Housing Rumble: Do You Need an Agent? (Day 6)

The great thing about the US of A

It's easy to see that this is a very heated and emotional topic for both sides. But the great thing is... you the consumer have the decision to choose! No one puts a gun to your head to make a decision. If you don't want a REALTOR don't use one. Simple as that. Great. We live in a wonderful country, don't ya think? The thing that people forget is that every home, piece of land, buyer, and seller, on this great earth is different. Every sale transaction is different. That my friend, will always prevent the real estate industry from becoming obsolete. Make your own decision and let's focus on something more important like who is going to win this presidential election!

LSW of TX @ Aug 06, 2008 15:38:02 PM

They are both missing the point.

Both of these individuals are forgetting a very important item when it comes to paying commission: What is the VALUE that the homeowner receives?

If the agent is doing nothing, has little experience, is lazy, and does not INVEST his/her own money into the sale of the home, then paying 6% or anything near it is ridiculous. However, if the agent provides service that goes above and beyond, and EARNS the commission, then I would pay 7% or even more. Agents are not a commodity...each agent does things differentyly. Match the amount you pay to the level of VALUE that you are receiving.

Mr. FSBO: You over simplify it by only looking at the amount of commission paid. If all agents did exactly the same things then that would be valid.

Mr. Traditional: You fail to realize that MOST agents out there are brutal and have no business being in the business and they by no means deserve the pay they receive.

Take it from someone who is a Broker who gets it: You get what you pay for but you should not just pay not knowing what you are getting. Make sure you ask A LOT of questions prior to signing an listing agreement. If you feel the value is there, then pay...if not, then do it yourself. I can assure you that the way my company operates and puts its money where its mouth is makes paying us what we are worth an easy question to answer.

Bottom line: A good agent will be WELL worth the fee if they do things the way they should and they are worth nothing if they don't.

David Binkowski of CO @ Aug 04, 2008 20:03:11 PM

Realtors to dissapear?

Wow, I can't wait for this to happen. When they all use FSBO websites and generic contracts.

I'll be glad my career has ended in real estate sales. History will have never served us such a sweet investment opportunity.

Let's face it, they're not going to use a lawyer for their negotiating or to read over their contracts (okay 40% will). It will be an open playing field for getting rich. Woohoo. Bring it on.

Gettin Lucky of FL @ Jul 23, 2008 10:44:28 AM

Its ALL about Protecting their Commission

Listening to these Realtors is an absolute JOKE!!!

Of course they disagree with everything said by Mr. Healy - They are trying to protect their best interest - The COMMISSION!

Lets see, I have so called "Skin" in both games also - And I will be perfectly honest - I was able to become a licensed Real Estate Agent by taking the required courses on-line and then taking the test. I did all the required courses in less than 15 hours, and easily passed the Test. Does that make me one of these so called EXPERTS at selling a home?? And to all you Sellers out there who were told by agents you have no idea how to negotiate - I NEVER ONCE was required to take a negotiations course to obtain a license. I am not sure how they have become experts??

I also LOVE the thought process that using an Agent gets the Seller 10-20% more on average of their final sales price! If that was true - WHY THE HECK would any buyer use an agent when he purchases a home?? Wouldn't he be paying 10%-20% more just to buy the home? I am sure if this was true - the general public would have figured this out by now - Thats why FSBO's are becoming more popular - Cut Out the middle man and save yourself the $$.

And to Mr.Faranda - Banks list their homes with a Broker because your ever popular lobbying group - The NAR - has lobbied lawmakers against letting Banks into the Real Estate Market. You cut out some of your main competition - what else is next??

A. Greiner of TX @ Jul 22, 2008 11:28:32 AM

Professions Don't Rise By Accident

Ah, if all agents were good for is to be the database of homes for sale like forsalebyowner.com. Then, buyers could all yell "I saw the house first" and save themselves (or the owner, we never know which) 6%. Too bad it never works out that way except in anecdotal examples and grossly flawed studies like Freakonomics author Steven Levitt 's hack job at Northwestern.

A few facts which you don't need a study to grasp:

1. Most people simply stink at selling anything, especially their own home.

2. For Sale By Owner sites have never been able to specify exactly who saves the 6% when you cut out the agents. Is it the buyer or seller? Answer: whichever one they are addressing.

3. Even though the internet and other innovations have utterly devastated the livelihoods of travel agents, stock brokers and others, Mr Healy himself admits that commissions have risen over 50% since 2000. The market is efficient, Mr. Healy.

4.If selling homes is so easy, and presumably foreclosures are even more popular among buyers than regular homes, why do banks list their REO's with a a broker? Because they know what works and what doesn't. And a title firm and attorney can't sell an REO without brokerage.

4. As a matter of fact, every successful title company and real estate law firm (and mortgage company) has strong relationships with brokers and agents.

5. Every discount and gimmick "business model" like Foxtons and Iggy's house has flopped.

I have a skin in both games because I run a full service firm and a FSBO assistance firm. I have a front row seat to plenty of FSBOs who sabotoge their own deals left and right. Who is right for FSBO? About 5-10% of the market. The rest need a broker.

J. Philip Faranda of NY @ Jul 22, 2008 06:55:23 AM