My Help-U-Sell realtor saved me 1.5% commission. I paid 3.5%, vs. 5% for the ReMax agent I interviewed. I bought/sold 3 houses, so I know what to expect. The entire listing/sales/closing process was the same, even though I saved 1.5%!
After interviewing both realtors in October 2005, I asked my Remax agent if she could price match her commission. She checked with her office, and was told she couldn’t, due to the high cost of E&O (Errors and Omissions) insurance. I checked with a friend who works for a company with potentially high liability, and their multi million dollar E&O insurance runs a few thousand dollars per year. So the Remax office story was just a plain lie. My agent was just telling me the story they told her. So that’s how they justify keeping their high commission – they tell the agent the overhead demands it!
I checked with my Help-U-Sell broker, and he told me they have E&O insurance, millions of dollars in coverage, and due to their excellent track record, have a low premium. They are fully insured, and don’t have to lie to me or rip me off, either. Wow, now I liked them even more! And I was really turned off by Remax. Something about lying to me…
I noticed that ZipRealty gives you a commission refund at closing. Like Help-u-sell, if you are a buyer, they will give you part of their 2.5% commission.
Oh, and she sold me house in 6 weeks. I’ve come to believe the most important part in selling a house is being in the MLS, offering a buyer’s broker a 2.5% commission, and setting a right price. All that stuff about Open Houses and flyers and advertising in the newspaper, is just fluff. As a buyer, I’m going to investigate every house in the MLS that’s priced right. I wouldn’t be so short sighted as to buy a house just because I saw a colorful ad in a newspaper. Although the realtors try to make you think that your house sold because of their extensive marketing. It’s the price, it’s the MLS exposure, it’s the co-broker commission!
With all that said, why would anyone pay 6%, or even 5%? Why would anyone use an overpriced-commission broker? Let’s stop saying “full commssion”, and call it what it is: “overpriced commission”.
I think that as home prices keep descending, sellers will figure out the best way to squeeze out a little more equity is to stop the handouts to the realtors.
After all, just becaue housing prices doubled, should their salaries double?
And don’t stop your price shopping w/ realtors. The title company made out like a bandit on my closing, too. They also price their services based on the cost of the house. Any of you buying/selling, shop around for title company prices.
I do believe in using realtors, I just think they charge too much.
.
