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Comment by MuffinFlavored | Hacker News Reader

> 6% realtors fee

I have a feeling that will get automated away in the next 5-10 years something fierce. More than it already is being by Redfin, etc.

Realtors don’t deserve more than $25-40/hr in most cases, let alone 6% of my home value.

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On avg they make $24.18/hr, so $25-40 would actually be a pay bump.

https://www.bls.gov/ooh/sales/real-estate-brokers-and-sales-...

Not only that, but an actually hourly rate would allow folks to have more financial security. Unfortunately, folks in a range of sales positions can have weeks without pay if they don't sell anything. This is especially bad with car and house sales - thousands one pay period and absolutely zero the next.

Had a friend doing real estate for awhile. The owner knew damn well which were the easy sales and which were hard, slow, and/or required a ton of work.

As a result a few favorite agents made a ton of money, drove luxury cars never more then 2 years old, and worked minimal hours.

The large majority of the agents made minimal money and had to fight of the scraps.

The glengarry leads are for closers only.

That’s one of the best movies of all time! Somehow I knew it would come up as soon as we started talking about real estate agents.

> As a result a few favorite agents made a ton of money, drove luxury cars never more then 2 years old, and worked minimal hours.

> The large majority of the agents made minimal money and had to fight of the scraps.

This mirrors the structure of the broader economy so in a perverse way, it makes sense.

Heh, yes that's what they get paid. As usual, it's the middleman that makes all the profit. So the profitable thing is to own the real estate agency, then you pay the agents as little as possible and charge customers 6% as you exploit the network effect.

That's because most of those hours are inefficient A lot of time spent coordinating meetings and walking with people showing the things they could see/read themselves. In most cases you only really need realtor at the very end, after you spend lots of hours seeing or showing homes, and now it's time to make the deal. It's not 1980s anymore, you can use internet to search for places yourself or to advertise your property yourself. If you remove those inefficient hours, there should be 5x less realtors but they might earn more and do better job.

And those 5x less realtors will pay far higher taxes to pay for UBI.

Wouldn't you want to say "My Zillow prediction is $1.2 million, you get 20% of any more than that if you sell by June but only this low rate otherwise"? Anyone with true ability would take the deal.

Aligning the incentives etc.

If you flatrate it, they don't have an incentive to find you a big buyer.

Not sure how many purchases go for cash only but I gather that bank won't give mortgage if price of the house higher than appraised one, since it won't recover the value in case of the default ?

They won't loan you more than X% of the appraised value, but you can make that up with the down payment (or pay the whole thing in cash, as you say).

But magically, if you know the right collection of real estate agent, appraisers, and mortgage brokers, the house always appraises for what you need it to in order for the loan to go through.

True, but that right collection will also ensure the price you need isn't unreasonable. If the house is worth $300,000 and you need $301,500 that is in the margin of error (which I doubt is statically calculated, but if it was). If you need $500,000 on the same house you won't get it.

Maybe they will post 2008. But you would be surprised at how those same combination of people would be complicit in the loan process far outside the margin of error back then.

There's something in here but 1) Zillow/Redfin predictions bounce all over the place based (I think) on recent local sales 2) Good real estate agents are good at estimating actual selling prices. I don't know if "ability" in a real estate agent results in a house being sold for more than it's worth.

homie.com is already doing that.

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