Town Square

Tired of Real Estate Agents Restrictive Trade Practices.

Original post made by jack, College Terrace, on Apr 29, 2012

We are all being ripped off by Real Estate Agents.
Sellers must pay 6 percent on multimillion dollar homes to buyers and sellers agents. The sellers agents "stage" houses by plastering over all the faults, reducing value by paving outside areas that drain into homes, installing kitchens of the cheapest kind that dont even hook up properly, and spending money on things that any decent owner would rip out (at a cost) and have to replace)
Then the buyers agent get 3 percent for nothing. These days you can find all you need to know about a house online. So the the price of preparing a couple of offer forms they make 3 percent on 2.5 million! That is absolutely ridiculous. And what do we get in return. We get buyers agents forcing buyers to bid more and more and more against each other. This is because this is such a fat prize that there are way too many agents for this market and they are all forcing their clients to bid against each other so that they will be the one to get the commission.
[Portion removed by Palo Alto Online staff.]
Its restrictive trade practices and the law should do something about it.


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Posted by curious
a resident of Midtown
on Apr 29, 2012 at 7:11 pm

And the 'seller' is not happy with the inflated price he/she sold the home for?

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Posted by another
a resident of Southgate
on Apr 29, 2012 at 8:16 pm

you can find a realtor who can help you buy a house in not booming time for as little as 1%, he can return 2% to buyer.also you can hire a realtor to sell your property in hot time for 4%,each gets 2%,seller agent and buyer agent.

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Posted by Outside Observer
a resident of another community
on Apr 29, 2012 at 8:27 pm

If it weren't for Lawyers, Buyers and Sellers wouldn't need Realtors.

Fix the problem at the source.

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Posted by Palo alto mom
a resident of Duveneck/St. Francis
on Apr 29, 2012 at 8:38 pm

Real Estate agents - if they are good at their jobs - provide a LOT of value (and no, I'm not an agent, nor is anyone related to me, but I have sold millions of dollars of my own real estate in the past 30 years). A reputable, intelligent agent will help you sell your home for the highest price. They will help you buy a home at a fair (okay, PA prices are nowhere near fair) price.

Any one can sell real estate, but only a competent, intelligent, organized agent can help you sale and buy homes with the least surprises at the fairest price. As in any business, you pay for expertise and knowledge.

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Posted by another
a resident of Southgate
on Apr 29, 2012 at 8:51 pm

I bet right now if a realtor wants to buy a house for himself, he needs to go to the direct source while not count himself as buyer's agent.

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Posted by Good grief!
a resident of Greater Miranda
on Apr 30, 2012 at 10:38 am

Obvious question for you....instead of whining about "there oughta be a law", why don't you sell it yourself? Itis called a FSBO, for sale by owner, property.

There is a reason most folks don't go that route, I look forward to hearing how that works out for you. Maybe it will go well!

Have fun! lol

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Posted by jack
a resident of College Terrace
on Apr 30, 2012 at 10:41 am

the sellers dont get more for the houses. Most people around here can see through the horrible window dressing to how much it will take to strip it down and do the work properly. They are bad for sellers and bad for buyers. And they are completely unecessary. They should have been long disintermediated by technology. And they dont do business with Redfin because they know that they offer nothing that Redfins great website cant give you direct so they all gang up against Redfin agents - and that is what should be illegal.

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Posted by Agree
a resident of Charleston Gardens
on Apr 30, 2012 at 2:23 pm

Yes, I agree that there isn't much value provided by either the buyer's or seller's agent, certainly not worth at least $30K each for being an agent for the cheapest house in the area. I bought my first house without agents, I paid $500 for the legal review of closing docs, and paid the title company a couple of throusands for their services, and that was it. I saved 3% and the seller saved 3%. There was no problem at all and I'd certainly recommend to go without an agent, especially for the buyers. Also, to stay competitive agents provide kick backs of all sorts in the range of thousands. Just be smart negotiating.

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Posted by another
a resident of Southgate
on Apr 30, 2012 at 2:52 pm

in today's market, the buyer can not get a house if he does not overbid is a very competetive market.

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Posted by another
a resident of Southgate
on Apr 30, 2012 at 2:56 pm

you should not go fsbo, cause those agents have insurance to cover the transaction fraud/negelect/all sorts of problem.

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Posted by HateStaging
a resident of Greenmeadow
on May 1, 2012 at 11:13 am

I prefer to see a completely empty house when I look at homes for sale. I think staging detracts seriously from the impression I have of a home. And the more artificial it looks, the more disgusted I get. Fix things that are broken and clean everything up. Get rid of as much junk as you can. But don't waste your money painting (except maybe white or off-white if it's to cover over some ugliness) or staging. Sometimes it does more harm than good.

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Posted by palo alto mom
a resident of Duveneck/St. Francis
on May 1, 2012 at 11:29 am

HateStaging - great advice to follow if you want your home to take longer to sell and to sell for less. When staging is the norm (as it is in much of PA), your house will look less appealing to most people if you don't stage it or at least do a major cleanup and paint a warm, appealing color.

There is nothing wrong with using a discount real estate agent, unless your home is high end (for PA that it). There is such a shortage of homes, that anything properly priced, prepared and marketed will sell quickly.

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Posted by Anon.
a resident of Crescent Park
on May 1, 2012 at 1:03 pm

First thing when I sold my first house I asked my seller's agent about the cost … it was negotiable and I paid less than 3%, though I cannot comment on if that is fair, or reasonable because I don't know how much my agent really worked or what he makes per year - I needed a service and got it at the most reasonable price I thought I could. Around here when you sell a house I don't see any reason why a real estate agent should make so much money for the amount of work they do, and there is not really a good way to measure if any advice they gave as to staging or painting.

My agent wanted me to paint doors, change light fixtures, put in stone counters, and tile floors, but I did none of that .. thought I did paint the interior, and I got a bit more than my best estimation said I would.

That said, I agree with the original sentiment that this business needs to be rationalized and some "commodity" price needs to be to applied to these sales. I guess it is nice to hit the jackpot if you happen to sell a huge mansion in Palo Alto as an agent, but like CEO pay is there any logic in those costs and prices, I doubt it, not matter what agents say in their defense.

The legal aspect can be taken care of by a competent lawyer but there is a curve to get up to speed and if time is critical the seller is over a barrel. It's certainly not rocket science and not something that has not been done in every way shape or form before.

The other side is bargaining, if you have a competent agent he will advise you. The thing is that most of the time people DO NOT GET WHAT YOU PAY FOR and often you do not know what the experience or competence level of your agent is, and more and more with tools like Zillow.Com you can find a price level that is fair relative to the comps in the local area on your own or at least check out what your agent says.