Remember when you could trust the network news?
Many of you may have had an opportunity to watch a feature on "60 minutes"this past Sunday that dealt with the subject of the internet in Real Estate. At least that was what it was supposed to be about. What it ended up being was a very biased attack on an industry. The story was full of what I will graciously call inaccuracies some of which I will address here.
It was also very noticable that, while the National Association of Realtors (NAR) was "quoted" by Leslie Stahl, we were never seen on camera. The fact is, we worked for over a year with CBS on this segment, and offered 3 different people to make comment, including NAR President Pat Coombs. They did speak to one agent, although it appeared to me that her answers to some questions were left on the cutting room floor.
The subject of the show turned out to be an attack on Realtor commissions. They wanted to show that full service Realtors are (and should be) going the way of the dinosaurs. While the internet is a vital tool today for buyers and sellers, it can never replace the experience and hands on touch of a professional Realtor.
Buying a home will always be a very complicated transaction, with many intricate parts that must fit together perfectly to close. That hasn't changed. But, I guess my 2 biggest gripes with the story are these.
First of all, the myth that 6% commissions are "sacrosanct", to use Ms. Stahls own words. Nothing could be further from the truth. Commissions are now, and always will be a negotiable item. Some agents stick to 6%, some take 5 or less. It's market driven, as it should be. Many discount brokers charge far less than that for limited service.
My second gripe had to do with a question asked of the ReMax agent about how she would compete with the online "agent" that saved their client so much by giving rebates. What I wish she had said (if she knew it) is that selling through a Realtor will net a buyer around 16% more than selling for sale by owner. For example, in our market where the average price for a home is somewhere around 180K, that means that AFTER paying commissions, they would have received an additional 10% of what they sold for, or $18,000. They were happy with the money they saved. I don't know what they sold there home for, but I would venture to say that, being in the Seattle area, their home probably sold for 2-3 times what it would for here, meaning they potentially left 50-60k on the table! All to "save" 5-6%! I'll be talking at length for a while on this subject, as it has me pretty riled. Walter Cronkite must be very proud of CBS right now.....