Competition and Real Estate

https://www.justice.gov/atr/public/real_estate/index.html

The Importance of Competition in Real Estate to Consumers

Buying or selling a home is the largest financial transaction most Americans will ever undertake. The median priced home cost $184,334* in 2009, and the median commission paid to real estate brokers came to $9,733**. Overall, Americans paid nearly $60 billion for brokerage services.

Home prices and commissions over time

• Competing models of real estate brokerage

Alternative Compensation Models: Quick Math

by Glenn Freezman

A large part of what I think about every day is how our industry can create new models that are fair to both home buyers and the agents who serve them. For me, alternative compensation models are creating a doorway that allow agents to do a better and more fair job of representing their home buying clients while still getting paid in a manner that is respectful of their professional status and the hard work that they do.

Alternative compensation models are basically real estate agreements that allow money to be shifted in a different way. For example, if an agent were to take the money that was earmarked for their commission payment at the closing of a deal and put it on the table as a refund or rebate for the home buyer do you think that would get the buyer's attention? Of course it would. However, the average Realtor isn't in the business of working for free (at least not on purpose!) so this agreement also means that in exchange for that possible rebate, the home buyers need to pay their agent directly for his or her time and assistance on an hourly or task based agreement and that if they make it all the way to the closing table then the refunded commission goes back in the buyer's pocket to cover closing costs or anything else.

There are some interesting things happening when it comes to doing business in the current environment.

• If it used to take 30 days to get a transaction closed, it now takes 120 or more
• If it used to take 20 contacts to get someone to listen to you, it now takes 100 or more
• If someone was inclined to do business with you before, they are now inclined to make sure they are getting the best deal regardless of their relationship with you

As a champion for home-buyers and alternative compensation agreements, I'm often challenged by Realtors and homebuyers alike regarding who ends up paying what at a typical real estate closing. The most common belief is that homebuyers don't pay the commission costs that go to the sellers and buyers agent - because that money ends up coming out of the seller’s pocket.

While I won't argue that that's what the mechanics of the deal look like, I will point out that every single cent involved in the transaction came out of the home buyer’s pocket first. Pretty simple math: no home buyer = no money to pay the agents.

Is a loan with no fees or origination charge the best deal?

Is a loan with no fees or origination charge the best deal? Maybe. Never forget that interest rate is only half of the equation. Rate AND fees are the whole equation upon which you should make a decision. When talking to borrowers who have been shopping rates, I always ask the same questions. What is the term of the mortgage, are both mortgages fixed rate, and what costs are associated with the mortgage. Read more

https://activerain.com/blogsview/2412434/is-a-loan-with-no-fees-or-origination-charge-the-best-deal-

I posted this on Active Rain at https://actvra.in/fpd if you would all be so kind to add your comments..  Thanks in advance. It is also on the Tomes Commmunity at https://www.theconsultingtimes.com/blog/archives/2011/07/always-leave-something-on-the-table.html

I posted a blog on active rain https://actvra.in/ffn.

It's alo posted on the Community Exchange, your comments are appreciated.  Thanks in advance to Cindy, who has not missed one yet! 

National closing costs rising

Across the nation, closing costs are on the rise and are up 8.8% over the last twelve months. Origination and title fees on a $200,000 home loan average $4,070 nationally according to Bankrate Inc.’s 2011 Closing Costs Survey.

The four most expensive states are New York with average closing costs of $6,138 followed by Texas at $4,944,

https://agentgenius.com/real-estate-news-events/average-closing-costs-have-risen-8-8-from-last-year/

Where is the animated video with the Dr. Buyer interviewing the lady realtor?

I liked it and can not find it on ACRE Youtube

Anybody have the link?

And the other animated videos are not on ACRE Youtube.

Where are they?

Thanks

Real estate licensee cannot draft documents after Buyer located

A real estate licensee has a friend who has agreed to buy a home from a FSBO Seller. The friend wants the real estate licensee to draft the purchase contract and other documents for a fee of $300. Can the real estate licensee draft these documents and charge the friend $300?

Answer:

No. Under Article 26 of the Arizona Constitution a real estate licensee acting as a broker or agent in the transaction can draft documents incidental to the sale or leasing of real property. The real estate licensee, however, cannot charge for the drafting of these documents.
Arizona REALTOR® Digest November 2004