Why are real estate agents needed?

Uber snxidh
Jun 30 43 Comments

Buying a million dollar home and paying 60k for commission seems so high. On top of that, I'm doing all the research work... why hasn't this process been reinvented to reduce the cost of buying and selling a home?

comments

Want to comment? LOG IN or SIGN UP
TOP 43 Comments
  • Zillow Group zite
    Helllooooo Zillow
    Jun 30 1
    • Uber snxidh
      OP
      Terrible company. Look at stock
      Jun 30
  • Google ;O 𓂺
    I think it's mostly to prevent fraud and manipulation, but is mostly an antiquated system that still exists because enough people depend on it for employment, like car dealerships.
    Jun 30 2
    • Microsoft
      temp_

      Microsoft

      PRE
      Amazon
      temp_more
      But fraud can be avoided without agents. You need to just have a good closing attorney or an escrow company to handle the closing.

      You can draft your own sell- purchase contracts.
      Jun 30
    • Google ;O 𓂺
      Yes and you can do that today. But an attorney won't give you tours, advice, neighborhood info, etc. Agents "protect" you by telling you what you're actually buying and sanity checking the price.

      In actual practice they're a bunch of fucking morons.
      Jun 30
  • Netflix nflxeng
    I purchased two houses in Bay Area and I never cared much for my agents input.

    1. They are usually very slow to show houses. I can see like 5-6 hoses in a day in 2 hours.
    2. My agent(s) always told me I was paying more and would ask me to lower price and we were getting overbid.

    Finally I started using them to fill my price on contract and we were able to score the house. I would do research and see houses. Not entirely sure why they need to be paid 40-50k??
    Jun 30 1
    • Noodle.ai waitwhut
      RE agents are a scam in my opinion. Most of them entered the profession because they couldn't get a normal job. I met some smart ones too but they are few and far between. function as glorified receptionists
      Jun 30
  • Facebook public2
    OP has clearly never bought or sold a home. It's a tremendous amount of work and requires a lot of hours.
    Jun 30 13
    • New / Other
      DuQvV7y

      New Other

      BIO
      Did stuff. Hustled hard. Retired
      DuQvV7ymore
      🤦‍♂️
      Jul 1
    • Uber snxidh
      OP
      Dont be naive. End of the day the buyer pays as the sale price could be lower
      Jul 1
    • New / Other
      DuQvV7y

      New Other

      BIO
      Did stuff. Hustled hard. Retired
      DuQvV7ymore
      As a buyer, your decision not to use a use a realtor doesn’t impact the sales price.

      The seller already has a contracted amount that they’re paying to the seller agent.

      Your decision not to use an agent doesn’t make your offer financially better. In fact, it makes it worse.

      Everyone thinks they’re an expert because they’ve bought 1 or 3 houses. 🙄
      Jul 1
    • Tableau / Eng TacW56
      I SOLD my house without a realtor. An extra 6% is a real, measurable difference. In 2013 during a bit of a slump too. 72K commish avoided.
      Jul 1
    • New / Other
      DuQvV7y

      New Other

      BIO
      Did stuff. Hustled hard. Retired
      DuQvV7ymore
      Like I said, you’ve done 1 transaction (or 3), now you’re an expert.

      SYAD.
      Jul 1
    • Facebook public2
      Sadly had you had an agent you probably could have sold the house for 100k more.
      Jul 1
    • Tableau / Eng TacW56
      Such hostility. It’s more than 3, and I never called myself an expert, just sharing the fact that it’s easy enough for a lay person to do it. A realtor’s license can be achieved by someone in 3 months or so without a GED, so it’s not like the bar’s real high to achieve expert status anyway.
      Jul 1
    • Facebook public2
      Not being hostile but the bar is actually incredibly high. Something like 90% of agents fail on the first year. Passing a broker lisence test is one thing but that's like saying everyone with a driver lisence can become a race car driver. A good agent is worth their weight in gold. You may not need one to get the deal done but you should to make sure you get the best deal possible in almost every case.
      Jul 1
    • Tableau / Eng TacW56
      You are now conflating salesmanship with other pragmatic duties of a realtor. They’re two separate parts of the job, and I thought it was rather clear that we’ve been talking about the process/logistics of buying/selling a home. These are very limited skills that anyone can quickly learn. On the other hand, selling (and it really doesn’t matter what the product is) doesn’t require any hard skill whatsoever. You can be a fantastic salesperson with zero training as long as you are likable (being attractive also helps). We’ve not be talking about the art of selling in this thread, but if we were then yes a realtor’s ability to be very successful will largely be dependent on the soft skills.
      Jul 1
    • Facebook public2
      We are because you said you sold your house and saved a commission lol. Your mistake changed the topic haha.
      Jul 1
  • OpenDoor Moo!
    That's the whole thesis behind Opendoor. We're doing pretty well so seems like you're on to something...
    Jun 30 3
    • Valassis / Eng
      GNu002

      Valassis Eng

      PRE
      Microsoft
      GNu002more
      Sort of. But it's not like sellers still don't get hit with fees. OD's average 8.1% and go up to 13% (before repair costs). If 6% bugs OP this isn't really an improvement.

      I like your business model but it's not substantially (or at all, likely) cheaper for a seller that has time to sell or the ability to carry two mortgages for a while.
      Jun 30
    • OpenDoor Moo!
      No, our model is more "agents don't really do anything so you may as well use Opendoor and get something of value out of the money you pay"
      Jul 1
    • Valassis / Eng
      GNu002

      Valassis Eng

      PRE
      Microsoft
      GNu002more
      What value does open door provide other than speed of sale, flexibility of closing date, and management of the repair process (which your realtor will do for you)?

      I've done the offer (declined - it was just for curiosity sake) and had two neighbors do it. Both were because they needed to relocate and wanted a predictable timeline. I don't remember seeing information about another value prop than those.
      Jul 1
  • Valassis / Eng
    GNu002

    Valassis Eng

    PRE
    Microsoft
    GNu002more
    If you believe your agent isn't providing that value then don't use one. FSBO is common. But if the buyer brings an agent you're still paying that if you want the sale.
    Jun 30 4
    • Uber snxidh
      OP
      Right but why does the agent have so much power. Seems like a conflict of interest where the agent only shows you properties where he or she makes more commission.
      Jun 30
    • Valassis / Eng
      GNu002

      Valassis Eng

      PRE
      Microsoft
      GNu002more
      So you have a buyer's agent not a seller's agent? They will show you whatever you want. The seller (often the seller's agent) pays their commission (and it shouldn't be 6% for a buyer's agent).

      My experience was If you want to buy a FSBO house where the owner won't pay the buyer's agent fee then you are going to have to pay it or pass.
      Jun 30
    • Oath Atinlay2
      “Why does the agent have so much power?” WTF? They work for you. Sack up and make then work for their money
      Jun 30
    • Google 1234-/:;(
      Because they can push a deal to completion. Most first time buyers and sellers have no idea what goes into contracts and everything to look for.
      Jun 30
  • Expedia hnAy18
    I discussed this with a friend. We ended up on the idea it's very hard for people to trust something online
    Jun 30 3
    • Uber snxidh
      OP
      Hmm seems like we trust many other things online and the trend is increasing...
      Jun 30
    • Expedia hnAy18
      It's not gonna be easy to send someone 1million$ over internet
      Jun 30
    • Netflix Disney-
      People do though. Roofstock.com for example
      Jun 30
  • Peloton / Other
    Thizzy

    Peloton Other

    PRE
    Peloton, Samsung Electronics
    Thizzymore
    Why are you even thinking about this? If you think they have no value, go ahead and sell or buy a house or property without one. If you get fucked don't come crying. Said job can be said about a lot of professions. Financial advisor? Stock broker? You can learn all of this by yourself and invest your own money. Most of them use AI anyway. It is usually the people that do not know exactly what goes on that say ignorant things like this. They work on commission. They put hours in the job and lots of deals fall through also which means no food on the table. Go ahead and do your "research" and buy/sell a property. Good luck!
    Jul 1 0
  • Facebook midlandp
    I bought thru an agent who charged 1%. I sold my old home thru the same agent for a fixed payment of $10k and I listed buyers agent commission as 1%.
    You just need to negotiate and hold your ground, like you do for com negotiations 😊
    Jun 30 0
  • Noodle.ai waitwhut
    If you are buying, you need a real estate lawyer to write up contracts for your offers. They charge around $3k. If you're working with an agent, they usually have a lawyer at their firm who does that. You can eliminate the agent from the equation and just go with a RE lawyer
    Jun 30 1
    • New / Other
      DuQvV7y

      New Other

      BIO
      Did stuff. Hustled hard. Retired
      DuQvV7ymore
      The only beneficiary here is the selling against who pockets the entire 6%.

      And houses of a certain size, it’s not 6%.

      It’s a negotiated price and can be as low as 3.5%
      Jul 1
  • Tableau / Eng TacW56
    In other developed countries the commission rate is 1-2%.
    Jun 30 1
    • Uber snxidh
      OP
      I'm wondering why the market here isnt efficient to drive the cost of sales down
      Jun 30
  • Microsoft pJcW86
    This thread lol. As a buyer or seller I wouldn't want to deal with Joe-Blow-know-it-all thinking he can do everything himself and making my agent have to waste time teaching him. Generally self-represented buyers under-offer and generally aren't realistic and have tons of mistakes in their offer. For sale by owners price way under or way over, general presentation sucks (photos, showings, marketing) and don't work well with buyer agents.

    As a multi-buyer/seller I use agents I've vetted and work well with because I just don't want to deal with all of the hassle even though I can be my own agent. I do my own research and let them take over on the offer.

    Self representing means you are totally on the line for anything and you could be sued for any breaches or misrepresentations.

    That said there are tons of shitty agents who are glorified salespeople who did not represent their client well and I was able to take advantage of it and get sales approved on my terms.
    Jul 5 0
  • Tableau / Eng TacW56
    Multiple research studies have shown that realtors literally add no value to process, and this is borne out by the data.
    http://freakonomics.com/2008/02/26/real-estate-agents-revisited/
    Jul 1 0
  • New / Eng harigur
    Try upnest. I interviewed with them. Horrible product and CEO.
    Jun 30 0