You could also have friends "mystery shop" the realtor and document it.

Why anyone would not want to bust their butt for a quick $50K is beyond logic.

I think your perspecive is based on what you've seen from lazy, unsuccessful realtors.

MLS & other online databases are only TOOLS that we use. If that was the majority of our work, then you'd think the playing feild would be pretty level among realtors, right? Fact is, 80% of the business is still done by the top 10-15% of the realtors, because they work harder, are better salespeople, and are more committed and professional.

What I see day in, day out are people who use the first realtor they come across, without refences or research, and then are shocked that they don't get a high level of service. It's madness, and it's *really stupid*.

Having said that, I think local, state (or provincial) and national real estate boards are largely to blame by setting the bar low for qualifications. Certaibly doesn't help to justify professional wages.

And as for commission... I got a call last night from a developper I'm working with. He's been apprached by another agent&broker who offered to handle his buisness for 4.5% (vs my 5%). The builder had a tough year last year, and is reasessing *everything*. He felt bad pushing the issue, because I've put a lot of work in, but he wanted to know if I was flexible with my commission. I told him I sure was, and could be over in a few hours to redo our contracts. Spent almost 4 hours with him today, and got all the contracts resigned for 6 months at 5.5%, and he couldn't be happier. So yeah, my commissions are negotiable, especially on weekends

Instead of negotiating DOWN on commission, I negotiated UP on service. We spend hours going over his goals for specs, pre-solds ad lots. We drew up a marketing plan and sales strategy to get things rolling faster this year. We even went over his own office management bottlenecks and set deadlines for firing some of the deadwood. He won't get that level of effort for 4.5%, or even 5%.

Discount brokers, FSBOs, no-service realtors are all important players in a competitive marketplace. I like them, personally. Scares the lazy players out of the business, and helps me sell my value at the full-service end of things

great idea!

Jake, while it certainly sounds like you take your job seriously and I applaud you for it, the brutal reality is that what you're describing only proves my point. A service-oriented activity such as you describe will always have appeal for the right kind of client (the kind that likes to be doted on and wants everything done for them, and is willing to pay for it). There's nothing wrong with that. It's exactly like a travel agent. There are still travel agents around and there's still a certain type of client that will always support them (the same type I'm describing).

However the reality is that more and more people are becoming empowered by technology and they don't NEED this type of service. I'd even argue that most of them (speaking for myself) don't even particularly want it. I get a certain amount of satisfaction in researching things for myself, learning about how things work and figuring out the particulars of processes, procedures and established methods of doing things as part of an ongoing life-education process. A lot of my peers feel the same way. We don't need people wiping our butts for us - be it government or someone trying to sell us a "service" for several thousand dollars.

From a seller's perspective I can see a little more value in having an agent. You don't have to deal with the prospective pool of buyers directly. There's inherent value in that. I've sold several cars private party and it's always a headache. Between the flakes, the idiots, the dreamers, the tire-kickers and the time-wasters, I can certainly understand the desire to pay someone else to not have to deal with that kind of B.S. directly. However, is it NECESSARY? Hell no. And at the end of the day, who pays for this? That's right - the BUYER, not the seller anyway. And what's the benefit to the buyer exactly? (*cricket* *cricket*) Yeah, that's right.

I'm sorry if it sounds harsh, but I resent people expecting that they're somehow entitled to skim 6% or 7% (or more) off the top of what I'm paying when all I get out of it is the privilege of (generally speaking) listening to a lot of B.S. sales pitches and drinking a lot of RE-office bad coffee - and correcting the mistakes the agents are making on their boiler-plate forms that they supposedly deal with all the time (I've done paperwork now more times than I can count and it never ceases to amaze me how many times I end up fixing math mistakes, misspellings, etc.) These are CONTRACTS guys! WTF am I paying you for?!?!

I don't mean to bash all agents - I'm sure there are some really great and committed ones out there and perhaps you're even one of them. I just can't stand the defensiveness a lot of them have regarding what they do and why they ought to be paid a king's ransom for doing what appears to me as quite little, involving only the most minimal amount of specialized knowledge. I have no problem paying someone for a service - with the caveat that I want them earning it and justifying to me that the service they're providing is worth it. I haven't gotten this impression yet.

And please don't try to justify the cost as "well, I'm just trying to make a living and cover my overhead". That's your problem, not mine. YOU decided to go into that career, not me. It's like me deciding to hire 50 people full-time, get a fancy office downtown with nice modern furnishings and then inflating my fee by 5000% to "justify" it to my client because I "have to cover my costs". Is that really fair?

The free market will eventually fix this problem, it's just a bit maddening it hasn't yet. But it's starting to...

things must be different in your neck of the woods. the costs (commission) comes out of the sale price, so the seller pays it NOT the buyer. car auctions (and probably more types of auctions) charge the buyer a fee as well as the seller but not in real estate.

Question of perception. I suspect the way you have dealt in RE has reinforced your views on realtors, and if I had the time right now I could show how your approach will continue to generate the behaviors that bother you. A *GOOD* buyers agent will more than pay for the 2.5 or 3% commission, even if the buyer pays it out of pocket. Some do!

Story: My 2nd cousin knows better than to trust a SMOOTH TALKIN FIVER PERCENTER (his term), even if it is his relative. Shops for a house, always calls the listings agent directly, finds they are pushy and doesn't trust them (err..) and starts to focus on the FSBO sales because "that's where the deals are".

A few months later we were at a bbq and he was bragging about the house that he bought... great deal "without any parasite costs" (his words). Three bedroom bungalow in a perfect secluded lot, and he only paid 172k, vs the 180-190 he saw everywhere else. Didn't get a building inspection either, because EVERYONE knows those are ripoffs. "you should see the house!" he tells me... blue bungalow, such and such rd..

"Oh the blue one with the single detached garage?" I asked. YEP!

R I G H T. The one my other buyers asked me to take them through a few months ago. The one with UFFI and asbestos siding. The one right behind the proposed new highway service rd in 2012. Great deal though, he paid 8k less than the other comps, easily saved having to pay that SMOOTH TALKIN FIVE PERCENTER.

Oh I see... so it's my fault, right? :rolleyes:

Jeezus.

I've gone the "cheap" route, negotiating their rate, with realtors twice.

What I found is the realtors that won't negotiate it were worth every penny while the others were not worth a dime.

One instance it came down to two realtors, the 1st would not negotiate, we passed and went with the other. 1st realtor had just picked up a house down the street which was also the closest comp in the area. She had it sold in two weeks for asking price. We languished for 6 months with the other realtor while the market started to slide. All she did was keep telling us was to lower the price.

Towards the end of my commit with realtor 2 "Katie" knocks on my door. She's another realtor, I'm ready to send her away but before I can she says, "I've been watching this listing, I have two questions, why hasn't it sold yet and why are you selling it so cheap?"

I invited her in and gave her the listing. She was there that weekend with a video crew and did a kick ass virtual tour. She RAISED the sell price back to where we had started.
First week she brought in more buyers than the other one had in months. EOD we ended up in a bidding war with 2 buyers at a time when most people were happy to have just one on the hook.

Frankly I don't see realtors going away.

Few years back, before moving to TX we were looking for a new place in NY. I quickly learned that if a listing was a FSBO to avoid it like the plague.

Owners by and large do not know how to sell a house and are a total turnoff. Too much personal baggage. They show you all the stuff that they loved about the house which a buyer may not give a rats ass about.

In a nutshell they do nothing to help the potential buyer see themselves in the house which is critical in closing a deal.

One FSBO that we did look at once was across the street from a friend of mine. The owners ended up going with a realtor. Realtor sold it for 60k more than they were asking on their own.

There are crap brokers and there are good ones. You need to do your homework.

I agree with P O P partially (as usual). If the service is worth the 5% "skim" then fine. One potentially large benefit is that if a buyer asks about an issue (that need not be legally disclosed) and the seller says I don't know yet does, there could be big legal trouble. If a broker is there, they can just say truthfully they don't know. (does not apply to issues that are required to be disclosed by law).

If the service is worthless then I don't want to pay for it. I am finding that as I look at car dealerships - the sales people seem to know nothing and do nothing. So, why should I pay a big markup that they will get?

A tip in an eatery is based on service and I think most people will tip better for better service. That is voluntary. Sales of houses, cars, etc. have that built in and price negotiations should be based on the level of service.

Without realtors/brokers there is no MLS.

Even if another alternative pops up it needs to be paid for somehow.

So while you may eventually eliminate the "middleman" you won't eliminate costs.

They just get moved somewhere else.

Exactly what I experienced when negotiating commission.

You most likely will get what you pay for.

Flip it, imagine your level of service if you tell the waiter/waitress up front that you are only willing to tip 5%.

Realtors talk about it up front because they pay for the marketing out of the commission.

What they have to spend is to sell the house is directly tied to what they can earn.

Waiters don't pay the kitchen for the food they serve you.

i agree with ^^this. a great realtor does stuff in the background. when i bought my home..i had a stupid question and called my realtor. i was out and about, and she was nearby. she asked me to stop by for a chat. she was setting up "english tea" at some house she was about to list. i asked her what she was doing, and she said she was hosting a realtor tea..she gets other sellers to see the house. that way any buyer they run across..this house would be on her mind.

this lady moved alot of inventory. she was never too busy for me. i still get emails from her.

P-O-P, you're absolutely right about Realtors not being needed when it comes to purchasers who are experienced, knowlegable and motivated with the greatest financial investment they'll make in their lifetime.

However, most buyers don't do this legwork beforehand, and so even the dogs get sold.
They have two-earner families and aren't willing to sweat the details.

I'm fairly knowlegeable with construction, and took a RE class before my purchase.
I researched hundreds of properties, compared the attributes of different areas vs price, did a drive-by of at least fifty, and made a comparisson chart of the top 25.

We pulled into the drive of this one twice and both times said "naw, too ugly and wierd". This was probably what others had said before. It was an off time of year, but the price had just recently been dropped $50K and the house had some expensive upgrades. I bought quickly after negotiating another $10K off for trees etc., and soon afterwards learned from my sister that a friend of hers had been ready to pounce on it.
We did a lot of landscaping(for a couple grand), and this Holloween four kids actually commented "I like your porch."

actually, some places do charge them

back to realty-
if I sell a house and it sells fast with little work needed by the broker, I just ask them to reduce their % and note why

if I could tell a broker was worthless, doing nothing, I'd tell them they were fired, or contact their boss

I have a couple of friends who are realtors & they are happy with the housing recession - said it flushed out a lot of the worthless ...

If the house sells quick I really don't care about paying the commission.

If you can eliminate carrying costs quickly and avoid reducing the price you'll likely come out ahead of the commision.

Sorry, that's not how I intended it to come across

I'll explain what I meant later on. I just put my daughter to bed and right now I need to drive across town to present an offer on a home I listed last wednesday. Offer is for 5k more than they had it as a FSBO for 6mths, and I intend to get it up another 2k.

No worries... Sometimes stuff just comes out wrong (I know all about that!)

Anyway FWIW I think there is SOME value to RE services, it's just another service (like many others) that is not weathering the onslaught of networked technology very well as information becomes more and more widely available to more and more people on little devices in their pockets these days...

The other thing to consider (as a generalized statement) is that people are by-in-large getting busier and busier as time goes on. Time is increasingly precious and they don't want to waste it on stupid B.S. sales pitches. I don't care how good someone is, how slick their delivery is and how experienced they are - I know damn well when someone is trying to blow smoke up my ass just to get a sale and it pisses me off to no end. Sure-fire way to get me to walk the hell out (which I've done in the past, rude though it may be I don't see it as any more rude than wasting my time with sales pitches).

The better agents (from my own point of view) are the ones who will research what they can about a place I find or express interest in, then let it "sell itself" rather than throwing out useless comments about "look at how wonderful this is - can't you just see yourself here?" (puke) That stuff doesn't go very far with me. I'm not stupid and I know full well they probably don't know too much more about the property than I do except for MAYBE a quick phone conversation with the listing agent and reading a few extra sentences in the non-public area of the MLS. Being that virtually all sales these days are bank sales anyway, the listing agents seldom know anything about them anyway, since their clients (banks) don't either - or at least claim not to.

Brilliant. A man after my own heart.

I use a listing agent who is a total pompous a$$. I offer 1% to the listing agent and 5% to the buying agent. The pompous a$$ listing agent doesn't care because he has every confidence that he is going to get all 6%.

When I sell my current house and flee California in 3 years and 9 months, it will kill me to give this guy 50k. But I am 99% sure that he will have a buyer for it before I even call him.

Make your money when you buy, not when you sell.

Depends what your carrying costs are to some extent but the logic is sound - makes sense.

Stuff here can be had so cheaply now if/when the time comes to move on I'd likely hang onto it as a summer place or an investment property. They're cheap enough these days! Which is nice...

Has anyone here done FSBO? That's how I found my current place (guy offered me a purchase option) but I'm finding the straight-up purchase opportunities out there are better, hence why I think it makes sense to be looking again...

I try to go out of my way to avoid pushy, obnoxious sales types as a rule however if it's someone working for me and selling my product or service, I'm a little more inclined to look past their methods and more at whatever results they can generate...

I certainly DO walk away from sales (and have in the past, including "big ticket" ones) if someone is a knob however...

When we sold my grandparents house, we listed. That night the girl who delivered the paper when she was growing up stopped. She bought it. Was a real kick since my mom and aunt showed the house. We always said we should have put a sign in the yard first. So when it was time to sell my aunts house, I reminded everyone of this. My cousins didnt want to deal with it. I told them we could try it for a few weeks and I would handle it. They signed with a friends mom. So the day of the open house, the new carpet is being laid. I go to pay the guy. There is an agent already there to show the house. 2 hours early. I told him he should wait a few hours so the men could finish. He said his buyers would be ok walking around them. It was the brother of the people 2 doors down. Yep could have sold it myself.

I bought and sold my duplex FSBO. Word of mouth and no sign. But the house I live in we used my ex's old sister inlaw. But the wife found it listed.

Moral to my stories. Try to sell yourself for a few weeks. A sign in the yard and maybe an ad. Never know what neighbor knows somebody looking.