How's your housing market? (2 Viewers)

[Buckna]

Actually, yeah, this is what I'm referring to. The argument upthread is between guys in very different markets. Here in SoCal, $700k buys you a 1700 sq ft, 3bd/2bath house on a small lot in the San Fernando Valley suburbs. That same house goes for $100k in many other suburban places in the country. The guy earning his 3% selling the same house really makes out if that house is in a stupid area like this one, by virtue of just being in the right zip code. He's not doing $20k more work getting the job done.

I think that's a legit argument, although the cost of living and median salaries would also be much lower in those 100K neighborhoods, it likely doesn't make up for the difference in size on those commissions.

 

[proteus126]

A bit off topic, but one thing I noticed in my neighborhood is that many of the houses are being sold by the same agent.  While she has a good thing going, I don't think it is a good thing for her clients.  Most of them are old and moving into retirement communities, and seem just to want to get out without maximizing value.  The original owners paid $60k in the 1960s and don't seem to care if they get $710k or $750k.  Houses are selling for less than (my opinion) they should sell for.  Maybe 5% less, so not a big deal perhaps.

I think she is lazy, plugged in, and just turning the crank.  Her face and name are familiar since she mails out status flyers every so often, and of course puts it on the shingle when the home goes on the market.  In talking with one set of neighbors who we were close to, and asking them about their experience, it didn't seem like she was very aggressive in getting them to sharpen up their presentation or get rid of some of the junk that made the houses feel smaller and dated.  As a result, not only is the sale price lower, but the homes don't move as fast as they might.

Seems like a agent agreement with lower base rate but containing incentives would be an interesting twist.  Multiple bidders in the 1st week?  $5k more to the agent.  Less than 60 days listing to closing, $3k more to the agent.  Do those exist currently?  Of course, there could potentially be a whole different host of issues with an over-motivated seller's agent!  For instance urging a lower listing price in order to get the bonus for a sale over 100% list price.

 

[Zegras11]

I get that for sure. Guess I’m just speaking for myself here. I have a legal background so I think I can handle it. Joe and Jane Smith, I can see why they’d want to pay. And if I have any problems I’d just hire a lawyer to review all the docs for me. 

And I get this. And my answer is people who sell on their own have dramatically less buyers actually see there home.  There are dozens of ways to get traffic and you might only employ a few.  We can employ all or most of them and get your house on a bidding war.

 

[Zegras11]

You sound like a 'very good agent' here.....

Look, he's right in what he's thinking, you said so yourself.  And over-paying an "agent" to make sure of it all is not the answer.  

If he wants to save a ton of money by educating himself and knowing what to do, more power to him.  

The thinly veiled threats of disaster are hilarious.  Oh wait, the potential catastrophic consequences is why you must have an agent!  Also, you must pay them the going-rate (outlandish or not).

Fear is the best seller of all-time.

.  This is ####### hilarious after the week I just had.  By all means, go sell your own home. 

 

[Zegras11]

I think that's a good way of putting it, there are definitely people out there that would do just fine without an agent and shouldn't need one when selling their house.

There's also a ton of folks that have no idea what they are doing. My wife spends a lot of time working on leads that are expired listings on For Sale By Owners. Occasionally you can convince one of these people to go with an agent and they are often surprised that suddenly they sell their house when they had no luck on their own. But a large percentage of those folks are just super cheap and/or have unrealistic expectations.

This x 1000.      The theme of these threads is that selling a house is simple and it's just not.  Not remotely close to being simple.   And I would say that anyone doing it that's not a real estate attorney is the biggest fool I'd ever meet.     Just make sure you have someone sell your home that sells at least 20 per year.  Do not hire a relative or friend unless they do that.  It ruins the relationship quite often. 

 

[Zegras11]

Here in Denver, wife has a listing that is closing this Friday. House was listed Wed Feb 14th, within 24 hours had two offers sight unseen over asking. Open house the following Saturday literally had a line of people out the door waiting to see it, ended up with 10 offers all above asking. Seller decided to go with a nice couple that were first time home buyers, they weren't offering the highest bid, but did offer 20K over asking and were willing to give an appraisal guarantee of 10K (so if the house didn't appraise for the sale price, which it didn't, they would make up the difference.) Assuming everything goes alright this Friday with the Closing, house will set a new record for that neighborhood. Helps that it was originally priced at 340K which is very entry level here in Denver.

It's tough for buyer's, any halfway decent house that's not outrageously priced has tons of offers and everyone competing to be the one to get it. My wife has a couple of buyer's that want new builds instead and the waiting list is like 9 months long.

exactly what I'm seeing on all of this. Had a buyer come in last Sunday at 10500 over asking.  ten offers and we lost.  three of them waived inspection contingency which is incredibly stupid.  

 

[Zegras11]

I think this was covered in the first Freakonomics book. When a real estate agent is selling someone else's home, they really don't care what it sells for. Say she could hustle another two weekends and get $10,000 more for the house. Her cut is... an extra $300. She'd rather sell it now and sign two more clients those extra two weekends than put in the work to help her existing client make ten grand. The agent will push to take the first offer to just clear the sale, rather than wait for a better one.

Meanwhile, when she sells her own house, the Freakonomics team found that real estate agents have their own homes on the market an average of 10 days longer, holding out for more money. 

An better incentivized system would probably work better for sellers looking to maximize their return. 

Any seller can do this if they want to.  The rate is a negotiation between seller and listing agent.   There are no set rates ever.

 

[NeverEnough]

I've been house shopping for a few months now & have decided that I'm giving up if I find nothing by early summer. It's too much of a seller's market. Wish I could move to bum#### & get one of the really nice 2 car garage homes for less than what no garage or 1 cars sell for in this area. I am not willing to have a hour+ commute again, though.

I'm not even looking for anything fancy. The problem for me seems to be it suddenly cost a ton more just for a 2 car v 1 car garage. WTH?! I don't think I'd be happy settling for another 1 car home & I am also itching to get back into a fast car. House shopping is holding up car shopping. I have toys now, but they don't fill the straight line speed slot. Miss my C6Z...

 

[Sand]

You want to pay your agent 1%?  That's laughable.  I would take 4% (instead of my standard 6%) to handle both ends of a transaction if I liked the situation, but nobody that has any talent is gonna take 1% to sell your home.  Wow.

I'e always thought it should be a sliding scale.  Not a hugely steep one - say 3% under 400k, 2.5% to 700k, 2.25% above that, etc.  At what percentage for a 500k house would you balk?  750k, 1M?

Just curious.

 

[Sand]

An better incentivized system would probably work better for sellers looking to maximize their return. 

Almost impossible to set incentives on these high priced items to maximize selling price vs. agent volume.  Volume is a huge knob for these folks.

 

[PIK95]

What's crazy is that 3% on a 100k house and 3% on a 700k house are very different amounts of pay, but, the same amount of work. I could see an argument for %-caps in some markets. 

  We get 0% so often (people lose jobs, appraisals don't add up, people flake out, and today I have a title issue) that I need to have some decent ones just to stay in business. 

  I'm a hard worker. People love me for that and I was one of the highest producers in my office.  That being said, I had a half dozen deals (at least) last year that just fell apart for the reasons above.  I worked a couple of hundred hours with those clients (and other window shopping buyers) where I got 0% and still had big expenses.

  It cracks me up that people will try and chisel us to our faces, yet they won't even flinch as their financial guys rake them over the coals with percentages and fees.  If people are bad, don't use them.  Don't expect the good ones to work for huge discount.  You wouldn't and you would start a thread about it if your boss even hinted at it.

 

[Zegras11]

What's crazy is that 3% on a 100k house and 3% on a 700k house are very different amounts of pay, but, the same amount of work. I could see an argument for %-caps in some markets. 

So we have 66 homes listed at $1,000,000+ in our county.

The MLS listings only show what the buyer agent is getting, so I don't know what the seller is getting.  
62 - 3%
2 - 2.5%
2 - 2 %.

I'm getting 2.5% on a $167k pending.   Agent said CA couple was selling 3 rentals and wanted a discount.  Makes sense.  But, listing agent limited the amount of buyers coming in by knocking buyer agent to 2.5% instead of 3%, which helped us to not get in a bidding war.   Seller LOST MONEY by asking for discounted rate.  Same homes within 1/2 mile are now getting $175k offers.  Dumb seller and dumb listing agent.

 

[Zegras11]

  We get 0% so often (people lose jobs, appraisals don't add up, people flake out, and today I have a title issue) that I need to have some decent ones just to stay im business. 

  I'm a hard worker. People love me for that and I was one of the highest producers in my office.  That being said I had a half dozen deals (at least) last year that just fell apart for the reasons above.  I worked a couple of hundred hours with those clients (and other window shopping buyers) where I got 0% amd still had big expenses.

  It cracks me up that people will try and chisel us to our faces, yet they won't even flinch as their financial guys rake them over the coals with percentages and fees.  If people are bad, don't use them.  Don't expect the good ones to work for huge discount.  You wouldn't and you would start a thread about it if your boss even hinted at it.

Had one fall yesterday. we beat out three offers with $3k over asking offer.  He goes into lender to give him statements and stubs and info is less than he stated on phone to get pre qual letter, AND HE QUIT HIS JOB for a new one the day after we went pending.  

I have one discount.  If I list and get you a new home, 1% off the listing to be paid as a credit when you close on the buy.  In writing.

If an agent is quick to drop their commission, how quick will they drop the ball negotiating on your behalf with a buyer?

 

[PIK95]

You sound like a 'very good agent' here.....

Look, he's right in what he's thinking, you said so yourself.  And over-paying an "agent" to make sure of it all is not the answer.  

If he wants to save a ton of money by educating himself and knowing what to do, more power to him.  

The thinly veiled threats of disaster are hilarious.  Oh wait, the potential catastrophic consequences is why you must have an agent!  Also, you must pay them the going-rate (outlandish or not).

Fear is the best seller of all-time.

  I have a client that absolutely loved the house we are under contract in right now, that I advised them against from the start.  We looked at around twenty homes before they wanted to move on this one.  

  So far we have had major inspection issues. The home has lead issues, asbestos issues, radon, and water problems.  I got a call yesterday from title that there were outstanding mortgage issues and oh yeah, the city took some of their land and nobody seems to know why.  We need a survey at a minimum.  Today the lender called and said the appraisal has all kinds of conditions.  

Bottom line is that this deal is probably going to just fall apart two weeks before closing. It's amazing that I have held things together at all. Most of my buyers listen to my advice but these didn't because this house was such a great deal.  And now it's gonna cost them. 

On a side note, I have at least sixty hours in with them and I probably won't get a dime.  They are so mad they may just keep their condo now.

 

[Sand]

  It cracks me up that people will try and chisel us to our faces, yet they won't even flinch as their financial guys rake them over the coals with percentages and fees.  If people are bad, don't use them.  Don't expect the good ones to work for huge discount.  You wouldn't and you would start a thread about it if your boss even hinted at it.

Ok, while we are being educated, how to the financial folks rake us over with percentages and fees?   

 

[Capella]

  We get 0% so often (people lose jobs, appraisals don't add up, people flake out, and today I have a title issue) that I need to have some decent ones just to stay im business. 

  I'm a hard worker. People love me for that and I was one of the highest producers in my office.  That being said I had a half dozen deals (at least) last year that just fell apart for the reasons above.  I worked a couple of hundred hours with those clients (and other window shopping buyers) where I got 0% amd still had big expenses.

  It cracks me up that people will try and chisel us to our faces, yet they won't even flinch as their financial guys rake them over the coals with percentages and fees.  If people are bad, don't use them.  Don't expect the good ones to work for huge discount.  You wouldn't and you would start a thread about it if your boss even hinted at it.

I paid less than 1% in financial fees last year. DIY

 

[Rodrigo Duterte]

Sounds like you two are most certainly deserving of the money you make, good for you.

I would also agree that most people need the help of a realtor.

But not everyone.  If someone is smart enough and has the time to do their own due diligence, they will be fine.

I also happen to think realtors are overpaid.  Not all of them, but a large part.  Of course, you'll never hear that from them, oh God no.

 

[Zegras11]

  I have a client that absolutely loved the house we are under contract in right now, that I advised them against from the start.  We looked at around twenty homes before they wanted to move on this one.  

  So far we have had major inspection issues. The home has lead issues, asbestos issues, radon, and water problems.  I got a call yesterday from title that there were outstanding mortgage issues and oh yeah, the city took some of their land and nobody seems to know why.  We need a survey at a minimum.  Today the lender called and said the appraisal has all kinds of conditions.  

Bottom line is that this deal is probably going to just fall apart two weeks before closing. It's amazing that I have held things together at all. Most of my buyers listen to my advice but these didn't because this house was such a great deal.  And now it's gonna cost them. 

On a side note, I have at least sixty hours in with them and I probably won't get a dime.  They are so mad they may just keep their condo now.

This #### happens way more than the "easy money" ones.

And the degree to which my clients trust me to do things correctly and efficiently is the degree to how smooth a deal will go. 

When a client, usually the guy thinks he knows how to do my job better than me, all sorts of issues pop up.     I had a guy last year insist that he didn't want to talk to my preferred lenders. Went with a bank I know is horrid and always quits at the sign of anything difficult as they are salaried employees. Deal went south and his was the first of a chain of 5 deals contingent on the others that all fell apart. I was so happy to be rid of them. Such a waste of time. 

 

[PIK95]

I'e always thought it should be a sliding scale.  Not a hugely steep one - say 3% under 400k, 2.5% to 700k, 2.25% above that, etc.  At what percentage for a 500k house would you balk?  750k, 1M?

Just curious.

Depends on the sellers.  "Mo Money Mo Problems."

 

[Rodrigo Duterte]

 Bottom line is that this deal is probably going to just fall apart two weeks before closing. It's amazing that I have held things together at all. 

See, I don't get stuff like this.  Isn't what just happened part of being a real estate professional?  Are you not paid to be able to hold it together?

 

[Zegras11]

Sounds like you two are most certainly deserving of the money you make, good for you.

I would also agree that most people need the help of a realtor.

But not everyone.  If someone is smart enough and has the time to do their own due diligence, they will be fine.

I also happen to think realtors are overpaid.  Not all of them, but a large part.  Of course, you'll never hear that from them, oh God no.

The ones that are over paid are the part timers, which is about 75% of all agents.  Going with a top listing agent will net you more money than the 3%, especially in this sellers market. I know of many that consistently get 8-10% over asking.

 

[Zegras11]

See, I don't get stuff like this.  Isn't what just happened part of being a real estate professional?  Are you not paid to be able to hold it together?

Sometimes the issue is out of your control like he posted about the title report having issues.  You do your best to make it still happen, but sometimes you just can't.

 

 

[PIK95]

Had one fall yesterday. we beat out three offers with $3k over asking offer.  He goes into lender to give him statements and stubs and info is less than he stated on phone to get pre qual letter, AND HE QUIT HIS JOB for a new one the day after we went pending.  

I have one discount.  If I list and get you a new home, 1% off the listing to be paid as a credit when you close on the buy.  In writing.

If an agent is quick to drop their commission, how quick will they drop the ball negotiating on your behalf with a buyer?

I had two simular ones last year.  One quit his job and the other one mislead the mortgage guy as he got paid under the table, lol.  He made 12k a year in paper, but like 50k in wheat penny tips.  I actually laughed when that happened.  That was the second buyer I lost for that condo as the first one fell apart a week before close over financing too.  

 

[PIK95]

See, I don't get stuff like this.  Isn't what just happened part of being a real estate professional?  Are you not paid to be able to hold it together?

I don't understand what you are asking?

 

[PIK95]

Ok, while we are being educated, how to the financial folks rake us over with percentages and fees?   

Ask them.  I'm expected to provide financial advice now (for free as usual) too? ?

  I always noticed my investments had a bunch of fees and costs that I didn't know about.  I asked my guy and we parted ways as I was losing money at the time.  The good news is I have no money to invest anymore as a poorish real estate agent so there's that.

 

[PIK95]

This #### happens way more than the "easy money" ones.

And the degree to which my clients trust me to do things correctly and efficiently is the degree to how smooth a deal will go. 

When a client, usually the guy thinks he knows how to do my job better than me, all sorts of issues pop up.     I had a guy last year insist that he didn't want to talk to my preferred lenders. Went with a bank I know is horrid and always quits at the sign of anything difficult as they are salaried employees. Deal went south and his was the first of a chain of 5 deals contingent on the others that all fell apart. I was so happy to be rid of them. Such a waste of time. 

This times a million fwiw.  

 

[Rodrigo Duterte]

I don't understand what you are asking?

You said it was amazing that you were able to "hold it together".  I'm just asking why it was amazing.  Is that not part of being a realtor?

 

[PIK95]

The ones that are over paid are the part timers, which is about 75% of all agents.  Going with a top listing agent will net you more money than the 3%, especially in this sellers market. I know of many that consistently get 8-10% over asking.

  I had a three family in December that was immaculate but in a bad neighborhood.  Sellers wanted 269 but would take 259.  I paid 2.5% and took 2.5% to list. 

  Despite the comps coming in around $250, I knew there were a bunch that were coming down the pipe that I could use at appraisal time. Also inventory on really nice three family's making $ were nonexistent.  I see alot of the same buyers agents at showings and we all talk.  

These sellers followed my advice when I said to list at $299 and I sold it in one day for $315 as is.  I also got the tenants leases at current rent as they were all the sellers family.  We had five offers that were all over $305 and three at $315.  

  We took the guy with the best financials as I was still worried about the appraisals.  Aided by my comps, we got the appraisal to $311 and everyone agreed.

  At the closing, the seller was very sad as it was the house she grew up in and her parents had passed away in.  I had my wife (teacher) put together an oil painting of the house for her and I had it professionally framed.  These are good people...

But just to show even good people can be unappreciating, the sellers husband has mentioned to me (the last couple of times I saw him) that I shouldn't have left 4k on the table at appraisal.  

I got them almost 50k more then they wanted because that's what I do.

 

[PIK95]

You said it was amazing that you were able to "hold it together".  I'm just asking why it was amazing.  Is that not part of being a realtor?

Not when you have to rely on the sellers, lender, and appraiser to work to try and keep it together.  Most times it falls apart because of one of those three that are not willing to play ball.

 

[Rodrigo Duterte]

Not when you have to rely on the sellers, lender, and appraiser to work to try and keep it together.  Most times it falls apart because of one of those three that are not willing to play ball.

But again, what is so amazing about you being able to hold it together?  Is that not part of the industry you are in?

 

[PIK95]

But again, what is so amazing about you being able to hold it together?  Is that not part of the industry you are in?

I surprised myself.  That was amazing to me.  I am not special in any way.

 

[LoadLetterPaper]

Excellent. Bought a 2 bedroom condo for 99k in 2015 and just checked Zillow

Zestimate®: $162,369
 

 

[PIK95]

Excellent. Bought a 2 bedroom condo for 99k in 2015 and just checked Zillow

Zestimate®: $162,369
 

Zilla can't be trusted.  Another client has texted me three homes they want to check out that they saw on Zilla.  They were not on my list of homes I sent them, so they thought I missed them.  Two of the three homes CLOSED in 2017, and the other has been under contract since the first week of February.  Zilla needs to update quicker.

 

[siffoin]

Shouldn't a realtor selling a house be judged on how well they do in a buyers market...not a sellers market?  It's like a financial advisor saying, "I earned my clients 18% in 2017!"  Big whoop.  I want to know how much you made them in 2008.  If you were listing a house for $300k in 2010, and got them $325k...yep you are f'n awesome.  When every house these days sells $25k above the list...big whoop.

 

[LoadLetterPaper]

Zilla can't be trusted.  Another client has texted me three homes they want to check out that they saw on Zilla.  They were not on my list of homes I sent them, so they thought I missed them.  Two of the three homes CLOSED in 2017, and the other has been under contract since the first week of February.  Zilla needs to update quicker.

I am sure it's not far off.

 

[RedmondLonghorn]

Apparently the market here is pretty, pretty, pre-TAY good.

 

[Buckna]

But just to show even good people can be unappreciating, the sellers husband has mentioned to me (the last couple of times I saw him) that I shouldn't have left 4k on the table at appraisal.  .

Reminds me of when I bought my current house a few years ago. We are sitting down at the closing going through and signing all the docs and the seller decides that then is the perfect time to state that he's not paying for title insurance because "he read on the internet" he didn't have to and that the buyer should. While title insurance is typically paid by the seller in our state, it is indeed a negotiable item. However, it was specifically spelled out in our offer that the seller would pay the title insurance. Guy was adamant about it, and was prepared to blow the whole thing up for less than a thousand dollars. Nevermind that he had his own purchase of another much more expensive place contingent on the sale of his home. His agent ended up eating the title insurance out of her commission so the deal would close.

I don't think he even knew that if it had fallen apart, I could have sued him for breach of contract if I really wanted to be a #### about it.

 

[PIK95]

I am paying the rent difference $300 out of pocket to keep another deal together.  The seller decided he changed his mind on giving his tenant a 30 day notice to raise the rent at closing as was agreed on.  And he waited two weeks to tell his agent.  She didn't offer to split it with me either. My buyer would walk to spite him si I ate it.  220k house and 2.5% commish fwiw.  People suxor.

 

[Zegras11]

Zilla can't be trusted.  Another client has texted me three homes they want to check out that they saw on Zilla.  They were not on my list of homes I sent them, so they thought I missed them.  Two of the three homes CLOSED in 2017, and the other has been under contract since the first week of February.  Zilla needs to update quicker.

LOL...   a lot of mine are "contingent short sales" that they list as active.  I spend 10 minutes talking about this at buyers consultation.  By all means, send me the info, and 98% of the time it will come back as them having it wrong.  And what's amazing is they get the data from the same MLS I'm sending from.  The other 2 percent are when they tell me they want a 2 car garage and they send me a home with no garage.

 

[needanap]

You want to pay your agent 1%?  That's laughable.  I would take 4% (instead of my standard 6%) to handle both ends of a transaction if I liked the situation, but nobody that has any talent is gonna take 1% to sell your home.  Wow.

Maybe your market is different than here in Orange County, but most listings are either 4% or 5% here.   

I would certainly sell an $800,000 house for 1%, especially if I was helping the seller purchase their next home for which I would I receive a commission.   (Deleted my pissy comment.  Different situations require different acitions)

On the buy side, I'd say the agent bringing in the buyer will receive between 2-2.5% on probably 90% of the homes listed.  Very seldom do I see 3%, and even less often below 2%.

 

[ffjunk]

Maybe your market is different than here in Orange County, but most listings are either 4% or 5% here.   

I would certainly sell an $800,000 house for 1%, especially if I was helping the seller purchase their next home for which I would I receive a commission.   Kudos to you for being so talented you can turn down listings that don't properly reward your skill.

So you can't even negotiate your own percentage and then you would want to be able to negotiate the sale of my house?

 

[Zegras11]

LOL....  So my clients that just lost Sunday to ten offers lost again against only one offer just now.  This place had $10k in work done (mold, windows, some carpet) and there were at least a dozen other things that needed repairs/updates.  The master shower was in the closet. LOL.  We offered under because it still needed 20k of work. They accepted the other offer with no inspection contingencies.  What a disaster that is going to be.

 

[Sand]

Ask them.  I'm expected to provide financial advice now (for free as usual) too? ?

  I always noticed my investments had a bunch of fees and costs that I didn't know about.  I asked my guy and we parted ways as I was losing money at the time.  The good news is I have no money to invest anymore as a poorish real estate agent so there's that.

Ah - ok.  I thought you meant the financial part of a house transaction.

Yeah- "money managers" are easily the most overpaid profession I can think of.  RE agents are a fairly distant second.  

Zilla can't be trusted.  Another client has texted me three homes they want to check out that they saw on Zilla.  They were not on my list of homes I sent them, so they thought I missed them.  Two of the three homes CLOSED in 2017, and the other has been under contract since the first week of February.  Zilla needs to update quicker.

Just to give you an idea - for the property I have at the beach my property value has "appreciated" over 100% in six months.  The house 2 doors down is valued at 1/3 of the land value.  Worse than useless.

Apparently the market here is pretty, pretty, pre-TAY good.

I looked through it and didn't see Burrumbuttock on the list.  Calling BS.

 

[needanap]

So you can't even negotiate your own percentage and then you would want to be able to negotiate the sale of my house?

Check out Redfin and Purple Brick -- their whole business model is offering the discounted listing percentage.   Would you not consider them because you would feel they would be unable to negotiate on your behalf?   

I offered up advice to a seller that if they did not have a listing agreement they should try to get their agent to take 1%, especially if that agent was potentially getting commission on the next purchase.   I would also argue that an agent charging you 3% could do just as good a job, if not better, than one charging you 6%.   If you want to pay 6% because you think that is going to net you more money, you can go ahead and do that, but in my opinion that is not a prudent financial decision.   

 

[PIK95]

Maybe your market is different than here in Orange County, but most listings are either 4% or 5% here.   

I would certainly sell an $800,000 house for 1%, especially if I was helping the seller purchase their next home for which I would I receive a commission.   (Deleted my pissy comment.  Different situations require different acitions)

On the buy side, I'd say the agent bringing in the buyer will receive between 2-2.5% on probably 90% of the homes listed.  Very seldom do I see 3%, and even less often below 2%.

If I'm selling an $800,000.00 house, its going to take alot more time and effort then a $300,000.00.  I wouldn't do it for less then 2.5% myself.  Every situation is different but I'm not doing anything for less then 2% on a home.

 

[Buckna]

Actually, yeah, this is what I'm referring to. The argument upthread is between guys in very different markets. Here in SoCal, $700k buys you a 1700 sq ft, 3bd/2bath house on a small lot in the San Fernando Valley suburbs. That same house goes for $100k in many other suburban places in the country. The guy earning his 3% selling the same house really makes out if that house is in a stupid area like this one, by virtue of just being in the right zip code. He's not doing $20k more work getting the job done.

Sounds like the Orange County guy is confirming what you are wondering about with agents charging lower percentages in higher priced areas. Makes sense, a 1% commission on a 800K home would be equivalent to a 2.5% listing on a 320K home.

 

[PIK95]

Check out Redfin and Purple Brick -- their whole business model is offering the discounted listing percentage.   Would you not consider them because you would feel they would be unable to negotiate on your behalf?   

I offered up advice to a seller that if they did not have a listing agreement they should try to get their agent to take 1%, especially if that agent was potentially getting commission on the next purchase.   I would also argue that an agent charging you 3% could do just as good a job, if not better, than one charging you 6%.   If you want to pay 6% because you think that is going to net you more money, you can go ahead and do that, but in my opinion that is not a prudent financial decision.   

I have never had a client try to leverage me with those sites.  You get what you pay for.  I'm not desperate.  I say no to people all the time that want me to work with them.

 

[PIK95]

Sounds like the Orange County guy is confirming what you are wondering about with agents charging lower percentages in higher priced areas. Makes sense, a 1% commission on a 800K home would be equivalent to a 2.5% listing on a 320K home.

I would rather have the $320 house 100% of the time in that scenario.

 

[siffoin]

If I were going to make a modern Tulip Bubble Souffle- I'd start with the fresh ingredients from this thread. (and I bought a house in the past 6 months in one of the fastest growing cities in the US- so who am I to condemn the masses.  Ooohh...there's a pretty purple tulip over there...yummm)

 

[-OZ-]

Just to give you an idea - for the property I have at the beach my property value has "appreciated" over 100% in six months.  The house 2 doors down is valued at 1/3 of the land value.  Worse than useless.

Go on....