What $1.8 billion jury ruling could mean for real estate industry
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- Опубліковано 2 жов 2024
- Earlier this week, a federal jury awarded $1.8 billion in damages against the National Association of Realtors and several real estate companies for finding that they artificially inflated brokerage commissions. Carter Evans takes a look at what the staggering payout could mean for the real estate industry.
#news #realestate #realtor
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I hope someone investigates HOA rules and corruptions.
Luckily I live in a condo where we just split the master insurance between the two houses $1,000 a year total! Some places pay nearly $1,000 just in HOA fees a month 😮
The homeowners should be investigating HOA rules and corruption. You do know that HOA is made up of homeowners.
yea, let's hope more legally binding documents can be proven to be "CONSPIRACY" and have more people get money for no reason other than being cry babies.
HOA rules are waay more impactful and unregulated than agent commissions. john oliver has a segment on how bad the situation can be
Yes because I’d rather not be in a house than to be in one with an HOA
I think it's time to make it more appealing for potential buyers. Real estate can be quite the rollercoaster! the stress and uncertainty are getting to me. I think I'll cut rents to attract potential buyers and exit the market, but i'm at crossroads if to allocate the entire $680k liquidity value to my stock portfolio?
"Overall, buyers hold a lot of the cards right now, and sellers are having to give out more concessions to close a deal." All the best, buying on sale is actually one of the best ways to invest in stocks, and advisors are ideally suited for such task
Until the Fed clamps down even further I think we're going to see hysteria due to rampant inflation. If you are in cross roads or need sincere advise on the best moves to take now with financial markets will be best you seek a fin-professional with fiduciary responsibilities who knows about mortgage-backed securities for proper guidance.
@@jeffery_Automotive this sounds considerable! think you know any advisors i can get on the phone with? i'm in dire need of proper portfolio allocation
I've shuffled through a few advisors in the past, but settled with 'Julie Anne Hoover' her service is exemplary and she's a genius in portfolio diversification. I'd suggest you research her further on your browser, sure you'll find her basic info.
@@jeffery_Automotive Appreciate this recommendation, hopefully I can get some insight to where the economy is headed and strategies to beat inflation with when I hear back from Julie .
My first two properties were bought and sold with agents. My third property I purchased as an owner-carry because the seller didn't trust real estate agents. Thinking I needed an agent anyway to write up the necessary paperwork, I contacted one and was quoted their normal fee of 7%. When I questioned that fee, because the deal was already done, the agent became very angry. So I tackled the paperwork myself, which was only a mild hassle and cost me ~$35 for the documents I downloaded and printed and filled out myself. This was 2019. It was an eye-opening lesson.
Agents are middle-men. The Internet and a title company eliminates them altogether
Good for you! Realitors and Real Estate Brokers are one of the biggest scams in America!!!
you know, and I bet you AI will allow others to do what you did more easily and even reference local regulations/ state laws.
If there's money to be made for offering this as a service I guarantee this will become a reality.
@@gator9129 - as an investor who works as an agent for myself, I never found the realtor too useful but for 3 things:
1. The agent allows a trusted person to open the door to another person's house.
2. The agent should "know" the market better than the client.
3. The agent should be experienced to walk the client through the process (insurance, bank, legal documents, etc) and removes/mitigates the emotion from the transaction. They should buffer buyer and seller.
Overall, I think agents are great for 1st time home buyers. If you buy a house on the regular (i.e. every 5-10 years), then I'd skip the agent. So do the research yourself and save the 2-6%.
You came across a greedy agent, or one who didn't want to take on "writing up terms" and used price to turn you away. A "normal fee" implies that an agent taking a listing will collect a fee upon the sale and that a portion of that fee, generally half, will be shared with the buyer's agent. In your case the agent would have been expected to take only what would correspond to a buyer's agent fee and not a total fee as in the case of an agent taking the property to the market for sale and including the buyer's agent fee within the total. And in closing, a fine but not a minor point - real estate agents are not attorneys and hence not licensed to practice law. "Writing up the terms" is in effect practicing law. Agents in most states are limited to using transaction forms and addenda drawn up by the respective state agency and these forms are for mandatory use by agents, Principals in a transaction, buyers and sellers, are free to write up whatever they choose, but if they want professional input on the contract terms then this is considered practicing law and should be done by attorneys.
Your larger point does not miss its mark, though. You came across an agent who either was greedy or who, in lieu of turning away work which was beyond their scope, chose to charge a lot to make it "worthwhile" or to turn you away with a high price. That part of the story only the agent can provide.
There are too many overpaid middlemen in this country 😡
Average realtor makes $67k. 92% failure rate.
like insurance companies
Realtors arent middle men….you must not fully understand what they do.
@@brendonkelley8213 So it's the seller's responsibility to burden into their sale the inadequacies of an entire industry?
@@jeffwilliams59 Prices are inflated for the effect that buyers dont come out of pocket. When a seller sells, what do they then become? :O a Buyer! They're shooting themselves in the foot in the future. They just dont care because theyre in a home theyre gonna stay in for 50+ years and most people, even homeowners, dont have that luxury.
The realty industry has been out of control for years. Some agents are fantastic, they show potential buyers unlisted properties and they are able to articulate how they can create the most value for both buyers and sellers. However, most aren’t good. And they offer little more value beyond just unlocking a door.
It's an open secret that agents only promote houses on the MLS, and stear buyers away from houses not one it (so many lies to stear buyers away froma good house just so that the agents can perpetuate this system. Why do agents get 2.5% on each side? its even more abursd in high cost markets like CA, a 1.5m house, what could agents possibly be doing that nets them almost $40k each! More then some americans make in one year. laughable.
Ever other devleoped counties have total fees in the 1-1.5% range. Why is the USA 5-6%? Makes no sense
These fees get baked into sale prices, driving up costs for buyer and sellers.
Another thing that makes no sense, a Buyers agent gets paid more if their consumer pays more? Why is there an incetive for Buyers agents to push people to bid the highest cost possible. Higher commision, and less work if they get a house faster.
A much better system is a fixed hourly rate for Buyers agents, and you could have either a commiison or fixed fee for seller.
-- THIS.
I bought a few houses through agents, and was like "why do I need you?" Out of 6, only 1 was great. She knew her stuff. There are some benefits with an agent but if buyers did the research, they wouldn't need one -- and you could save 2-6%.
However, an agent (outside of knowledge of the market) should help remove/mitigate the emotion from the buy. That to me is the most unscripted benefit.
@@jlui21 That in-between role can be more valuable than most people think.
And I'm sure you are at the top of your field and deserve every penny you make.
Well said.
Im not sure how I feel about this, but I would love to see HOAs get reigned in
reined*
Yes
Reining in an HOA is like trying to control a bucking bronco unless you have Board connections or work for the State.
@@5DNRG Yes. It's the same for every organization, institution, corporation and municipality. Gotta have connections and big money. Everything is corrupt in the united states..... even Dunkin donuts
@@5DNRGit’s easy to put HOAs in check, don’t buy houses in HOA neighborhoods and they go bye bye
I’ve represented myself on two real estate transactions, it isn’t difficult, and I was able to negotiate directly with the sellers. We got a deal done in minutes rather than the days of going back and forth through middlemen. All I think will happen is a new type of business model will develop.
How did you get access to MLS?
@@internetpointsbankI sold my Chicago-area condo myself. Did not need MLS as in my town realtors only advertised in the local newspaper at the time. I just ran an ad in there with photo.
Agree! I never use a realtor when buying because of all the back and forth as you note. They show you their listings, not what you have specified, and I can shop for myself online.
Exactly! It's not the 1950s. Instead of paying agents and other middle men thousands of dollars, spend a few hundred taking a basic real estate course/seminar through the local community college to learn about state/federal loan/lending programs, commercial lending, pre-qualification, purchase offers, contracts, disclosures, inspections, title searches, closing costs, local practices, escrow, and closing (or just get a good book). In short order, you'll learn how to protect yourself instead of having contracts that are weighted toward the buyer and the agents. Then hire a real estate attorney to look over all the documents before signing anything.
Ditto. I listed mine last year directly on Zillow. Paid they buyer's agent 1.75%. Escrow / title company reviewed all the contracts anyway
I’m a person in my early 20s who recently became a real estate agent. I realized that the NAR was a “scam” when I was required to pay more than $1100 to join. The catch is that they have the MLS tied to the association, so if you want to use the MLS, you have to be a member. And the MLS is another $75 quarterly plus almost $30 monthly for the Supra E Key. The real estate industry is an unfortunate web of deceit and money grabbing with a lot of players involved. The mortgage industry as well. I don’t regret becoming a real estate agent because of the knowledge I’ve gained. But I realized becoming one was more of a stepping stone to educate those about their own real estate rights so that they don’t have to solely rely on others like brokers and agents for that knowledge. So yeah. Kinda happy the NAR got caught up.
Bro teach me I need all the info on real Estate
Grifters need to protect their grift.
Right there with you!
As a seller, we had a big fight on our hands because we didn't want to sell our house at the same time we wanted to buy another one. We had enough equity in our current house to get a loan to buy another house. The realtors were mad that we didn't want to sell our house right away, so we went back to the bank and got a statement from the loan officer saying that our loan was not contingent upon selling our house. There is no law or state regulation requiring the sellers to sell their property. Buying and selling houses cause unnecessary pressure on the seller in short period of time and we didn't want any pressure or rush to judgement. Boy they thought we were doing something illegal. We bought another house and after that settled down, we took our time to get our current house up for sale for highest bid without undue pressure and deadline. It worked well.
most re agents are really not so saavy and can make a lot of trouble for people wanting to do anything outside of their box
It is always a good idea to interview more than one broker. The opinions of brokers vary as do their fee for service based on experience and expertise. I'm glad it all worked out for you. There is nothing wrong with buying a home before selling your current property if you have the ability to do that, especially in a market were values are rising. Inherently, you will sell at a higher price than when you buy. It's is not an exact science by any means.
If a real estate agent or sales person is pushing you to do something you don't want to fire them on the spot
Or they have been burned in the past and want the closing to go smoothly
Good for you! I got in this business and realized that integrity and transparency is rare, but the ones who have it, always outperform.
Realtors get more to sell the house then the Carpenter did to build it. They can take a pay cut
I've never had a client tell me I was not worth my value... and I always asked. It depends on who you higher. Just like a carpenter... They all have the same tools available to them but the experience and expertise makes all the difference.
@@TheMcCartneyTeam I’m not a client, but I’ll tell you… you are not worth your value. The way we transact real estate is archaic and needs to change.
@@ufdan25 I wouldn’t expect you to understand my value. It’s ok.
@@TheMcCartneyTeam Nothing against you personally, but you work in an archaic system that technology rendered obsolete many years ago. Also, you do not deserve or need tens of thousands of dollars to transact my home sale. You know this is true.
@@ufdan25 Seems like the seller’s agent should get more than the buyer’s agent. The seller’s agent does the open house, oversees the marketing, etc.
I've said for decades that realtors have ruined the housing market. 2020 I sold an investment home. As I looked at the closing contract, I told my realtor "I'm not giving you $6000 dollar's for filling out this paperwork." Apparently, she'd never been told this before. Sensing I was serious and about to walk, she finigalled the paperwork and gave herself a $2000 reduction.
Hilarious that the interviewed agent claims her parasitic and overcharged fee will now come out of the buyer's pocket. Almost sounds like a threat!
Agent fees are insanely out of proportion to the actual amount of work they put in.
If buyers were paying the buyers agent there is no way anyone would pay them 3% of a home’s value to unlock the door and write an offer.
You’re so right, the seven days a week and 10 hours a day I work to master my craft, provide the most accurate up to date information while traveling 70 miles in my state to service as many clients as possible to actually make a living as a business owner is not deserving for the little work I put in. Not to mention years of nurturing clients and spending many dollars on business expenses because (I am a business owner)
@@1-Wheel-Driveyou probably have had bad experiences with agents and I’m sorry to hear that, but there I am always transparent with my clients both buyer/seller and disclose where commission goes if a buyer agent is involved for exposure and they’re happy to pay for the service because time = value
@@1-Wheel-Drive I have a menu of real estate commission charges - I don’t charge 6%. They vary based on the marketing and features I pay out of pocket. Inflation has hit myself as well. My business expenses have increased, there are 2 million less transactions happening now than two years ago. I actually am working hard now to find business opposed to 3-4 years ago. The transaction side of it is relatively the same, though yes. I am a business owner, so as a self-employed person with employees to pay, I in fact bring as much value to my client to justify my pay. Just like any other business owner
@@1-Wheel-Drive I indeed have lowered my commission as a sellers agent, paid for fees for my clients, provided rebates for my buyers. I don’t pocket a full commission check and go to Disney land. It goes back into my business and if I’m able to provide relief for my buyer or seller I sure have. In addition I’ve helped buyers purchase a home at 0% commission (Yes, worked for free) I’m in the business as a member of the community looking to help people achieve their goals. I’m up for any change coming my way because at the end of the day It’s all about the client (who chose to work with me)
Real estate prices are out of control ...period.
Supply and demand.
Sounds like they are about to get even more crazy for buyers.
The elites have been inundating the country with immigrants to increase the property prices. If they allowed the population shrink naturally, the property prices would've fallen as the demand decreases
@@bobcob3362Fifteen million vacant homes in America with six hundred thousand unhoused citizens. How is this supply and demand?
@@bobcob3362 More like intentionally constricted supply and synthetic demand.
I just sold my house and before I signed the contract with the listing agent, I asked for a reduction in the commission because I know it's negotiable. The listing agent told me they would not reduce the commission to 4% from 6% because "It's a cost of doing business" and that buying agents wouldn't even take potential buyers to see the listing because of the reduction in the standard commission. Talk about a racket. I then found another agent and they agreed to a 4% commission and they split it 2% each and the house sold in a month. Right now if you're selling a home you have the power to negotiate because interest rates are high and these agents can't be greedy.
The power of negotiation ^^^
I think the other interesting thing that’s not talked about is the fact that agents have to split their commission with their broker. That shaves off sometimes more than half in what their gross commission is. There are good agents that care about their clients and go above and beyond to serve and represent their buyer and seller. But the issue is deeply systemic. Yet, agents will naturally receive the brunt of the blame because they’re the “face” of the industry.
Hire professional inspectors and purchase home through an attorney for a set fee. Commissions on home sales are way to high.
This x100
@@peacenow4456 They are cheaper than that realtor commission.
iNSPECT myself with an ice pick for timber under house, and a super bright lite.
This is absolutely an option!!
The greed of the real estate industry has been a main contributor on this.
There should be a cap on commission. The same amount of work goes into selling a $500,000 house as a $1,000,000 house, but the commission is twice as much.
Exactly what I tell agents, nobody deserves $70,000 commission for something I worked so hard for!
@@email6743they do if they sell it for you and bring buyers. If not you would of done so on your own which almost no one does successfully. You rely on their network of qualified clients and marketing to make top $ at the end. Not to mention all of the moving parts involved after the agreement is signed. It’s a full service and its no walk in the park for them
That's why the commission rate is negotiable. I only paid 3.25% to our agent on my last sale, and he split that with the buyer's agent. People just need to be more assertive and advocate for themselves. After all, it's your money!
Not so. Luxury homes take longer to sell because there are fewer buyers at that price point. So there's usually more advertising in more expensive media for a longer amount of time, increasing the realtor's expenses, especially in a slow market. If house doesn't sell, realtor doesn't see a penny or in other words they're out of pocket all those costs without any income. If being a realtor was so easy, everyone would want to be one.
You clearly know not what you talk about! The costs for a Realtor who is an individual business person are enormous for those expensive luxury homes!!!!!! The advertising and open houses all have to be top notch, many of those homes have to be staged with furniture to make them more desirable than if they were just empty. Ask yourself this question... does somebody selling Mercedes make more than somebody selling Huyundia's?
I've sold two homes by myself, no realtor. I just had to get the necessary disclosure forms, etc. Know how to market, know how to show. Know your home's valuation. Know how to negotiate.
Realtors are great for those that don't want to bother saving 6% of their hard earned home's equity.
5% is standard now where I live but I can see 4% or 3% being the new norm
Fake story. You have no idea how much you lost in terms of time, stress and money by selling it yourself but you go around telling everyone about your fake stories. Why not become an agent and make all that easy money? Exactly.
@@albundy3929 stress isn't a cost. Nobody needs to save stress unless they like spending money to do so.
Market value isn't that hard to determine.
Your argument is weak.
who said market value is difficult to determine? you have no idea what a good realtor does in terms of making you money and lowering chances of lawsuits and protecting you from swindlers. then there's the actual mechanics of a real estate transaction and keeping the transaction on track. you are clueless on this topic. @@jamisojo
My house is worth about $375k. If I paid 6% in commission that would be $22,500. I bring home $30 an hour so I would say it is definitely worth the time, stress, and hassle to sell it myself and save over 4 months worth of take home pay.
This whole class action lawsuit is illegal/illegitimate. It’s a free market, a buyer or seller can choose whether or not they want representation, they can choose what commission they want to pay or if none to a buyer/seller themself. They can try to represent themselves but good luck knowing the first step in the process as a buyer or seller, the paperwork, or going to closing. The only thing this is going to do is now force buyers to pay 3% +-or less for representation further hurting America and the first time home buyer dream when you have to pay an additional 3% +- fee on a transaction. To be honest, just seems like the perfect time for a government to distract from the economy on house prices and interest rates.
@stopthecrazyguy9948 you go become a lawyer.
As a former real estate broker, I never understood the logic of this commission structure. There is none.
In England estate agents charge 1.18% plus the hideous VAT so total 1.42%. Plus in England you can sign up multiple competing estate agents to compete with selling you property. The fees then may go as high 3%. All negotiable.
And? This is the US where everyone can buy. UK - top 10% can buy?
@@ptturboe5792hence the lawsuit - the realty companies have been found to create and unfair trading market … hence the 1.8bn penalty
It’s the same as in the US except when offering a buyer fee it’s not 2 or 3 agents that can sell the home it’s thousands of agents that sell homes in that market all competing to sell your house.
I understand that a seller might not want to pay for the work of the buyers agent. That is a natural thing to not want to do. The funny part is that most of the work to sell a house is done by the buyers agent. It’s no secret among agents that it’s easier and less work to be the seller’s agent than a buyer’s agent. Hope the sellers don’t shoot themselves in the foot.
😂 so true.
Oh they have shot themselves in the foot. A listing agent just lists a property, they don't go out and actively look for buyers that's where the buyer's agent comes in. Most sales are commenced due to a buyer's agent.
👏 can you imagine a buyers agent skipping over a listing because no commission is to be paid and you have a first time home buyer with minimal funds?!
Yep…I can see it!
I do FSBO and happily pay the buyer agent.
@@sgAlwayzif I had an agent skip over a house and I found it on my own through Zillow I would no longer have that agent. Then just call the sellers agent to do the transaction. Simple.
i sold my home without realtors... listed it on MSL list for $69
What is MSL? What’s the Website?
The worst part is useless agents calling you trying to convince you to use them.
that guy is completely wrong, saying that realtor didn’t do anything for him.!?!? The realtor brought him the the buyers! how can you be that dense not realize what a buying agent is. You can’t sell your house if nobody wants to buy it! 😂
There’s a difference between selling (listing) agent and buyers agent - any as a seller you pay both!!!
That’s the point of the lawsuit.
Why do you need both? Agents should be market makers.
the entire home buying process needs to be looked into. including the wya banks finance homes. it shouldnt cost an arm and a leg to get intoa home.if you can afford a 3k rent, you can afford a 3k mortgage there is no difference except your credit score
Not true, you need to factor in taxes, homeowners insurance & possible HOA fees. Plus maintenance. I've had to repair both Hvac systems in our house over the last 3 years at a cost of $4k. Refrigerator, washer & dryer, hotwater heater, plumbing if you have a well & septic cost $5-10k to replace or repair... and on and on!
Spoken like a guy that never owed a home.
@@jimmycain8669🎯🎯
It’s about risk to the investor. Let me ask you this would you loan 500k to someone you never meet just because they can afford their rent?
@@steveh6178which is usually more than made up for by interest rate deduction; unless your low income and large family
Interestingly, everyone walks away from closing with a check in their pocket EXCEPT the buyer. So, who paid the fees???
FYI. A 6% sales commission is factored into the sales price for new construction...
Go after the damn banks to lower their numbers on the amortization chart. Front loaded - hugh rip off!!!
They "work" 7 days a week, I get it.I've never met a realtor that I honestly trust! I agree with this article, we have so much more access to inventory through the internet!
They answer a call on their off day and say it’s work.
Are use to think I was a dirt bag when I sold used cars until I became a realtor and then I realized what a real dirt bag is
There’s good and bad in every field. It’s important to be one of the good ones b/c people BS catches up in business eventually
2:05 not true. Seller and buyer can get together and negotiate the rates down TOGETHER
All depends on where one resides. East coast yes possibly but on the West coast that will never occur.
@@peacenow4456 💯
Commission on real estate in this country is just plain too high. For the amount of work that gets put in I would think 1 to 2% is sufficient, which by the way is standard rate in Norway. Considering the frequency that Americans buy and sell homes due to having to move for jobs these huge 6-10% commission rates become highway robberies and a hug tax on homeowners.
Most brokers around here only get a $500 flat fee for a home sell/buy. Used to be a percentage but now theres brokers offering a $500 flat fee so the real estate agents just want to work for them so they can keep the money they deserve for actually being the one involved in the home sale
So where's the money going if it's not going to the brokers then? So many layers to this SMH
Sounds like they are going out of business lol.
@@Sealae80 normally each agent gets 2.5% and the broker gets 1% of the 6%. But the seller can negotiate the 6% then each will get less
@@greghenner4978 this is how it was or this is how it's going ?
I don't understand the basis of the ruling. If the seller of the house in St. Louis agreed to use a realtor, I assume that he signed a contract with them. In the contract, I assume, was stated the fee that he had to pay. Did the court say that this contract was against the law? Or did the court rule that this fee is against the law? In either case, this doesn't stop real estate agents from increasing the price of a home, say, 5% and splitting the commission between them. That is, as long as the seller of the home agrees to this, the current system can remain intact. (My point: there are probably a lot of workarounds.)
I think there’s a perception that the seller better follow the rules or agents won’t show their house.
Exactly. To me this only helps keep prices higher.
The reality is all other developed counties have much lower fees. Clearly there is collusion on the agents to keep fees high and weirdly fixed at 5-6% MLS ensures fees are higher amd sellers lost on mls. else agents won't show you a house. It's textbook collusion
Yes, he signed a contract. If he didn't understand the commission he shouldn't sign the contract. Sounds like he didn't understand why he had to pay a buyers agent. A buyers agent is paid to bring a qualified buyer to purchase the home. I think the problem comes in because we could not pay a buyers agent 0% commission if the seller did not want to pay for one so it was required to pay a buyers agency commission a min of 1%. Now sellers are able to pay 0% if they wish not to pay for a buyers agent to bring them a qualified buyer.
Feel sorry for the buyers that are going to have to pay the agents commissions apart from the downpayment, closing costs and inspections! They should keep it the way it is, the only people that won are the class action attorneys, those rats!
Agreed 100%
Yes, also, what many people don't understand is that if the seller does not pay the buyer's agent commission, then buyers will simply offer a lower amount to offset this additional cost, knowing that the seller is saving on commission. Sellers will thus net the same as if they had just paid the commission themselves, so who is really paying the buyer's agent fees?
Plus, the additional out of pocket cost is going to reduce many buyers' purchasing power and result in even lower offers overall. In the end, this is going to hurt both buyers and sellers.
@@zm6301 Bingo!
Just get rid of the broker!!!
If I'm an agent and I have interested buyers for your house, why would I help them buy it if your not going to pay me anything? This ruling sounds nuts.
BINGO! Not to mention the plethora of behind the scenes moving parts that take place, in the 5-6 weeks before closing. Doing that on my own would be literally maddening
Do you think you’ve added $15000 of value? Looks like easy money. I’d pay an agent a few grand if I had to, otherwise it’s me buying and paying an attorney who actually deserves the money for the work they put in
@@johnsnow145 The real work is done by the attorney. Agents don't take on any liability.
@@bakerstreet101 please describe the “real work” the attorney does if you even know. This should be an interesting response lol
@@johnsnow145 the core of a transaction are the legal documents. My real estate agents didn't provide or review the legal documents, or conduct the due diligence into condo financials when I looked at condos. Mainly, they are not liable for mistakes or misrepresentation they might make during the process, even square footage. Try suing a realtor for misrepresenting a property and see how that goes.
There can be a lot of hands in the commission. Sellers agent, sellers agent broker, buyer's agent and buyer's agent broker. Too many cooks in the kitchen. Relax or eliminate the rules on owning/needing a brokerage. Less hands should lower costs.
A government lawsuit where the money goes back to those whom lost it is a rarity these days.
Minus 30% attorneys fees, and divided among all the plaintiffs. Everyone is getting like 10 bucks. In 5 years when this thing actually settles.
@@bryanwhite6876 Only if you spend half an hour online in most cases. Most of us make more than that at our day job & never mess with it.
Did the plaintiffs pay the attorneys who were representing them in this case or did they work on a contingency? Is it really that different? There is such a misunderstanding about fees and who is responsible for the fee and who pays the fee. Truth is most times the payment of the brokerage fee comes from the proceeds and not the seller. There are also advantages in offering a payment to a buyers broker. The one thing I think that is really valuable coming from this is the need to better educate the consumers on how the fees work and what their options are when hiring a broker. I do not believe we will see an immediate change in the fees paid to a real estate brokerage for services. The market dictates the fees for buying and selling a home. The level of skill and expertise of the agent you hire will also determine how much of a fee you may be responsible for when hiring an agent to represent you.
5 to 6% is too much of a commission. The Architects don't make that. It's been one of the great rip offs for a long time- why people allowed it I don't know. The person who owns the property is in control
exactly!
Thank you! As a structural engineer, we make considerably less on the design of a house than a real estate agent. Unlike the real estate agent, we get paid once. The real estate agent theoretically, can get paid every 2 years for the same house if sold. Plus, the real estate agent had absolutely zero to do with the design, and the structural engineer assumes the liability for 12 years. Something is very wrong when an engineer makes less than 1% on a million dollar home, and the real estate agents make 3% for putting in considerably less effort, and don't have to worry about liability.
What does he mean doesn't do anything for me .... the buyers realtor is the one who brought you the buyer to make the sale!!!!
Right!! 😂
You know the end of an empire is near when every day jobs like real estate agents, chefs, tow truck drivers, etc become popular reality TV subjects.
Absolutely a conspiracy to separate me from my money.
All the unnecessary paperwork is also ridiculous !
I will forever be indebted to you you've changed my whole life continue to preach about your name for the world to hear you've saved me from a huge financial debt with just little investment, thanks so much Mrs.jennifer Baron.
Wow, amazing to see others trading with Ms.Baron , I am currently on my 5th trade with her and my portfolio has grown tremendously.
tbh you don't really need a agent like that anymore.
Exactly. Add your house to Zillow and most will find it
I own multiple home and I think the seller should pay both fees. However, the fee should not exceed 2% per realtor.
And if there is only 1 realtor representing both then the max that person can get is 3% with the additional 1% going towards the buyer associated fees.
As a realtor, I agree with this. Dual agency at 6% is a scam and unethical. Commissions should be negotiable on the price of the home too. A multi million dollar home shouldn't yield an agent so much either
Just remember, we realtors are independent contractors, so out of our fee we first have to pay our brokerage house a percentage, then, good old Uncle Sam. So a generic 10K commission is more realistically 5-6K when everything is said and done. And you are only as good as your last commission check. And we do work hard for our clients, whom have their own jobs and lives and can't dedicate so much time and energy to the process. Think of us as chefs at a restaurant. You go to the restaurant and the chef cooks for you. Do you begrudge the money he makes? I mean, he's just making food for crying out loud. We all make food.
This industry is long overdue for a shake-up on commission structure. I like the model of several European countries where the commission gets split, half to the seller and half to buyer; you pay for your agent, and I'll pay for mine.
This is awesome, who was the lobbyist who coerced some politician or industry advocate to allow this. Now these real estate organizations will fight back with new fees to nickel and dime buyers and sellers.
I put my old home for sale on Facebook, and made signs myself and put them around town. I also had an open house day. I'm not paying a fkng broker to do it for me, they don't even know my home? That's like me hiring someone to sell my car!
Be careful what you wish for. A buyer absorbing buyer agent fees makes it easier for corporations to buy single family homes. In a few short years there will no longer be starter homes. Corporations will buy them all up and home owners will help them do.
Source: My 4th grade education...
This is awesome! There is an agency in Central Illinois that takes an extra 1% (4% total for themselves ) during the sale or won't process the sale for the seller. It's ridiculous! The buyer has to pay 3 1/2% commission if they want the house. They run the entire county with no competition and wont budge on fees. They refuse to show buyers ANY "for sale by owner" homes. 7% commission in all is insane! I hope someone goes after them. (The agency name starts with the letter B and are in the original home of the Chicago Bears. )
If they were making a big profit they would have competition. Thats the open market. And why should agents show for sale by owners? Buyers can see it through the owner. Why should any person be expected to work for free?
They aren’t doin g anything wrong. Get a grip. Or become an agent and do it for less. Easy money right?
Biggest profit is for them is to not compete. Realtors have to be licensed so it’s not an open market and the realtors association colluded with the companies to set commissions. It’s the monopoly on MLS listings.
This is not crazy, it is called invention, if this is the reality then there should be a private company which opens their services and provide a solution but regulation will not help. The free market will be better to deal with it. Many people talking as if this is evil then create a solution which makes economic sense and the people will vote with their dollar
Doesn’t matter if it’s just one company. In Southern California they are ALL dishonest as the day is long.
Sold my last house without listing. Paid $250 to a Realtor to help with paperwork. Even if I could have sold for more money, it wouldn't have made up for the difference in a huge commission. Sale by owner works.
How lovely !! I found the house on redfin and go see the house myself. Agent helped wrote an offer, and took 2.5% of the sales price. Wooping 30k made in less a week. I don't understand
Those days are over dude.
Nah. I bet you are too lazy to sell it yourself. There is no other logical explanation. @@ptturboe5792
That’s what I don’t get about this lawsuit. You have the option to not use a realtor.
Agents purposely only show homes with higher commissions, and not what a lot of buyers actually want.
6% fee is outrageous. on top of that you also have to pay taxes from the sales. among additional fees. i’m surprise everyone put up with it for such a long time. like forever.
yeah but the sellers all signed agreeing to paying that 6% right? 🤔 if you don’t want to pay 6% go interview another agent and pay 4% or 3%. It’s really that simple.
Any fees are like taxes, it discourages both buyers and sellers. Lower real estate commission means more sellers and more buyers, good for the market.
Realtors get paid way too much when it's the buyers and sellers doing most of the leg work. All realtors do is send you a bunch of DocuSigns and then collect a fat check.
Not true, Realtors oversee inspections, make sure if the home has mold, it gets removed and certified as being removed and oversee the repairs, negotiate repairs if needed and closing costs if possible from seller to buyer, open doors for you and assume all liability if anything happens to the home during the showings, they also make sure your earnest money deposit is not released until you're close to closing day and get keys the day after.
You are clearly ignorant to the process that is not arguable!
Banks over see inspections.
@@REAngel5019 Nonsense, an independent inspection is done and is part of the disclosures, the agent inspections don't add any additional value and the buyer's agent will push their client to waive contingencies to be competitive anyway. They will also act like negotiating a $20k discount for a repair is being fiduciary after they pushed you to bid $200k over.
@@someguy6075 like I said, the ignorance is strong on this thread, keep thinking that way if it makes you sleep better at night! 🤣😂🤣😂🤣😂🤣😂🤣✌️✌️✌️
The Plaintiffs missed an opportunity to make another important change in real estate...the prices!
Most times, the listing prices are arbitrary and based on DESIRE versus DATA.
That's exactly why real estate, in areas like San Francisco, Los Angeles and New York are so ridiculously high.
Every listing has a history, as it pertains to the selling price.
Historically, I've seen homes that sold six months prior for 500k, sell for $1.2M in L.A. county.
No property is appreciating that fast!
We have listings here, as high as $150M.
One particular listing, close to that amount, sold in 2014 for $5M. Fast-forward 8 years and it's listed at $139,000,000.
There is no REGULATION in this industry because every time a property is sold, the COUNTIES, STATES and Federal governments make money; through taxes and capital gains.
They don't give AF about the citizens of this nation; that are being displaced and priced-out of the market, due to these exorbitant asking prices.
There MUST be a cap placed on how much "premium" can be placed on a property because, unfortunately, most buyers are not astute enough to write offers that fit the actual VALUE of the SFR, land or commercial property they're buying!
They, instead, rely on their "agents" who are totally incentivized by MONEY.
The higher the property, the more COMMISSION they make!
In the above example of ridiculously priced real estate, no agent or buyer is writing a more realistic offer of $20M for that house, even though they should.
Buyers having to pay for their own agent’s commission will lower affordability even more
Stealing $60,000 from the seller for "listing on the web" is a SCAM of the highest proportions.
It’s not a scam. You don’t understand all the work that goes into selling your home. You should try selling the home yourself and see if you can sell it for higher than what a realtor can sell it for.
@@nn3277BINGO! He’s probably never done it
IF you think all a realtor does is post the listing online that you are truly ignorant on this subject and may want to stay out of it!
@@nn3277 I truly believe that realtors don't care about the price; what they want is a fast sale and lower prices sell faster. Closing on 4 houses a month rather than 1 a month is far more lucrative. I just don't trust the system we have in the US.
@@nn3277 do you think more work goes into selling a home than designing its structure? If structural engineers charged in proportion to what real estate agents charge, less homes would be built and sold. You should try designing a structure yourself and see how it goes. A structural engineer designs a residential structure once for a relatively small fee compared to the cost of the house, and get paid once. A real estate agent can sell the same house every two years and get the same, if not higher fee, and they had zero, absolutely zero involvement in designing the house. Yet the structural engineer is on the liability hook for a minimum of 12 years. So yes, real estate agents get paid too much for what they do...
"Someone who didn't do anything for me". Well, they DID bring you a qualified buyer...
The qualified buyer saw the home on Zillow and asked to be shown the home. There is nothing an agent has and will disclose to a buyer that is not listed publicly.
@@mbbohn7402thats just so not accurate 😂 you clearly have never bought or sold a home
@@mbbohn7402 As someone who has been involved with literally hundreds of home sales, people don't just walk into a listing after seeing it on a website, unless it's an open house. Before I would invest the time of putting someone in my car and driving them around, I would make sure they were both interested AND qualified to buy what I was showing them. I don't want looky-loos, and neither do the sellers.
Something is wrong when the structural engineer that designed the house makes considerably less than the real estate agents involved, and it's the engineer and architect that take on the liability for a decade. If the engineers' fees were in proportion to what the real estate agents charge, there would be considerably less homes built...
That's the issue I have also! Me the builder makes $50k profit but the real estate agent who really does nothing makes $25k, that's $25k of my profit. Doesn't make sense to me! My real estate agent only charges me 4% but thats still too much but 1% agents wont do any work. Real estate agent should only get 1% and no more, .5% for the buying agent and .5% for the selling agent. The builders are lucky to even be pulling 5-10% profit on most homes they build after expenses.
Then sell the real estate. Don't engineer it. Sell it.
The agents make more (maybe, usually not) because most agents are broke and "quit" after a year when they have made $0. Being a real estate agent is not all that different than selling life insurance. If you don't know people and if you aren't constantly networking, then you don't make anything. You have no salary. The majority of licensed brokers give up their license after a year or two of not making any money.
@@greghenner4978no offense but the builder I know profit 500k and more on their builds. You probably have a bad business model or your not a good builder.
@@rstvanman1999 Well you have to build something that's worth millions to make $500k. I'm sure by the time the owner pays all the bills and employees he's not getting $500k. Unless they built something in the 9 figures range. I build $400k homes, you can't make $500k when the home is only worth $400k. Custom homes take too long to build for me but to each their own. There's all different types of builders but most are barely pulling 5-10% after everything if they were pulling more investors wouldnt be pulling out of real estate to get back into the stocks and bonds markets. I know, I was one of the only ones who made it through the last recession with all my stuff while everyone else lost theirs and some committed suicide. Owners of KB Homes, ICI homes, those are stock market companies. We used to make money off every single home built in NEFL back when every builder went through us to get a home built but we cut back on that business to relax and build and remodel homes. They're strung out on loans and everything I do is cash so I get all the money the bank isn't getting 8% from me. You can build section 8, you can build custom homes, you can build a cookie cutter homes, you can build shopping centers, you can build skyscrapers, everyone has their niche all different profit amounts and time to build. The very top stock market home building companies are only doing like 6 billion in sales, thats like 2 companies most are a quarter billion to 2 billion. Sales doesn't mean profit! The CEO which is 9x out of 10 the owner gets a set check. I can guarantee I'm making more than 80% of those CEOs and building a 100th of the homes cause I don't have the overhead and loans those companies do. I own over $6 million in property outright, no loans. I feel I'm doing good! Just cause you're big doesn't mean you're actually making a lot of money but you're definitely spending a lot. Now a days the home builders are even making less having to buy down loans just to sell houses. I don't have to do that cause I don't have a loan on the home that I have a set amount of time to sell the home or I don't make a dime. Home builders did have the houses sold before they were built but times have changed since the interest rate increases and now they actually have to list and sell the home.
@paulcolburn3855 why would I quit engineering? What needs to happen, and will, is that engineering fees should be increased to reflect the liability incurred. If a real estate agent can walk away with 1.5% after it's all said and done, engineers can as well.
Horrible for consumers, especially buyers.
Buyers will suffer because they can’t see the value of the buyer agent so they will opt to do things themselves. Sellers will suffer because more upset buyers will file lawsuits trying to get back the losses they endured by not having a broker.
😂let me get this straight. The same plaintiffs that signed contract with the buyers agent- are getting paid now for a lawsuit ?
Years ago a 6% commission was maybe a few thousand dollars. Now, because the costs of real estate are so high, the commissions are a huge amount of money. Same with tipping at a restaurant. Years ago a 10% tip was a few dollars or so. Now with everyone expecting a 20% tip and the final tab at a restaurant being so expensive, to me the amount tipped seems like a lot of money in relation to the actual work done to serve the meal. Both real estate commissions and restaurant meal tips are exceedingly high because the cost of the product is exceedingly high.
That's exactly right. The amount of work for a waitress to bring a $100 dinner plate is exactly the same amount of work for her to bring a $15 dinner plate. It makes no sense to tip extra.
Also ridiculous is them getting a fixed percentage when the home prices rise as fast as they have.
How would you like to get a 20% raise in a year?
exactly, everybody should be upset that the housing market went up that fast. Everybody was greedy and just seeing all the equity that they were getting. But they just didn’t realize that it was going to make it unaffordable for everybody in the long run.
This is a game of cat and mouse. Seller's will raise their commission fees from 3% to 6% and will offer buyer's agents half of that. The ball keeps rolling and realtors keep getting richer.
@@peacenow4456right?! It’s literally how it works. I’m going to have to vet my seller/buyer clients more carefully.
Real estate agents have been overpaid for way too long, My real estate agent knew nothing about the neighborhood. I was buying a home in basically put together two sheets of paper and got thousands of dollars for that.
But they studied and passed the exam! would you take your mom to a discount doctor or pay more for a great doctor if your mother was ill?
Its a Job! I worked hard to pass the test and get where I am today!
@@matthewites4524 next time your mom is sick tell her I know a good real estate agent 😂. Not even close to the same job. A real estate agent is the equivalent of someone taking your order at Taco Bell. They just punch in the order on a screen and then hit submit. That's about the extent of their knowledge, and they should be paid the same as a Taco Bell employee.
This comment was not for you to turn into a diva. I’m not questioning your intelligence. Yes there are bad realtors and there are good ones. If you didn’t know most realtors are college educated with masters in psychology!
Didn’t mean to make your panties wet
you’re soo worried about your agents income lmao! and the commission didn’t even come out of your pocket! 🤣
@@bradfordjharthandling food and handling the most important transaction of someone's life is not the same. You sound bitter
So many people here unaware of the work realtors actually do. And how much effort GOOD realtors put into making sure their clients have the easiest route possible.
5 years and like a 90% fail rate.
It's having a bad agent who doesn't understand the contract so they can't explain it to the client.
Once again.....
the consumer loses.
Welcome to America.
Welcome to capitalism.
No place else in developed world do people lay such high uncapped percentage based fees for real estate, not to mention absurd add-ons and markups like showing fees and listing fees and viewing fees. There should be a few tiers of mostly flat rates depending on service provided.
Industries that need to die or dwindle to about 5% of what we have right now: real estate agents and realtors, property managers, lawyers, insurance agents and the insurance industry, every protected public sector job with monopolies and immunity, most natural monopolies, corporate consultants, god the list goes on.
strange ruling. they are overruling a contract. realtor fees are too high but best way to combat this is a paradigm shift like happened with AirBnB or Uber.
Airbnb is part of the reason for overpriced homes
Lawyer Fees are high, toll-road fees are high, contractor quotes are high, groceries are high, realtor fees are high, professional cleaning fees are high, the list goes on. The cost of living and service is, high lol
Meanwhile the crook and Micheal Ketchmark is getting 40% of 1.8 billion and then the rest of you sellers that are complaining are going to get $200. Meanwhile after you sell your house and it is your time to buy, you will not have any representation as a buyer. Because the loyalty of the listing agent goes to the seller. Way to go genius!!!
Great job 👏 👍
The current owner of the home didnt complain when the person who sold them the home paid the buyers fee for them, but now the shoe is on the other foot NOW its an issue?? Smdh...
this is a frivolous lawsuit. commissions can be negotiated 100%.
Too many unskilled BS artists in selling homes driving fancy cars to be hard work.
Nah, just the dumb masses that fall for the facade. Quick to judge. Give me a genuine person all day.
The attorneys for the NAR did a terrible job. Homeowners have a choice on how to market their home. They can choose to sell it on their own. The fact is that when it is put on MLS, the home is able to get top dollar because of the exposure. Commissions are negotiated on many transactions. Agents lower their commission as credits for repairs or to make the deal. I wonder if the attorney for the plaintiffs would do the same.
The real value realtors provided at one time was access to the MLS system. That value is no longer exclusive to realtors and is available for most via online services like zillow. Its super easy for people to find their property in real time versus giving some parameters for a realtor to run a report then get back to them or give them access to a filtered search middleware access point.
Honestly can't see the value in hiring a realtor to find me a property.
As for listing the property even less for 30K. Print a standard real estate contract and if you don't feel comfortable doing it yourself pay a real estate attorney 2K to handle the paperwork and closing.
The biggest value a realtor might provide today is actually physically doing showings and that is even dwindling with remote automatic locks and security cameras. As a seller I have no problem opening the doors to my property to save 30K.
Homeowners shouldn't be forced to hire a real estate agent to list their property on MLS.
Because NAR ganged up with Zillow and does not allow FSBO listings to be approved easily.. even if approved, they dont show up
@@greghenner4978they aren’t. They have flat fee limited service options for FSBOs. Look it up. It’s like $500 in my state of FL to list on your own on the MLS.
In practice the standard 5% commission is often much higher. If you think about it ....the seller pays the 5% on the SALE price ..that 5% is EFFECTIVELY paid out of the seller's EQUITY. Only when you have NO mortgage is a 5% commission actually 5%....If you sell a house for 500k and have 250k mortgage ... then you OWN half the house or $250k in equity. 5% of the 500k sale price is 25k ....but the 25k commission of 250k in equity is 10%.
As an investor of long term rentals I love this. It will cause real estate to come to a screeching halt and bring down prices 😊 Buyers already can’t afford and then asking them to pay 3% up front is going to help dry up a market.
Yes, it's going to be harder for sellers to sell without buyer's agents bringing them customers, thus having to reduce their price to attract more buyers. Seems like a wash. You get what you pay for.
@@leslielucci3182. How so in today’s market? As a buyer I can go on Zillow and view houses for sale in any part of the country. Why do I need a realtor?
So buyers can use flat fee listing services and then use a title company/RE attorney to close
@@brookyogini6625 yes that’s an option right now. There’s a reason it’s not that popular though.
@@brookyogini6625they were always able to do that.
Why even need a realtor. Shopping for a home should be similar to shopping for a used car... some cars are more expensive than some homes. Realtors are raking in way too much. $15k for showing buyers around the house. That's price fixing. Realtors can make over $150k/yr for just selling just 1 house a month. That's more than most people make working 9-5 M-F. No wonder house prices are so high.
In the old days real estate agents were mainly part timers and very common for women who were raising kids.
The industry has been avoiding the inevitable which is making commissions more transparent and negotiable. Sure there are some good agents but even these ones shouldn't be splitting 6%. Especially in expensive markets like the Bay Area. This will open up the flood gates for new Real Estate models that will charge less commission or be hourly/fee based. It is about time. I'm not scaring the Realtors but think about the StockBroker and their role 35-40 years ago. They charged a big commission and before the internet they claimed they had inside info on companies. Where are the Stockbrokers today? pretty much extinct and replaced by Fee Based Financial Advisors. Could this be the fate of Realtors? Today I find my own house to buy on Zillow and then the Realtor writes up the purchase contract. How is that worth 2.5%-3%?
Unless you’re in the industry it’s easy to speculate and be anecdotal about things happening on the industry.
Without a buyers agent you’re going backwards, without the NAR you’re going backwards again.
The NAR failed to educate on how the process works, what they do, and why they’re the biggest lobbyist for Real Estate in the country.
I hope they all have to pay money back to the sellers and who would pay commissions that high in any other industry. It’s a shame realtors force these commissions
It’s funny how everyone is saying it’s a lot but you don’t understand who actually helps you out when you get into a bad position with your loan or a contract.. or when you need a contractor quote to renegotiate an appraisal….the buyers broker.. LOL. The sellers in this case save in the short term it will affect how people can actually locate these properties.
😂😂😂😂 the past three years the agents told people: "if you don't buy someone else will."
It's a scam anyways. 3% commission to agents for showing homes and taking few pictures???
That's stupid. Few thousands should be more than enough, not 3%.
500k house takes away 30k in commissions for nothing.
These agents don't do craaaap except tagging along with the buyer or seller and make big bucks.
It should be fixed fee based like other jobs based on time.
I don’t see anything wrong with the commission being split. The seller is getting something from the realtor who was working with the buyer. He (or she) brought you the buyer. A lot of realtors are trying to find buyers for your house because they want to get part of the commission. Without a commission, why would they do that?
If it’s 6% of normal pricing houses, it’s not too bad for the work they do but when you think about what realtors do for 10-20 million dollars houses. 6% is way too high. And don’t forget there are many 20-50 million dollars houses in New York and California. You can’t just run around and make phone calls and make a million dollars commission. I understand there are many hard working realtors out there but the fees are this high is just because of how wrong the system is. Not the work realtors do.
Why should the seller pay the buyer’s broker instead of the buyer paying their own broker? I understand that a seller can’t sell if there isn’t a buyer on the other end, but it’d make more sense to split the fees so the buyer nor seller is over-burdened. I understand that will effectively raise the price of the house, but 2-3% each is definitely better than 5-6% on one person in a transaction.
@@jcabram9002high end of luxury market is not set at 6%😂
@@jcabram9002it's generally not going to be 6% for a home in the millions. The buyer's agent commission is easy to figure out because it's publicly posted in the listing and while it can be whatever the seller (and their agent) decide, for a given market they tend to be fairly consistent. Where I live, currently, 3% is common up to about a million, so if the sellers commission is the same, 6% but do keep in mind the seller's agent commission is negotiable (for example getting a one percent discount for buying and selling with the same agent is fairly common). For homes over a million it's 2.5% for the buyer's agent (so 5% overall assuming equal commissions, but again the seller could negotiate lower). Over about $5 million it drops to 2.25% (so around 4.5% overall). Beyond 10 million there aren't enough data points but it may get lower still.
@@KonohasYeIlowFlashit's not necessarily shifting the burden, while the seller may no longer be paying the buyer's commission, the buyer is likely to reduce their offer to account for having to pay the commission so the reduction in price might cancel out. Or it might even be worse for the seller if the buyer isn't allowed to roll the commission into their mortgage because then it would likely come out of their down payment having an amplified effect on their budget e.g. they have $100k savings, without having to pay commissions their budget is $500k @ 20% down, but if they have to reserve 3% of that for commission or $15k, their down payment would be 85k so their budget is now $425k. So as a first order approximation, having the buyer have to pay the 3% commission could drag home prices down 15%. Of course that 5x figure is exaggerated but the point still holds, if the buyer's aren't allowed to roll in the commission, it's going to hurt not help the sellers.
This is ridiculous it says right in the contract that the seller will pay a commission and it is split. Take responsibility , these disgruntled home seller should have just should have sold their homes on their own. Playing the victim. Really? This will
Hurt the buyer and the seller will ultimately get less for their homes since buyer will have to roll this few into the mortgage. It’s going to be a wash. Sellers still with net the same 😮
Hopefully, this settlement will extend into "title companies". Those firms, typically controlled by law firm entities, supposedly facilitating "closings". In fact these "title" companies have begun to act in most markets as arbitrary judiciary decision makers with a primary interest in collecting fees.
It’s about time these fraudulent criminal lazy scam artists are brought to justice!!!
Real estate agents are not needed due to the internet. So buyers should not be impacted.
If you buy a house an old house with a lot of trees, make sure you get a sewer scope done. The roots will grow into the ground and crush piping. I saved a couple thousands because they didn’t consider inspecting the sewer line. This is just one of many potentially life altering costs an experienced buyers agent can help you navigate. Key is experience.
So many people want to buy houses but don't understand the process or their legal obligations. It's NOT like buying a car. Having someone on the buy side is invaluable.
Only people that the buyer needs on their side to help them stay out of legal trouble is a Attorney & title agent. A buyers agent really has no value.
@@DawudHyatitravelsnot true, a buyer's agents oversees inspections, including if the house has mold makes sure it gets removed and certified as being removed. , makes sure your earnest money deposit is not released until a few days before closing and can negotiate some repairs if needed, a lawyer is not going to open doors for you for at least a $300/hr retainer fee, buyer's agents also negotiate buying down the rate on the loan or the seller helping with closing costs on your loans. Lawyers will charge you even more for a 35 day escrow than a Realtor would.
@@REAngel5019. The bank requires inspection of properties. Even if the Real Estate Attorney charged a few thousand dollars to look over and explained the documents it would be far cheaper than the 3% on say, $500k which would be $15k.
A buyers agent does not oversee inspections. The inspector does.
Stop giving these useless agents money
@@edh2246 a buyer's agent usually gets 2 to 3%, not sure what a lawyer charges for overseeing the process of buying a home, but buyers didn't pay this, it came from the sale of the homeand sellers paid for it! ! After this judgment, the listing agent will have to do both the work of a listing and a buyer agent, but looking more after the interests of the seller and the buyer not really being represented, I don't understand how this can be good for buyers!🤨🤨😑😑
Notice that Zillow ganged up with NAR and does not show FSBO listings.. Been trying to sell something since last year. Zillow never approves FSBO listings.. even if it does it takes 2 - 3 months but still does not show up. I hope they go bankrupt.
As a professional real estate investor, I say it's about time! I've always questioned why the hell to I have to pay the buyers broker to negotiate against me. They certainly don't represent my best interest! Thank you CBS for correctly explaining the issue, and thank you to the attorney and seller that finally stood up and said that paying the buyers broker with his money in unethical. In real estate schools they pound the idea about fiduciary responsibility. I say if they get paid by the seller then there fiduciary responsibility is to the seller. So if you paid the buyers broker when you sold your home, go sue them and get your money back!
Nobody’s gonna get sued, they didn’t pay the buyer agent they pay the sellers agent. But the seller agent and the buyers agent have a contract. So you shouldn’t worry about what their contract says just worry about what Yours says. And you just pay your 6%. I don’t want to worry about what other people do with their money. I mean if you sold a car and a guy gave half of it to his business partner. Because you came in based on an ad that he ran, would you tell them that they can’t split their commission a certain way.
Paying the commissions comes out of the sale proceeds. Technically, the seller pays because the proceeds are directly going to them when the sale is completed. You're the one that brings the money to close the deal.
I've been in the real estate investment business for over 20 years and I completely disagree with you. respectfully of course
Most MLS's had the ability to offer as little as $1. Now they will be able to offer 0. It's not that big of a difference. When I've educated my clients on the value in offering compensation to a buyers agent and the reasons why they understood it. Transparency is critical.
I’ve got new information. OP is practicing The Secret, he hasn’t invested in anything except books promoted by Oprah.
Or we can just bypass the gatekeepers. I paid the 6% on the first house I sold, it was a $60k house. The one I’m ready to sell now is almost $600k. I’m not paying 10x more commission for the same amount of work.
If the fee does not exist, it doesn't get passed on! Also there are services that list on the MLS without commission.
The downside is that you are losing HUGE market exposure of prepared buyers. FSBO is a nightmare. No one is represented and they dont know the process from start to finish….which is not small undertaking. Not to mention if theres no broker no one has to follow the rules….theres no one to answer to unless you involve attorney. That certainly is more than a realtor lol. It’s like shooting your self in the foot before a martathon.
OK, but what about buyers? are you telling people to go make the biggest purchase of their life without a professional? I mean sellers will tell you anything they for you to buy their house. And once you sign that contract, you’re responsible.
@@johnsnow145 stop scaring people. It’s the lawyer and contract that ultimately matters. It’s time to get rid of useless agents
@@kaseyc5078 I’m not scaring anyone. It’s reality. The same reality as how 90% of for sale by owner homes are sold by a realtor in the end. If it was so easy why wouldn’t everyone be a realtor and be wealthy? 🤔 also where would you find the buyer? How would you or they know what to do? That’s not your attorneys problem but ultimately yours
@@kaseyc5078if lawyers give a better deal, then do it. But I don't remember lawyers doing open houses or home tours
Do you know what’s so funny about the suit? That makes no sense you actually when you list your home you get to choose whatever commission you want to pay there’s no set commission you get to choose what commission you pay the sellers agent and what percentage you would offer the buyers agent, so this is completely false I’ve worked in real estate I’ve been a customer myself it’s completely 100% false. For example when I sold my condo I agreed to a 2.5% interest rate. Excuse me commission to the sellers agent and 2.5 to the buyers agent however, I could’ve said I only wanted to offer one to the buyers agent, I could offer only a half a percent I could’ve offered nothing. These are all my choices and I’m actually stunned that the plaintiff one because every commission is agreed to every one of them.
Buyers need to be represented by professionals. As a seller, the buyer's broker closes the deal with the parties. Getting the deal worked out is the role and also making sure the terms are fair. Zillo, Open door, and Big Business are behind the litigation. The consumer is left unprotected.
Yes that is all poor people who can barely afford need. Another middle man you have to pay off.
B.S. The work a realtor does during a $500K sale is not worth $15K.
@@mikegoldstein7112 those attorneys Don’t practice Re exclusively. Which leaves the client exposed. A career realtor will outwit them because they memorized all 14 pages of agreement and know how to manipulate it. You ever hire your plumber to change your cars oil?
@@Dthraco what work do they do? I bet you don’t even know 😂
Huh?
Here's how I'd look at it as a buyer. With a commission being paid by one party (seller), your agent (buyer's agent) has no incentive to negotiate a lower price on behalf of you because he'll receive a higher commission with a higher sale price! If that wasn't the case, I could hire a broker to negotiate for me to buy a house and pay him more if he gets me a lower price! The price I pay and his commission could be inversely proportional.
We moved across state and my real estate agent found my dream home, without me. As a buyer, her work was invaluable. I am thankful to her, to this day & paying 3% to the seller's agent and to my agent, was well worth it! I would have never found this home on my own, as we were across state and the sellers only allowed a 3-day bidding window. My agent worked w/the seller's agent to ensure my bid was appropriate and everything was handled in the utmost, timely manner. Agents have knowledge I do not have and they take care of my needs, via additional items I need within the contract, deeds, etc. These agents earned their fees!
If only the defense would have used this argument. :)
Then why does the seller pay for your agent??? That's what the lawsuit is about!
@@alm4132 Because the buyer's agent brought the seller a buyer. Pretty much simple as that.
@@alm4132because the seller is the only one who gets all the buyer funds. It's a very large amount. The seller doesn't come out of pocket until he or she receives first the buyers funds. Those funds come from the buyer not the seller. So who's paying the buyers agent really it's the buyers funds that the buyer gave over to the seller. It cost to do business. It's a mutual gain. Not only that but the buyer is paying separately loan fees and interest rates to the lender and closing costs. If the seller only has to pay the buyers agent for bringing them the buyers/money and assisting that transaction to go smoothly not only for the buyer but for them too sellers should consider themselves happy and well worth the convenience.
Lets now sue lawyers since they make the losing plaintiffs pay for their attorney fees. 😂
You are a realtor, admit it!!!