Let me see if I can help her out, since she obviously has never taken an Econ 101 class..
OK, let's say you had a company who made widgets (oh, please, don't ask what a widget is). So the company makes a million widgets, at a cost of $1 each, and prices them at $100 each. But there's only buyers for 2 of them.
So the company lowers the price to $50. And finds 5,000 buyers.
So the company lowers the price to $10. And finds 10,000 buyers.
So the company lowers the price to $2. And clears through their inventory.
So did that help?
It doesn't matter how much you believe in your price, or think you can justify your price. It doesn't matter what your costs are. The ONLY thing that matters is what price the market will bear for your product or service. And the market will no longer pay 6%.
Try $20 an hour. Max.
And want a really good tip? Go find another job. "realtor" is no longer a viable profession in America.
Thanks Wot for the link...
Will I cut my commision? No!.... Next question.
It should be that easy, but it isn't! My value as a REALTOR to you the home seller is well worth my professional fee. You the home seller, need to know the answer to my most frequently asked question.
March 19, 2008
Supply. Demand. Price. Logic. realtors. Something's missing in this loop as a ramen eater states "Will I cut my commision? No!.... Next question"
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59 comments:
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Remember the old saying when it comes to realtors,
"10% sell.....90% talk"!
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Strange. Her logic is that people should pay the 6% fee because she chose to work within a profession where fees are collected in an elaborate distribution stream where evil people are all taking away a cut. How is that a homebuyer's problem? Her commission is split over and and over until she's left with a molecular sized piece of cheese too small for a poor church mouse.
Is this the part where we feel sorry for realtors?
Like the capitalist market system is so compassionate and won't question the 6% anymore. The truth is, the market economy is cold, emotionless and brutal.
With the entry of Redfin will come more and more competitors adding more and more value. Realtors don't add the same or sufficient value that customer want anymore. They've been jumped. The refusal to cut the 6% commission is more than a public embarrassment.
Another great thing about the market economy and advancements: The foolhardy and arrogant will get taken down...hard.
I love her comment in the comment section.
"I have a family to feed"
Ramen...10 for $1.
She belongs in the Housing Bubble Hal of Shame with a pigheaded quote like that.
Will you sleep with me?
Omigod - As much as I like NH, the God-awful worst vacation my family ever had was at Lake Winnipesaukee - and realtors played a big part. Rented a place on the water which was infested with fleas! Demanded another rental, which we got, but then discovered that half the place didn't have electricity. Told the realtor in no uncertain terms that they had "misrepresented" the original listing which was apparently the right buzz word to use cause they then cut me a check for the full amount, which I then dutifully cashed at the local bank on which the funds were drawn. Salvaged some of the week in a motel but man it was the worst. Realtors days may be numbered, but realtors in tourist areas truly are doomed.
Average sale price in Lake Winnipesaukee:$366,602 in October 2007. Per Kim's blog. Guess she's too busy earning her 6% to update her numbers or would that be down-date since the current numbers will be lower.
OK $366,602 x .06=$21996.12
Take away $1000 for marketing which is high.
$20996.12 split with broker leaves $10498.06 for Kim. Divide that by $30, which is way more than most realtors would earn on the open market means that Kim would have to work 349 billable hours to justify her cut of the commission. That would mean that in order to justify the commission she says she earns she would have to work full time 40 hours a week for two months to earn her commission at a rate of $30 an hour.
All I can say to that is BLOGGA PLEASE!
And if all she does is list the house then sits at home all day doing her makeup for her next "marketing" photo she still gets about $5k for nothing.
The market will tell her what her skills are worth. It is kind of sad that she does not seem to understand that 6% of nothing is nothing. Maybe Starbucks will give her a job pumping lattes at 6%. At about 25 cents per venti latte she would have to pump a lotta lattes and might learn the value of a dollar and the value of her so-called profession.
Stupid RealWhore.
Economics 101a:
0 x 6% = $0. = No Lexus payment.
Get it, Bitch?
Everybody get over there and post right away. It's easy. I'll bet the cuts off comments real quick when she hears what the public really thinks of her "profession"
does she know how to work the pole?
I bet she looks great in a swimsuit or in a go-go cage.
Maybe she should try car sales.
Starve Whore
"Oooooo now she's pissed. Her response after just a little feedback -
"you made your point! You don't need a REALTOR! Speaking for myself, I am soooo glad you don't!!! Good luck with your book and your house!
PS I am college educated, thank you!
Since you keep coming back to post I am going to assume that you are in a difficult situation in this housing market.
You can stop commenting here now. I allowed you to make your point. Please don't come back!"
Oh well - poor Kim - her commission is already going to be cut in half because where she used to make $36K to sell a $600K house - she'll now only make $18K because the same house will only be worth $300K. It's not our fault she has to split her commission or pay taxes or miss her daughter's baseball clinics. Poor, poor kim.
"You the home seller, need to know the answer to my most frequently asked question." ... which i will only give you if you pay my exorbitant fee. Sounds a bit like extortion! Or like Matthew Lesko or a million other "buy my book and get my secret" shysters.
Wise man once say:
see goods, then pay.
The Mexican...
Keith, what's a widget?
*
*
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My value as a REALTOR to you the home seller is well worth my professional fee.
Man, that sounds like it came right from the pages of the NAR crook manual. "Professional" and "Realtor" should NEVER be used in the same sentence, unless you are telling someone not to use it in the same sentence. Whoa, that confuses me even after I typed it.
Give 'er a little while and the supply and demand, that Keefer was talking about, will have her cutting her fee in half, plus she'll even throw in free belly dance lessons.
Cha, cha, cha-rumba!!! Hey, I'm getting in the mood here. YEEHAW!
Will I cut my commision? No!.... Next question.
Okay, here's my next question.
Will you kindly remove your skinny little, over-priced, NAR, smart ass from my house? You're stinking up my house with that cheap perfume. You got my house smelling like some cheap harem. Plus, i've been smelling baby shit ever since I shook your hand. And, pull that blouse up, too! Your mammary glands are exposed!
(I had to post twice on this subject. It's just too easy.)
Today: Flip That House
Tomorrow: Flip That Burger
Everyone should visit Kim's blog and hand her a clue.
Love those cheeks.
I've bought/sold 13 houses in my years. On NO occasion did I ever get any value from a Realtor except for spending a few hours being driven around in the early years. Later on we decided to do the driving ourselves. Every service I required was off-loaded to someone else for another fee (attorney, appraisal, inspection, etc.). Realtors are not worth the price of a token for a bus ride.
Someday, everyone will be allowed to list their homes on a national database and the noise your hear next will be the implosion of realtor's & their over priced offices. It can't come to soon.
That's funny... she's better off becoming a broker and lower the overall costs while making more money to compete in today's market!
Hey Keith,
You really need to get some help from some of us with updating the threads. It's hard to have a good discussion when it's only updated once or twice a day.
Thanks for the great blog though bro.
Went to her site. No nude pics. WTF?
This begs the obvious question. Who is going to come up with the alternative? "For sale by owner" may help some motivated people but doesn't provide most folks with the support they need. Let's look at the real situation. Jack and Jill need to sell their house. They don't know shit from shinola about interest rates, advertising, state and local rules about defect disclosures, checking buyer's credit worthiness, arranging for inspections, getting appraisals, deciding what price to ask, negotiating with people who make offers, arranging escrow, title insurance, dealing with defects and who pays for fixing what, and who knows what else kind of crap ends up complicating the transaction for a simple house sale. Who's going to come in and say "for a certain percentage of the sales price I'll take care of everything". That's what Jack and Jill want. Until someone they trust comes along and offers the product at a lower price the realtors will continue to have their monopoly. What you're suggesting is that a "scab" organization come along and break the "union". This is an entrenched "guild" system supported by the establishment. If you think a sanctioned alternative is going to pop up to provide competition you might as well ask why it's going to cost you $200 an hour if you want somebody to walk you through Aunt Edna's probate so you can get your $3,000 she left you. It would be wonderful if the monopoly could be broken in dozens of situations and a fair system for determining professional competency established so a real market economy in skill sales could prevail. The lawyers run the whole show right now. How likely do you think it is that they're going to cut their own throats to begin the process?
I collected youtube videos of all the realtor scams, deceitful behavior, adn idiocy I could find.
Some are sleazy, some funny:
http://www.youtube.com/profile_video_blog?user=russedwards777
An investigation on some realtors who withhold information about houses that used to be Grow Ops.
http://www.youtube.com/watch?v=lW5gVoqXCU8&feature=PlayList&p=717776DAE8BAF634&index=27
New realtor business model as pretty playthings to show you properties: You can find one to suit your own taste:
Paolo Zampolli launches Real Estate agency in New York City with high-fashion models as the Agents. Agents include former Supermodel, Angie Everhart.
http://www.youtube.com/watch?v=Uhe5yj2oF-E&feature=PlayList&p=717776DAE8BAF634&index=26
-OR-
Olivia the Plumper Sexy Real Estate Agent
Olivia wants to sell you a house and she'll do anything to make a sale. From scalebustinbabes.com.
http://www.youtube.com/profile_video_blog?sid=717776DAE8BAF634&id=BF83C1136590899A
Hmm... how would you feel if you go to work one day and hear these words from your boss, "Good morning, I have decided to decrease your pay for the next three months, its really no big deal."
Hmm... Those were precisely the words spoken to me during the last recession. Except it was a 6% cut for 1 year. Might hear them again this recession if the firm I work for is bought out by the Chinese.
To See how much value the Realtor brings to your transaction you could give them a lie detector test:
Real Estate Agent Lie Detector
zeroagents.com.au tested to see what would happen if we managed to get a real estate agent on a polygraph machine (lie detector) with predictable results
http://www.youtube.com/profile_video_blog?sid=717776DAE8BAF634&id=640426AF6FD019D2
-AND-
Keller Williams Realtor Steals
What happens when a realtor shows your home.....they steal perscription medication.
http://www.youtube.com/profile_video_blog?sid=717776DAE8BAF634&id=74B1EB244BE47564
WHAT IS A GOOD FEE for a real estate agent? 4%? 2% per side?
What about using REDFIN or ASSIST2SELL?
FSBO scares me!
ha ha, "professional fee". ha ha ha. stop it, you're killing me!
I tend to think of a professional as someone who needs years of training (4 years of focused college study minimum, think entry level engineering and then I question that). Not someone who has maybe a months worth of class time to prepare them for a test.
This realtor is valuable becasue she grows so much pot in 21 seperate grow houses:
http://www.youtube.com/profile_video_blog?sid=717776DAE8BAF634&id=6E7C56DFAB196F32
Suzanne Researched This Commercial
This Realtor brings value t teh market and helps your wife emotionally blackmail you and ruin your future! Suzanne!
http://www.youtube.com/profile_video_blog?sid=717776DAE8BAF634&id=EB00D700CE7E7523
The Internet will cut into their monopoly eventually.
What worries me is that the Internet didn't do much to counter it during this massive boom. You'd think with all that money flying around, that someone would have tried to capture some of the money flow. For some reason, that didn't happen, and that makes my first prediction above uncertain.
What is a widget?
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Let's see now. A real estate professional can only collect a commission if he/she can sell a property.
Almost all buyers need a mortgage to command the purchasing power to close a deal. So, now that the credit crunch is in full gear and only the most prime borrower who can pay a significant downpayment has a chance of getting a mortgage. The mortgage credit market is getting worse not better. The SPRING SELLING SEASON is just about to start and millions of folks are going to find out in the next few months that they are flat broke as real estate prices COLLAPSE even further.
The 2nd Great Depression has just kicked off and we begin the 1st quarter.
http://www.kimcarp.com/blogs/kimcarp/archive/2008/03/18/will-i-cut-my-commision-no-next-question.aspx
I hate brokers so much that i listed FSBO with 2 1/2% to buyer broker and today a broker came into my bldg to show an apartment in the same line that is listed at the same price but 13 floors lower (about 5k per floor) and with 15k less in upgrades. Yet this little flamer broker with his/her LV bag refused to show mine. Needless to say we had words about the responsibility to the client of not showing it and he laughed in my face about fiduciary responsibility. whore they are the worst scum of the earth. Any thoughts out there???????
So the next question should be:
"Do you prefer chicken flavored ramen, or beef?
Umm... your aware that 6% of zero is zero right?
A sellers' agent has at least the same interest as the seller, to sell for a high price in a reasonable time. Sellers' agent working on comission will stay with us. The problem are buyers' agent - their interest are not aligned with the buyers. There a fee-based system would make more sense. I don't care which way the development towards fees is taking, but it is important to block the NAR's attempts to prohibit discount agents.
The comments over there are a big realtor cheerfest. I tried to leave one but apparently her defective cheap blog software doesn't work with a Mac browser.
Seeing the "we deserve 6%" comments from those lazy greedy self-entitled realtors makes me wanna puke.
My conservative estimate is that a realtor is actually worth 3%. The reason why I say this is because the 6% commission is split between a buyer's agent and a seller's agent. Buyer's agents are worthless so 3% is unearned.
Therefore what a seller's agent should do is charge 3% and stiff any buyer's agent.
Of course with the internet even seller's agents could go to zero. They have to slash commissions now so that people don't get the idea of just listing their house in creig's list instead.
Check out the cash back rebates being offered by these ramen eaters:
http://eperks.com/
Thanks for that site, Keith. If I should ever need to sell my house and my employer won't pick up the cost of commission, that's where I'll go.
Seriously.
Chuck, I've sold and bought on my own twice. Going in I was as clueless as Jack and Jill. It cost me $400 bucks to have an attorney look over my docs and close the sale. And, since I sold and bought in the same week...he did BOTH for the same $400.
If someone is too stupid to understand the basic concepts of selling (and, erm, READ and LEARN) they deserve to pay a Realtwhore an outrageous fee.
Selling your own home isn't complicated. At all. Buying a FSBO isn't, either. An entire Realtwhore empire has been built because the sheeple are lazy. lazy, lazy.
And 6% of 0 is still 0. Until the Fed figures out some way to change it.
hahahahahaha
So many bitter rentuh's in here!
hahahaha
just posted this:
-----------------------
As a potential buyer/seller, I don't care about your cost structure, rather like when I go shopping I don't care about the cost structure of the store. What I do care about is what I have to pay and what I get for the money.
6% realtor fees on a $400k house is $24k. $24k!!! The alternative is to do it by oneself, spend say 20-40h of work, and at most a few k on advertisement and lawyer's fees. What sane person would choose the $24k alternative?
I think there are two reasons why anybody would:
1. To get access to certain data sets (MLS databases)
2. That they harbor misconceptions about the difficulties of doing it without a realtor.
In short, the realtor value proposition is to monopolize certain data sets and mislead the public about the difficulty of their tasks. Of course anybody who has tried FSBO knows it is not particularly difficult, and there are excellent handbooks. Research shows that FSBO get just as good deals as those done by realtors. And in the information age, the data base monopoly is falling apart.
Time to find a different business model.
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Econ 101 continuing education;
1 Million homes for sale,
Some Lookers,
No Buyers,
NO COMISH..........CAPEESH?
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fellow HPers, can we please admit that we would like to be realtors [(R)TM Copyright] ourselves? seriously
look, we're failed renters who, come on, cant we admit we wish we bought in 2001? i wish i had. and as much as i dont like realtors TMetc, i am jealous of their job and large commissions for driving around and stuff, it'd be a sweet gig.
keith you with me?
Entitlement Princess.
They're not just in real estate. They're everywhere in America.
One positive thing about a good ole fashioned economic depression is the housecleaning. It cuts all these spoiled, bratty brain-damaged creatures back down to where they belong. Close to the ground. Let's see how far her entitlement attitude gets her when she has to decide which one of her daughters to whore out for food or wood to burn for warmth in the winter. Ha ha!
Many professionals with (4-years of focused college minimum) have also been thrown to the wind in our beautiful global economy.
The brother of friend of mine, who holds a masters in computer science and electrical engineering, was laid off and forced to choose a job in another field outside of his profession. He eventually chose a job with the devil himself (Angelo Mozillo) because most of the major IT firms here had out-sourced all the good paying positions to foreigners (people from India making up the bulk).
Now, he will most likely lose his job at Country Wide along with many others, and his IT skills are too rusty to re-enter the market at a good salary.
So, when I here about realtors not receiving their commissions any longer, I'm not surprised in the least.
There is a very large pool of very skilled, highly educated people in this country who have been forced to choose jobs now at substancially lower salaries.
If things are humming along so great in this country, this would not be happening to our work-force.
Anonymous said...
ha ha, "professional fee". ha ha ha. stop it, you're killing me!
I tend to think of a professional as someone who needs years of training (4 years of focused college study minimum, think entry level engineering and then I question that). Not someone who has maybe a months worth of class time to prepare them for a test.
"Selling your own home isn't complicated. At all. Buying a FSBO isn't, either. An entire Realtwhore empire has been built because the sheeple are lazy. lazy, lazy."
The NAR was built on tricking the public into thinking thats selling a house is overly complicated when it's not.
Just like how idiots still pay lawyers $1,000 to set up a one-man LLC when in reality it's a 5-minute fill in the blanks form.
This isn't the most popular place for realtors to chime in, obviously.
However it should be noted that there in no reason that any consumer that chooses to use the services of realtor has to pay a 6% fee to sell a property.
Most consumers do not negotiate at all with potential brokers/agents, and therefore don't negotiate well on their own property.
I am in the business and have been for many years. I will charge a 6% fee to sell a property, but it doesn't mean I have to.
Both buyers and sellers are becoming more sophisticated and it is reasonable to expect a seller to find a buyer to purchase their property. I've had sellers call me and ask if they could have me negotiate the deal with the buyer for a flat rate of (insert negotiated rate here), and on many occasions I have done just that.
The 6% listing fee is being criticized fairly here on this blog because practitioners in our business never bother explaining 'where the money goes'. Many sellers to this day, for whatever reason, prefer to see their listing advertised in the local newspaper (a waste of money in my opinion). But when it is what the client wants, the cost of running the ads fall to me and since I don't ask for marketing fees up front, the risk is on me.
In this current market, I'm offering flat rate fees to sellers that agree with me on my marketing plans that are very much more cost effective as compared to print advertising. If the client agrees, we settle on a negotiated flat fee for my marketing service that mostly includes on-line advertising.
To put a listing in the MLS the seller, under the outdated rules of the MLS, offers a commission to the buyers broker/agent TO NEGOTIATE AGAINST THE SELLER. Doesn't make sense to me, never has, so I also offer my buying clients a flat rate that is negotiated and any commission dollars greater than that rate is given back to the buyer at the close of escrow.
I think in order to stay relevant as an industry, the business model will have to move in this direction. I can see sellers paying realtors up front for marketing (with realtors making some profit margin) and also realtors collecting a 'transaction fee' upon close of escrow.
Right now though, in this market, sellers that are hiring realtors do not want to part with money up front. So I think that sellers end up paying a premium in the end because the realtor is taking on most of the risk to market the property and to transfer the property.
Bottom line, sellers AND buyers need to negotiate with a realtor on fees if they CHOOSE to hire one. Any realtor that says that services are not negotiable are not worth hiring.
Why are so many renters bitter? I can tell you as a renter why. Let's start with the obvious. Increasingly "creative" (read: toxic) financing only raises the prices of the item financed. Anyone with a normal income is priced out of the market UNLESS he gets stupid enough to get an increasingly toxic loan. Any attempt at being responsible like insisting on a FIXED RATE mortgage is punished by being forced to continue to rent.
with "starter" anything priced so high that only lotto winners and kids of CEOs can be first time homebuyers, it's easy to see why renters aren't exactly happy campers. Realtors and loan brokers, be glad this is not the United States of Iraq. Bitter Iraqis have a tendency to spontaneously combust.
If prices drop to affordability by ordinary people, cry me an Amazon River real estate vermin. Thanks a lot Greenspan for letting the ARM insanity progress to its logical limit, the adjustable rate juice loan. That inaction effectively outlawed responsible borrowing to buy a home of any kind. Greenspan and cronies, you all deserve to burn in a hell hotter than the heat of a re-entering spacecraft.
I'm guessing she removed all the comments? I saw nothing there except good intentions and horrible presentation.
Hopefully someone will point her in this direction.
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Your a realtor.....Not Royalty!
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"Why are so many renters bitter? "
I as a renter am not bitter at all. In fact, I'm laughing my ass all the way to the bank.
I see that many renters on this board are in the same boat as I.
Hmm, say you sell a $500K place and split the commission between you and a buyers agent. You are each getting $15K, you give Coldwell Banker $7500 (you crazy sap) and that left you $7500. Ok so you had $1000 marketing expenses that you should split with Coldwell so now you have $7000 remaining. So how many hours did you work to make that sale?
It better be at least 350 hours or 2 months of fulltime work to justify that rate. I understand that not all listings sell but c'mon the payout has to equal your skills plus the time you put in. You don't get something for nothing in the long term, only in the blips during the bubbles.
If you stick it out as a realtor your attitude will be markedly different after the easy money days are over.
Remember the stereotype realtor is Edie Britt in Desperate Housewives. She's getting the easy money for basically socializing and bonking guys. That is what the media image of a realtor is.
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