So, yeah, it's been rather annoying how many articles I've been getting dripped into my email about the recent huge lawsuit over Real Estate commissions. But, yeah, I've been sucked into reading everything that lands in it and searching out other opinions and facts as well.
And, now, here we are wondering what the heck is going to shake out, right? Well, nothing for quite some time as NAR (National Association of Realtors) and the two big brokers all named in the suit, are already in the fight to change the outcome.
For now, it will be much of the same. Seller will pay a certain commission, always been negotiable, to listing agent who will share generally half of it with the buyers agent. Let's talk about the word negotiable for a moment. We, my 3 lovely ladies and I, charge between 5-6% on all listings, generally 5%, but if it's going to be more challenging for whatever reason, we would charge 6. The 6 number is what is boasting around the lawsuit, saying we've been over charging with that amount. Well, 21 years ago, that was standard, nowadays it's 5%. And, there are plenty of discount brokers who charge less. They come and go, and, well, you get what you pay for. No BS there. You want a top notch attorney? Pay through the nose for one. Best doctor, pay extra out of pocket since they aren't in network, right? Best Realtor? The one that keeps up with allllll the laws, the regulations, etc? Pay them what they are worth too. Now, I just recently had someone ask me for a discount. I graciously said my team works too hard to do discount pricing. She shopped around and came back to our little group of 3 lovely ladies. Should have charged her 6 though, she was a huge challenge the entire time! But, that was negotiable to us. Nope, we generally won't do it for less. She had a choice and realized we were the best choice. Everyone has that opportunity. Every time.
Sometimes I feel like we make an astronomical amount of money on the sale of, say, a 2M home. And, the last time I sold one of those I gave my buyer a 10K credit out of my earnings. TEN THOUSAND dollars out of my pocket to help him with the pricing on the home. He didn't like me doing it, but I insisted.
And, then, when I look at the bottom dollar of what I make? After all my expenses? (I'm not going to bother to list them) All my time spent? I deserve every penny I make. And, it's our choice if you're going to get a discount on our fees, our choice. Your choice if you have us work with you or not.
Moving forward, if the lawsuit sticks. Buyers would get screwed royally. I mean royally. Imagine a first time buyer, squeaking every penny they have for a down payment, loan costs, etc. And, now, they have to pay their agent too? You know what will happen? They will ask for a Seller credit to help with those extra costs. Or, they just won't buy a home. And, then? Sellers will either end up paying for the buyers agent fee or there will be more sellers on the market and then they'll have to drop their price a few times to get a buyer in that is willing to pay the extra costs that the Seller has for years, and years, years.
I guess I wouldn't be so opinionated on the subject of Realtor commissions if I hadn't been through the battles over 21+ years helping people in and out of homes. Battles with the other agent, the market, the appraiser, the repairs, the lender, the everyone. We agents do battles for our clients that you aren't even aware of. If all of a sudden, agents were expected to say, work for 1/2? What kind of motivation do you truly think we'd have in answering the phone at 10pm when you're freaking out over a low appraisal. Or calling the escrow officer at 6am to see where the heck the buyers loan docs are so you can get your escrow closed?
A good Realtor deserves a good pay. Just like an artist, an attorney, a doctor, insurance sales person (mine is awesome and worth every penny), and just like you. Just Like You. Would you like to wake up one day and have your boss say, "Oh, hey, we've decided you make too much money so we're cutting your salary by 50%." Nope, You wouldn't like that possibility either.
Okay, there you are. My thoughts, opinions, and the facts on this dilemma. We'll see how it shakes out and how it affects the future of home sellers, buyers, and Realtors.
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