'Million Dollar Listings'
Has anyone else had the chance to watch an episode or two of that television show, "Million Dollar Listings." Can someone please explain to me just exactly what special expertise those three low-talent real estate agents bring to the table to justify $200,000 to $300,000 or more commissions? None of the episodes I watched revealed anything these guys did, other than show potential buyers the property and make a few telephone calls.
And is it ethical for an agent to represent both buyer and seller and demand a "double commission"? Under this system, the agent had no incentive for getting the price reduced for either client, because that would only serve to reduce his, the agent's commission. (I saw one episode where the agent with the Bobby Goldsboro hair-do convinced his buyer client to raise his bid substantially, and that just did not appear to be quite right.)
Would it not be more fair for an agent to be entitled to a minimum commission, say, one or two percent of the listing price. Then EARN an additional commission of, say, ten or fifteen percent of the amount he saved his client, the buyer, from the listing price. So, if a property listed for a million dollars, he would be entitled to a minimum of $20,000 (at a two percent minimum). And, if the buyer ultimately got it for $900,000, the agent would get another $10,000-$15,000.
And is it ethical for an agent to represent both buyer and seller and demand a "double commission"? Under this system, the agent had no incentive for getting the price reduced for either client, because that would only serve to reduce his, the agent's commission. (I saw one episode where the agent with the Bobby Goldsboro hair-do convinced his buyer client to raise his bid substantially, and that just did not appear to be quite right.)
Would it not be more fair for an agent to be entitled to a minimum commission, say, one or two percent of the listing price. Then EARN an additional commission of, say, ten or fifteen percent of the amount he saved his client, the buyer, from the listing price. So, if a property listed for a million dollars, he would be entitled to a minimum of $20,000 (at a two percent minimum). And, if the buyer ultimately got it for $900,000, the agent would get another $10,000-$15,000.
Comments
Uh, they don't have any special expertise. This is pretty much how most all realtors work.
I don't believe that it is, but realtors will say they have a code of ethics, so it is ethical. Make sense?
It's the way the entertainment industry works.
It's a slippery slope, and most brokerages discourage being a dual agent. I've had the opportunity on listings I've had, and told the would be buyers to get an agent or a real estate attorney, and referred them to people I trust.
Normally both buyer's and seller's agents are working against you as both stand to make more if you pay a higher price, but this is one way to turn the tables.
The way the entertainment industry work?? No, my friend, I am in the entertainment business and this is how the RE business works.
RE is the only service industry I know of where one can enter the business with a basic set of skills and expect to extort 6% of someones wealth. (actually now that I think of it stock brokers are another set of individuals)
Hopefully with the collapse of the RE market nation wide we will see the collapse of collusion between RE companies.
Later in this episode, "Bobby Goldsboro" is "helping" a friend purchase a $6 million-plus Malibu Colony property. After he has made his half-dozen phone calls, negotiating the purchase price, and earned an un-godly commission, they show him immediately afterward in his office, in front of the mirror, applying tons of hair-spray to his hair-do. As if the producers were saying, "Yeah, that was indeed 'hard work.'"
Of course it's the way RE works...but show me a Realtor on the listing side or the buying side for Hollywood A-listers in Malibu (Chad Rogers neck of the woods) or other high end areas of L.A. such as the Platinum Triangle (Beverly Hills, Bel-Air, Holmby), Hancock Park, etc that isn't connected either through family or friends in the industry.
I'm not saying that they aren't skimming 6% on high end transactions with no real skills, but before they are able to do so, they have to know someone first. It's usually through their parents.
I grew up with some of these types of "kids" (Not Chad Rogers however).
Besides...what's a few hundred thousand between friends when they are all worth $100MM+?
This isn't your typical RE for mere mortals.
EconE hit that one on the head, the agents doing neighbourhoods that drive the premiums of $2m+ are in that system because of family/friends/connections. They typically actually get 6% on those houses as people who buy there want to be in if they aren't already.