[gycom]

The 6% fee (more normally 5% around these parts, western US) is paid by the sellers, but with the buyer's money. Usually. However, it's important to note that there was never a requirement for anyone to pay anything; it was simply what was commonly put into contracts. The settlement didn't change anything about that in particular.

I just sold a house a couple weeks ago. I agreed to pay my seller's agent 2.5% out of the sale price. I also, in the contract, offered to pay 2.5% to the buyer's agent. In the event that my seller's agent was also the buyer's agent, that 2.5% would be refunded to me. What actually ended up happening was that in the offer that we ended up accepting, the buyer asked us to pay 3% instead of 2.5% to their agent. We agreed.

[greenfish6]

The primary driving factor on all these rates is the net take home for the seller. The reason why the total fee of 6% in a 3/3 split is because if this is done, then the seller will net about 10% higher than if they used no realtor. Similarly, for the buy agent half, they will get multiple extra % of home price above that 2.5%.

The structure of the MLS / commission system incentivizes sellers to take out these large fees because they will be rewarded for doing so. Only when the system is upgraded to allow sellers and buyers to find each other and pay market rates will the fees go down (we want to provide our own MLS in the longer term future)

[poulsbohemian]

>then the seller will net about 10% higher than if they used no realtor

See this is the bit where a good Realtor makes their money... on nearly every deal I do, I am saving or making more money for my buyers and sellers over what they could either do on their own or what they would get from another Realtor. Why? Because I have a strong analytical approach to the market and I actually do my job. The typical agent waits for offers to come in and makes no effort to negotiate a better outcome for their seller. Likewise, many agents are lazy and have no idea how to advise their buyers on what to offer or how to create an overall compelling offer, IE: what are the possible levers we can use to create a competitive offer apart from cash on the barrel? It makes me cry when I see agents who don't even know what acting in their client's best interest means - but I don't blame them, I blame the public that makes no effort to interview or get to know their agent. Way easier to pick the person from your church or who you went to high school with than to actually interview and ask questions. I often wonder - does the public also act ignorantly when picking a lawyer, an accountant, a doctor, or other professionals?

[BostonEnginerd]

Yes, most of the public uses the doctor which is assigned to them when they have something go wrong.

The trouble is that it’s hard to distinguish between “friendly and nice” and “competent”. This is how people end up paying a financial advisor almost 2% to buy index funds.

It would be nice if we could rely on certification by third parties as a mark of competence, but clearly that’s not enough.

[gycom]

"Our own MLS" already exists in multiple forms; getting everyone to agree to use the same one is the problem, and AI isn't going to solve that.

[aiaiaiaiaiai]

As a non american, why arent the other sites getting used? And why does MLS cause this fee structure anyway? Why dont sellers give a 3% discount or cashback to agentless buyers too? It would be in their interest. The cashback would effectively reduce the downpayment.

[throwway120385]

The buyer's agent handles some matters of the contract like properly notifying the seller of defects found during an inspection by form. There's a process for that that is meant to prevent the buyer from disadvantaging the seller if the house ends up back on the market. There are other things the buyer's agent does, like ours would sometimes temper our reactions when representing us to the seller's agent. She would also let us know when items on the contingency timeline were expiring and what our options were after those deadlines. That's not something I had the time to figure out on my own.