I'm all for open transparent markets but I doubt they will have much impact on house prices. There's too much specificity. No matter how transparent a market it can't save speculators from themselves.
It'll be great for both buyers and sellers. The added cost of the commissioned realtor in the purchase and sale transaction is huge-- as big as people's down payments!
Will it have a big impact on house prices? Probably not by any more than the reduction in commission. But as a seller, it'll certainly feel more satisfying to know that you're not paying $15K to a realtor for a few hours' work, for the sole purpose of gaining access to buyers on MLS.
I am hardly a Realtor apologist but there are other legitimate reasons to use a buyer agent than accessing past sales data. Will what marginal buyers are paying in any way influence what I am willing to pay? Usually no. All it tells me is if my bid will be taken seriously or not.
Redfin didn't prevent exorbitant prices nor afaik did it clobber Realtor commissions in the US. Nevertheless Redfin in Canada can be nothing but positive.
Time for Realtors to come to terms with their true value proposition. And if it's commission based pay, as long time commenters have pointed out, they are in a conflict of interest. Many, despite this conflict, do bring some value to the table for those who don't breathe the market 24-7.
Probably not by any more than the reduction in commission
Not even that, because prices are determined by what buyers are willing and able to pay. They don't care how much commission the seller is paying.
I mean collectively, there may be individuals who think otherwise but that doesn't matter unless they are the high bidder, and such people are unlikely to be high bidders. :) Lower commissions will mean higher net proceeds for the seller.
I'm all for open transparent markets but I doubt they will have much impact on house prices. There's too much specificity. No matter how transparent a market it can't save speculators from themselves.
ReplyDeleteIt'll be great for both buyers and sellers. The added cost of the commissioned realtor in the purchase and sale transaction is huge-- as big as people's down payments!
ReplyDeleteWill it have a big impact on house prices? Probably not by any more than the reduction in commission. But as a seller, it'll certainly feel more satisfying to know that you're not paying $15K to a realtor for a few hours' work, for the sole purpose of gaining access to buyers on MLS.
I am hardly a Realtor apologist but there are other legitimate reasons to use a buyer agent than accessing past sales data. Will what marginal buyers are paying in any way influence what I am willing to pay? Usually no. All it tells me is if my bid will be taken seriously or not.
ReplyDeleteRedfin didn't prevent exorbitant prices nor afaik did it clobber Realtor commissions in the US. Nevertheless Redfin in Canada can be nothing but positive.
Time for Realtors to come to terms with their true value proposition. And if it's commission based pay, as long time commenters have pointed out, they are in a conflict of interest. Many, despite this conflict, do bring some value to the table for those who don't breathe the market 24-7.
Probably not by any more than the reduction in commission
ReplyDeleteNot even that, because prices are determined by what buyers are willing and able to pay. They don't care how much commission the seller is paying.
I mean collectively, there may be individuals who think otherwise but that doesn't matter unless they are the high bidder, and such people are unlikely to be high bidders. :) Lower commissions will mean higher net proceeds for the seller.