And as for the comment above about “watching a few shows on HGTV”- if everyone could do it- they would!

So the house sells.
The entire commission then is $5070.00. My brokerage takes 20% off the top- something most people forget- so that leaves $4056.00. I then have to take out an additional 20% to give to Uncle Sam, which leaves $3244.80. If you do the math, you’ll realize that for the amount of time spent selling this house, I am making a little over $4 a day- and this is just if the house SELLS within 94 days. Maybe some of you are low-maintenance, and with perfect houses (right!) but most people truly do need expert assistance.

Try thinking outside of YOUR home and consider what someone like myself runs across as a PROFESSIONAL. It’s a lot tougher than it looks, folks!

Is it worth 3-6% of the home price? Probably not. I’m getting half of my buyer’s agent’s 3%, and I think it’s a fair arrangement.

Please note that Realtors show houses constantly most of which they do not sell, and receive NO compensation nor fee for this. Perhaps it will change that when the Realtor shows or accompanies, he/she will be PAID for the time rendered, in the same way that everyone else is.

Also, they would be PAID when called upon for price opinions- which are now given as a courtesy (even to FSBOS)- and take long hours to write up, not including meetings with the sellers and research at the town .

In my experience with ‘discount brokers’, they can be depended upon to do ZERO work because they can have the expectation of earning the minimum or less. In a shared transaction, I did 100% of the work because the discount listing broker did NOTHING. The payout was substandard. The discounter eventually went out of business.

I feel that the main reason why people hire realtors is setting the right price. (and the other is probably because in my state California we are so sue happy that people need an insurance by hiring the realtor) Sellers tend to view their home worth more than what the current market is willing to pay for it, especially they can’t accept that after all this work and etc., in a buyer’s market, they are not going to get what they want to make out of the sale, they are only going to get what the market is willing to pay for.

I do work with FSBO sellers and investors who sell their listings on their own. They use discount broker to list the home on MLS for extra exposure, use the laywer to write all the legal stuff, and do all the marketing legwork themselves like open houses, flyers, etc. The marketing part can get tedious, you have to have patience for it. In the end they do save quite a bit of money, like $40,000 on commission for example with one of my FSBO clients.

Personally I feel that it’s worth some time just to pay the realtor a small fee to ask for their opinion on pricing the home (or you can interview a bunch of realtors with no intention of actually hiring one to get a sense of where you should price your home at… not that I am encouraging that behavior), since most homes that fail to sell largely due to overpricing.

Cheers,

Cindy

There have always been FSBOS out there and sometimes they sell.

True, the internet is providing a huge amount of real estate information previously unobtainable by the consumer which makes it tempting to do-it-yourself. And yes, it has various effects on the business we have known, however….

Your home sale and purchase are the biggest and most emotionally charged transactions that people engage in. It is daunting to have strange people in and out of your home. Also daunting to qualify and negotiate with them. How do you attain the best price and terms ? Most are clueless as to how. Do you really want to tackle this tricky task yourself?

If you are not familiar with an area, it still is a ton of work to run around by yourself trying to find the perfect house- even with directions and computer printouts. Inefficient at the least.

My real estate colleagues work excessively hard for their clients, huge chunks of time and expense are consistantly invested- often with no reward. Our buyers and sellers are nervous and rely upon us. They are too busy with their own families and careers to have to set up their own appointments, to be responsible for their own marketing, to deal with all the detail and potential for legal complication, and to invest all the days and weeks needed. They are most willing to pay commissions rather than shoulder all the labor-intensive work, responsibility, and stress all alone.

It will be interesting if your prediction does comes true, but it may be considerably more challenging in actuality than it looks like in theory.

If I already knew someone who wanted to buy my house, then I would go to a lawyer and sell it that way – and save thousands. But I will likely just put mine on the open market and the exposure a realtor brings will be what helps sell the house.

I offered to buy a house that was FSBO (I had no agent) and I offered ~5% less than what homes were selling for in the area. My reasoning when I presented the offer was he was still coming out ahead of not using a realtor. He didn’t take it. I ended up buying another house FSBO that was listed for sale ~6% below market.