Homebuyers And Sellers Say Real Estate Agent Fees Are Too High
Homebuyers and sellers throughout the US have been grappling with increasing home prices and mortgage rates, and now are taking issue with increasing real estate agent and brokers fees that are increasing in parallel with seemingly everything else in the real estate industry.
According to NPR, especially after the lawsuit that the National Association of Realtors settled last summer that implemented new policies regarding agent compensation, buyers and sellers began to pay closer attention to every fee included in their transactions.
With this new commission structure and policy, agents have to inform buyers and sellers that their fees are negotiable.
Buyers must also sign an agreement with their agent to establish how that agent will be paid. This will also involve the buyer agreeing to pay the agent if the seller’s agent refuses to do so.
Agent compensation offers are also no longer prohibited to appear on multiple listing services, MLS, which are online databases used to list homes.
These new rules in the industry have opened up a lot of conversations among buyers and sellers and the ways in which they proceed with their transactions. They also have opened the door for brokerages to begin charging flat fees.
“Home buyers and sellers almost feel like they’re trapped into using agents, rather than they’re hiring agents at a reasonable fee,” says Rob Luecke, CEO of ShopProp Realty, a flat-fee brokerage that operates in nine states.
Luecke says his “goal is to eliminate commissions — or at least get them a lot lower, and put the power back into the home buyer and sellers’ spot where it really needs to be.”
Traditional commission-based real estate agents are making the “you get what you pay for” argument that their higher fee will always be worth it. These agencies pride themselves in a higher level of service that flat-fee brokerages can’t offer.
Leanne Liang, an agent with Redfin in the East Bay area outside San Francisco, says: “If you move half a mile away, it’s a totally different market. So I think buyers can really benefit from agents who are experienced in that location.”
Liang suggests that buyers and sellers should do diligent research and interview different agents and brokerages to make the best decision for themselves and their goals.
“It’s not just putting a house on the MLS and then just waiting for the offers to come in. In a challenging market, I think we as agents really work for our paychecks.”
Eric Mastrota is a Contributing Editor at The National Digest based in New York. A graduate of SUNY New Paltz, he reports on world news, culture, and lifestyle. You can reach him at eric.mastrota@thenationaldigest.com.