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How to handle the explosive–and difficult–Mississauga real estate market – insauga.com

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Three years ago, worried first-time homebuyers wondered—for good reason—if they would ever be able to own a home (even a very small one) in the city they grew up in. 

Their fears were legitimate. A lack of housing inventory prompted desperate buyers, some with much deeper pockets than others, to sometimes throw an additional $100,000 (or more) at a seller in order to lock down an already egregiously costly fixer-upper. Buyers were purchasing homes without any conditions (who needs a home inspection?) in order to beat out 10 to 15 other bidders, and realtors were shocked to see dozens—sometimes hundreds—of people converge upon an open house. 

The former Liberal provincial government stepped in with the Fair Housing Plan and pledged to levy a special 15 per cent tax on foreign buyers and speculators in at attempt to thwart investors from purchasing properties and letting them sit empty for years while increasing in value. The federal government also imposed a more rigorous stress test (that it’s now modifying) that required prospective borrowers to qualify at higher than normal rates. 

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The legislation worked and buyers backed off, but the cooling was only temporary and outrageous bidding wars and sky-high prices are once again becoming the norm. 

“I had a client in January 2020 and we made an offer on a condo that sold for $472,000 and had five offers,” says Nik Oberoi, a sales representative with Cloud Realty. 

“One property in Mississauga recently had 27 offers. We’re getting five to 10 offers minimum, again.

Competition drives prices—which are already high—higher. Recently, the Toronto Region Real Estate Board (TRREB) released its monthly housing data and revealed that the average house price (all home types combined) in Mississauga hit $782,415 in January 2020.

Evidence suggests the market is heating up because the previous legislation failed to rectify the most significant issue: A lack of available housing.

“A big reason is there are a lot of inventory issues, [even in the condo market]. There aren’t a lot of good units that have been well-kept. We have a lack of inventory and we have more buyers than normal. We have a lot of new immigrants in Mississauga and the GTA and interest rates are low.”

Oberoi says more first-time homebuyers are entering the market because of the federal government’s First-Time Home Buyer Incentive, which allows buyers to apply for a shared-equity mortgage with the government of Canada. It offers 5 per cent or 10 per cent for a first-time buyer’s purchase of a newly constructed home, 5 per cent for a buyer’s purchase of a resale (existing) home, or 5 per cent for a buyer’s purchase of a new or resale mobile/manufactured home. 

“There are too many buyers right now and it’s a tough time if you’re a buyer,” Oberoi says. 

Oberoi says today’s real estate climate is becoming a repeat of winter 2017. 

“This is happening to everyone. It’s not just happening in Mississauga or the Square One area. It’s happening in Toronto, Barrie, Durham, Oakville, and Burlington. The entry-level price point for one and two-bedroom condos and towns and semis is more attainable for first-time buyers, so competition for these homes is huge. We’re not seeing this with detached houses as much because those have much higher price points.” 

Oberoi says that desperate buyers will purchase condos without looking at the status certificate, which is risky because the certificate can reveal pertinent information on the building’s financial health and whether or not property management is locked in any legal disputes.

But while the market is a challenging one for buyers to navigate, Oberoi says there are steps people can take to help ensure they find what they’re looking for. 

“First thing, get your financing in order. Do not shop unless you have a pre-approval from a reputable lender or bank. If you give a financing condition, the [seller] could pass you over. Do not actively shop without talking to a bank. Think about how confident can you make the seller,” he says.  

“Second, if you want a home inspection, do it before the offer presentation date. It can hold up the offer otherwise. The seller will go with the offer that doesn’t have any hiccups to deal with afterwards.” 

Oberoi also recommends reviewing the status certificate for a condo before moving to buy. 

“If you want to buy a condo, review ahead of time to waive that condition. It’ll make the seller feel more confident. Don’t go into a condo without looking at the certificate. If you love the place and don’t want to lose it, look to see if other properties are selling in that building. If something is wrong, you’ll see a small number of properties being sold.”

Oberoi also says to be prepared to bid over-asking—but only within reason. 

“You have to look at how many offers there are. If there are eight offers, you know it’ll go for more. Every offer adds about $5,000 to the price. So you might have to go $30,000 to $40,000 over asking,” he says.  

“If you want it, you have to be willing to slightly overpay. You save in the long run, because the next seller will want more than what their neighbour sold their unit for, so you mitigate expenses on the next unit that will cost more money. At the same time, know when to stop yourself. If you keep overpaying wildly, you start the bubble. That’s what happens when someone pays a ridiculous price just to win.” 

As for how much is too much to overpay, Oberoi says it depends on what your plan is. 

“If you’re buying for yourself and plan to live in the home for a long time, it’s okay to spend an extra $10,000 or $15,000 [because you will recoup your investment]. If you’re an investor, it’s not a good time to buy because you will be overpaying,” he says.

“Check your emotions and try to be logical about your purchase. People do have more money to spend because of the first-time homebuyer’s incentive. There are more buyers than inventory. It’s not about what the house is worth, it’s what you’re willing to pay.” 

As for what can be done to cool the market and make it easier for buyers to navigate, Oberoi says he’d like to see real estate better regulated. 

“I’d like to see real estate more regulated. Realtors underprice to start bidding wars and we have a responsibility to keep prices in check, especially when we have immigration growth and job growth in the area.”

He also says buyers should work a realtor who knows the market area well. 

“Work with the right realtor. An inexperienced realtor might encourage you to spend more than you need to. Find someone who knows your area, too—don’t use a Scarborough agent to buy a house in Mississauga.”

He also says that it’s important to ask yourself if buying a home is the right choice for you. 

“I believe in homeownership. It’s good that the government is trying to help people [buy homes] and I want more products in place to help people get into the market. It’s another vessel for you to create more freedom and wealth. But I also want people to be able to afford the houses they are living in instead of using credit lines and borrowing from family,” he says.

“We need more education. There are other opportunities for financial freedom, maybe real estate is not right for you right now.”

Despite how heated the market is, Oberoi still believes Mississauga is a good investment for prospective homeowners. 

“There’s a lot of things happening and the city is not stopping. It is a good time to get into the market, but be careful if you’re worried about this chaos. You can buy pre-construction development. We need to keep a close eye on the market and educate people on how to get in but not be stupid. We can’t have 2017 again, that makes more room for a collapse,” he says.  

“If you have a long-term goal in your home, you will not lose money. People who will be affected by shifts and changes will be those who put everything into the house and struggle to pay for other things. Have a long-term goal—don’t buy now if you want to sell next year. This is still a safe market.”

While Oberoi says it’s hard to say whether or not different levels of government will try to cool the market again, he does say that development—which will ultimately increase inventory—is not slowing down. 

“There’s been a lot of real estate buzz since 2016 and that will continue. We’re seeing condo booms in Barrie and Oshawa. The boom has contributed to Hamilton’s growth, now it’s a little less affordable. People are moving as far west as Brantford.”

The best advice, however, is not setting yourself up for disappointment by shopping before you know what you can afford—and accepting that some homes will simply not work for you and your budget.  

“Make sure you can afford the house. If a bank won’t give you a pre-approval, you cannot afford it.”

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NAR settlement explained: Why Realtors like me are scrambling

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One of my favorite “Modern Family” episodes depicts the hilarity and nonsense of a real estate agent’s daily life as Phil Dunphy rattles off deed restrictions and the proper pronunciation of the word “Realtor” (real-TOR).

A registered trademark of its originator, Realtor is a title only real estate agents who pay membership to the National Association of Realtors (NAR) are allowed to boast.

Today, after more than 10 years as one myself, the “Realtor” prestige has lost its allure.

Just when it felt like NAR was bouncing back after a sexual harassment scandal in 2023, we real estate agents and brokers now find ourselves in the aftermath of this month’s multimillion dollar NAR settlement.

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While I am nervous about what these NAR settlement changes mean for my residential real estate business and community, I am pleased that we’re all turning our eyes and ears to a company whose pockets have gotten too big and too dark for too long.

But enough about NAR.

Brokers, their agents and our local associations are scrambling to decide how to restructure serving residential buyers fairly without undervaluing our work. It feels a bit like a bomb just went off, and we’re running up to each other screaming, “Can you hear me talking? Are you talking? What are we going to do about this?!”

We have only until mid-July to figure it out.

Here’s what we know now: Buyer broker compensation is no longer allowed to be included on the Multiple Listing Service (MLS). And buyers are now required to sign a Buyer Representation Agreement, which includes the buyer broker’s compensation.

Real estate agents are worth it. So how do we get paid?

Buyer services are harder and more unpredictable, I think, than seller services (even in a buyer’s market!). Some buyer clients take years to find a property, while others take only a few weeks.

The stories we agents could tell would make anyone roll with laughter or cry – probably both. Being a real estate agent is like a reality TV show. How will we divide our whole job into billable hours? Billable tasks?

As an agent, I’m not only giving advice about market data and negotiating terms for sale. I’m also an on-call therapist, a babysitter, an interior designer, a cleaner, an exterminator … agents gladly do an endless list of tasks for our clients. Just ask your favorite agent what she keeps in her car for emergencies!

One thing I can predict with much certainty: Buyers will have to do more work to buy a property in the future. Private tours will be less common and replaced by 3D tours, video tours and open houses. Buyers might also have to meet with their inspectors, contractors and others without their agent.

Maybe buyers really will do it all themselves without losing money.

Buying a house?Don’t go it alone. A real estate agent can make all the difference.

If you’re hoping to buy in the next three months, my recommendation would be to close by July 1. Most first-time homebuyers have no idea what has happened or how it will affect their ability to negotiate.

In the past week, I’ve had to explain the NAR settlement to every friend, neighbor and client outside the industry. I can only tell you that we’re all racing to get it figured out by the time it does affect everyone.

NAR settlement explained: How will this impact home sellers and real estate prices?

Seller-paid buyer broker commissions were created with equitable rights to good representation in mind. Specifically, so that first-time buyers could afford to have a fair negotiation, instead of being swept under the rug by a seller’s agent signed to protect the seller (a law in most states).

My heart breaks for those sellers who were swindled into commissions. As much as I’d like to blame NAR, this error is also on agents, brokers and local boards who clearly violated our ethical code. It’s maddening to watch agents and brokers feed right into the stereotype that real estate agents are lazy and just in it for the biggest paychecks.

So, who will pay the buyer’s agent now, and how will this affect home prices?

Real estate prices:Will home prices fall after Realtor lawsuit settlement? You shouldn’t count on it.

It’s commonly acknowledged that the 5-6% sales commission was “baked into” the sales price. Investor agents and builders have been using low-to-zero percent buyer broker commissions as leverage for years.

While I do think that 5-6% sales commissions will be a thing of the past, there is a chance that sellers will find a way to simply advertise buyer broker commissions through a different medium. This compromise walks a fine line with the new restriction.

Seller-paid “buyer credits” is my favorite idea bumping around. Buyer credits would be offered on the listing, and could be distributed as the buyer sees fit at the closing table. The buyer could use the funds for themselves, their broker or both.

If buyers are responsible for the buyer broker commission on top of other purchasing costs, the sales prices will have to come down. Lower sales prices should not affect the sellers’ net proceeds in this instance, since the sales price deficit should roughly mirror the now absent buyer broker’s commission.

In short, even though most sellers think they should be celebrating now, these new rules probably won’t affect sellers much, if at all, once the dust settles.

What does the NAR settlement mean for buyers?

Gone are the “Let’s go tour this house for fun!” days.

A signed Buyer Representation Agreement is now required before a property showing. This has always been best practice. For some states this will be a big change.

For example, I usually complete a buyer consultation and one or two property tours before requiring a buyer’s agreement. I do this to be sure we’re a good match for each other. A successful client-agent squad requires a lot of trust and a common communication style.

Take the tours off the table, and I think things will get awkward. Now I spend one hour with a potential buyer and then prompt, “So do you trust me to guide you through your biggest life purchase? Sign here.” I’m sure thankful many of my clients are referrals.

How will the commission change impact real estate agents in 2024?

The part-time agents and small brokerages will likely diminish over time, which will either be great or horrible for the industry. Agents will have to do more with less, and our 60 to 70 hour work week will feel impossible without high sales volume.

Once in escrow, the brunt of the work usually lands on the buyer’s agent, too. If there are more transactions without buyer’s agents, then the seller’s agent will have to pick up the slack.

Emily Ross

I often joke that as a 1099 real estate agent, I’m either overpaid or underpaid on each property. Still, my annual income mashes up into a worthwhile sum despite the work-life balance.

Without that 2-3% buyer’s commission propping up half my income, I am not sure the 11:30 p.m. phone calls, 6 a.m. texts, missing my daughter’s basketball game for an impromptu showing, and never having paid time off or maternity leave will be worth it.

Maybe I ought to go back to copywriting.

It feels like most brokers and Realtor associations are strategizing how to make the buyer agent obsolete with new technologies. I think they’re focusing on the wrong solution, but that’s a story for another day.

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A settlement in a U.S. lawsuit could upend the cornerstone of real estate industry: commissions

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The cost of selling a home in the United States may be about to change dramatically.

A real estate trade group has agreed to a landmark deal to drop what was once a cornerstone of the industry: the six per cent sales commission paid to agents.

In Canada, two lawsuits filed against various real estate bodies want the courts to come to the same conclusion and force wholesale change in the way Realtors charge their fees when a home is sold.

“We got here by a cartel of brokerages and real estate associations that control the rules, and they’ve done it for a very long time,” said Garth Myers, a litigator with Toronto law firm Kalloghlian Myers.

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He filed the proposed class-action lawsuits in Federal Court on behalf of plaintiffs who allege that the Canadian Real Estate Association, the Toronto Regional Real Estate Board and several local brokerages and franchisors conspired to set fees and illegally drive up the price of real estate commissions.

At the heart of both the U.S. and Canadian cases is the opaque way in which real estate agents charge their fees.

Lawsuits revolve around Competition Act

In Canada, there are different fee structures in different jurisdictions. In Ontario, for example, a commission of five per cent of a home’s sale price is split between the buyer’s and seller’s agents.

With the average price of a Toronto home at $1,225,000 last month, Realtor fees would amount to $61,250.

In Vancouver, Realtors charge seven per cent on the first $100,000 of the sale price, and between 2.5 and three per cent on the balance. So agents would split between $29,500 and $34,000 in fees on a $1-million home.

A real estate 'For Sale' sign outside a single-family home.
In Canada, there are different fee structures for real estate agents in different jurisdictions. In Vancouver, Realtors charge seven per cent on the first $100,000 of the sale price, and between 2.5 and three per cent on the balance. (Ben Nelms/CBC)

In the U.S., agents generally charge a commission of five or six per cent.

But what is common among those different jurisdictions is that the fee paid to the buyer’s agent is baked into the price of the home, while a seller can negotiate with their agent and get a better fee.

A potential buyer can look up the details of a home on something called the Multiple Listing Service (MLS). The listing includes everything they would want to know about a property — from size and taxes to upgrades and amenities — but it doesn’t disclose the amount a buyer will pay in Realtor fees.

Myers said the existing system enables agents to steer clients away from homes that aren’t paying the full commission.

“It’s clear to us that consumers are being ripped off, it’s clear to us that the rules elevate the cost of buyer brokerage commissions,” he said. “Now the open question that the court is going to have to resolve is whether this is criminal conduct under the Competition Act. And that’s what we’re fighting about in court.”

It will likely take years before the cases are resolved.

WATCH | How sweeping U.S. real estate changes could impact Canada:

How sweeping U.S real estate changes could impact Canada

15 hours ago

Duration 6:22

A landmark legal settlement is upending the U.S. real estate market. CBC’s Peter Armstrong breaks down the possible ripple effects for home buyers and sellers in Canada.

U.S. industry pushes back

In the U.S., there is already fierce disagreement over what the court settlement — which ends legal claims from home sellers over real estate commissions — actually means.

On March 15, the day the $418-million US settlement was announced, the National Association of Realtors said fees have always been set by the market, not by collusion among agents. Besides, the group said, those fees have always been negotiable.

“Offers of compensation help make professional representation more accessible, decrease costs for home buyers to secure these services, increase fair housing opportunities, and increase the potential buyer pool for sellers,” the association said in a statement outlining the broad points of the agreement.

Rows of houses are shown in a subdivision.
A housing subdivision is shown in Middlesex Township, Pa., in April 2023. In the U.S., there is disagreement over what the $418-million US court settlement — which ends legal claims from home sellers over real estate commissions — actually means. (Gene J. Puskar/The Associated Press)

Since then, high-profile brokerages have pushed back against the notion that the industry will be forced to change as a result.

“Since the settlement announcement, there have been numerous articles and stories in the media on what this means for buyers and sellers,” Budge Huskey, president and CEO of Premier Sotheby’s International Realty in Naples, Fla., said in a statement released on Tuesday.

“Regrettably, most reflect a profound lack of understanding of the real estate business as well as mistaken claims.”

Huskey said the notion that sellers will no longer pay a fee to the buyer’s agent is simply false.

“There has never been any obligation for a seller to pay buyer agent compensation at any time, yet it has been a historical practice that’s worked exceedingly well since the advent of modern residential real estate,” he said.

Realtors in Canada, such as ReMax, aren’t saying much publicly while the cases work their way through the courts. A spokesperson for the organization would only say that “we do not comment on ongoing litigation.”

U.S. reaction watched closely here

“It’s important to note the litigations in Canada and the U.S. occur in different legal and factual contexts, and the litigations are at a much earlier stage here in Canada,” the Canadian Real Estate Association said in a statement to CBC News, adding that “we’ll continue to review U.S. developments.”

The statement goes on to say that buyers and sellers in Canada “have always been able to negotiate commissions with their agent…. On the buyer side, buyer representation agreements are required in at least seven provinces in Canada. These agreements set out terms like services and fees between an agent and their buyer. This represents more than 80 per cent of homes sold in Canada.”

Real estate experts on this side of the border have been watching the U.S. reaction very closely.

A man with grey hair and a grey beard, wearing a blue overcoat and tie, stands outside a building.
Murtaza Haider, a professor of real estate management at Toronto Metropolitan University, says he thinks the lawsuits in Canada will lead to the same outcome as those in the U.S. because the two real estate systems are so similar. (Pelin Sidiki/CBC)

Murtaza Haider, a professor of real estate management at Toronto Metropolitan University, said the two systems are so similar that he believes the court cases here will lead to the same outcome as those in the U.S.

But, he said, people should temper their expectations.

“We won’t have a system blow up. It’s basically giving the buyer the rights to negotiate with the agent, a commission for the services they may or may not use,” Haider said.

Down the road, he imagines a system where some buyers pay an agent a full commission to help them find a home, figure out a price and close the sale, while others will simply need someone to help them file the paperwork.

Haider warned that there may be some unintended consequences to changing the system. Currently, he said, the fee paid to both the buyer’s and seller’s agents is essentially included in the price of the home. Fees are not an extra closing cost outside the home price.

“Right now it’s baked into the mortgage amount, so you don’t have an out-of-pocket policy. But [if you] have the flexibility and freedom to negotiate, that amount [may be] coming out of your own pocket right away,” Haider said.

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The Homeowners Who Beat the National Association of Realtors

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When Rhonda Burnett went to sell a home in 2016, she knew she would have to pay a commission to her real estate agent.

The house was a second home — she and her husband, Scott Burnett, had purchased the three-bedroom house in Kansas City’s Hyde Park neighborhood as a place for their oldest son to live after he was accepted to law school in Kansas City in 2008.

Her real estate agent presented her with a form that detailed how much commission they would pay, with choices in four boxes: 6 percent, 7 percent, 8 percent or 9 percent.

Ms. Burnett was instructed to select one, and she picked 6 percent.

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The rest of the form, which stipulated that the commission would be evenly split among the buyer and seller agents, was already filled out; Ms. Burnett asked if she could lower the commission paid to the buyer’s agent, but her agent told her doing so would discourage agents from showing her home. “I shop sales,” Ms. Burnett, 70, said with a laugh. She spent three decades as a stay-at-home mother while her husband, Scott Burnett, 72, worked for a waste management company and spent 20 years working as a local legislator. “I’m always looking for a break. But when I asked her if I could negotiate, she said, ‘No, you really can’t.’”

Three years later in 2019, Ms. Burnett became the lead plaintiff in a landmark legal case about home sale commissions against the National Association of Realtors that led to a settlement earlier this month that real estate experts say will rewrite the housing industry in the United States.

The settlement followed a federal jury verdict in October in favor of the Burnetts and four other plaintiffs, on behalf of 500,000 Missouri home sellers, that ordered N.A.R. to pay $1.8 billion in damages. Under the agreement, sellers’ agents will no longer be able to make offers of commission to buyers’ agents on most of the databases where homes are listed for sale, a shift that will, experts say, lower commissions across the board. For decades, most agents in the United States have charged an industry standard of between 5 and 6 percent, which is higher than in nearly any other developed country.

The plaintiffs argued that N.A.R. and several large real estate brokerages had conspired to inflate real estate commissions, pointing to several N.A.R. rules that required a seller’s agent make an offer of commission to a buyer’s agent. Those commissions, the home sellers argued, were negotiable in name only, and unnecessarily high, forcing home sellers to pay unnecessary fees to close a sale.

Ms. Burnett spoke for both herself and her husband. She told the jury how she felt that the rules of the real estate industry had seemed fixed, and she believed she was forced to pay a commission that was never truly negotiable.

In an interview, Ms. Burnett stressed that she didn’t blame her real estate agent, whom she believes was just doing her job. Ms. Burnett spent several years as an advocate for the Kansas City public schools, meeting with educators and parents that helped her district. Her real estate agent was also a school advocate, and they often saw each other at district meetings. She blamed the industry, and the powerful National Association of Realtors, which had set the rules.

“It’s not the Realtors. But the Realtors are controlled by a huge spider web,” she said. “After I joined the lawsuit, I learned so much about how the industry is run. It goes all the way to the brokerages and up to N.A.R.”

Despite the settlement, which is pending a federal judge’s approval, N.A.R. continues to deny any wrongdoing in terms of its rules for agent compensation.

“N.A.R. does not set commissions, and commissions were negotiable long before this settlement. They are and will remain entirely negotiable between brokers and their clients,” the organization said in a recent statement.

Before the lawsuit went to court, N.A.R. — a powerful trade organization with 1.5 million members, more than $1 billion in assets and a cash-flush lobbying arm — seemed impregnable. It had fended off a Justice Department inquiry into anticompetitive behavior for more than a decade, and successfully sued upstart real estate companies that challenged its stance. The Justice Department inquiry is ongoing.

But in U.S. District Court for the Western District of Missouri, the home sellers were speaking directly to a jury of their peers. It offered them an opening.

Michael Ketchmark, 58, a plain-spoken personal injury lawyer who became lead lawyer on the case, sensed his advantage on the first day of the trial.

Stepping to the front of the courtroom on Oct. 17, he gestured to his mother and father, who are in their 80s and attend all of his trials. On that day, Margaret and Eugene Ketchmark were seated in the front row.

“I told the jury that everything I needed to know about this lawsuit, I learned from my mom and dad when I was in kindergarten,” Mr. Ketchmark said in an interview. “If you take something that doesn’t belong to you, you have to give it back. And that’s what this case was. It was a refund case. It was about giving the money back.”

Mr. Ketchmark was referred to the case by a friend and fellow attorney who knew the Burnetts. He then began looking for other plaintiffs across Missouri who might have similar grievances.

Mr. Ketchmark had never tried a housing case before, but he was no stranger to big wins — in 2002, he won a $2.2 billion civil judgment against Eli Lilly and other drugmakers, claiming that they failed to uncover the scheme of a Kansas City pharmacist who was diluting chemotherapy drugs. The drugmakers, who never admitted any wrongdoing, later settled for $72.1 million.

Mr. Ketchmark had a similar upbringing to the plaintiffs in the case against N.A.R., with parents who didn’t make a lot of money and who saw a house as their biggest investment. He grew up in West Des Moines, Iowa, as one of four children, and his father worked at a bank. His mother didn’t finish college until he himself was in law school — she put herself through night school.

He had a strategy: Talk to as many average Americans as he could about the case, and find out what resonated. His team began running and filming mock trials.

“We would watch the tape, and start developing out the themes of the case,” he said. By the time they got to trial, Mr. Ketchmark estimates he had watched 2,000 hours of video of mock jurors discussing the case.

“I intuitively knew when the trial started that if we could win this, that if the jury followed the law and reached the right result, that it would change the industry. And it has,” he said.

He pressed Ms. Burnett, who grew up in Georgia and met her husband when they were both working in President Jimmy Carter’s White House — Scott did field organization, Rhonda worked as an administrative aide — to describe her childhood with a stay-at-home mother who sold Tupperware and a father who worked at the federal penitentiary and took on shifts selling sporting goods at the local Sears for extra cash.

Ms. Burnett’s agent listed the house for $275,000 but it sold for $250,000. Ms. Burnett paid $15,298 in commission.

Mr. Ketchmark guided Jerod Breit, 42, another plaintiff in the case, to share stories of working as a police officer in St. Louis before saving up enough to buy his first home in South St. Louis. And he encouraged Hollee Ellis, 53, to tell the jury about her mother, who worked as a real estate agent.

Ms. Ellis, a former high school English teacher who now works in nonprofits, talked about joining her mother at real estate showings as a child, and later even working as an assistant at her brokerage at one point. She joined the lawsuit, she told the jury, not in spite of her mother but because of her.

If real estate agents were actually able to negotiate commissions, she said, she believed her mother could have made more money, rather than less.

“She operated under that assumption and that practice and that standard for so many years,” Ms. Ellis said of the split 6 percent commission. She shared with the jury that her mother is now suffering from Alzheimer’s and has advanced dementia. “Whereas I know she worked very, very hard for some of her buyers and possibly could have negotiated a different rate.”

Ms. Ellis described selling a modest three-bedroom, single-level brick house in 2016 and feeling that she could not negotiate the 6 percent commission she paid that was split between her agent and her buyer’s agent. “It’s not about money at all,” she said of the case. “It’s about reversing a practice that I feel is unfair.”

Ms. Ellis and her husband, Jerry Ellis, a forklift driver, were looking to sell their house in Ash Grove, Mo., because Ms. Ellis had a new job opportunity at a nonprofit in South Carolina.

They owed $107,000 on their mortgage. They hired a real estate agent who sold the house for $126,000, netting them just over $18,000. Forty percent of that ended up going to real estate commissions for both their agent and the buyer’s agent.

“It was a hard pill to swallow that we were walking away with so little,” she said.

Mr. Breit, 42, also said he felt he had money taken from him.

He spent more than a decade as a police officer. He bought his first home, a two-bedroom brick Tudor in south St. Louis he described as a “gingerbread house,” with the help of a fellow officer’s father — a retired paramedic who worked as a real estate agent on the side.

When it came time to sell that home, Mr. Breit said, that same retired paramedic offered to help again, he said, and promised he would only take the “law enforcement special” of 5.5 percent commission.

Mr. Breit took issue with the commission to his buyer’s agent, and had already joined the class-action lawsuit when lawyers began reviewing the contracts of his home sale. It was only then, one day before he was scheduled to take the stand, that he learned he hadn’t been offered a law enforcement special anyway.

He sold the home for $149,900 in 2017. He was charged $4,946.70 in commission to his seller, and $4,047.30 in commission to his buyer, totaling $8,994. When the numbers were brought to his attention, he did the math in his head several times, disbelieving. His agent, using forms that were preprinted, had gone ahead and charged him the full 6 percent.

“I know people say it’s negotiable,” he said. “But it’s really hard for me to believe that it’s negotiable when the documents are pre-filled and we don’t question it.”

Mr. Breit left the police force in 2017 and now serves as a regional executive director for Mothers Against Drunk Driving, or MADD.

“I’m just a person who sold a house,” he said. “I don’t go to Jiffy Lube to pay for an oil change next week, and I don’t pay for someone else’s Hulu account because we live on the same block. People should only have to pay for what they use.”

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