Real Estate Commissions and Procuring Cause
I.How Real Estate Commissions Work
This post comes at the suggestion of my wife. Until she met me, she apparently had no idea how real estate commissions worked. I, on the other hand, grew up around this stuff. My dad has owned a real estate brokerage in Maryland since the late 1970’s, so I probably understand it too well for my own good. This leads me to assume it is all common knowledge, but as in most cases, my wife is probably right.
While there are always exceptions, real estate commissions generally work in the following manner. A seller lists a property for sale with a listing broker. If the property sells while listed, the listing broker will earn a commission for providing brokerage services to the seller. The listing broker may choose to offer a cooperating buyer-broker a portion of the listing commission. If the cooperating buyer-broker is successful in bringing a buyer ...Read more
As covered in a previous blog post, all MLS listings are now online. Except for some private information, consumers are privy to the same information as agents. This fundamentally changes the role of a real estate broker. Real estate brokers are no longer the sole conduit of marketplace information. In the pre-internet days, brokers had to go to a brick and mortar real estate office and open a book with actual paper to see what listings were available. Finding a listing in the book did not guarantee there were pictures of a particular property, so agents routinely made trips to preview properties for clients and to make sure they fit certain parameters. Agents still had to show properties to clients, and only then would the client decide whether it was right for them. In the pre-internet days, real estate brokers were the vehicle that drove home sales. If an agent put in the time and effort, he or she could become a market expert. Brokers ...Read more
"Correct or not, consumers have confidence in the big brand name.”
The above quote is from Art Bartlett, the Founder of Century 21 Real Estate and the Godfather of real estate franchising. I think the first three words are the most important. Mr. Bartlett does not seem to provide the best endorsement for choosing a big brand real estate brokerage. If that was his intent, wouldn’t he say so? Shouldn’t a quote about the most successful real estate franchise model EVER be about helping consumers? I think Mr. Bartlett was probably an awesome guy, but his model doesn’t seem to help buyers and sellers make the best decisions. It likely helps big brand brokerages attract consumers, but that’s about it. It should be noted he made this comment AFTER he sold the entire Century 21 brand. At least he was honest.
Taking things ...Read more
Which website has the best real estate search engine with the most “exclusive” listings and “top rated” properties? Well, the short answer is all of them. They all have the SAME listings, even the bad listings. Really, they all have the same information in different formats. Sadly, many are attempts to confuse or sway the consumer.
Huh? So here is how it works. Real Estate brokers upload listings into the MLS (Multiple Listing Service). The MLS is a service that allows agents to search for available properties. The MLS is then disseminated to hundreds of paying websites through IDX (Internet Data Exchange). The agents are privy to private information (think: seller contact info) on the MLS, but most of the listing is public, especially the important stuff like price, pictures, location, etc. The websites then display all of the listings in different formats. It is really that simple.
The listings ...Read more
What the heck is Lawyers Realty Group?
Lawyers Realty Group is a real estate brokerage owned and operated by a real estate lawyer.
Wait, back up – what is a brokerage?
A brokerage is a company that facilitates the buying, selling, and renting of real property (think: houses and land).
So you are just like Long & Foster or Coldwell Banker?
Well, I wouldn’t say that (more on that in future blog posts), but we can accomplish the same results, usually in a more efficient and knowledgeable manner.
But why would I need a lawyer to buy or sell a house?
The best answer came from another lawyer I know – Why WOULDN’T you want your real estate broker to be a real estate lawyer? There tend to be two types of people regarding lawyers. The first group gets a lawyer before they “need” one (i.e, before they are in a tough spot). The second group gets a lawyer after they “need” one (i.e., – the S has already hit the fan). If you want to buy ...Read more