I have always been interested in real estate since I bought my first house in 1995. Since then I have bought, lived in and sold 4 additional homes. Buying a home is a complicated process to the newly initiated buyer, but it gets easier as you move and buy other homes throughout your lifetime. Unfortunately, due to the economy we are currently in, and the effects of covid, moving will not be as easy going forward if things don't change.
With all that said, I've never understood why the seller is on the hook for a 5-6% commission, split between the buyer's agent and the seller's agent. No where else in the world of business transactions can I think of where the seller of a product, service, or used goods pays half the sales tax or any type of commission just for selling said product, service or used good. Example: I have sold all my cars myself rather than taking them to a dealership and getting pennies on the dollar for them. I never paid for the fee's that the buyer would pay at the DMV. I wasn't even asked to. That would be silly of a buyer to even ask. Example: I go to estate sales ocassionally. When I purchase an item or items at such sale, I don't demand that the seller (estate sales company) pay the sales tax on my purchases. That would be ludicrous, and of course I would not even ask them to because it's stated up front that you will pay sales taxes at estate sales.
My personal belief is that inflation over the last five or six decades has caused the price of housing to skyrocket. Salaries on the other hand have limped along at 3-5% over those decades barely covering or not quite covering the basics. This makes housing even more challenging for new buyers or move up buyers. As the price of housing has risen, and at the levels they are today for a home, isn't it about time to re-evaluate the 5-6% commission and LOWER it? Especially since homes today cost hundreds of thousands of dollars MORE than they did in the 1960's, 1970's , 1980's, 1990's, 2000's???
Why should the seller be robbed of another 3% of their equity? Why??
On a $500,000 home today the seller at 6% commission pays $30,000! to sell their house. If commissions were cut in half, to 3%, split between the buyers agents and sellers agent, on that same $500,000 home, the SELLER would pay $15,000. Quite a difference. But still a fair payday for both buyer and seller agents who would receive $7500. The average salary in America is $53,000. The point is that MOST people in MOST markets in America DO NOT make $7500 per month in salary. A good real estate agent should sell a home a month. That's potentially $90,000, or more based on the above example. Why is the real estate model still a 6% commission model? Who set it? Why do we have this monopolistic model with the buying and selling of homes?? Seems a bit elitist to me.
I'm really a simple person at heart. To me, the buyer should be responsible for paying their agent a 1-2% commission range or whatever they can negotiate, and the seller should be responsible for paying their agent a 1-2% commission range or whatever they can negotiate. Lower commissions would enable both parties, buyers and sellers, to meet their moving objectives without feeling totally robbed by the real estate agent monopoly of how real estate is bought and sold in America. Sometimes change is good. In this case, it's long overdue for change to benefit the customer!
The purpose is not necessarily to see housing prices drop, although that would be nice. Don't count on anything "returning to normal" now that covid is considered in the past and non relevant to a large degree. Inflation is here to stay because our gov't just can't stop spending money like drunken sailors on wars that have no bearing on the average American, and spending bills so stuffed with pork that it is udderly ridiculous. No, with covid-con, the globalists accomplished their goal and did their damage to America and the 5 eyes nations,i.e. the UK, Canada, USA, Australia and New Zealand getting 75% of those populations to roll up their sleeves and take the dna altering death shot. Pardon my sidebar here.
Back to real estate. Here's another reason why it makes sense for the seller to pay their realtor 1 to 3% commission and for the buyer to pay their realtor a 1-3% commission. When you go into the courtroom as the defendant, or the plantiff, you pay a lawyer to represent you. The plantiff pays for their own attorney to represent them and the defendent pays for their own attorney to represent them, that is, unless they are poor and the court will appoint them a defense attorney. The point is, you need to pay an expert ( an attorney in this case) for their expertise to represent you and your best interests. Regarding how real estate, buyers and sellers also need an expert to represent their best interests to sell or purchase a home. Someone long ago just decided that the seller would pay for both agents. Why? Did the consumer get a say so regarding this matter? No, they didn't. This is one reason why average people despise real estate agents, especially sellers. Realtors are elitists, and they really don't even do that much, it's not like they are an attorney too and can do all the legal paperwork. Like the plantiff /defendant example above, why is real estate transactions the only transaction where the seller gets stuck paying for the services of the buyer?? It's time that people revolt and just pull the plug on the seller paying the freight for the buyer. Heck, I had to save for 12 years before I could buy my first home. Younger folks have no concept of "sacrifice" to obtain large goals like owning a home. This heavy chain around the neck of seller has to be broken! It's not fair. Everyone in the room knows it's not fair, but the power players in the real estate world don't want what's fair. They like many others are just plain GREEDY!
I have always been interested in real estate since I bought my first house in 1995. Since then I have bought, lived in and sold 4 additional homes. Buying a home is a complicated process to the newly initiated buyer, but it gets easier as you move and buy other homes throughout your lifetime. Unfortunately, due to the economy we are currently in, and the effects of covid, moving will not be as easy going forward if things don't change.
With all that said, I've never understood why the seller is on the hook for a 5-6% commission, split between the buyer's agent and the seller's agent. No where else in the world of business transactions can I think of where the seller of a product, service, or used goods pays half the sales tax or any type of commission just for selling said product, service or used good. Example: I have sold all my cars myself rather than taking them to a dealership and getting pennies on the dollar for them. I never paid for the fee's that the buyer would pay at the DMV. I wasn't even asked to. That would be silly of a buyer to even ask. Example: I go to estate sales ocassionally. When I purchase an item or items at such sale, I don't demand that the seller (estate sales company) pay the sales tax on my purchases. That would be ludicrous, and of course I would not even ask them to because it's stated up front that you will pay sales taxes at estate sales.
My personal belief is that inflation over the last five or six decades has caused the price of housing to skyrocket. Salaries on the other hand have limped along at 3-5% over those decades barely covering or not quite covering the basics. This makes housing even more challenging for new buyers or move up buyers. As the price of housing has risen, and at the levels they are today for a home, isn't it about time to re-evaluate the 5-6% commission and LOWER it? Especially since homes today cost hundreds of thousands of dollars MORE than they did in the 1960's, 1970's , 1980's, 1990's, 2000's???
Why should the seller be robbed of another 3% of their equity? Why??
On a $500,000 home today the seller at 6% commission pays $30,000! to sell their house. If commissions were cut in half, to 3%, split between the buyers agents and sellers agent, on that same $500,000 home, the SELLER would pay $15,000. Quite a difference. But still a fair payday for both buyer and seller agents who would receive $7500. The average salary in America is $53,000. The point is that MOST people in MOST markets in America DO NOT make $7500 per month in salary. A good real estate agent should sell a home a month. That's potentially $90,000, or more based on the above example. Why is the real estate model still a 6% commission model? Who set it? Why do we have this monopolistic model with the buying and selling of homes?? Seems a bit elitist to me.
I'm really a simple person at heart. To me, the buyer should be responsible for paying their agent a 1-2% commission range or whatever they can negotiate, and the seller should be responsible for paying their agent a 1-2% commission range or whatever they can negotiate. Lower commissions would enable both parties, buyers and sellers, to meet their moving objectives without feeling totally robbed by the real estate agent monopoly of how real estate is bought and sold in America. Sometimes change is good. In this case, it's long overdue for change to benefit the customer!
The purpose is not necessarily to see housing prices drop, although that would be nice. Don't count on anything "returning to normal" now that covid is considered in the past and non relevant to a large degree. Inflation is here to stay because our gov't just can't stop spending money like drunken sailors on wars that have no bearing on the average American, and spending bills so stuffed with pork that it is udderly ridiculous. No, with covid-con, the globalists accomplished their goal and did their damage to America and the 5 eyes nations,i.e. the UK, Canada, USA, Australia and New Zealand getting 75% of those populations to roll up their sleeves and take the dna altering death shot. Pardon my sidebar here.
Back to real estate. Here's another reason why it makes sense for the seller to pay their realtor 1 to 3% commission and for the buyer to pay their realtor a 1-3% commission. When you go into the courtroom as the defendant, or the plantiff, you pay a lawyer to represent you. The plantiff pays for their own attorney to represent them and the defendent pays for their own attorney to represent them, that is, unless they are poor and the court will appoint them a defense attorney. The point is, you need to pay an expert ( an attorney in this case) for their expertise to represent you and your best interests. Regarding how real estate, buyers and sellers also need an expert to represent their best interests to sell or purchase a home. Someone long ago just decided that the seller would pay for both agents. Why? Did the consumer get a say so regarding this matter? No, they didn't. This is one reason why average people despise real estate agents, especially sellers. Realtors are elitists, and they really don't even do that much, it's not like they are an attorney too and can do all the legal paperwork. Like the plantiff /defendant example above, why is real estate transactions the only transaction where the seller gets stuck paying for the services of the buyer?? It's time that people revolt and just pull the plug on the seller paying the freight for the buyer. Heck, I had to save for 12 years before I could buy my first home. Younger folks have no concept of "sacrifice" to obtain large goals like owning a home. This heavy chain around the neck of seller has to be broken! It's not fair. Everyone in the room knows it's not fair, but the power players in the real estate world don't want what's fair. They like many others are just plain GREEDY!