[jliptzin]

Pretty simple to fix actually. Charge a flat fee up front, like $1,000, to do the initial listing. Get the house independently appraised, maybe subtract 10%. Give incentive commission equal to the difference in the sale price and the discounted assessed home value * 20%. So if the agent manages to sell a $500,000 home for $700,000, they get a $41,000 commission. If the home sells for 10% below its market value, they only get the $1,000 compensation for the listing.

Of course this will never actually happen due to the racket currently going on as described in the lawsuit. Why would they agree to this structure when they can already skim 6% off the home price just buy submitting some photos to MLS and opening up doors and closets for people for a few weeks.

[nugget]

In your model you’d simply shift (even more) corruption onto the appraisal process.

[jliptzin]

Still, even if a home appraises for 25% less than it otherwise should, that's still a vastly better compensation scheme than our current system.

[manny_hasyrs]

This will make buying a home very unattractive as an investment.

[jliptzin]

How does changing a real estate agent’s compensation scheme suddenly make home buying a poor investment?

[opportune]

homes shouldn't be investments anyway

[snovv_crash]

Then you need independent appraisals where you pay for the service, but they pay a penalty based on how inaccurate their appraisal is.