Real Estate Agents Underpaid?

Quote from laier19usa : The greedy SOB refused to even rebate us back 1% of the commission even if it meant he got to pocket 5% instead of 3%. He gave me some crock about buyer's rebates being illegal...

Even in states where it's illegal there are ways around this: Seller's Agent reduces fee to Seller (buyer is not involved), and Seller pays closing costs/gives cash back to buyer at closing. Since this is between the Seller and Buyer, the Agent is not technically doing anything wrong.

I personally used the Seller's Agent on our last home and did something similar to what I stated above. My lawyer wrote up everything a buyer's agent would have for much less than a buyer's agent. I don't feel I lost anything not using an agent, and honestly I'm glad I didn't since it saved me cash.

I have nothing against Real Estate agents and pretty much view them exactly the same as any other Service Provider: if I put the time and effort into then they probably aren't needed. If I don't want to put any time or effort in, then their worth the 6% or whatever you agree to.

Quote from Dr. J : There are realtors here but AFAIK the actual AGENT only gets, typically, 1.5% (half of half of the 5-6%). so in a $400k sale, that's $6k. Like a waiter, a $200 table bill doesn't require 4 times the work as a $50 table bill, so using the 15% rule of thumb would leave a horribly inaccurate (too much) tip.

So you are one of those people... I'm going to guess that you go to a chili's with a few friends and tip 2 bucks on a $50 ticket. Then you go somewhere nice and get a $200 bill and still tip $2. You know, as being someone who did it getting through school, the problem is that your server is making $2.13/ hour. Sure on good nights I could work 5 hours and make ~$150. Most nights though were nothing like that at all. Do you know what $2.13/ hour gets you? The ability to pay income taxes on money you made or didn't make that you still had to claim. At the end of the day your waiter most likely has to claim ~10-12% tips vs sales for tax reasons. So really when you come in and tip someone 1% you are really taking money out of your waiters pocket. Oh, thats not even mentioning that they share tips with the bartender too.

I'm sorry for this big rant... People like this just burn me up. I realize we are here for deals, but when you get one for gods sake don't be the guy that that tips $2 on any size ticket when you go eat. It really makes people hate you lol.

(P.S. All but 2 people I worked there with were putting theirself through college and most the time had 2 jobs to make ends meet)

my father is an agent and that man worked harder as an agent than i've ever seen. was he out there inspecting the houses every nook and cranny? not really. but he was constantly on the phone with perspective buyers and drumming up business. he spent 3 straight weeks cold calling people. didn't matter. impossible business to prosper in unless you know people who own expensive real estate. i wouldn't call them overpaid, i think the real estate agent process should be redefined though because it doesn't seem fair to either party.

by the way, have you ever asked a real estate agent what they think of buyers? the phrase at my dad's office is "buyers are liars" meaning they're impossible to figure out, husband says they want this, wife says they want that, in the end they were just too ashamed to say what they really want. try walking a mile in their shoes first.

New flash. The realtor doesnt sell your house.
MLS does. They are just the gatekeeper

I can see either side. This doesn't fit for the "finance" forum, this should be in the lounge or something.

People that think they are overpaid are ones that found a house and did everything without much time. This results in around $1000 per hour of work involved. Hence they are apparently overpaid.

People that think they are underpaid are ones that have relatives in the business (because uncle tommy the real estate agent works 100 hours a week) or they have bought a house after wasting the agent's time looking at 1000 other homes without researching anything on your own. This results in around $1 per hour of work involved. Hence they are apparently underpaid.



Personally I think they should get less commission and earn profits by other means. For instance if they charged $50 to show a house to you then you are less likely to waste their time on 999 homes and would make the practice more efficient. However as with all jobs, if they get paid less then you will end up with crappier agents as time goes on. So in the end more money isn't a bad thing.

I wish people would stop ranting about tipping waiters, no one gives a shit about how much waiters make an hour and no one forced them to take that job. The good waiters will get tipped, but if you are bad then eventually you won't want to be one since you won't be making enough. Think of it like darwin's theory being applied to employment.

I think it varies where you sell and who you work with. I believe some Real Estate Agents get bang bucks (especially around 05 to 08 scandal). If you live in higher end place with how prices 250,000 and up your talking big money as someone that lives in a town where its cheaper say $80,000 etc. Personal experience is some real estate agents are assholes as some arent. With one all she cared was about to sell didn't try to help out in giving us a better deal or talking to the owner and only mentioned the upsides (which werent really any since condos overall arent worth much). Another agent was actually more sincere and helpful telling us that condos arent worth it and didn't want us to see those instead look at homes.

Quote from gpister : I think it varies where you sell and who you work with. I believe some Real Estate Agents get bang bucks (especially around 05 to 08 scandal). If you live in higher end place with how prices 250,000 and up your talking big money as someone that lives in a town where its cheaper say $80,000 etc. Personal experience is some real estate agents are assholes as some arent. With one all she cared was about to sell didn't try to help out in giving us a better deal or talking to the owner and only mentioned the upsides (which werent really any since condos overall arent worth much). Another agent was actually more sincere and helpful telling us that condos arent worth it and didn't want us to see those instead look at homes.

I used to pull the same scam on buyers when I sold real estate. It's a lot easier to get them to fall in love with a house than with a condo. and, of course, the former tends to sell for a lot more than the latter, generating a much juicer commission for the agent.

Quote from hcazualcc : my father is an agent and that man worked harder as an agent than i've ever seen. was he out there inspecting the houses every nook and cranny? not really. but he was constantly on the phone with perspective buyers and drumming up business. he spent 3 straight weeks cold calling people. didn't matter. impossible business to prosper in unless you know people who own expensive real estate. i wouldn't call them overpaid, i think the real estate agent process should be redefined though because it doesn't seem fair to either party. by the way, have you ever asked a real estate agent what they think of buyers? the phrase at my dad's office is "buyers are liars" meaning they're impossible to figure out, husband says they want this, wife says they want that, in the end they were just too ashamed to say what they really want. try walking a mile in their shoes first.

What your dad does to generate business is not the same as what the op is trying to point out.

Quote from laier19usa : I do have a real problem with realtors because so much money is spent on them and they add no real value to the transaction. It just infuriates me when I consider how much more affordable housing prices could be without these leeches who basically have a monopoly on the industry. What's amazing to me is there are still people out there that don't mind having an extra 6% built into the cost of selling/buying a home just so someone can schedule appointments, drive them around, and unlock doors for them.

YOu can buy a home off a person who's selling FSBO And not pay one cent to an agent. NObody is forcing you right? Same with car dealers, I wish I could have bought a GM Silverado during the meltdown for half price but the damn dealers wont let GM sell it on ebay or directly to a person.

A good agent is supposed to do more than just open doors for you. If that's all that your agent is doing or you think being an agent has to it, then you are mistaken.

I think they make too much money.. if I sell my place, Im doing FSBO with a paid MLS listing. I can show my own house for the $24000 commission I would fork out

Quote from samurai03 : What your dad does to generate business is not the same as what the op is trying to point out.

I think my argument coincides perfectly with what the OP was saying but I'm looking at it from the opposite side of the spectrum. It's called market pricing, and when you look at it from the real estate agent's perspective they are being underpaid. The OP wants the service they provide and would also like most real estate agents to live below the poverty line.

Quote from 8mpg : I think they make too much money.. if I sell my place, Im doing FSBO with a paid MLS listing. I can show my own house for the $24000 commission I would fork out

Why aren't we first complaining about politicians and wall street bankers making too much money first before we talk about lousy RE agents?
If you are selling FSBO, get ready for the house to sit for a while and/or get ready for tons of I've got a buyer interested, would you pay me a commission for it type of calls. In this market if you price it right, there's no problem selling it fsbo. Might even get an investor to buy it. However, the retail buyers pool who are working with agents will not come to view your house as the agents want the commission from the other homes.

Quote from Superocean : Why aren't we first complaining about politicians and wall street bankers making too much money first before we talk about lousy RE agents?

cause either they worked hard 100+ hrs/week to get there or they have God like connection and then worked hard to stay on there.

Quote from happyhunting : So you are one of those people... I'm going to guess that you go to a chili's with a few friends and tip 2 bucks on a $50 ticket. Then you go somewhere nice and get a $200 bill and still tip $2. You know, as being someone who did it getting through school, the problem is that your server is making $2.13/ hour. Sure on good nights I could work 5 hours and make ~$150. Most nights though were nothing like that at all. Do you know what $2.13/ hour gets you? The ability to pay income taxes on money you made or didn't make that you still had to claim. At the end of the day your waiter most likely has to claim ~10-12% tips vs sales for tax reasons. So really when you come in and tip someone 1% you are really taking money out of your waiters pocket. Oh, thats not even mentioning that they share tips with the bartender too. I'm sorry for this big rant... People like this just burn me up. I realize we are here for deals, but when you get one for gods sake don't be the guy that that tips $2 on any size ticket when you go eat. It really makes people hate you lol. (P.S. All but 2 people I worked there with were putting theirself through college and most the time had 2 jobs to make ends meet)

+1

I delivered pizza all through college and if you didn't tip the customary 15%, your order went to the bottom of the pile at the very least. On a Friday/Saturday night, that might make you 7th or 8th in my delivery order. If someone else got your ticket, then we would make sure they also knew that you were a s**t tipper. If you were a really awful tipper, the driver might spit in your food, drop some Ex Lax into it, eat food out of your order (even cutting the middle out of your pizza), or simply disappear your ticket and pretend you never ordered at all. Some of the guys would even key cars on their way back down the driveway, pour deer urine down the cowl vents, and so forth. Don't underestimate how much you piss someone off by screwing with their income. They have rent, bills, and families to support just like you do. And if you insist on being an a**hole, then you deserve whatever comes your way.