Why Are Real Estate Agent Fees So High?
Today, Real Estate Agents earn a substantial commission (4-6%) to sell your home. As the housing prices are increasing throughout the country, it begs the question, “Why are Agent Fees So High?” and “Why Can’t I Keep More of My Money?”
History of the Commission
Prior to the internet, real estate agents were essential to the sale of the house. No Zillow or similar services meant that every tour and introduction needed to be done in person. There was no standardized way for a buyer to find a house online, so people would often visit major real estate companies to view their listings or follow a sign by the road with the writing “Open House.” As a result, larger real estate companies had a competitive advantage due to their name recognition and access to more exclusive listings.
Zillow and the Rise of the Internet
After the introduction of services such as Zillow and the increase in online searches for houses, the 4-6% commission that real estate agents asked for in the past has become outdated. Larger real estate companies do not have a monopoly on house referrals and according to a recent Yahoo Finance Article, due to the increasing number of virtual tours and the effects of the recent covid-19 pandemic, around 5% of people do not step foot in their prospective new house before buying. While a Washington Post Article claims that around 60% of people make an offer on the house without physically visiting the property. This means that houses are readily available to view online and databases have access to nearly every house in the United States. Real estate agents still serve a major role in preparing a house to be sold or bought and completing the proper legal paperwork that people are unaware of, but the high commission system has become outdated.
Commission Savings With 65FIFTY Realty
The Future of the Commission
The lessening need for the real estate agent has sparked debates online regarding the necessity to pay a high commission. A New York Times Article analyzed this issue and found that real estate agents look for the greatest commission and not the interest of the client and as a result companies like Redfin (Similar to Zillow), will begin to show the agent commissions on listings, proving that there are alternatives to the deceitful high commissions we see today.
What Are the Alternatives?
Seeing an opportunity in the Los Angeles real estate market, 65FIFTY Realty was formed. The objective was to get rid of the high commissions and charge a flat fee of $6,550, no matter the value of the home. Real estate veteran and founder, Anthony Tavera (CA DRE #0145045), was tired of people losing money from their house and knew there had to be a better option:
Anthony Tavera
“I’ve seen people lose thousands of dollars in commissions to real estate agents and in a hot housing market like today, it’s important for people to understand there are alternatives when selling your house.”
Real Estate. Transformed.
The method has become so successful, that 65FIFTY has excelled past its pears becoming one of the biggest names in Los Angeles and dominating the San Dimas, Glendora, and Pasadena areas. Having saved over 1.5 million in commissions in 2021 alone, 65FIFTY is just getting started and is ready to save millions more for its clients.
