6% Hopefully gone forever

[Moses_Young]

My wife and I have bought and sold 5 houses in our life. I briefly got my Realtor license and listed and sold several houses in the mid 90s. (Not my own house).

So I completely understand your mentality in thinking an absolutely insane amount like $36,000 is ok.

Think about that amount of money vs. the service provided. It's literally crazy we ever thought that was reasonable.
ESPECIALLY since just putting a sign of your own out front and placing it on different websites yourself, in this market, will fetch almost immediate results. There are many sites that will tell you what your house is worth. You don't even need a realtor for that anymore.

So I don't think it's ok any longer. There really can be no justification for handing a commission of that magnitude for listing your property.

And that is why this change, brought about by this lawsuit is so vitally important. You are going to see 2, maybe 3 percent commissions become common place.
Further, I think we are going to see a lot more flat fee rates.

A flat fee of $2000 to maybe as much as $5000 is about the most I'd now be willing to pay to not try FSBO.

I'd argue a flat fee is more reasonable than a commission. Whenever does a mechanic, an electrician or a plumber charge based on the value of your car or home, rather than for the work done and hours actually spent?

Despite what's said about Australia, the 3% or so commission is unreasonable there, also. House prices are kept so artificially high (by government mismanagement and corruption) that realtors can afford to charge a lessor commission in terms of percentage, as people are paying double or more what the houses are actually worth.

Compare a million dollar home in AU against a $400k or $500k home in the US, if you want to see my meaning.

 

[ZNP]

I'd argue a flat fee is more reasonable than a commission. Whenever does a mechanic, an electrician or a plumber charge based on the value of your car or home, rather than for the work done and hours actually spent?

Despite what's said about Australia, the 3% or so commission is unreasonable there, also. House prices are kept so artificially high (by government mismanagement and corruption) that realtors can afford to charge a lessor commission in terms of percentage, as people are paying double or more what the houses are actually worth.

Compare a million dollar home in AU against a $400k or $500k home in the US, if you want to see my meaning.

What if the house is not sold? Salesmen are paid on commission because if they don't sell they don't get paid.

 

[Moses_Young]

What if the house is not sold? Salesmen are paid on commission because if they don't sell they don't get paid.

I'd argue they are paid on commission because it's more profitable. If they were worried the house wouldn't be sold, surely it would be more profitable for them to charge by the hour, no? What if the mechanic is worried he can't fix the car, the electrician the light, or the plumber the pipes? Yet they still charge for the work and by the hour.

 

[ZNP]

I'd argue they are paid on commission because it's more profitable. If they were worried the house wouldn't be sold, surely it would be more profitable for them to charge by the hour, no? What if the mechanic is worried he can't fix the car, the electrician the light, or the plumber the pipes? Yet they still charge for the work and by the hour.

I would argue that they are unnecessary and can be replaced with AI. You need someone to fairly price the house for the market, easy for AI. Someone to post this on the appropriate websites -- easy for AI. Someone to take the pictures so that they can have these walk through videos online. That takes a few hours of labor by someone with expensive equipment. Perhaps $500 to $1,000 for this service depending on the size of the property and number of rooms.

Then you need a lawyer for the closing and again, something AI can do better, faster and cheaper than humans.