6% & 3% = Sacrosanct

Saturday, I posted a video about the proposed settlement of one of the class action lawsuits against the National Association of Realtors.

Nobody watched it.

I am not surprised.

Nobody outside of the real estate industry gives a damn right now because people only care about Realtors or the real estate industry when they are selling a house.

That's it.

But from my perspective, the whole thing is interesting. Two parts, especially.

#1 - The news media has it all wrong. I'm always preaching about the media not being our friend and how they say shit to get clicks and eyeballs for advertising.

That is true in this case.

Under the proposed settlement, consumers can now negotiate with Realtors and not pay 6% to list their house.

The media reports that "The standard 6% commission is gone!"

The truth is that the NAR has never set a standard commission, and consumers have always been able to negotiate fees.

But "NAR lawsuit settlement changes nothing" isn't a very sexy headline, so here we are.

[Question: what else is the media getting you all stirred up about that's untrue?]

#2 - But wait! There is a standard commission

Although not endorsed or set by the NAR, 6% is the standard fee that most Realtors charge to list a house, with half generally paid to the agent representing the buyer.

Like any industry, some charge more or less for whatever reason, but 6% is the standard.

And there has absolutely, 100% been collusion among the realtors since for-freaking-ever to keep it that way.

In the private circles and break rooms of the big-box-brokerages all around the country, 6% is the thing that everyone is talking about (but that no one is talking about [wink, wink])

Want proof?

Go join a Realtor group on Facebook.

Everybody is bitching that the NAR "rolled over" and "didn't protect Realtors" from this "unfair lawsuit."

Protect from what, exactly?

I'll tell you: it's the conversation.

From 2005, when I got my license, through 2023, when brokerage was my primary income, my team and I sold thousands of houses.

Rarely did anyone question our fees.

99% of the time, it was assumed.

Of course, it made that part of the job easier. If nobody questions the fee, you never have to discuss it.

And while the lawsuit hasn't changed the rules very much, it has changed the public's awareness.

And the vast majority of Realtors are terrified of that awareness because the vast majority of them can't justify what they charge for the shitty service they provide.

That statement makes me quite unpopular among my peers, but it's true. As I noted in Saturday's video, even the NAR admits that realtors are untrained, unprofessional, and/or incompetent.

Two things are evident from all of this.

One, all of those untrained, unprofessional, and incompetent Realtors are making it quite clear how this lawsuit came to be in the first place.

And, two, the media, as usual, has no idea what they're talking about.

There may be a silver lining in all of this, however. If (and that's a BIG IF) this causes any real change in the industry, there will be a massive opportunity for the great agents to demonstrate that lower fees don't necessarily equate to a better outcome.

Most, out of fear, won't see that opportunity.

They'll only see that their sacrosanct 6% might be in jeopardy.