed the “home buyers” telling them their services are free… it’s even in their code of ethics that they can advertise services as free when they expect payment.

Redfin and companies like it will expose this reality and there will be downward pressure on not just the seller side of commission but also buyers side, especially now that we are in a buyers market.

Agents will say that their mega brand has the best site with the most traffic… well for about $500 bucks, your listing can appear on THIER site because they use an MLS feed. Why pay 6%?

Agents in most cases are not real marketers and they don’t really analyze what they do. If you don’t believe me, use this tool real estate commission negotiation calculator and script we created that helps you interview your agent (if you decide not to try FSBO first) and provides you a script to negotiate your fees from any of the mega brands.
Watch the expression from the agents you interview and save yourself thousands in real estate commissions. When you get an agent that can break-down these calculations, they you got an agent who is really earning their commission.

We just sold our house and are building a house. We used a traditional agent who charged 5% total to sell our old home and help us buy our new home. Granted, she is a fantastic agent, so the services were stellar, but even so, she took care of things I simply didn’t want to deal with. Was I capable of taking pictures of my home and posting them online — most definitely. Could I have dealt well with others and negotiated for what I believed was necessary for my family — of course. Could I have researched home sales and values to understand what the right price to list at should have been and figured out what I’d probably eventually take for it — yes, of course.

The most important question however is did I want to do any of this — not at all. It was worth every cent to me to have our excellent realtor with her years of experience manage all of this while I juggled the fun of work, parenting, and Pop Warner pre-season football. She thought of things I wouldn’t have, and kept the nightmare that was managing through the closing on the house completely hidden from me while I was trying to make a deadline.

Would it have been worth it if she wasn’t an excellent realtor? Nope. With all of the tools and resources available to me, I am not willing to pay someone to do as well as I could have, I expect them to do significantly more and make my life a better place. Its for these same reasons that I have a professional paint my home and keep my lawn. And I’m not comparing realtors to painters or to landscape companies — just my motivations for using professionals in all of these areas.

In reality, the days of sub-par 6% realtors are probably numbered, and as well they should be. However, as with many other services, professionals who are good at what they do and have a strong value proposition will always find customers willing to pay for convenience and experience. The fact that we have a choice now is what really matters.

The reason that you pay for representation is to have someone do the hard stuff — the same reason you pay for anything. Using Redfin.com’s business model, part of the hard work (and a doubling of the legal liability) is shoved onto the listing agent — the hook in the NYT article. Much of the rest is not done at all — to the buyer’s peril.

> Yes, in this case, the money goes from seller to buyer.

All the money in a real estate transaction comes from the buyer at the closing table. Sellers need some representation and a lot of marketing prowess. But buyers need a lot of zealous, conscientious representation — this is why all the contract contingencies should be written to the presumptive benefit of the buyer. Buyers can and should negotiate their agent’s compensation, with any surplus commission going toward their costs. But an unrepresented seller faces far fewer disastrous consequences than an (essentially) unrepresented buyer.

I’m sooooo tired of this over-simplified comparison. An airline ticket is a commodity….every seat will get me to my destination exactly the same.

Consider this: You drive to work every day. It’s easy. You press the accelerator and avoid the other cars. But would you rather someone chauffeur you instead? It would allow you to do things you enjoy: read the paper, catch up on phone calls, crossword puzzle, etc. Too expensive you say? How about $5 each way? Therein lies my point. I think 99% of FSBOs are avoiding the cost of a Realtor. If that cost was cut to say, 2%, the ranks of Realtors would thin and consumers would breath a sigh of relief. Presumably, the Realtors left standing would get a crack at more deals and therefore make as much if not more money.

This is incorrect. Redfin’s cost-savings come from shifting the costs of buyer representation to the listing agent. Redfin takes full commission for doing only the easiest and cheapest parts of the job, then disburses two-thirds of that commission to the buyer. The net consequence of this, in the long run, will be the curtailment or elimination of the buyer’s agent’s commission. Redfin doesn’t represent its buyers at the most critical points of the transaction anyway, but it remains that buyers are the parties most in need of conscientious representation.

Yes, I’m a Realtor — but you’re completely safe from me. I only work with people who see the profit in my praxis.

I’m currently selling my house in the UK and negotiated down from 1.5% to 1%.

When I buy I won’t pay any commission; this is only paid by the seller.

Maybe, maybe not. Realtors will also flatter sellers, appealing to their greed, by inflating the listing price cited by other agents to get the listing. I’ve seen that done.

I recently sold a piece of real estate on Craig’s List. My first time with it. Easy. No fee. Can put up photos. The local paper wanted a small fortune for weekend ads. I’ll never let a realtor walk over me again. Craig’s List is a local newspaper’s worst nightmare.

Real estate is just the next domino to fall.

Must be information week, because I also learned how car dealerships stay in the game. They have enormous control over auto manufacturers, who consequently can’t sell cars online.

“As soon as the cost of buyings/selling real estate comes down, buyer/sellers will continue to use agents as a convenience rather than out of fear or being uninformed. ”

Sure. When was the last time you talked to a travel agent?

I’m probably a rarity in my age group (53 years old), I found my current home on the Internet, as well as my car, washing machine and dryer, music, gifts, and all travel arrangements.

My children and grandchildren are professionals when it comes to using the Internet, we can only imagine where this will all lead to in the future?

Edward