I’m watching a friend buy a home, and the realtor is earning nearly $20,000. All this despite my friend finding the property himself in the end.
Is the paperwork really worth that much?
With tools like Zillow and Redfin, it seems fair to ask do we really need these middlemen?
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I’ve bought and sold 3 homes over the years, each time the paperwork and legalities were more complex than the time before. That said, I don’t think the complexity justified the realtor fees.
I was a realtor for a stretch. If he found the property himself he can use an attorney for the contract stuff.
Those who can, do. Those who cannot, sell houses.
When we bought our first home, the realtor was very helpful up to the closing. She did not show up to the closing. Thank God my father-in-law was there when things went sideways. It helped that he was a commercial real-estate lawyer. When it was all said and done, he said he had never seen a closing that was as borked up as outs.
After that closing and the problems we had with home ownership, I don’t think I’ll ever buy another home unless I can pay cash. I absolutely freaked out when I saw the truth in lending form that showed that if we had kept the loan until the house was paid off we would have spent $300k on a house that was listed at $120k by the time it was all said and done.
It can be a lot to learn while you’re working full time and it’s nice to have someone coordinating everything for you.
I would 1000% agree that the work they do does not seem to add up to how much commission they get. Tens of thousands of dollars for doing some pretty basic stuff seems totally excessive.
Realtors work off a percentage of the final cost. Sell an expensive house, they get more money. Most the time realtors earn off the seller of a house. So the home buyer does not notice.
Hell no
I worked for a startup that built an app to replace realtors. We spoke with plenty of people who thought realtors were unnecessary and not worth the fee. We could get these people to start using our app, but when the moment came and they found the house they wanted to buy and things got real, they panicked and stopped using our app and found a realtor. That startup is no longer in business.
Realtors are like lawyers – theoretically you don’t need one, they’re overpaid, not always well liked/respected, BUT when you’re in the shit and truly need one, you’re going to hire one.
I’ve bought two houses. And tried to buy others. The ones with real estate agents were a pain in the ass.
The one I bought without an agent and was for sale buy owner was so easy. They were out of town selling her mother’s house. They had a family friend show it to me. I wanted it. We spent two minutes on the phone negotiating a price instead of the back and forth bullshit of going through agents. Once we had our price, she had a real estate attorney draw up a contract. We signed. Then, set up a closing date. Which, that only cost $500.
I was getting a mortgage. They still required a home inspector which I would have gotten on my own even if it wasn’t required. There was nothing missing from the process except BS and high fees.
Here in AU you have an agent that sells the house, but you very rarely use a buyer’s agent.
You find the place, organise a walkthrough. If you like it and want to put an offer in the conveyancer takes care of all the contract stuff for a small fee. Like a couple grand. I was completely surprised when I saw in the US the sell AND the buyer used an agent. Seems like a waste of time.