Maybe Renee Porsia either didn't ask her client the right questions or doesn't know how to pick the appropriate house for her clients. There are definitely two sides to every realtor/buyer relationship and if both aren't in synch, it won't work.

I for one think it is ridiculous that agents make about 30K on the sale of a 500K home. My agent showed me 5 homes and really I didn't need to see that many and made about 20K in a week after spliting the commision and selling my house. And really there is no way you can get around paying them. I do find them beneficial is selling your house but as a buyers agent unless you are relocating they are useless. I 'm sure this is one of the forces driving short sales since you were able to borrow with no money down. If you make 5-6% over a few years and have to move you have to hand over your investment earnings over to the agent for what? What do they actually provide besides a monopolized service that anyone one could do based on some of the experiences that I have had.

I just went through this article by Renee Porsia, and I cannot be more incensed by it. The premise of the article is that the buyer should take the real estate industrial complex at face value. The asking price is the right price, the comps given to you by your agent are all legit. The market "analysis" propagated by the agent are all "correct." If you question any of the steps in the process, you're being not "nice."

I ask any reasonable person: if you hand someone a check for 30k after a few hours of work, how much "nicer" can you be?

I think part of the issue for me (as someone who would like to buy a house in the next five years) is the incentives for agents are not in sync with what the buyer wants. Ideally for the agent, the buyer sees one house, buys it and that's it. Big commission with little work. Ideally for the buyer, s/he gets a great house for a great price, no matter how many houses that requires seeing.

While both parties want the buyer in a house, the agent wants the buyer to do it as quickly as possible and may not care if the buyer's choice is the best for him/her.

Paying a straight fee for services rendered might be a way to keep the grumbling from agents down, but that might just generate lazy agents who show 10+ houses without researching them properly.

It doesn't seem like there's an easy solution.

Here is a link with a nice summary.

http://www.miamicondoforum.com/?p=1120

I especially like this comment: "You toil for 1.8 years to pay a Realtor for a couple of hours work".

Realtors required only a pulse to make money during the boom. Incompetant individuals stumbled on a gold mine. They had better prepare to go back to the unemployment line...

Jamie,

I think this does argue for some more Realtor discipline when interacting with prospective buyers. I'm been very pleased with my buyer's agent, but it's largely because we entered into a binding agreement setting up an agency-client relationship upfront before I asked them to do any real work (and, I should say, only engaging in that relationship after receiving a trusted recommendation, and since many Realtors rely on referrals for business development...).

I think that Realtor's who do a bunch of work before cementing a agent-client relationship are just asking for trouble. Likewise, I think buyers (those that want Realtor assistance anyway) who do not have someone under contract working in their specific interest under set terms and conditions are setting themselves up for trouble, too.

A client relationship also establishes the seriousness of the buyer. Establish this relationship up front and a Realtor should never have worry about the number of homes that need to be shown because there's a payday awaiting them at the end of the process, regardless of how long it takes (within the specified parameters of the agreement, of course). I personally have no qualms with making an agent actually do a little work for the money.

Do the agreement up front, and you can walk the buyer through the process, tell them how to get pre-qualified, send them off house hunting and tell 'em to give you a call when they've found what they want to see.

My own agent has been pleased to show me any house I've ever asked to see, and even took several and showed them consecutively - I think I saw 8 houses in a single afternoon, but then again, maybe I've just got a great agent, or least one who agreed with me when the house I was seeing was a real dud and it was time to find some more.

I just can't help but think that Renee Porsia is setting up her lame rules of buyer etiquette based off of those damnable shows on cable TV where the buyers see 4 house and make a choice almost on whim. The only thing real about those "reality" TV shows though are the camera crews.

Porsia is being ridiculous. There is no "etiquette" here; a buyer who decides not to buy is inconvenient, but not displaying bad manners. A good salesperson is valuable, but when she starts thinking she's entitled to a sale on her own terms, then she's delusional. And a buyer's agent is not the solution, because that person is still interested in getting the client to spend the most money in the shortest possible time. I think realtors can add value, but buyers need to keep in mind that, at the end of the day, after the nicey-nicey, or claims of offended etiquette, it's still all about the money.

The problem isn't how many houses an agent shows you it is how much they get paid for a very small investment. Because of the Market monopoly agents get a huge percentage 6+% of a homes value when they didn't even make the investment. If a buyer would have to pay an agent out of their own pocket do you think they even would use one? The cost is nothing for the buyer but it's huge for the seller!!!

That's pretty hilarious as well as being pathetically arrogant. I don't think you sign an open ended contract promising to buy a house. If the realtor can locate a desirable house for an acceptable price int the agreed upon time frame then a deal can be completed. The realtor is a facillitator and nothing more. I've dealt with a seller's realtor who took several days to respond to simple questions, return counter offers, set up home inspections etc. Talk about poor behavior boarding on an ethical lapse, I'm sure she eventually cost the seller's thousands of dollars after prospective buyers walked away.

All the data being available online - what are realtors for?

Jamie:

Why are you succumbing to this agitprop? You are better than this!

realtor not Realtor! That summarizes the ethos of Porsia's article: shoddy writing/logic and superciliousness.

realtors are a dime a dozen. Finding a good one worth their commission is harder than finding a well-priced house. But they are out there... better to spend most of your time looking for a house.

Shaker: couldn't tell if you were being sarcastic... but I would demur about a binding agreement, especially so early.

Must be too late for me, jake, because I'm not sure I'm following your question. Are you asking why I capitalize the "r" in Realtor? I follow our stylebook's lead on that. Same reason I don't put a comma before the "and" in a list of three things. :-)

As a first time buyer, I find this conversation a bit strange.

If I didn't have a buyer's agent, I would have no clue what I was doing. The process is very confusing and intimidating if you've never done it before.

My agent showed me house, helped me identify advantages and problems in them, helped me find comps to feel I was getting a reasonable price, knew what was reasonable to ask of the seller after inspection, and has made sure nothing's been forgotten between the contract and closing.

With zero experience in homebuying, there's no way I could've done those things on my own, much less feel confident about whether it was all done right.

Thanks for weighing in, everyone. I've heard a lot of what people ~don't~ want. But I'd like to hear more of what you do want. (Suggestions and advice, in other words. Griping, not so much.)

Some of you might feel perfectly able and willing to buy and/or sell a home independent of an agent, setting aside multiple-listing issues. But for those who need at least a little bit of assistance (which applies to most everyone, wonks included), what's helpful and useful?

From the NAR's Membership Mark Manual:

"The National Association is the proud owner of numerous marks including but not limited to the terms REALTOR®, REALTOR-ASSOCIATE®, REALTORS®, the REALTOR® Logo and the Block "R" mark (which may be referred to collectively as the "MARKS")."

What are Realtors good for?

A. Taking your investment profits
B. Holding a Monoploy
C Doing a job that any simplton can do
D All of the above

I am a renter, looking to be a first time buyer.

What I don't need from a realtor:

1. Lists of homes - With the wealth of information that's available on the internet, I don't need my realtor to feed me a list of homes. If anything, I feel that I'm more familiar with the small section of the market I'm looking at than any realtor will be.

What I do need from a realtor:

1. Point of contact for seeing a home - When I do find a home that I want to see in person, I feel I need to call my realtor. The main reason is I don't want to deal with the listing agent.

2. Someone to write up the offer and guide me through all the other stuff

What ought to be the negotiated term of engagement is the commission percentage.
Further, It is not true the real estate commission costs the buyer "nothing". The seller is paying it, but the buyer is paying the purchase price upon which the commission is calculated. A percentage of the buyer's agent commission ought to return to the buyer. Redfin.com already does this, by @ splitting their agency fee with their client, the buyer. I would not deal with any real estate agency that would not match this Redfin.com offer.
Sellers should negotiate a lower percentage commission with their agents, and perhaps consider offering a bonus worth .5 to 1% if the home sells in a short time period, e.g. closes in 45-60 days.

Buyer said:

" The cost is nothing for the buyer but it's huge for the seller!!!"

I'm going to have to agree with MET. The funds for an agent might have to come out of the total sale price and thus some people think the seller pays, but fundamentally, when you buy a house, all the money comes from the buyer. It's the buyers money that gets distibuted, so in essence they pay for everything.

Lets be honest...a real estate agent is not needed in this age of the internet. Sorry to all those who are real estate agents. Instead of a first time home buyer tax credit to those who can't afford a home anyway - why doesn't the government do what needs to be done? Simply eliminate or cut down on outrageous closing costs and agent fees and other "paper pushing" thievery. The amount of money an agent receives for unlocking and locking homes is WAY TOO MUCH!!

By the way - Maryland area home prices are nowhere near bottom. I see at least another 20% drop. At least.

Apparently, there are more realtors in the US than in all the other countries of the world combined.

Ditto to Kevin's comments about what a prospective new buyer needs from their agent. I would add to that---
My buyer's agent is awesome. Patient, willing to show whatever is of interest on short notice, walks us through the specifics of the general systems of the house (plumbing--is it pvc, copper or galvanized?); electric (how many amps); if it has CAC (is it flex line or ducts) and on and on. If you already have owned a house, these things might be a waste of time, but I find it very helpful.

When it comes to writing up the contract, he liaisons with the listing agent and advocates for our perspective.He pulls comps and takes into account my input based on the review of the comps.

I was skeptical about using a buyer's agent at first, but his knowledge about the ins and outs of home ownership, repair, and real estate valuation and what it takes to make a deal happen is really fantastic.

I want to clarify what I said earlier: I don't think Realtors are worthless but they are not worth what they are being paid. Many are getting paid the same as a neurosurgeon when they don't even have a college education and don't need one for what they are doing. I like my Realtor and the work that he does but I don't like the fact that I was forced to pay him $30K for a few days work. I Know - many of you are going to say that I could have sold it myself but when the NAR realtors have a monopoly it is harder then it should be....

Re: "Looking" who loves his/her buyer's agent --"When it comes to writing up the contract, he liaisons with the listing agent and advocates for our perspective" -- I can just imagine the "liasing" that's going on with the listing agent: Buyer's agent: "My client can afford 400k but is only offering 380k, so have your buyer hold out for 400k, and we'll both make more money on this deal." If the Buyer's agent is not doing that, then he isn't behaving like a normal human being. (Normal human beings prefer getting more money to getting less, especially if the client is unable to figure that out.)

As a Realtor who mainly works with first time homebuyers looking for homes that are priced between $200,000 - $300,000, I have to say that there needs to be a restructuring of the commission scale. I work just as hard for a sale at $200,000 as I do for one at $600,000, but the commission is completely different. My responsibility to the buyer or seller is exactly the same no matter the price. I don't do less for a client who buys an affordable home compared to a luxury home. Overall, I think there will be a large change in the profession in the near future, but I also believe the profession will not go away 100%. I think there will be a time when buyers will pay for the services of an agent. The key item is value. Our clients need to see value in our services. From what I am reading on this blog, many don't think we offer any value. If you don’t think your agent is providing you a valuable service, fire them and move on to someone who can.

I too dislike realtors. But to me the most absurd part of the commission is the basis. Realtors should be paid a percentage of the difference between what the seller paid and what the sellers receives. For instance, we sold a house in Florida for a "profit" of $25,000. But the realtor got 6% of the selling price, not a percentage of the $25K. I'd be happy to up the percentage, say 10% or even 15% of the gain, but for the realtor to make a commission on the full selling price is absurd.

Since all the money comes from the buyers through the sales price at closing and it is true that even though you are not paying your buyer agent directly, they are making a commission from the seller's agent. Therefore you are paying for it as a buyer. But try convincing a For Sale By Owner to sell their house at 5% discount compared to their neighbors. I just don't see that happening much and I bought my home from an owner sale. They want the "market value" too.

With all the talk of realtors is there a code of ethics a realtor must follow? I had one who would send me emails with foreclosures listed in my neighborhood, suggesting that the same thing would happen to me if I didn't sell my house quickly before getting in trouble financially. Is that ethical? I felt she was preying on my fears, as it turned out I did not have to sell my house, but simply needed it refinanced.

Yikes, whirrrp -- glad it worked out all right for you. I don't know the answer, but if you'd like to complain, you might try the Maryland Real Estate Commission (www.dllr.state.md.us/license/occprof/recomm.html) or the Maryland Attorney General's Consumer Protection Division (www.oag.state.md.us/Consumer/index.htm).