The Infamous SIX Percent Realtor Commission
So after several years of disruption within the real estate industry, a heated bubble, and now a flaccid economy, we’re wondering if agents are actually doing less work? If it’s a fact that agents are doing less work, have commissions also gotten smaller?
We ask this question not because we have the answer but because it appears that not much has changed since the Realtor’s Six Percent 60 Minutes article except that what was once disruptive is now Traditional, and what was then a traditional model seems more accepting of alternative of pricing models, and unbundled services- is this capitulation from the full service guard?
Are consumers really doing more work? Are consumers really getting better information from the internet today than five years ago? Are online forums doing a better job of servicing the consumer than Realtors? Better yet, are consumers actually getting better service because agents use social media and have nicer marketing?
We have to wonder, because even in a down cycle, things are looking up for Redfin, as they just landed another $10 Million in funding, and Flat Fee Realty reports they’ve listed 649 units this year (2009).
With a pitch like this, it’s no wonder
(from Flat Fee Realty…)
“Now you can list your property on the local MLS for as low as $299* or try listing your home only on Realtor.com for just $199 – You Choose! Either way you’ll save the typical 3% listing commission. Why hire a 6% agent when you can do some of the work “By Owner” and save your hard earned equity.”
Is the paradigm eroding? Are traditional full service agents overpaid? Can anyone defend a Six Percent commission anymore? Is full service real estate truly negotiable?