My house is valued at around $1.24M in Zillow. To sell, the closing cost includes a 6% commission for real estate agent which comes to around 75k. My problem with that, given a market like bay area where the house literally sells itself this seems too steep a price. I bought the house in peak market 2 years back and it has appreciated by just 150k. That is 50% of my investment going to some fancy pants in commissions who didnt take any of the risk investing in a house. I feel the commission should be based on profit margin instead of the value of the house, given how steep the housing price is here. #sanfrancisco #mortgage #housing P.s. not selling the house. I know people who slog to make 75k a year, while real estate agents walk away with 75k for doing nothing! I want some justification for why they get to walk away with our money,.the system is broken. If I make 100k from stock investments the brokerage doesnt walk away with 6%!
Let’s say you made a huge margin. I am sure you wouldn’t say that the commission should be based on profit margin. There are ups and downs!
It would always cost the seller less to pay a commission on profit margin instead of selling price.
if you feel that, you should have negotiated that with your listing agent. no use grumbling now.
Not selling, just understanding what goes into selling. Yes will definitely negotiate.
you’ll find that an enormous amount goes into selling
1) never sell real estate, especially after 2 years 2) zillows estimate means nothing 3) even if true tax free 75k for 2 years of living is pretty amazing
Hmmm, so I spend 2 year paying mortgage, cutting on my expenses and sacrificing things. While some guy spend 2days selling the house and walks away with 75k. That sounds fair to you?
Yep, lot more than 2 days worth of work. If its less than 30 days you will get a better sale price and a 3% rebate.
Hmm, when I bought a house, the seller’s agent received 5%
List yourself. If you spend a week, you can do it
Your agent will give half (or some % anyway) of that $75k to the buyer’s agent if that makes you feel any better Like others have posted, the Zestimate is almost meaningless... if it’s a good house in a good area it’ll go for a good price Your main issue isn’t so much that the agent is making $$, it’s that your home hasn’t appreciated as much as you wanted it to. Maybe wait?
Your agents’ commission is built into the home price. Also, The industry is set up for an agent to be able to sell your house for a higher price., netting you the most money otherwise you could sell it yourself easily. Sometimes, I take my child to the doctor for a sprained ankle and the doctor takes one look at it and says “ice it”. I never argue about how much fee he is going to be charge me for that visit.
A doctor and real estate agent are not the same. A good doctor makes around 200k a year and has to pay insurance premium to practice, while a real estate agent can make the same in a month selling 5/6 houses with very little to no qualification.
Real estate agents buy insurance too. With an experienced agent you can save a lot more money and time. It’s definitely well worth it.
Commission on profit ? What if you sell at a loss, should the agent pay you ? If it’s just 2 days of work, why don’t you just list it yourself and sell it ?
I had the same exact feelings OP. Some random person with very low actual value add makes more money than people who actually add more value. The commission should be based on house prices in my opinion with a cap of $10k at max
It’s the same reason why you pay your pediatrician $250 after insurance each doc visit, for them to chat with you and check your kids blood pressure and temperature. They are professionals and the industry is set up for them to survive, some thrive but not all. It’s the same reason a plumber will charge you $150 to change a $20 faucet.
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>> I bought the house in peak market 2 years back and it has appreciated by just 150k If it went up, then it wasn't peak. But the fees are indeed crazy