We are doing a 1031 exchange, so lots of moving parts that I want to be sure we do it right.
If you are looking at multiple houses listed by different agent, would having an agent organized help? Not sure thatâs worth 3%.
Iâd be fine with buyerâs agents billing by hour like attorneys or accountants or other professionals do. Even at $100 an hour, hardly anyone would earn the $30,000 commission on a purchase of a dilapidated shack heir buyers found on their own and made an offer on the next day. Yup, thatâs close to what an agent gets by assisting with the purchase of a typical Seattle house. That would also get rid of picky buyers who like to look at properties but canât commit to one - because under that arrangement, every property viewing would cost them an hour of their agentâs time.
3 Likes
On realtracs - our local listing service - I checked 8 lists. All say seller concession offered.
I assume it means they are paying commission.
I asked someone today who has been looking for a house in a Ca city. His realtor said that in that area sellers are still offering compensation to
Buyers agent.
1 Like
Oh thatâs interesting that you are relying on the real estate broker to help you with the 1031. Iâve done a lot of 1031s in the past as a lawyer and the Qualified Intermediary was the one who always drove the 1031 process and made the dates really clear.
By the way, yesterday in the Democratic Party Platform they said they want to eliminate 1031s. Obviously no change will be implemented this tax year, if at all, but thought that might be interesting to you and maybe others. The IPX1031.com website has some good information on this. Since 1031s for business assets (as opposed to real property) was eliminated several years ago, I think it could be in the realm of possibility that 1031s for real estate could also be eliminated. So I think this issue bears watching for those interested.
I think the value of a buyerâs broker might depend on who you are and who they are. If you are a 1st time homebuyer, I think a good broker is really helpful. If you are in a tight market, it helps to have a good broker who can help you get your ducks in a row so you are ready to make a competitive offer quickly when you find a house you like. If you are from out of town, a good broker can help you find connections.
About what a broker can and canât do for out of town clientsâŠâŠWhen we moved to the South, we interviewed several buyers brokers, and none of them would recommend any particular town or neighborhood, and they would not tell us what neighborhoods were âgoodâ and would not tell us which neighborhoods had more or less crime. Instead they told us to google the school districts and the crime statistics and for us to tell them where we wanted to look. They did tell us about traffic patterns and convenience to certain stores/amenities. On a slightly different note, once I was interested in buying a house in my home town. My parents let me know that there had been a double murder there about 30 years prior and that it involved torture too. Yikes, I would never buy that house. I wonder whether a local real estate agent in the know would be allowed to disclose that fact or not.
1 Like
Posting here for any buyers out there. According to the article, there are twice as many as agents than houses on sale.
4 Likes
Iâd believe it. When I lived in CA, everyone it seemed had a realtor and mortgage license. Like half my co workers.
Everyone talks about the realtors they know.
But go to your local realtor office webpages and they have tons and tons of agents. Thereâs many more than people know about.
Like my industry (cars), most probably donât make it.
But Iâm sure the raw #s are high. Many are likely part time.
But there are also (in our area anyway) less houses on the market since 2020 and listings are being sold much quicker. So if youâre just comparing two flat numbers - # of realtors to # of listings - it may be because you have plenty of realtors (who may have been in the business prior to 2020) but low inventory.
I would think they are talking about national average. Not all markets are sellersâ market. If it is a sellerâs market somewhere, thereâs a buyerâs market somewhere else.
2 Likes
Based on the feedback I hear from friends and their kids, it feels like mostly we have Sellerâs markets and some cooled off neutral markets. Decided to google on itâŠ
#3 is in my state. But no help for my friendsâŠ. - â Having Breckenridge as a home base wonât come cheap, though: The average [home list price] (https://www.realtor.com/realestateandhomes-search/Breckenridge_CO/overview) rings in at about $1.8 million, but itâs possible to find a sweet cabin for less than $500,000.â
2 Likes
My D was just in Breckenridge ⊠so beautiful! Wish prices were more affordableâŠ!
2 Likes
My s is closing on his house (townhouse) tomorrow. Stay tuned.
7 Likes
Good luck to your son!
1 Like
Thank you! I can only hope he was liquidating stock when the market came back up, not when it tanked! I sorta asked. He sorta didnât answer 
1 Like
Forgot to mention- as a âhousewarming token giftâ I ordered them one of those pre- inked stamps with their new address for envelopes. Then I realized itâs unlikely they ever mail anything these days!
6 Likes
Iâve been waiting for this to shake out in our California market. The bottom line is âwas there collusion and/or monopoly?â. Iâve bought and sold a lot of properties in the last 15 years so this is my experience. Yes, there was
I bought all properties myself, without real estate agent. This gives me a leg up because the selling agent gets both sides of the commission, but not recommending this approach to regular buyers. When you negotiate a listing agreement, the agent should get a very reduced commission, saving seller money out of pocket, if the buyer comes to their agent.
You have every right to negotiate a lower commission structure with your selling agent. But sellers were never told that. Even if asked I was told No. i worked with the same agent over 15 years. At first I was told the âbrokerâ of the office wouldnât allow lower commissions. So, yes, broker companies tried to hold the line on commissions because they didnât want to cave. Then discount brokerages started popping up and I had to really push.
But, no matter how low their side got (possibly 1%) they were adamant that I couldnât change the 2 1/2 % offered to buying agents. Main reason was that the buying agent % was posted in the MLS (you donât see it on Zillow type sites) and it was an unwritten rule that none of the companies wanted anyone to see they had broken the commission barrier. I was told buying agents wouldnât bring buyers to my listing. It was all baloney. A property down the street came out with only 2% offered to buying agent and sold in 3 days. My agent was horrified that an agent had let that happen. Collusion
If you are required to sign a buyer representation agreement, negotiate the terms. Even if the Seller is offering reimbursement for buyerâs agent fee if your buyer agent cost is less than another offer, the Seller will select your offer over others. There are many ways to get creative with the buying agent fee. Maybe $x/hr for showings, paid by buyer and then a low % or flat fee on purchase.
I also believe that fixed price commissions might be coming. There is only slightly higher costs for selling a $3 million house versus a $500,000 house. Mainly in some staging (which no agent pays for anyway, unless you negotiate it into contract), better photos and drone videos, and maybe some international advertising (total cost probably $5,000 to $10,000 depending on advertising). And sometimes a luxury house owner will require agent to be at all showings. Thereâs no reason an agent should get $75,000 for one sale vs $12,500 for the other sale. Sometimes trying to get sellers and buyers through the entry home closing process is even harder.
Just my take on what will change.
8 Likes
Iâm also going to add that most of the closing costs are negotiable, depending on where you are. The only costs set in stone are taxes and government fees
Title company charges, escrow company charges, title insurance are dependent on who you select for the services. Usually the selling agent will insert escrow and title company into the contract based on who they work with. You are allowed to push back and select your own services but most people donât bother. In my state, the actual title insurance cost seems to be a monopoly or regulated by the state. Most are the same, but the âservicesâ side is negotiable
For example, if either side is âcashâ there is a lot less work involved for escrow, title or a lawyer. If there is an HOA involved, more work!
Escrow and title companies (guess itâs a lawyer in other states) just automatically throw in a bunch of junk fees such as courier costs, reproduction costs, document charges. Loan companies add them also. Insist on getting itemized list of charges before you get too far in the process. They love to throw them on the closing sheet right as you are sitting at closing table.
7 Likes
How does contacting a sellerâs agent work? Do they show you the house and you negotiate price on your own and go from there? I am considering to forgo an agent and not sign any exclusive contract.