FSBO Talk Straight discussion about buying and selling homes with out the use of traditional real estate methods.

Real Estate Trends

Are Real Estate Commissions excessive?

My wife and I recently had our vaccineshots. Of course upon exiting the Pharmacy my wife's first words were "so where are we going on vacation?". We decided on a nice beach resort in Cabo SanLucas. When we arrived therewas large group of about 600 real estate agents from XXXRealty. They were having. sales/marketing/recruitment event. We spoke with many of the attendees and they were a pleasure to be around.

For those who do not know XXXis a relatively new Real Estate Brokerage with a different twist for revenue sharing. They have been growing in great numbers and I can understand why. From what Iunderstand, agents not ony receive commissions for theirown sales but also receive revenue from any agents under them. As well as revenue from downstream revenue from those agents. Much like you would see with an Amway or other multi level marketing group. I might not have it 100% but you get the gist. During our conversations I wouldoften hear about "XXX" agent with XXXdownstream agents making $XXXa month in residuals from those gets. Some of those agents were getting anywhere from $10,000 - $100,000 month.

I have to admit, as a Broker myself, those numbers sounded very attractive. Plus Ibelieve those were realnumbers. They were not just being made up. However being a true believer in FSBOI had to start questioning, how much commission is reallywarranted? I have no qualm with an agent making a nice living doing real estate. There are some great agents out there who are worth every penny.BUT if someone is making $50,000 a month just off of residuals fromother agents, isn't the system a bit bloated? I realize not everyone in that group was making $50K a monthbut I did hear a lot of $5,000 - $20,000 month in residuals plus their normal commission.

I am a big believer in giving home owners a choice in the way they sell their home. At TexasFSBO/MyCastleRealty our clients have the option of For Sale by Owner/Flat Fee MLS or Full Service Realty.