July Stats Preview: Summer Snoozefest

Let’s take a look at regular monthly “preview” charts. Now that July is in the past let’s take a look at the local housing market stats for the month. Short story: Inventory edged up again but is still at historic lows. Sales are slipping slightly year-over-year but are still quite strong.

Here’s the snapshot of all the data as far back as my historical information goes, with the latest, high, and low values highlighted for each series:

King & Snohomish County Stats Preview

July was pretty much the same story we’ve seen all year: Few listings, strong-ish sales, and almost zero foreclosures.

Next, let’s look at total home sales as measured by the number of “Warranty Deeds” filed with King County:

King County Warranty Deeds

Sales in King County decreased eleven percent between June and July (a year ago they fell ten percent over the same period), and were down four percent year-over-year.

Here’s a look at Snohomish County Deeds, but keep in mind that Snohomish County files Warranty Deeds (regular sales) and Trustee Deeds (bank foreclosure repossessions) together under the category of “Deeds (except QCDS),” so this chart is not as good a measure of plain vanilla sales as the Warranty Deed only data we have in King County.

Snohomish County Deeds

Deeds in Snohomish decreased nine percent month-over-month (vs. a one percent decrease in the same period last year) and were down two percent from July 2016.

Next, here’s Notices of Trustee Sale, which are an indication of the number of homes currently in the foreclosure process:

King County Notices of Trustee Sale

Snohomish County Notices of Trustee Sale

Foreclosure notices in King County were down 33 percent from a year ago and Snohomish County foreclosure notices were down 48 percent from last year. Both counties are near their historic low levels for foreclosures.

Here’s another measure of foreclosures for King County, looking at Trustee Deeds, which is the type of document filed with the county when the bank actually repossesses a house through the trustee auction process. Note that there are other ways for the bank to repossess a house that result in different documents being filed, such as when a borrower “turns in the keys” and files a “Deed in Lieu of Foreclosure.”

King County Trustee Deeds

Trustee Deeds were down 49 percent from a year ago.

Lastly, here’s an update of the inventory charts, updated with previous months’ inventory data from the NWMLS.

King County SFH Active Listings

Snohomish County SFH Active Listings

Inventory rose 11 percent between June and July in King County, but was still down 19 percent from a year earlier.

In Snohomish County it was a similar story: Listings up 10 percent month-over-month but down 10 percent year-over-year.

In both counties the month-over-month increase in listings for July was on par with where it was over the same period a year ago.

Note that most of the charts above are based on broad county-wide data that is available through a simple search of King County and Snohomish County public records. If you have additional stats you’d like to see in the preview, drop a line in the comments and I’ll see what I can do.

Stay tuned later this month a for more detailed look at each of these metrics as the “official” data is released from various sources.


About The Tim

Tim Ellis is the founder of Seattle Bubble. His background in engineering and computer / internet technology, a fondness of data-based analysis of problems, and an addiction to spreadsheets all influence his perspective on the Seattle-area real estate market.

129 comments:

  1. 1

    I wonder what caused the dip down to only 12 trustee deeds back in what appears to be probably 2006? Given the steep downturn at that point I suspect it was probably new legislation or caselaw, but I don’t remember anything during that period that would disrupt foreclosures. If you ignore that period we’re basically running at historic lows, which is what you would expect given prices and the general economy.

  2. 2
    Joe says:

    Still is it good time to buy in Snohomish?

  3. 3
    ess says:

    RE: Joe @ 2

    Snohomish county or city?

  4. 4
    Mel says:

    RE: Joe @ 2 – Lynnwood is a good place to buy especially Meadowdale area. Close to the waterfront.

  5. 5
    Bubble Trouble says:

    By Joe @ 2:

    Still is it good time to buy in Snohomish?

    It’s always a good time to buy everywhere.
    – Real Estate Agents Everywhere

  6. 6
    ARDELL DellaLoggia says:

    RE: Bubble Trouble @ 5

    Troll

  7. 7
    uwp says:

    By Bubble Trouble @ 5:

    By Joe @ 2:

    Still is it good time to buy in Snohomish?

    It’s always a good time to buy everywhere.
    – Real Estate Agents Everywhere

    You forgot “or sell.”
    It’s always a good time to buy or sell everywhere.

  8. 8
    sfraz says:

    RE: Bubble Trouble @ 5 – Agree. Asking the wrong peeps. Always a good time to write the check. Buy now or be priced out forever!

  9. 9
    sfraz says:

    RE: ARDELL DellaLoggia @ 6 – Come on now Ardell. You know the title of Tim’s blog. Why call someone a troll for speaking honestly? “Seattle Bubble- local real estate news, statistics, and commentary without the sales spin.”

  10. 10
    Joe says:

    RE: ess @ 3

    Snohomish county – Bothell and Snohomish area .

  11. 11

    By uwp @ 7:

    By Bubble Trouble @ 5:

    By Joe @ 2:

    Still is it good time to buy in Snohomish?

    It’s always a good time to buy everywhere.
    – Real Estate Agents Everywhere

    You forgot “or sell.”
    It’s always a good time to buy or sell everywhere.

    I think what you all are forgetting is most agents don’t convince people to buy or sell. People who want to buy or sell contact agents. And often the driving force behind the decision isn’t the particular market conditions.

  12. 12

    RE: Kary L. Krismer @ 11
    Yes Kary

    Why do buyers buy with HORRIFYING bubble risk nooses over their heads?

    Ask ’em, they’ll give reasons like how can prices ever go down? Speculation, not science.

  13. 13
    Bubble Trouble says:

    By sfraz @ 9:

    RE: ARDELL DellaLoggia @ 6 – Come on now Ardell. You know the title of Tim’s blog. Why call someone a troll for speaking honestly? “Seattle Bubble- local real estate news, statistics, and commentary without the sales spin.”

    What people forget is that r/e agents are middle men/women. They make money on the transaction and the higher the price, the higher their income. So of course they will always cheerlead r/e and do everything they can to increase prices. How do you increase prices? By increasing demand. How do you increase demand? By telling everyone that buying is a good idea and even better create a sense of urgency, i.e. buy now or be priced out forever. Sound familiar? And if that doesn’t work, pull on the heart strings…..come on, you don’t want to raise your children in RENTAL do you? Why that’s practically child abuse (ok they don’t say child abuse but they come pretty close to implying it). I’ve been buying real estate for close to 20 years and I’ve heard it all for agents.

  14. 14
    Deerhawke says:

    Actually, I thought it would never happen, but I am going to stick up for real estate agents.

    Right now is actually a really tough time for most of them. Why? Because most agents act as agents for buyers and sellers. They do best when it is a fairly healthy and fairly balanced market with a little appreciation and reasonable interest rates.

    However, this market is an absurd one-sided seller’s market. The evidence at the top of this column says this will continue to be the case for the forseeable future. Sales are basically about the same as last year despite a contraction in inventory by 20%.

    So most agents right now are not actually doing all that well. If they represent buyers, they end up looking at 50 places and writing up offers on 20 places for every actual purchase that goes through. If they represent sellers, the sellers want every last penny and are really greedy and unreasonable. Most are able to negotiate a discount on their listing commission, in part because of Redfin and other discount brokerages.

    I have seen a couple of people try to get started in the business this past year. It looks pretty brutal.

  15. 15
    Doug says:

    RE: Deerhawke @ 14 – I don’t disagree, but hard to feel sorry for that buyer’s agent who showed 50 places to a client when they gross over $100k on just 3-4 deals.

  16. 16
    Ross says:

    By Deerhawke @ 14:

    Actually, I thought it would never happen, but I am going to stick up for real estate agents.

    Right now is actually a really tough time for most of them. Why? Because most agents act as agents for buyers and sellers. They do best when it is a fairly healthy and fairly balanced market with a little appreciation and reasonable interest rates.

    However, this market is an absurd one-sided seller’s market. The evidence at the top of this column says this will continue to be the case for the forseeable future. Sales are basically about the same as last year despite a contraction in inventory by 20%.

    So most agents right now are not actually doing all that well. If they represent buyers, they end up looking at 50 places and writing up offers on 20 places for every actual purchase that goes through. If they represent sellers, the sellers want every last penny and are really greedy and unreasonable. Most are able to negotiate a discount on their listing commission, in part because of Redfin and other discount brokerages.

    I have seen a couple of people try to get started in the business this past year. It looks pretty brutal.

    Agreed that being a buyer’s agent in this market could be tough. But seller’s agent? Maybe they are getting squeezed a bit on commissions, but when homes can sell in a week, it still seems lucrative from the outside. 1.5% on a million dollar home that sells in 2 weeks seems pretty darn good. What am I missing?

  17. 17
    sfraz says:

    RE: Doug @ 15 – Correct. I know of realtors going on huge vacations a few times a year. Money is flowing on those multiple offer listings on the Eastside.

  18. 18

    RE: sfraz @ 9

    Because he recently attacked me personally and in the many years I have been “on the internet” I have not been “that” agent. In fact I have MANY times said it is a much better time to sell than to buy in the last year and have been cautionary since late 2015.

    Yes, I have told people (in late 2007) to renew their lease for another year and not buy.

    ALL agents EVERYWHERE do not… That is just a troll statement and I don’t go around calling people trolls as a rule, do I? In a dozen years do I go around calling people trolls? No. She/He is a troll.

  19. 19
    Joe says:

    RE: Kary L. Krismer @ 11

    My agent forcing me to buy any property if I see.. she is looks like junior and advising me – this will go 100 K more in next year 20K in 2 months ; if you are not buy I will buy and rent it .. I said NO for many properties..

    Always asking me can I write offer, Just add 20K more we can win,,. without know how many offers there.. I have to research more before go with her..

  20. 20
    S-Crow says:

    RE: Joe @ 2 – Snohomish and surrounding areas offer a lot. It is a really nice community. Some of the benefits: Centennial Trail – used by many living in King Co that cycle or drive to Snohomish. It’s a former railroad that is blacktopped over for cyclists, walkers, runners along with dedictated areas for horse riding. It goes from Snohomish to Arlington. In town, lots of places to meet with friends for food, coffee shops and brew. The Snohomish Pie Bakery is to die for. The Snohomish Library is one of the nicest around. The $25 million dollar new Aquatics Center in Snohomish is very popular. While prices have been escalating, if you have the means, you can buy homes with property – meaning acreage. You also have lots of access to outdoor activities such as Lakes, hiking, Harvey Airfield for skydiving or starting your flying lessons, balloon rides and more. It takes me 50 minutes with good traffic to get to Stevens pass for skiing. It took me 1 1/2 hrs door to door to travel to Leavenworth for dinner last Saturday.

    Snohomish school district has many new or newer schools –downside is high taxes.

    Buying today? Sure, if the plan is to be in the home for several years. If you have a short term horizon or have a mobile employment situation then stay out of this market.

    S-Crow

  21. 21
    Erik says:

    RE: sfraz @ 9
    Ardell is one of the top agents in king county. She doesn’t need to pressure clients to do anything. I’m sure she gets tons of referrals because she does such a great job. If she doesn’t like a client, she won’t work with them.

  22. 22
    wreckingbull says:

    RE: S-Crow @ 19 – I had really hoped that the Centennial Trail would be extended up to meet the Cascade Trail. It’s really not that far of a missing link. Apparently our Skagit County Commissioners shot this down, which is no surprise. That being said, it is still a gem!

  23. 23
    Bubble Trouble says:

    By Deerhawke @ 14:

    So most agents right now are not actually doing all that well. If they represent buyers, they end up looking at 50 places and writing up offers on 20 places for every actual purchase that goes through. If they represent sellers, the sellers want every last penny and are really greedy and unreasonable.

    Say it takes 1 hour to see a place and 1 hour to write an offer. So in your scenario that is 70 hours of work. Let’s say the house sells for $750K. The buyer agent gets 3% of that which is $22,500. Assuming that is split with their broker, it’s $11,250 for the agent themselves. Which works out to a nice $160/hr.

    And yours is an extreme example. More typical would be show 10 houses, make offers on 2 or 3.

  24. 24

    By Bubble Trouble @ 13:

    By sfraz @ 9:

    RE: ARDELL DellaLoggia @ 6 – Come on now Ardell. You know the title of Tim’s blog. Why call someone a troll for speaking honestly? “Seattle Bubble- local real estate news, statistics, and commentary without the sales spin.”

    What people forget is that r/e agents are middle men/women. They make money on the transaction and the higher the price, the higher their income. So of course they will always cheerlead r/e and do everything they can to increase prices. .

    That’s pretty naive. First, it completely ignores the fact that agents represent the interests of their clients and roughly half the clients are buyers who are not interested in higher prices. Second, it assumes that individual agents somehow affect the market. That might be true for agents who get quoted in press reports, but even there the effect would be very negligible or even a negative effect.

  25. 25

    By Bubble Trouble @ 22:

    By Deerhawke @ 14:

    So most agents right now are not actually doing all that well. If they represent buyers, they end up looking at 50 places and writing up offers on 20 places for every actual purchase that goes through. If they represent sellers, the sellers want every last penny and are really greedy and unreasonable.

    Say it takes 1 hour to see a place and 1 hour to write an offer. So in your scenario that is 70 hours of work. Let’s say the house sells for $750K. The buyer agent gets 3% of that which is $22,500. Assuming that is split with their broker, it’s $11,250 for the agent themselves. Which works out to a nice $160/hr.

    And yours is an extreme example. More typical would be show 10 houses, make offers on 2 or 3.

    Wow, you really are not only naive, but also ignorant. You don’t have a clue what agents do or how they spend their time, but that doesn’t stop you from making up numbers as to how their time is spent. And you’re even claiming you know what is “typical” as to the number of showings. Priceless nonsense. Did get a good laugh at the 50/50 split with the brokerage. Maybe that might happen with the relatively new enhanced supervision rules if the agent was also on a team, but absent that possibility it just shows you’re making up facts and posting them in the Internet.

    But then your outrage at $166 an hour. Trained professionals are worth more than that! I charge more than that when I work on an hourly basis. Now many agents are not worth anything–that’s another issue. But $166 on a contingent basis is hardly a high number. The ignorance is strong in this one!

  26. 26
    Bubble Trouble says:

    Full Speed Ahead on the east side of the state….

    http://www.krem.com/news/local/spokane-county/home-sales-skyrocket-in-spokane-co/461643021

    “This June, Spokane county hit an all-time record with 944 homes sold. The new record shatters the June 2005 record of 871 homes. The average price of a home in Spokane county also rose to $233,756, up 7.6 percent from 2016.”

    Not sure why average is reported instead of median, but nonetheless the bubble is in full effect statewide. I’m tempted to sell some of my homes, but the cash flow is too good to give up.

    BTW, anyone remember what happened right after 2005’s record? Bueller? Frye? Anyone. Well, we won’t talk about 2006-2009 crash, that would spoil all the fun. Let’s throw that down the memory hole, never to be seen or heard again.

    This is what passes for “objective journalism” today, LOL.

    “KREM 2 Morning Show Executive Producer, Erin Robinson, is among the new homeowners this summer. “It’s really exciting,” said Robinson. “Honestly, if you’d asked me two months ago, if I thought I was going to be a home owner I probably would have said no. But, I’m excited!”

    Putting aside the merit of buying vs not buying, I have never understood the excitement of buying a house. I’ve owned more houses than I can count and I can honestly say I’ve never said to anyone I’M EXCITED about it. It’s actually a PIA having to move. But the real estate marketing machine doesn’t mention things like that. It’s non-stop excitement baby!!

    So what should people do now, Mr. Realtor? Do you think it’s a good time to buy? Or do you think this madness is a sign that maybe I should hold off?

    “Right now, we’re in what’s called a seller’s market,” said Ross. “There’s not enough inventory, and there’s a lot of buyers. So, it’s a little bit of a race to the house. I don’t see any signs of it slowing down.”

    Of course you don’t see it slowing down. It’s always a great time to buy. Real estate never goes down after all. Everyone knows that.

    So Mr. Realtor, what is your advice to people looking to buy, what should they do?

    “You need to be ready to go. And you need to be ready to make a decision, which is hard because we all like to sleep on something that’s a big decision. And you don’t really get the opportunity to do that in this market.”

    Terrific advice. You’re about to spend hundreds of thousands of dollars on an asset. Probably the most expensive thing you will ever buy in your lifetime. And also commit to living in a specific home for many, many years. But don’t do anything stupid like think about it and whether it’s a good fit for you and. Just go for it man. Buy now and ask questions later!!

    And Realtors wonder why they get a bad rep? Good lord.

  27. 27
    Bubble Trouble says:

    By Kary L. Krismer @ 25:

    By Bubble Trouble @ 22:

    By Deerhawke @ 14:

    So most agents right now are not actually doing all that well. If they represent buyers, they end up looking at 50 places and writing up offers on 20 places for every actual purchase that goes through. If they represent sellers, the sellers want every last penny and are really greedy and unreasonable.

    Say it takes 1 hour to see a place and 1 hour to write an offer. So in your scenario that is 70 hours of work. Let’s say the house sells for $750K. The buyer agent gets 3% of that which is $22,500. Assuming that is split with their broker, it’s $11,250 for the agent themselves. Which works out to a nice $160/hr.

    And yours is an extreme example. More typical would be show 10 houses, make offers on 2 or 3.

    Wow, you really are not only naive, but also ignorant. You don’t have a clue what agents do or how they spend their time, but that doesn’t stop you from making up numbers as to how their time is spent. And you’re even claiming you know what is “typical” as to the number of showings. Priceless nonsense. Did get a good laugh at the 50/50 split with the brokerage. Maybe that might happen with the relatively new enhanced supervision rules if the agent was also on a team, but absent that possibility it just shows you’re making up facts and posting them in the Internet.

    But then your outrage at $166 an hour. Trained professionals are worth more than that! I charge more than that when I work on an hourly basis. Now many agents are not worth anything–that’s another issue. But $166 on a contingent basis is hardly a high number. The ignorance is strong in this one!

    What ignorance? It’s simple math.

    It’s interesting how realtors get so defensive when I point out the obvious.

    I’m not outraged at $160/hr. I was simply pointing out that you guys have a pretty good gig going there. If you can make $160/hr driving around showing people houses, all the power to you. What else do you do? Oh right you do “marketing”, lol. You take a few pics and post them on the MLS listing. That takes what? 2 hours. Let’s see what else, you go to closings, which takes what an hour, 2 tops. And that pretty much describes your job.

    You can spin all you want, but at the end of the day realtors are house salespeople who get a commission off each sale and administer paper work of the sale. And like with all sales people, some work harder than others, and some make more money than others. But what you do is sell, sell, sell. And like all salespeople, you never tell a prospective customer that now is a bad time to buy. For a salesman, it’s always a goo time to buy.

  28. 28
    uwp says:

    By Bubble Trouble @ 26:

    BTW, anyone remember what happened right after 2005’s record? Bueller? Frye? Anyone. .

    Two more years of double-digit appreciation?

    By Bubble Trouble @ 26:

    “KREM 2 Morning Show Executive Producer, Erin Robinson, is among the new homeowners this summer. “It’s really exciting,” said Robinson. “Honestly, if you’d asked me two months ago, if I thought I was going to be a home owner I probably would have said no. But, I’m excited!”

    Putting aside the merit of buying vs not buying, I have never understood the excitement of buying a house. I’ve owned more houses than I can count and I can honestly say I’ve never said to anyone I’M EXCITED about it. It’s actually a PIA having to move. But the real estate marketing machine doesn’t mention things like that. It’s non-stop excitement baby!!
    d.

    Do you seriously not understand how someone might find it exciting to buy their first home?

  29. 29

    By Bubble Trouble @ 27:

    What ignorance? It’s simple math.

    I wasn’t attacking the math. I was attacking the made up numbers which you were applying the math to.

    What else do you do? Oh right you do “marketing”, lol. You take a few pics and post them on the MLS listing. That takes what? 2 hours. Let’s see what else, you go to closings, which takes what an hour, 2 tops. And that pretty much describes your job.

    Well first, I do very little marketing. Second, that doesn’t begin to describe what is done when representing a buyer on the purchase of a house. BTW, I do go to closings, but most agents don’t.

  30. 30
    Bubble Trouble says:

    By uwp @ 28:

    By Bubble Trouble @ 26:

    BTW, anyone remember what happened right after 2005’s record? Bueller? Frye? Anyone. .

    Two more years of double-digit appreciation?

    By Bubble Trouble @ 26:

    “KREM 2 Morning Show Executive Producer, Erin Robinson, is among the new homeowners this summer. “It’s really exciting,” said Robinson. “Honestly, if you’d asked me two months ago, if I thought I was going to be a home owner I probably would have said no. But, I’m excited!”

    Putting aside the merit of buying vs not buying, I have never understood the excitement of buying a house. I’ve owned more houses than I can count and I can honestly say I’ve never said to anyone I’M EXCITED about it. It’s actually a PIA having to move. But the real estate marketing machine doesn’t mention things like that. It’s non-stop excitement baby!!
    d.

    Do you seriously not understand how someone might find it exciting to buy their first home?

    I understand it. But that doesn’t make it any less silly.

  31. 31
    Bubble Trouble says:

    By Bubble Trouble @ 30:

    By uwp @ 28:

    By Bubble Trouble @ 26:

    BTW, anyone remember what happened right after 2005’s record? Bueller? Frye? Anyone. .

    Two more years of double-digit appreciation?

    .

    https://fred.stlouisfed.org/series/MSPUS

    After 2005, comes Q1 2006. And two years from Q1 2006 is Q1 2008.

    Q106: $247,600
    Q108: $233,900

    Granted, I wasn’t a math major, but I’m pretty sure $247 to $233 is NOT double digit appreciation for two years.

    And look at that chart comparing bubble 1.0 to 2.0. Pretty much identical.

    Bubble 1.0 trough to peak was 172 to 257 = 50% over 6 years

    Bubble 2.0 trough to peak (so far) is 208 to 313 = – what do you know?? – 50% over 6 years.

    Gee I wonder what’s going to happen in the next 2 years……

    It’s not different this time, it’s never different this time. Math never changes and neither do economic fundamentals.

    So in the past 15/16 years house prices have increased from around $170K to around $310K. Hey, not bad right!! Even with the crash in between that’s a great return.

    Well is it? Kind of. Adjusted for inflation $170K in 2001 is worth about $245K today. So about a 2.5% a year real rate of return. Decent but nothing to get overly excited about. And this at the peak of the bubble. In 2-3 years from now when prices fall back to $260K, the real return will have been 0% over 20 years.

  32. 32
    uwp says:

    By Bubble Trouble @ 31:

    https://fred.stlouisfed.org/series/MSPUS

    After 2005, comes Q1 2006. And two years from Q1 2006 is Q1 2008.

    Q106: $247,600
    Q108: $233,900

    Granted, I wasn’t a math major, but I’m pretty sure $247 to $233 is NOT double digit appreciation for two years.

    June 2005 NWMLS King County Median home price: $380,000
    June 2006 NWMLS King County Median home price: $435,000
    June 2007 NWMLS King County Median home price: $470,000

    I will help you with the math: roughly 11% appreciation for two years (24% total).

    Welcome to the Seattle Bubble.

    “Seattle Bubble is the Seattle area’s #1 resource for news, analysis, commentary, and community discussion on the local real estate market. This community site is focused on productive and open discussion of the local housing market, so that everyone involved can work toward a goal of improving understanding and dispelling myths.”

    Also I should add: Seattle is special!

  33. 33
    Deerhawke says:

    I don’t want to get too deeply into defending real estate agents, but if people are going to attack them, then at least you need to know what realtors do for a living and what they bring to the table.

    I just went through selling a house on my own. The buyers had been following my work and knew what I build. They watched the structure go up and came by at least once a week. No marketing involved. This transaction was about as smooth, simple and as direct as these things come.

    But there was still a TON of back and forth involved. Several meetings and then a huge number of calls, texts and emails. A lot of it was answering simple questions, tracking paperwork, dealing with lenders, appraisers and inspectors, finding misdirected paperwork, avoiding miscommunication, etc. If you are dealing with a couple, you assume that if you answer a question once, one person will tell the other. In this case, I was dealing with two busy professionals, so all questions got answered twice. I would guess that all of that communication and detail tracking related to the sale took about 40-60 hours. You can say that if people are organized or we have different systems, none of this is necessary. Ok fine, but then you might want to re-engineer humans as well.

    Bubble Trouble when you do your math on how long it takes to do things and how real estate agents are overpaid, I can tell that you are really not in touch with what is involved here. There are a million details to be tracked and nailed down in each transaction. You don’t just write up a number on an offer and walk away with a big check.

    And lets remember that in this world, you only get paid when you succeed. All that time you spent on all those failed transactions — you get paid exactly $0.

    And like most other things these days, it is a star system when it comes to compensation. Beyonce make millions but that really talented singer at your local bar makes $150 per night after paying her band.
    So the agents who have really figured out their niche and have a good referral-based business, make solid six figures. A few even make seven. But for every one of those who succeed, there are ten trying like mad to claw their way up and take a piece of it away. And behind them are 25 or 50 more who will drop out and end up fitting you for shoes at Nordstrom.

    I know the other side of this story all too well. I spend a year and a half developing, financing and building a house. I take on 100% of the risk. It really gripes the heck out of me to look at the closing statement and see that 6% of the proceeds are going to the real estate agents. On my last transaction, that came to $108K. Yes, just real estate commissions.

    Yeah it really really gripes me. It is a weird system, but then remember that baseball is even weirder. The guy who hits one ball out of 3 gets a massive paycheck. The guy who hits one out of 4 can stay in the lineup but better not have a slump. The guy who can hit one out of 5 is on the farm team if he is on the team at all.

    Hey, Bubble Trouble, if you think it is such a bed of roses, take the course and get your license. Three weeks and 500 bucks and you too could be striking it rich. What is stopping you?

  34. 34
    whatsmyname says:

    By Bubble Trouble @ 26:

    …. I’ve owned more houses than I can count and I can honestly say I’ve never said to anyone I’M EXCITED about it.

    The interesting part here: How high can you count?

  35. 35
    Eastsider says:

    There is no justification for 6% RE commission. In the UK, the average high-street estate agent fee is 1.3% including VAT. Why does it cost 4 times as much to sell a $2m house than a $500k house? If we don’t have a powerful RE lobby, we will be paying far less in commissions.

  36. 36

    By whatsmyname @ 34:

    By Bubble Trouble @ 26:

    …. I’ve owned more houses than I can count and I can honestly say I’ve never said to anyone I’M EXCITED about it.

    The interesting part here: How high can you count?

    LOL, although another point would be that the topic was the excitement of the first purchase, not the 20th.

    Also, in BT’s defense, even though he’s reportedly bought multiple properties, he might not be aware of what the agents are doing in the background. We try to warn our clients after the inspection contingency has passed that they probably won’t hear from us for a while. We do that so they won’t feel suddenly abandoned after having had so much contact. But a week or two prior to closing the contact resumes.

    Also, someone above mentioned a transaction failing. One big reason it might fail is a supplemental title report throwing up a new roadblock. I remember years ago some agents asked me to look at their file on a client they were having issues with. The client was selling a number of properties, but the agents were completing ignoring the supplemental reports that were coming in. I don’t think they understood them, and until they asked me they weren’t asking anyone to explain them, but clearly ignoring them wasn’t the solution. Or similarly the situation I mentioned last month of the issue which popped up after the inspection contingency had passed that was covered under the title contingency I had used. That needed to be resolved, and while the client was aware what was going on, they had little involvement in getting it resolved. In simplest terms, the agent oversees the transaction and makes sure others (title, escrow, and particularly lender) are doing their jobs timely.

  37. 37
    Green-Horn says:

    RE: Deerhawke @ 33

    Beautiful and respectful view of both sides of the real estate transaction.

    Even if some do very well, it’s hard work, lots of details and persistence with an uncertain payoff.

    Certainly I’m not the only one who really values your thoughtful contributions of a real developer here. Hope you keep taking time to share your experience.

    Thanks.

  38. 38
    toad37 says:

    RE: Deerhawke @ 14

    I’m looking in to getting licensed. Really hope the market comes in to balance sooner rather than later!

  39. 39
    sfraz says:

    RE: Green-Horn @ 37 – It’s old school. Just like car dealerships. Powerful lobbying keeps them in place. “…shaking up the industry has been difficult. For one, the National Assn. of Realtors is an influential obstacle when it comes to change in the industry.

    “It’s a powerful trade association, and its cohorts are brokerages, multiple listing services, real estate associations and individual agents. They all work diligently to keep a buyer and seller apart,” said Joshua Hunt, chief executive of Trelora, a full-service, commission-free real estate agency. He said those who are part of the outdated system fight to keep things as they are to preserve current commission rates.”

    Commissions in the U.S. are especially high. In Britain, Singapore and the Netherlands, they usually fall between 1% and 2%, according to a report by the International Real Estate Review. http://www.latimes.com/business/la-fi-ditch-the-real-estate-agent-20161001-snap-story.html

  40. 40
    Ross says:

    By Green-Horn @ 37:

    RE: Deerhawke @ 33
    Certainly I’m not the only one who really values your thoughtful contributions of a real developer here. Hope you keep taking time to share your experience.

    +1

  41. 41

    RE: Deerhawke @ 33

    It’s really hard to describe what we do because it is different from one house to the next and one seller to the next.

    Today I had roofers clean a roof, clean gutters inside and out, an HVAC guy go into the crawl space to service and tag the furnace and change the filter and had a new garage door put on to replace the old one that broke shortly before my sellers moved away to the East Coast. I am spackling and doing touch up, I put their trash out. I cleaned out their fridge because they didn’t have time to finish when they were leaving. I will hire cleaners to do it all closer to when it is being listed. I am having all new carpet installed. Lots of other odds and ends. Replacing all of the burnt out lightbulbs. Had a power washer do all the hard surfaces outside but may need him to come back again right before listing and photos.

    I will stage the whole place myself, though I will rent large pieces like sofas.

    All this before I start the “agent” work… “Marketing” is getting nice photos on the internet and whatever it takes to get nice photos. Every house is different. My sellers just had twin babies after they bought the house and they were so overwhelmed that I just said give me a key and leave. I’m doing whatever is needed. I hope to and usually do sell it in 7 days or less and that is what people “see” us “do”. But it takes a lot of work before it is listed to insure it sells in a short time at a high price.

    Not every house looks like what you see in the internet photos when we arrive on the scene. Resale tasks are as many and varied as there are sellers. Never two the same.

  42. 42
    Voight-kampff says:

    RE: Ardell DellaLoggia @ 40

    Speaking of homes that don’t look like they do in the photos. I guess this is cheaper than staging. Maybe agents can hand out VR goggles when clients want a tour! :)
    https://www.redfin.com/WA/Seattle/7751-37th-Ave-NE-98115/home/317808

  43. 43
    Eastsider says:

    RE: Ardell DellaLoggia @ 40 – Unfortunately it still does not justify the 6% commission every homeowner pays. LOL.

  44. 44
    wreckingbull says:

    By Ardell DellaLoggia @ 40:

    RE: Deerhawke @ 33

    Today I had roofers clean a roof, clean gutters inside and out, an HVAC guy go into the crawl space to service and tag the furnace and change the filter and had a new garage door put on to replace the old one that broke shortly before my sellers moved away to the East Coast.

    I’d like to know how much the roofers, HVAC guy, and garage door installer made per hour. Probably not even close to what you made simply arranging their services. Why is that?

  45. 45
    ARDELL DellaLoggia says:

    RE: wreckingbull @ 43

    I paid for their services and for all the things needed to perfect the product. The HVAC guy was $180. He was there for 45 min or so. The roof cleaner came at 8 and left around 1 but he took a lot of breaks. That was just under $700. I didn’t tip him because he blew soot in the house. Lots of it. The garage door with install was just under $1,000. He was good. I tipped him $50 over the invoice price. He was there for almost 4 hours. I was working the whole time they were. Started at 8 left at 4.

    That was just today.

  46. 46
    ARDELL DellaLoggia says:

    RE: Eastsider @ 42

    I only account for my half of that. I don’t know what other agents charge or do. Of my 3% I am putting 1% or more into the things I am doing. In this case I did not discount as the seller and I agreed the money was best used to improve the product to get them a higher return.

    Only half of that 6% is my end. The buyers’ agent gets the other half. That agent’s duties and arrangement with their buyer client are not known. to me.

    My clients don’t complain about my fees. I don’t charge them all the same price.

    I helped them buy the house two years ago. I offered to pay to improve it to help it look as good as it did or at least closer to what it looked like when they bought it.

    In this market the only “marketing” needed is to perfect the product and get good photos so that the house sells itself.

    It’s not the easiest house due to age and Floor Plan. It won’t sell for highest possible price without significant prep. Hoping for the best. It’s not in the hottest location but I think it will do well.

  47. 47
    Blurtman says:

    One under appreciated thing about brokers in all businesses is that they keep the market going.

  48. 48
    Blurtman says:

    One under appreciated thing about brokers in all businesses is that they keep the market going.

  49. 49
    ess says:

    Regarding the ongoing discussion of pay for real estate agents-

    I have heard many complaints about various occupations getting paid too much over the years. Of course it is a function of the marketplace, licensing requirements, supply and demand and other factors which help determine the salaries or what folks can charge. In many instances the employment or work entails more than what most casual observers believe it does.

    The only occupation I have discovered that pays well and doesn’t require much effort is that of trust fund kid. I have known some of them over the years, and it has always appeared to me that the pay is way out of proportion to what they produce on behalf of society. I have had my application to be employed as a trust fund kid for over 40 years, but have yet to secure employment in that lucrative field.

  50. 50

    RE: Deerhawke @ 14
    American “Good Job “Emphasis Dies In Issaquah By a Rino Republican

    https://www.numbersusa.com/content/my/congress/1183/gradescoresheet

    Is Seattle and America doomed to 3rd World level Amazon Warehouse slave wages?

    Is Reichart trying to destroy Seattle’s Manufacturing with COLLUSION WITH JAPAN????

    These aren’t just FAKE NEWS words/allegations, the prognosis is based on NWO brainlessness [deeds].

  51. 51

    RE: ess @ 46 – I think you’re confused. The position of Trust Fund Kid doesn’t make money, it burns through money. You’re applying to get money, but you should be applying to spend money!

    If you’re halfway decent looking and young (e.g. better looking and younger than me) and willing to branch out to a different area you could try Florida and widows. Palm Beach is special!

  52. 52
    uwp says:

    By Voight-kampff @ 42:

    RE: Ardell DellaLoggia @ 40

    Speaking of homes that don’t look like they do in the photos. I guess this is cheaper than staging. Maybe agents can hand out VR goggles when clients want a tour! :)
    https://www.redfin.com/WA/Seattle/7751-37th-Ave-NE-98115/home/317808

    Hah, a home in our neighborhood did something similar.
    The furniture was off just enough that it looked strange. I suppose the technology will get better in the future.

  53. 53
    Bubble Trouble says:

    By uwp @ 32:

    By Bubble Trouble @ 31:

    Also I should add: Seattle is special!

    Of course it is! So is LA and SF and NYC and Denver and Atlanta and…well pretty much every city. Go to any city, talk to a real estate sales person and they’ll list off 100 reasons why (fill in city name) is different and why the laws of economics don’t apply here and why you better buy now or be priced out forever.

  54. 54

    I generally say that you don’t want a buyer to be disappointed when they actually look at a house. So the photos should not look too good relative to what the house actually looks like in real life. Deceptive photos might get people in the door, but they are more likely to deter an offer being made than to encourage an offer.

    Where the listing photos show furniture, would the lack of furniture during a showing have an impact? This is not just relevant to VR staging, but also situations where the owner moves the furniture out after a period of time. I’m not expressing an opinion on that one way or another, and it very well could be property specific. Some properties look worse without furniture than others. But the issue is, what do you want the buyer to expect when they walk through the door?

  55. 55

    Anyone have new windows installed lately? I just saw a listing that said they spent $60,000 on new windows in a standard 2 story 2,500 sf house. Is that even possible?

  56. 56
    Bubble Trouble says:

    By Eastsider @ 35:

    There is no justification for 6% RE commission. In the UK, the average high-street estate agent fee is 1.3% including VAT. Why does it cost 4 times as much to sell a $2m house than a $500k house? If we don’t have a powerful RE lobby, we will be paying far less in commissions.

    Part of the reason they can get away with 6% is because people have been trained to just accept it as a fact. The same people who will spend hours negotiating $500 off a car, will just blindly accept a 6% commission on the sale of a $500K house. Cuz, well it’s just how it is, right? The other part is the r/e industry propaganda that portrays buying and selling a home as something only a “qualified professional” should do. It’s really not that hard to do. And if you want someone to hold your hand, a r/e lawyer will provide that service for a fraction of the $30K commission on a $500K house.

  57. 57

    By Bubble Trouble @ 55:

    It’s really not that hard to do. And if you want someone to hold your hand, a r/e lawyer will provide that service for a fraction of the $30K commission on a $500K house.

    You don’t understand what is involved, but that doesn’t stop you from claiming it’s not that hard to do. And here’s some pretty good evidence you don’t understand what’s involved: You think a RE lawyer does all the same things as a RE agent.

    I’d suggest giving it up. We get it that you don’t like agents or what they charge. But you don’t have a clue what you’re talking about. Your attempts to put meet on the bones of your arguments are failing miserably.

    BTW, there’s one entity that advertises here (or at least used to) where you can get charged less and get RE attorney services. So perhaps being a bit better informed as to the options which exist would help.

  58. 58
    ARDELL DellaLoggia says:

    RE: Bubble Trouble @ 55

    That has always been an option. Why do you think people don’t choose that more often? Seller’s can use a limited service company in the MLS, full internet exposure for about $1,500 plus whatever they choose to offer a buyer’s agent.

    There are many options available. Why blame us for people choosing to hire us instead?

    I recently had someone ask me to help them buy new construction who wanted to pay me 25% of my normal fee. I told him new construction wasn’t hard. You can do it yourself. I even offered to assist by answering his questions for free. But I wouldn’t take the job with a 75% discount. He opted to hire me at my much higher charge for my services. How is that my fault?

    Are you mad at us, or the people who hire us?

  59. 59

    RE: ARDELL DellaLoggia @ 57 – Given all the choices there are it seemingly would make more sense to complain about how the commission doesn’t vary depending on competency of service. And what’s sad/ironic is that the people who think they need the least service probably need the most!

    I don’t believe you’re a Realtor, so you probably don’t have access to the Hotline questions. Some of them really leave me shaking my head, but those agents are just as likely to get the stereotypical 3% as a competent agent who would never ask the question (or get into the mess) in the first place. The same is true in the attorney area. I remember taking over a case from a bankruptcy mill, and reading over their fee agreement they were going to get paid much more than what I would have charged, and they basically barely knew the basics of bankruptcy law. Unfortunately in both real estate and law it’s very difficult for consumers to assess the competency of their representative.

  60. 60

    RE: Kary L. Krismer @ 58

    I am not currently a Member of The National Association of Realtors and have not been since Lawrence Yun became a laughing stock. I don’t agree with much of what they do over the last decade in terms of PAC monies and lobbying and insignificant advancements in Buyer Agency. But I have many friends who still are, and must be, as in most areas of the Country not being a member is not an option.

    I would like to see all areas operate as we do here so that agents don’t have to be members of the Trade Association in order to get access to Supra lockboxes and the mls. It is a monopoly and I am very much in favor of membership becoming more optional for all agents in the U.S.

  61. 61

    RE: Ardell DellaLoggia @ 59 – I’m not a fan of NAR either, but WR does good work, for the most part.

  62. 62
    Eastsider says:

    By Ardell DellaLoggia @ 54:

    Anyone have new windows installed lately? I just saw a listing that said they spent $60,000 on new windows in a standard 2 story 2,500 sf house. Is that even possible?

    FYI – I replaced all windows plus a skylight of a SFH for under $10k (after PSE rebates) three years ago. I doubt it costs more than $20k to replace all windows of a 2,500sf home today.

  63. 63
    Eastsider says:

    By Bubble Trouble @ 55:

    Part of the reason they can get away with 6% is because people have been trained to just accept it as a fact. The same people who will spend hours negotiating $500 off a car, will just blindly accept a 6% commission on the sale of a $500K house. Cuz, well it’s just how it is, right? The other part is the r/e industry propaganda that portrays buying and selling a home as something only a “qualified professional” should do. It’s really not that hard to do. And if you want someone to hold your hand, a r/e lawyer will provide that service for a fraction of the $30K commission on a $500K house.

    The main reason they have been able to maintain 6% is due to their monopoly power. The MLS exerts complete control over home sales data and their members. For example, pertinent information about a home for sale is only available to MLS members. Membership rules and regulations pretty much perpetuate the status quo. RE is just like healthcare. Consumers are the ones hurting.

  64. 64
    Eastsider says:

    By ARDELL DellaLoggia @ 46:

    RE: Eastsider @ 42

    I only account for my half of that. I don’t know what other agents charge or do. Of my 3% I am putting 1% or more into the things I am doing. In this case I did not discount as the seller and I agreed the money was best used to improve the product to get them a higher return.

    Only half of that 6% is my end. The buyers’ agent gets the other half. That agent’s duties and arrangement with their buyer client are not known. to me.

    My clients don’t complain about my fees. I don’t charge them all the same price.

    I helped them buy the house two years ago. I offered to pay to improve it to help it look as good as it did or at least closer to what it looked like when they bought it.

    In this market the only “marketing” needed is to perfect the product and get good photos so that the house sells itself.

    It’s not the easiest house due to age and Floor Plan. It won’t sell for highest possible price without significant prep. Hoping for the best. It’s not in the hottest location but I think it will do well.

    I am sure you work very hard. I am also certain that UK has some hardworking agents too. Most agents I know do not deserve the 6% for just closing a home. If UK can work with 1.3% commissions, why are we paying 6% and 4.6 times as much in commissions here? For a median home in the area, the commission of $30k is about half a year salary. I doubt it takes a typical agent half a year to close a home sale. In my experience working with agents, they spend at most 1 month of their time combined to close a home. In this market where some sales transact in 2 weeks, how can those agents possibly work more than a few days each? Why do they deserve half a year’s salary? They don’t even need a RE college degree to become agents, unlike doctors, lawyers and software engineers.

  65. 65
    Brendan says:

    RE: Joe @ 2
    Snohomish is nice, if you mean the city. Very far away from everything though. I doubt it will ever develop much more since it’s so far from job centers.

  66. 66

    RE: Eastsider @ 62

    The MLS never tells anyone what to charge. Nor does the Board of Realtors.

    Change is supposed to come from businesses who test the waters with Alternative Business Models. Those that started over the years with low commissions ended up raising them. One most notable company started out at a 50% discount for buyers. They truly thought commissions were outrageous. Today they are barely discounting 15% on a $2.5 Million Dollar house.

    Does this mean they just got greedy? Or did they try charging less and couldn’t make that work. That company is not profitable at the moment even with the huge increase in commissions. They apparently are still recovering from the deeper discount years.

    It’s not “the monopoly”. Many, many companies form out of the outrage of high commissions and they just can’t seem to be profitable. Many have tried. No one stops them. No one dictates what a company can charge. It just doesn’t seem to work out.

  67. 67
    ARDELL DellaLoggia says:

    RE: Eastsider @ 63

    I enjoy having a conversation and try to keep an open mind. But my Feb sale that “took two weeks” from offer accepted to closed took me six months…to later sell with a two week closing date. Do you really think we start working the day a home is listed for sale?

    We don’t show that part of what we do because it is very personal and confidential. But are you really thinking our work starts the day you see a house go on market?

  68. 68
    jon says:

    I think the stealth discrimination mentioned in the following article is quite a plausible explanation for real estate transactions being higher, but there is no proof, and I don’t know of a reason why the same would not happen to other countries also.

    http://www.economist.com/node/21554204

    Perhaps there is some difference in the laws there that prevent it? I know that there is a rule here that only Realtors can advertise an open house on the MLS, which seems like it should be a violation of anti-trust.

  69. 69

    RE: jon @ 67

    “The” mls is a members only system. Licensing Law requires that one be licensed to represent people in the purchase and sale of real estate. We have full access to peoples homes. It is a highly regulated industry.

    BUT some members of the mls have companies that allow you to put your home in the mls through them for as little as $95. Realistically for all the things you need like many photos (that you provide) and a lockbox and paperwork, etc. more like $900 depending on how many photos you want online.

    http://www.savvylane.com/index.html#compare_page

    MLS 4 Owners was one of the original flat fee “For Sale by Owner IN the mls” companies and they appear to still charge $500 for up to 25 photos and most of the things you “need” to be IN the mls properly and provide access to your home for agents to show it.

    http://mls4owners.com/

    Not familiar with this one, but there are many local discount broker companies.

    https://www.owners.com/

    Here’s a list for 6 mos for $185 company.

    http://list4flatfee.com/

    This one was mentioned in a post here before and makes the news from time to time. Site says its “free”.

    https://www.faira.com/

    This seems to be an a la carte service

    http://americaathomerealestate.com/

    These are all members of “the mls”. There is nothing that limits a company. They can charge whatever they want. No one tells brokerages what to charge people. No monopoly. No cartel. Just lots of rules and laws about entering people’s homes and representing them in the purchase and sale of homes.

    Most of these have been around for decades and there are more, I was just looking at the listing side. These are among the least expensive but most any agent is free to negotiate their charge at any time.

    Why didn’t these companies completely take over the market? Why do people hire us vs using them always. I don’t know the answer to that anymore than I know why some people here think all sellers “have to” and do pay 6%.

    Why does Eastsider want me to make $60,000 a year? Where is his logic for that? I started working at an annual salary of $4,800 a year in 1972. I have been working for 45 years. By the late 80’s I went from $4,800 a year to about $40,000 a year working in a bank. Why should I make $60,000 30 years later? As to his griping about education level, the President of that Bank had no degree and started in the mail room and he had more integrity than any current day, more educated, bank executive.

    Where does all of this angst come from? What’s the real beef here?

    Clearly people who hire us instead of them do not feel this way, and they are MANY. No one has to hire us. There are many options as I have noted. What you can’t have…is us…at that price. Sorry.

  70. 70
    Blurtman says:

    Somewhat on topic:

    Why is Zillow so slow to update new info? It would seem to offer a disservice to sellers and buyers alike. Redfin and other sites are much. much better.

    Kary, the door is open.

  71. 71

    By Blurtman @ 70:

    Somewhat on topic:

    Why is Zillow so slow to update new info? It would seem to offer a disservice to sellers and buyers alike. Redfin and other sites are much. much better.

    Kary, the door is open.

    That’s what I’ve been talking about for years. I don’t know the technical reason currently why it updates less frequently than broker sites. It used to be that for firms that didn’t automate the process of having their listings go to Zillow, Trulia and Realtor.com that the agent had to use some sort of a third party service to manually enter the listing and any changes. Lots of agents would then forget about the “changes” part and their listing could stay at the wrong price or wrong status for months. I think Zillow and Trulia put an end to that type of input a few months ago, but I haven’t checked on their accuracy since then.

    To some extent the NWMLS is at fault for this. Years ago they did automatically upload all their listings to Realtor.com, but then stopped. They could upload to all those three major sites, but apparently can’t come to terms on doing so, and/or maybe some of the major member brokerages don’t want that to happen for some reason I can’t explain. I would assume it’s something similar to the disputes that can arise between TV broadcasters and cable/satellite companies, but with a lot less consumer pressure.

    But why are you looking at Zillow? Nothing good can be found there. It’s an advertising company for agents, not a source of good information for consumers.

  72. 72
    Eastsider says:

    By Ardell DellaLoggia @ 69:

    Why does Eastsider want me to make $60,000 a year?

    Did I really say that?! Can I even make a statement that many CEOs are overpaid when their counterparts in Japan make one sixth as much? (I mentioned that our RE commissions are over 4 times those of UK. )

    Btw, $30k commissions is about 16 months mortgage payments for a $500k home with 20% down. IMO, that is excessive. The UK equivalent is about 4 months commission.

  73. 73
    Eastsider says:

    By Ardell DellaLoggia @ 69:

    These are all members of “the mls”. There is nothing that limits a company. They can charge whatever they want. No one tells brokerages what to charge people. No monopoly. No cartel. Just lots of rules and laws about entering people’s homes and representing them in the purchase and sale of homes.

    NWMLS has complete control over RE listing data and that is their monopoly power. Zillow has not been able to integrate NWMLS data into their site despite having no trouble getting direct data feed from hundreds of MLS organizations nationwide. NWMLS uses its monopoly power to dictate what Zillow can innovate in RE space, some of which will benefit consumers and lower transaction costs. For example, NWMLS disallowed local agents from using the “Coming Soon” feature on Zillow when most MLSs have no such restrictions. I am not here to argue the merit of “Coming Soon” feature but NWMLS should not have such monopoly power on ‘public’ RE data. If “Coming Soon” harms consumer as some claim, it is up to the regulators, not few among hundreds of MLS organizations nationwide to dictate. Such power to dictate maintain the status quo and harms consumers.

  74. 74

    By Eastsider @ 35:

    There is no justification for 6% RE commission. In the UK, the average high-street estate agent fee is 1.3% including VAT. Why does it cost 4 times as much to sell a $2m house than a $500k house? If we don’t have a powerful RE lobby, we will be paying far less in commissions.

    That’s apparently only the seller side, and the typical range there is 1-2@, so hardly a 4x difference. Also, not clear on whether that is before or after the VAT, because apparently they changed how that had to be disclosed in 2016–it would depend on the survey date. I’ve yet to see how the buyer’s agent is paid, but perhaps they haven’t figured out over there that the seller gets more money paying the buyer’s agent’s commission.

    As to the powerful RE lobby, be thankful for them. If we had the same nominal rates here you’d pay $15,000 for REET on a $500,000 transaction (3%), and $43,750 on a $1,000,000 transaction(4.375%). I mentioned above that Washington Realtors does some good things, and one of those things is going nuclear any time the legislature considers raising the maximum REET from the 1.78% number.

    https://www.gov.uk/stamp-duty-land-tax/residential-property-rates

  75. 75

    By Ardell DellaLoggia @ 60:

    But I have many friends who still are, and must be, as in most areas of the Country not being a member is not an option.

    I would like to see all areas operate as we do here so that agents don’t have to be members of the Trade Association in order to get access to Supra lockboxes and the mls. It is a monopoly and I am very much in favor of membership becoming more optional for all agents in the U.S.

    In many parts of the country the MLS is owned by a Realtor entity, so it’s not that odd that you’d need to be a Realtor to join the MLS. It’s sort of like how you have to become a member of the NWMLS to have access to the NWMLS.

    Many parts of the country have more than one MLS in a particular area. I would assume often that is to get a non-Realtor MLS up and functioning.

  76. 76
    jon says:

    By Eastsider @ 72:

    By Ardell DellaLoggia @ 69:

    Why does Eastsider want me to make $60,000 a year?

    Did I really say that?! Can I even make a statement that many CEOs are overpaid when their counterparts in Japan make one sixth as much? (I mentioned that our RE commissions are over 4 times those of UK. )

    Btw, $30k commissions is about 16 months mortgage payments for a $500k home with 20% down. IMO, that is excessive. The UK equivalent is about 4 months commission.

    Anyway, no one is forcing anyone to become a real estate agent. If removing restrictions that protect realtors cause their incomes to go down, then they can leave the field and automation take care of the paperwork. Plenty of other industries are doing through the same process.

  77. 77

    By Eastsider @ 73:

    NWMLS has complete control over RE listing data and that is their monopoly power. Zillow has not been able to integrate NWMLS data into their site despite having no trouble getting direct data feed from hundreds of MLS organizations nationwide. NWMLS uses its monopoly power to dictate what Zillow can innovate in RE space, some of which will benefit consumers and lower transaction costs. For example, NWMLS disallowed local agents from using the “Coming Soon” feature on Zillow when most MLSs have no such restrictions. I am not here to argue the merit of “Coming Soon” feature but NWMLS should not have such monopoly power on ‘public’ RE data. If “Coming Soon” harms consumer as some claim, it is up to the regulators, not few among hundreds of MLS organizations nationwide to dictate. Such power to dictate maintain the status quo and harms consumers.

    It’s their data! Of course the have complete control over it. Go try to publish the data of AVComparatives on the Internet somewhere and see what happens.

    As to Zillow, as I mentioned I don’t know what the deal is there with them not being able to come to a deal with the NWMLS. Maybe it’s their fault, maybe it’s the NWMLS’s fault, or maybe one or more of the larger brokerages is somehow blocking it. The point is it’s not clear why they can’t come to a deal, but Zillow doesn’t just get to have the data. It’s not theirs. What I will say about the topic is I really hate agents who hate their listings appearing on Zillow. I don’t think there’s any legitimate reason to not want that to happen. IMHO they’re just upset that they have less power to try to find buyer clients from their listing situations. But an agent finding buyer clients is not why a seller hires an agent. They really need to think about their position. That said, I don’t believe that’s what’s behind the NWMLS position regarding Zillow and their data, unless maybe that’s the position of a powerful brokerage. I’m pretty sure that is a minority position among agents.

    As to Coming Soon, the NWMLS doesn’t prevent that, but they do prevent their agents from participating in it, because that is the type of activity which is only good for the agent participating in the activity. It’s bad for the agent’s clients, which presumably is why you don’t want to defend the program itself. There are a lot of other restrictions on what agents can and cannot do if they want to participate in the NWMLS. But as Craig Blackmon proved, it’s their choice. Or someone else could set up another MLS, as has been done elsewhere and as actually exists in a small part of the NWMLS territory.

    Finally, your monopoly argument is rather weak given all the different types of brokerages that are included in the NWMLS system, and the relatively low barriers to entry to becoming an additional such brokerage.

  78. 78
    sfraz says:

    RE: Brendan @ 65 – True. Co-worker lives there. She is late every week. Sometimes taking her 2 hours to get into Bellevue. Put a price on losing 4 hours of your day staring at exhaust and bumpers.

  79. 79
    Joe says:

    RE: sfraz @ 78

    From where to where 2 hrs? I disagree.
    Seattle – Bothell, Snohomish takes same time as Bellevue or Redmond. Same traffic in 545 and 405N.
    If you use ST express its 30 mins ,if you drive in peak hours not more then 1 hr for me.
    Lot of people drive from Seattle – Everett , I never hard 2 hr expect if its bad traffic.

  80. 80
    Joe says:

    RE: Brendan @ 65
    I dont understand ? Whats far away from everthing– I agree Seattle downtown is 25 miles I dont know whats far in there -? Am I missing anything here

  81. 81

    RE: jon @ 76

    There are no restrictions that cause their incomes to go up or down. How can you “remove” what does not exist?

  82. 82

    I can explain all of these things…but I fear it falls on deaf ears, but here goes.

    1) “As to Zillow, as I mentioned I don’t know what the deal is there with them not being able to come to a deal with the NWMLS. Maybe it’s their fault, maybe it’s the NWMLS’s fault, or maybe one or more of the larger brokerages is somehow blocking it.”

    Answer: None of the above. No one’s “fault”. No one is blocking them. For a very long time Realtor.com was the only 3rd Party/non-brokerage site that had an automatic feed from the mls. When Zillow and Trulia and some other smaller 3rd Party sites were born, our mls decided they had to treat all fairly. So they dropped the feed to Realtor.com and the Brokerages get to decide which 3rd Party sites to advertise on. The Feed goes to all Brokerages and the Brokerages decide where to advertise. The mls never sent the properties to The Seattle Times ad page, as example. Zillow is a place to advertise a listing and the Brokerages hired by the sellers decide where to advertise. No one did a bad thing to Zillow…but rather dropped Realtor.com in order to be fair to Zillow and Trulia and all the other new online “ad” sites.

    2) “Many parts of the country have more than one MLS in a particular area. I would assume often that is to get a non-Realtor MLS up and functioning.”

    No. Ours is an extremely large mls system. So large that up north between NWMLS border and Canada we were once sued or a suit threatened for being a monopoly and too large. Most mls geographic territory is MUCH smaller than ours. Members can list their properties in two mls systems if they belong to both. The same as agents in Tahoe choose to be licensed in two States because if you drive around the Lake you are sometimes in CA and sometimes in Nevada, when you work near a border of two mls systems you often belong to both and list your properties in both. That is what causes the overlap, the same way an agent can list a property in two “areas” in our mls. Both of the mls are normally Realtor owned and operated, so has nothing to do with two different types of Brokerages.

    3) “For example, NWMLS disallowed local agents from using the “Coming Soon” feature on Zillow when most MLSs have no such restrictions.”

    Well no. The rule had nothing to do with Zillow. The rule, which is a relatively new rule, came before Zillow’s “Coming Soon”. We used to have to list a property IN the mls within 24 hours of a seller signing the listing Contract. These days it takes a LOT longer to prep a house and stage it and get great photos. We can’t do all that in 24 hours. So agents had to work without any contract and it was becoming a huge problem. So the mls changed the 24 hour rule to allow an agent up to 30 days to do their prep work to insure better work for sellers BUT that 30 day extension came with a proviso that the agent not try to sell the house on his own during that 30 days and before the home was listed for sale. The “No early advertising” went hand in hand with the increased # of days to do better prep work for the seller. It had nothing to do with Coming Soon, but Coming Soon violates the rule. The rules is for a completely different reason. It is to make sure agents have sufficient time to give sellers the best possible pre-listing service, while at the same time protecting the agent while performing these services.

    4) Did I really say that?! Can I even make a statement that many CEOs are overpaid when their counterparts in Japan make one sixth as much? (I mentioned that our RE commissions are over 4 times those of UK. )

    Let’s try to drag this back into some sense of reality…like stick to this Country. I don’t know what they charge for a bagel in UK and if it costs more or less or why…or a steak…or a nanny…or a roll in the hay! What other Countries charge for things is irrelevant. I think 12 year olds can work full time for a pittance in some other Countries. That has nothing to do with what we let our 12 year olds do. That it exists in another Country is irrelevant.

    Let’s get relevant. Real Estate Agents have a “core” area where they work. Often it is where or close to where they live. So if an agent lives and works where there are homes for $120,000 then his/her income is less. If an agent lives and works where there are homes for $2,000,000, then his/her income is more.

    It is not the 6% that is the problem as if you are in Detroit or Philadelphia or Ohio or SWE’s $40,000 Kansas market…then 6% is not too much. This argument only comes up when the price of houses is high. In some lower priced areas it is NOT 6% it is more. In some higher priced areas it is NOT 6% it is less. The problem with the Seattle Area is there are some condos near Microsoft and in Juanita and in many places still selling for a price where 6% is not an outrage. There are places near Kary where 6% is not an outrage…then there is Bill Gates neighbor where 6% is an outrage.

    There is NO law, rule, lobby, massive external effort to dictate any % and there is no need for it to be less in many places in this Country. Every, Every, Every single time the ONLY % that needs to be paid is the one a seller agrees to pay. Period!

  83. 83
    sfraz says:

    RE: Joe @ 79 – Snohomish (city) to downtown Bellevue. Not always 2 hrs. , but several times a month. She has lived there 20 years. Says it has really gotten bad in the last few years.

  84. 84

    RE: Ardell DellaLoggia @ 82 – Ardell, I’m not even going to bother to respond to that. Do you just disagree to disagree, even if you don’t have a rational behind it? But let’s just take the first topic–listings to Zillow where you basically restate the history I already stated. But if the NWMLS is just refusing to allow them to directly syndicate listings as you claim, then it’s the NWMLS’s fault. That’s pretty simple, but you somehow claim that it’s not the NWMLS’s fault for taking the position they take.

    Do you just like to argue with men? I think you’re sexist. ;-) (Seriously, I think it’s lawyers you have the problem with, as demonstrated by your repeated arguments with me, Craig and even Marc.)

  85. 85

    By sfraz @ 83:

    RE: Joe @ 79 – Snohomish (city) to downtown Bellevue. Not always 2 hrs. , but several times a month. She has lived there 20 years. Says it has really gotten bad in the last few years.

    You could always pay $10 each way for the HOT lanes (or whatever those are called there). ;-)

    On that topic I love the bifurcated world that those lanes create–people willing to pay for things and people not willing. What’s sad though is that just a relatively small tax increase on everyone would allow much better traffic situations, but instead we’re left in a Tim Eyman hell hole where you have to pay a ton to have reasonable traffic, and then that’s only available in a very few areas. Everyplace else the traffic sucks!

  86. 86
    Eastsider says:

    By Ardell DellaLoggia @ 82:

    Every, Every, Every single time the ONLY % that needs to be paid is the one a seller agrees to pay. Period!

    You know this is not true. First, the seller has to go thru NWMLS to list a home. Next, if he decides to pay the buyers agent less than the standard 3%, agents will not show his homes. We are still a ways from the 1.3% commission in the UK.

  87. 87
    Eastsider says:

    By Ardell DellaLoggia @ 82:

    3) “For example, NWMLS disallowed local agents from using the “Coming Soon” feature on Zillow when most MLSs have no such restrictions.”

    Well no. The rule had nothing to do with Zillow. The rule, which is a relatively new rule, came before Zillow’s “Coming Soon”. We used to have to list a property IN the mls within 24 hours of a seller signing the listing Contract. These days it takes a LOT longer to prep a house and stage it and get great photos. We can’t do all that in 24 hours. So agents had to work without any contract and it was becoming a huge problem. So the mls changed the 24 hour rule to allow an agent up to 30 days to do their prep work to insure better work for sellers BUT that 30 day extension came with a proviso that the agent not try to sell the house on his own during that 30 days and before the home was listed for sale. The “No early advertising” went hand in hand with the increased # of days to do better prep work for the seller. It had nothing to do with Coming Soon, but Coming Soon violates the rule. The rules is for a completely different reason. It is to make sure agents have sufficient time to give sellers the best possible pre-listing service, while at the same time protecting the agent while performing these services.

    You just proved that NWMLS has monopoly power in this market. Zillow has no trouble getting direct data feed from hundreds of MLSs nationwide but has no access to this market. The rules are simply what they call ‘barriers of entry’.

  88. 88

    By Eastsider @ 86:

    By Ardell DellaLoggia @ 82:

    Every, Every, Every single time the ONLY % that needs to be paid is the one a seller agrees to pay. Period!

    You know this is not true. First, the seller has to go thru NWMLS to list a home. Next, if he decides to pay the buyers agent less than the standard 3%, agents will not show his homes. We are still a ways from the 1.3% commission in the UK.

    Did you not read my post that the 1.3% is only the seller’s side, and may not include the VAT (depending on when the survey was taken)? Care to refute that?

  89. 89

    By Eastsider @ 87:

    By Ardell DellaLoggia @ 82:

    3) “For example, NWMLS disallowed local agents from using the “Coming Soon” feature on Zillow when most MLSs have no such restrictions.”

    Well no. The rule had nothing to do with Zillow. The rule, which is a relatively new rule, came before Zillow’s “Coming Soon”. We used to have to list a property IN the mls within 24 hours of a seller signing the listing Contract. These days it takes a LOT longer to prep a house and stage it and get great photos. We can’t do all that in 24 hours. So agents had to work without any contract and it was becoming a huge problem. So the mls changed the 24 hour rule to allow an agent up to 30 days to do their prep work to insure better work for sellers BUT that 30 day extension came with a proviso that the agent not try to sell the house on his own during that 30 days and before the home was listed for sale. The “No early advertising” went hand in hand with the increased # of days to do better prep work for the seller. It had nothing to do with Coming Soon, but Coming Soon violates the rule. The rules is for a completely different reason. It is to make sure agents have sufficient time to give sellers the best possible pre-listing service, while at the same time protecting the agent while performing these services.

    You just proved that NWMLS has monopoly power in this market. Zillow has no trouble getting direct data feed from hundreds of MLSs nationwide but has no access to this market. The rules are simply what they call ‘barriers of entry’.

    Care to refute my argument that it’s the NWMLS’ data, and that if Zillow wants to use it that they have to come to terms with the NWMLS?

    Also, not really sure what that statement by Ardell even has to do with that topic. What she’s addressing actually has nothing to do with Coming Soon. The NWMLS used to have a rule that required listings to be turned in and go active within 24 (or was it 48?) hours of signing. They changed that apparently realizing how long it takes agents to get properties ready to list and how unfair it was to require that they do that without being under contract.

    It has nothing to do with Coming Soon. Promoting a property without an active listing has always not been allowed. Based on the Department of Licensing’s apparent position of having a history of listing go to pending too quickly being problematic, even the DOL might have a problem with Coming Soon.

  90. 90
    Eastsider says:

    By Kary L. Krismer @ 88:

    By Eastsider @ 86:

    By Ardell DellaLoggia @ 82:

    Every, Every, Every single time the ONLY % that needs to be paid is the one a seller agrees to pay. Period!

    You know this is not true. First, the seller has to go thru NWMLS to list a home. Next, if he decides to pay the buyers agent less than the standard 3%, agents will not show his homes. We are still a ways from the 1.3% commission in the UK.

    Did you not read my post that the 1.3% is only the seller’s side, and may not include the VAT (depending on when the survey was taken)? Care to refute that?

    Why don’t you do some research? The 1.3% is the total RE commission in the transaction. The UK market is far more competitive. For example, a seller can use multiple agents to sell the house. Also, commissions are typically lower for more expensive homes, and go as low as 1% or less.

  91. 91
    Eastsider says:

    By Kary L. Krismer @ 89:

    Care to refute my argument that it’s the NWMLS’ data, and that if Zillow wants to use it that they have to come to terms with the NWMLS?

    I have already stated that NWMLS has monopoly power because of its home listing data. It is THE market in the region if you want to buy/sell a home. Why should it dictate how other RE business uses the ‘public’ data? Hundreds of MLSs nationwide did not impose such restrictions on Zillow.

  92. 92
    ARDELL DellaLoggia says:

    RE: Eastsider @ 90

    That is called an Open Listing. You don’t see it often, but I have seen it in other parts of the Country in areas where there are only a few brokerages in the area. Basically in that scenario no one represents the buyer or the seller and whichever brokerage brings the buyer to the seller gets a finder’s fee.

    I have two friends, one in South Africa and one from the UK, who have described the low commission arrangement in the past. One of them has a Zillow type Company and the other is trying to start a company that discounts lower than their low and getting a lot of pushback. I’m heading out of town for a week but when I get back I’ll ping them and try to get them to weigh in here on the topic.

    I will also start a poll in my national agent closed groups and see who does and doesn’t feed to zillow from their mls systems. Many have been talking about discontinuing the feed because of Zillow’s newer “Instant offer” feature. Not sure if any did yet. Will find out.

    It gets more complicated because Zillow just started blocking agents from manually posting listings.

    The Internal discussions have been pretty nasty lately. Bob Goldberg just took over as CEO of The National Assiciation of Realtors on Tuesday. I may run into his buddies while on vacation but I think it’s too soon to know where he will fall on some of these big topics.

  93. 93

    RE: Eastsider @ 90 – I did, it’s the seller’s side only, for a system similar to our commercial real estate system. And seemingly they don’t have a MLS system at all–they deal with the listings of individual firms (who apparently pay their agents salaries, plus small commissions).

    Buyer’s agency is just starting to rise up, this is a 2015 article, but I’ve found them going back to 2010.

    http://www.telegraph.co.uk/finance/property/buying-selling-moving/11356670/Send-out-a-search-party-the-rise-of-buying-agents.html

    So basically you’re not only assuming what agents over there do are the same as here, but you’re also comparing apples and oranges.

  94. 94
  95. 95

    By Eastsider @ 91:

    By Kary L. Krismer @ 89:

    Care to refute my argument that it’s the NWMLS’ data, and that if Zillow wants to use it that they have to come to terms with the NWMLS?

    I have already stated that NWMLS has monopoly power because of its home listing data. It is THE market in the region if you want to buy/sell a home. Why should it dictate how other RE business uses the ‘public’ data? Hundreds of MLSs nationwide did not impose such restrictions on Zillow.

    I already addressed your public data argument in post 77. You didn’t respond. Just saying it’s the public’s data again is hardly convincing. It’s the NWMLS’s data. Not even agents who access the data can use it without complying with the NWMLS’s rules.

    Also, those agreements Zillow has with other MLS entities are largely relatively new. They made a big push to get them a couple of years ago. I’m assuming that they are paying the MLS entities to use the MLS data, but as detailed in post 77 we don’t know why the NWMLS doesn’t have an agreement with Zillow. Maybe Zillow isn’t willing to pay enough. Maybe the NWMLS is asking too much. Maybe a powerful brokerage is blocking it. But absent an agreement, it remains the NWMLS’s data, not the public’s data.

    Oh, also, the NWMLS is hardly the only way to sell or buy. It’s just the best way. That doesn’t make it a monopoly. There’s even another MLS entity working in at least part of the NWMLS area.

  96. 96
    Eastsider says:

    By Kary L. Krismer @ 93:

    So basically you’re not only assuming what agents over there do are the same as here, but you’re also comparing apples and oranges.

    It should be obvious that every country/market has its own rules/regulations/customs. But RE commissions, as far as the consumers are concerned, are not apples and oranges. They are real money! (Btw, stock trading commissions went down from several hundreds per trade 30 years ago to mere dollars and even ‘free’ today. House ‘trading’ commissions have not experienced meaningful drop despite technology during the same timeframe.)

    As to the UK agent fee –

    “Estate agent fees – the seller rather than buyer pays these”
    http://hoa.org.uk/advice/guides-for-homeowners/i-am-buying/the-hidden-costs-of-buying-and-owning-a-property/

    This website seems pretty complete and is mostly targeting UK consumers if you want to learn more about the UK market. It is the very first search result using Google.

  97. 97
    ARDELL DellaLoggia says:

    RE: Kary L. Krismer @ 93

    1) Our commissions were the same before we had Buyer Agency. The “half” was not added because of Buyer Agency.

    2) When a Listing Agent writes the offer checking “Seller/Seller” representing only the seller in an unrepresented buyer purchase, our contracts do not negate the half set aside for the buyer’s agent. The commission is the same whether the buyer is represented or not.

    3) Our “agency” and representation difference does not account for the cost difference. Agency was outlawed in Oklahoma with no commission change. Florida moved primarily to no representation Transaction Brokerage. They allow full representation but no difference in fee for none.

    NAR warned that Transaction Brokerage might and likely should lead to lower commissions. But it didn’t happen. They charge the same for less.

    Buyer Representation was supposed to cancel out “caveat emptor”, but we know the courts still seem to uphold that thinking.

    “They” are correct that there have been many changes since I started in 1990, but not a one pierced the Almighty 6% in a big way.

    There is no law or rule or body of influence that dictates it must be so…but somehow it always stays the same.

    I have no patience for some other Country…blah, blah, blah. But the gist of his argument has merit if not for dragging other Countries into the conversation.

  98. 98
    Bubble Trouble says:

    By ARDELL DellaLoggia @ 58:

    RE: Bubble Trouble @ 55

    That has always been an option. Why do you think people don’t choose that more often? Seller’s can use a limited service company in the MLS, full internet exposure for about $1,500 plus whatever they choose to offer a buyer’s agent.

    There are many options available. Why blame us for people choosing to hire us instead?

    I recently had someone ask me to help them buy new construction who wanted to pay me 25% of my normal fee. I told him new construction wasn’t hard. You can do it yourself. I even offered to assist by answering his questions for free. But I wouldn’t take the job with a 75% discount. He opted to hire me at my much higher charge for my services. How is that my fault?

    Are you mad at us, or the people who hire us?

    See my original post. Most people blindly accept the 6% because it’s always been like that. It’s the same reason auto dealers get away with charging $399 Doc Prep fees. . Same with title companies charging junk fee after junk fee. Same reason mortgage companies charge origination fees (you need to pay the lender money in order for the lender to lend you money? LOL). Most people just blindly pay these ridiculous fees.

    But just because most people accept getting ripped off doesn’t make the person doing the ripping off any less wrong in doing so.

  99. 99
    Eastsider says:

    By Kary L. Krismer @ 95:

    But absent an agreement, it remains the NWMLS’s data, not the public’s data..

    Can you imagine NYSE or NASDAQ charging an arm and a leg for ‘public’ stock trading data? If not, why should NWMLS hold monopoly power over ‘public’ home selling data?

    Oh, also, the NWMLS is hardly the only way to sell or buy.

    You can’t be serious.

    Here is my final comment on this subject. Despite UK’s 1.3% RE commissions, its housing market functions well. Our stock market used to have fixed commissions pre-1970’s. Trading 1,000 shares of AMZN stock would set you back by $1,000 in commissions. Now you pay less than $10 in commission for such trades. Sure, many stock brokers lost their jobs but we now have a more robust market. Today, no one can dispute that eliminating fixed commissions has been beneficial to stock investors and the economy. I am sure stock brokers in the 70’s complained that eliminating fixed commissions would result in adverse investment returns and harmed investors. Sounds familiar?

    My hope is that politicians and regulators will finally have the courage to go after MLS monopoly but that is unlikely to happen due to the powerful RE lobby. My other hope is that an online website like Zillow or even Amazon will bring much needed competition and reduce transaction costs in the process. That seems more likely to happen as we have witnessed intense competitions and reduced prices in market after market following such entries.

  100. 100
    ARDELL DellaLoggia says:

    RE: Bubble Trouble @ 98

    But why don’t people just use the cheap services more? They must need us.

  101. 101
    ronp says:

    RE: S-Crow @ 20 – that harvey airfield sounds nice, flight training at KBFI would scare me a bit.

  102. 102
    ronp says:

    RE: ARDELL DellaLoggia @ 46 – that is the kind of experience, knowledge and expertise that is valuable to seller. Good job!

  103. 103

    By ARDELL DellaLoggia @ 97:

    RE: Kary L. Krismer @ 93

    1) Our commissions were the same before we had Buyer Agency. The “half” was not added because of Buyer Agency.

    2) When a Listing Agent writes the offer checking “Seller/Seller” representing only the seller in an unrepresented buyer purchase, our contracts do not negate the half set aside for the buyer’s agent. The commission is the same whether the buyer is represented or not.

    As to the first part, I didn’t claim otherwise. But “before” the other half went to the agent who showed the buyer the house, who was considered the seller’s agent notwithstanding the fact that they never met the seller and might have shown the buyers 80 different houses. A really stupid system which I was critical of even before I became an agent (because it existed before I became an agent.

    As to #2, not quite right. Selecting the box is not the operative act, and arguably never was. But under current law the listing agent would clearly need to also have a buyer’s agency agreement with the buyers to be a dual agent.

  104. 104

    By Eastsider @ 99:

    By Kary L. Krismer @ 95:

    But absent an agreement, it remains the NWMLS’s data, not the public’s data..

    Can you imagine NYSE or NASDAQ charging an arm and a leg for ‘public’ stock trading data? If not, why should NWMLS hold monopoly power over ‘public’ home selling data?

    Huh? What makes you think it isn’t that way? It wasn’t so long ago that to get real time data you had to sign up for a service and pay a fee. The licensing was quite detailed. But what makes you think that the companies that report the NYSE and NASDAQ data don’t have licenses from them to do so?

  105. 105

    By Eastsider @ 99:

    Here is my final comment on this subject. Despite UK’s 1.3% RE commissions, its housing market functions well.

    Well you totally ignored my post on how high their “stamp tax” is–the equivalent of our REET tax. But if you consider a system functioning well that possibly has higher costs of sale than ours on most transactions, and where the buyer is typically completely unrepresented in a transaction, I don’t know what to say. That’s not better in any regard!

    Basically you like a system where sellers pay more to sell only because RE agents get paid less. So apparently you don’t care that if you sold a $1,300,000 house under their system you’d pay about $57,000, (about 4.4%) in stamp tax.

    That BTW is why WR’s fights the REET tax increase proposals (and sales tax on commissions proposals). They realize that such taxes even though paid by third parties impact commissions. So the choice is basically whether real estate agents (or attorneys, etc. in the case of sales tax) get the money, or whether government gets the money.

    Finally, here’s another article on the stamp tax from today, which not only goes into what I was addressing, but also touches a bit on the Vancouver tax situation because they apparently have an extra 3% tax on second homes.

    http://www.telegraph.co.uk/money/ask-a-money-expert/do-have-divorce-estranged-wife-avoid-3pc-extra-stamp-duty-new/

  106. 106

    By ARDELL DellaLoggia @ 100:

    RE: Bubble Trouble @ 98

    But why don’t people just use the cheap services more? They must need us.

    Some people do and some people don’t. And some people want the extra service even if they think they might not need it. But the point is, there is a choice. It’s not like Eastsider claims, that to sell you need to pay 6%. That’s a false and misleading argument in it’s entirety.

  107. 107

    By Kary L. Krismer @ 104:

    By Eastsider @ 99:

    By Kary L. Krismer @ 95:

    But absent an agreement, it remains the NWMLS’s data, not the public’s data..

    Can you imagine NYSE or NASDAQ charging an arm and a leg for ‘public’ stock trading data? If not, why should NWMLS hold monopoly power over ‘public’ home selling data?

    Huh? What makes you think it isn’t that way? It wasn’t so long ago that to get real time data you had to sign up for a service and pay a fee. The licensing was quite detailed. But what makes you think that the companies that report the NYSE and NASDAQ data don’t have licenses from them to do so?

    Too late to edit, but here’s what Google’s stock price page says:

    “Either Google or its third party data or content providers have exclusive proprietary rights in the data and information provided.”

    Also: “All data and information is provided ‘as is’ for personal informational purposes only, and is not intended for trading purposes or advice.”

    https://www.google.com/googlefinance/disclaimer/#disclaimers

  108. 108
    Kmac says:

    Replace agents with robots?

    A real estate technology company that aims to lower the cost of home-selling by using robots and “big data” instead of commission-based real estate agents has opened a Long Island office — its first outside of California.

    http://www.newsday.com/business/real-estate-tech-company-aims-to-replace-agents-with-robots-data-1.13937907

  109. 109
    ARDELL DellaLoggia says:

    RE: Kary L. Krismer @ 106

    Yes, that is my point. That is why I for many years have chastised you and others for bad-mouthing and pointing out weaknesses of new startup alternative business models.

    We should welcome and to some extent even assist these new models that could conceivably put us out of business. We should always work to move our industry forward vs digging our heels in the past.

    We, as an industry, do not fail by charging too much. We fail in not supporting and embracing new business models, and we do it time and again for decades.

    Our profession done well is usually worth the cost of our services. But you admit, and often, that a large % and likely the majority do not do the job equal to the cost of service.

    We need to support all of the lower cost models that will replace our weakest links with lower cost options. They do not replace the best of us. They replace the worst of us, and rightly so.

    Every time a low cost model springs up we should wish them huge success. They offer a system of checks and balances and test whether or not we are still relevant.

    Some % of buyers and sellers will still need the best of us at the higher cost. But you of all people should recognize that the least of us need to be weeded out with these lower cost alternatives.

  110. 110
    justme says:

    RE: ARDELL DellaLoggia @ 100

    >>But why don’t people just use the cheap services more? They must need us.

    I think it is because the full-price agents boycott the sellers and the properties that are offered with discounted commissions. The practice is largely hidden from view, because it is illegal, but I think it is still there.

  111. 111

    RE: jon @ 76
    You’re Right

    Albeit Japanese Engineers make more money than American Engineers; European Engineers make more money than American Engineers too…

    Their Motherland Cost of Living on like an OVERPOPULATED island country is not America’s fault.

  112. 112

    RE: justme @ 109

    Hence my most recent comment #108. In a weaker market it would be more difficult for sellers to face this fear. But in this market of low inventory?

    Sellers do believe, and often rightly so, that they have more to gain in price than they have to gain in a lower cost service option. There is no way the house I am working on right now could have utilized a lower cost option.

    The internet now puts up to 25 potentially beautiful photos on the internet. THAT is the marketing. There is generally more than one buyer for every good and well priced home in the areas where lower cost options would be more reasonable to use. The house is NOT going to be not seen by potential buyers as long as it is “in” the mls. If you are saying the seller sees more value in getting the most number of offers and so pays the full amount for that reason, then they are buying and paying for what they want. If they want 8 offers vs 4 and 4 isn’t “good enough” in their mind and they are willing to pay the max to get the max, well that is their right and a free market choice.

    My clients all need me and what I do, both sellers and buyers, of that I am sure. If people need us, then there is nothing wrong in their hiring us.

    The sad part is the scads of people who complain that they have a bad agent. Why did they hire them? Why didn’t they fire them? Can we really have compassion for buyers and sellers who hire the wrong agent and pay them too much? If they can only find bad agents, then is fear of the disadvantages of a lower cost alternative really valid?

    “,,,offered with discounted commissions…” That is a completely different issue. There is no 6%. There is 3% plus 3%. The seller’s services are the first 3. You are now talking about the second part…the other half…the buyer side…the 3% that is up to the buyer to control and not the seller. It is a “set aside” for buyer representation. It is the buyer and not the seller who can hire someone with that 3%. The buyer can choose a 3% agent or a 2% agent or a flat fee service or a company that rebates the majority of that to the buyer…NOT the seller.

    The seller only truly pays for his side of the fence. The seller puts 3% into the price in case the buyer needs it and if the buyer doesn’t need it then the buyer controls that piece with their choice of service.

    This is the part that the 6% tirades get wrong, wrong and wrong. The seller doesn’t get to choose the buyer’s service. The seller offers the maximum the buyer MIGHT need and then the buyer decides on what happens on their side of the fence. A seller can’t decide a buyer needs less service. Only the buyer can decide that. The seller controls and negotiates their 3. The buyer controls and negotiates their 3. There is no 6% until the buyer has no agent. The seller should require that the buyer use the 3% he gave for the buyer to hire an agent with in order to eliminate vicarious liability. If the buyer then chooses to keep it vs buy an agent with it, that is the buyer’s decision, not the seller’s.

    The seller says “here is 3% for the buyer to hire an agent with”. The buyer then chooses how much protection he does or does not need. Some still need the full 3% service. Some can hire an attorney to help with paperwork and keep the bulk of it. It’s the buyer’s side of the fence. The seller is merely providing the funds because only the seller can include it in the list price. The seller should NOT save money if the buyer needs less service. The buyer should and DOES save that money.

  113. 113

    By ARDELL DellaLoggia @ 109:

    RE: Kary L. Krismer @ 106

    Yes, that is my point. That is why I for many years have chastised you and others for bad-mouthing and pointing out weaknesses of new startup alternative business models.
    . . .
    We need to support all of the lower cost models that will replace our weakest links with lower cost options. They do not replace the best of us. They replace the worst of us, and rightly so.

    Every time a low cost model springs up we should wish them huge success.

    No. Many of the low cost models are bad for consumers, and we should point that out when it occurs. Like the one that offers a “free home inspection.” That sounds good to the uninformed, but it can basically be the same as a swift kick in the balls. Of then there’s Craig’s model, where he completely misrepresents the exposure that his listings will get.

    There are good alternative models. Redfin and WaLaw for example. But many of them are things just started by tech people that don’t have a clue about real estate. When those pop up we shouldn’t wish them success, we should point out their shortcomings.

  114. 114

    By justme @ 110:

    RE: ARDELL DellaLoggia @ 100

    >>But why don’t people just use the cheap services more? They must need us.

    I think it is because the full-price agents boycott the sellers and the properties that are offered with discounted commissions. The practice is largely hidden from view, because it is illegal, but I think it is still there.

    I think there may be some of that that is intentional, and maybe some of it that is unintentional. I can tell you the SOC is a field I don’t typically look at, but I would be more likely to notice a listing by some of the firms that offer very low commissions (less than 1%) so that I can get a buyer’s agency agreement in place before showing it. Very few sellers though go with such services. I doubt it’s because they recognize the downsides, but for whatever reason they are not very popular.

  115. 115

    By Ardell DellaLoggia @ 112:

    The sad part is the scads of people who complain that they have a bad agent. Why did they hire them? Why didn’t they fire them? Can we really have compassion for buyers and sellers who hire the wrong agent and pay them too much? If they can only find bad agents, then is fear of the disadvantages of a lower cost alternative really valid?

    It would be nice if quality of service was the focus of our discussion. The problem isn’t that some agents make 3% on some transactions. The problem is that some agents do that who aren’t worth even $1,000 or who shouldn’t be allowed to do brokerage services even for free!

    I’d love to improve the quality of the profession, but I don’t really have any great ideas, other than perhaps make every agent who hasn’t passed one of DOL’s situational tests do so, even if they have practiced for over 10 years. That would probably weed out a lot of the unqualified agents because some would never be able to pass such a test.

    But the other problem is the consumer typically has no idea whether or not their agents was good and did a good job for them. They only know that they like their agent and what their agent told them.

  116. 116

    RE: Kary L. Krismer @ 115

    The gist of the problem as to agents who are worth it and agents who are not is the brokerage system.

    A Brokerage makes MORE money off the WORST agent. The “extra” money the seller is paying for weakest link goes to the Brokerage, not to the piss-poor agent.

    The weakest link pays the highest split, so the brokerages gain more by having more agents who offer less value. That is why they love to hire agents who pay them 50% of what the seller pays for the service vs those who keep more of it.

    THAT is a huge chunk of where the consumer gets shafted.

  117. 117
    Doug says:

    Now that we’ve covered every aspect in determining a real estate agent’s worth, how is the Seattle housing market doing?

  118. 118

    RE: Doug @ 117 – The July stats will be out shortly–within hours.

  119. 119
    ess says:

    By Doug @ 117:

    Now that we’ve covered every aspect in determining a real estate agent’s worth, how is the Seattle housing market doing?

    Depends if you are buying or selling!!
    Sooner or later the market will take a breather. When sooner or later finally shows up is anyone’s guess.

  120. 120

    By Doug @ 117:

    Now that we’ve covered every aspect in determining a real estate agent’s worth, how is the Seattle housing market doing?

    They’re out. Sales are down about 75 units, but the median is up over $100,000 at $658,000 (King County SFR). Active listings 2,727, which is down about 75 YOY. YTD the new listings are up 300.

    Stats from NWMLS sources, and are owned by the NWMLS, but not guaranteed.

  121. 121

    RE: Kary L. Krismer @ 120 – The numbers I gave for Active listings above was actually the closed sales data. I thought the new number for inventory looked slightly low at the time. The correct number is 2,896, which is down over 600 YOY.

    Same stats disclaimer as in prior post.

  122. 122
    Deerhawke says:

    When I think of the NWMLS or any other multiple listing service, I think of S.I. Hayakawa’s famous quote about the Panama Canal.

    “We should keep the Panama Canal. After all, we stole it fair and square.”

    If agents were honest about the MLS, they would just say something like “Of course the MLS is a monopoly. In fact, it is a great monopoly. But hey, if you don’t like it, go start your own.”

    Technology will cause things to change over time, but realistically one would have thought that there would be more change than there has been. Redfin has shaken things up — somewhat. If I were younger and wanted to start another business, I would get financing and start a national version of walawrealty.com. That is a solid business model that could make a lot of money and eat away at commissions.

    But the reason that people pay stupid commissions is that they are stupid, lazy and fearful. Consumers make all kinds of noise about how unfair the commission structure is, but in a market where there is no way in he- – that they should pay more than 1.5% to list a property, they pay 3%. And in a market in which buyers can absolutely get a substantial rebate, they let their agent keep the full 3%

    Why?

    First, they have not taken the time and made the effort to educate themselves about the market and their place in it. Second, they have not taken the time and made the effort to figure out what they should do to their house to get the top price in that market. Third, they really want someone that they have some kind of connection to (however tenuous) to tell them what to do and to tell them they are making the right choices. They need the reassurance.

    For them, that is worth the money. They might complain once the transaction is over, but at the time it is worth the price.

    Different agents earn their business in different ways.

    I bought a property in June and the listing broker was as flat-out incompetent as they come. He messed the paperwork up unbelievably. But he is a top producer and since intelligence was clearly not the key, I asked him what he thought was the secret to his success. He said he was a good closer because he has a deep reassuring voice, a good empathetic nod while maintaining eye contact and a “heavy finger” when he shows people where to sign.

    I went through a transaction two years ago where the listing agent was around 30 and an ex-model. This person could make three spelling or diction errors in one short email sentence despite spellcheck. (“I will defiantly jet back in tough today.”) I asked her the secret of her success and she said that all women want to work with another woman who is fashionable. Men like the tasteful decolletage, tailored skirt and heels –and a sympathetic hand on the arm.

    And then there are the people who really earn their 3 or 6 percent commission.

    One of the best agents I ever dealt with helped get a long-term rental ready for the market. It was September 2007, the market was crumbling and I really needed to sell that place. He helped put together a punch list and found good subs for some of the work. When I was running late and couldn’t find a short in the electrical system, he showed up at 5:30 am on the morning of the open house with a thermos of coffee and a pair of coveralls. He was on his back in the crawlspace for an hour and found the short. He moved some of the staging around to make it work better. He washed his face in the sink and put on a great open house. Later on, he helped me to see that the below-price offer I got was probably the only one I would get– and a bargain. When the first lender backed out, he found another to do the deal and got it to close not just on time but a couple of days early. He actually saved my posterior.

    So I think it is a very well-crafted monopoly, but people could make better choices.

  123. 123

    By Deerhawke @ 122:

    I bought a property in June and the listing broker was as flat-out incompetent as they come. He messed the paperwork up unbelievably. But he is a top producer and since intelligence was clearly not the key, I asked him what he thought was the secret to his success. He said he was a good closer because he has a deep reassuring voice, a good empathetic nod while maintaining eye contact and a “heavy finger” when he shows people where to sign.

    I went through a transaction two years ago where the listing agent was around 30 and an ex-model. This person could make three spelling or diction errors in one short email sentence despite spellcheck. (“I will defiantly jet back in tough today.”) I asked her the secret of her success and she said that all women want to work with another woman who is fashionable. Men like the tasteful decolletage, tailored skirt and heels –and a sympathetic hand on the arm.

    Welcome to my world. The problem is too many people pick agents due to name recognition and/or advertising. Oh, and there’s that picture too! Or else they want an agent with a high volume of transactions, not realizing how they get that result and that having that volume almost certainly requires a team of agents of varying quality.

    Back when I started real estate I was a bit more respectful of the quality of agents, but that’s probably because I better remembered how bad some attorneys are!

    Finally, as to your good agent example, I hope they didn’t actually fix the short in the electrical! I don’t mind diagnosis, but actually doing the repairs on electrical probably is a licensing violation. That’s the one area I won’t touch at all.

  124. 124
    ARDELL DellaLoggia says:

    RE: Deerhawke @ 122

    The only reason we started the mls (nationally) was to offer to share commissions with one another. We can’t legally do that with unlicensed people.

    I don’t think people know what the mls is.

  125. 125

    RE: ARDELL DellaLoggia @ 124 – And by “share commissions” Ardell probably means: “So that a seller can indirectly make an offer of a commission to an agent who knows a buyer, such offer being made through their agent who lists the property.” That’s basically how MLS services work–that and including listings from multiple brokerages so you don’t have to look multiple places.

  126. 126
    ARDELL DellaLoggia says:

    RE: Kary L. Krismer @ 125

    OMG No! Don’t you know what the mls is? Ever read a Listing Contract?

    That’s insane. You’re pulling my leg.

  127. 127

    RE: ARDELL DellaLoggia @ 126 – Oh great, Ardell wants to pick another fight with a lawyer on a topic she doesn’t know squat about.

    From paragraph 4, commission:

    Seller will pay [listing] Firm a commission of ___% of the sales price, or $_______ (“Total Commission”). From the Total Commission, Firm will offer a cooperating member of MLS representing buyer (“Selling Firm”) a commission of ____% of the sales price, or $___________.

    So basically the seller is paying the commission through the listing firm. And if you don’t believe that, how do you explain what happens if the seller breaches? The buyer’s agent will start an arbitration against the listing firm and likely be found to owe the money to the other agent and then the firm will have to sue the seller if they won’t pay.

  128. 128
    jon says:

    More shots fired in the careful dance to gradually automate the role of agents without being forced out of business by being cold-shouldered first: https://www.geekwire.com/2017/zillow-ceo-calls-redfin-threat-organized-real-estate-says-rival-wants-get-rid-buyers-agents/

    It took decades before railroads could stop paying employees to ride in cabooses. The real estate agent system will be much more difficult to get rid of, as Deerhawke’s exquisite comment above illustrates. Perhaps what it will take is a website that meets the emotional needs of the buyer and seller in addition to the informational needs.

  129. 129

    RE: jon @ 128 – I wouldn’t really consider the opinion of anyone who works at Zillow as being informed. They are an advertising company, not a real estate company.

    Funny you mention cabooses. Just yesterday I was thinking about that very point (and also wondering where the word came from). I haven’t looked into this, but I hypothesized that the death of the caboose was due to automated switches. Basically, that if they flipped a switch they probably had to flip it back after passing through. I’m sure they did other things back there, but my guess is that automation and remote control is what killed them off. Still no guess on where the word came from–I’ll need to research both points at some point.

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