How To Choose The Right Realtor Because My Realtor Sucks

This post will teach you how to choose the right Realtor to help sell your home for top dollar. You'll also learn how to choose the right Realtor to help you buy a home and get the best deal.

Despite the pandemic, the real estate market is very strong right now due to record-low mortgage rates and more time spent at home. Perhaps you are thinking of buying too or selling into strength.

For the right price, everything is for sale. So when my real estate agent friend pitched to put my home on the market in the summer of 2012 given the lack of inventory, low interest rates, pent-up demand and Facebook going public, I figured why not test things out.

I had a single family home that is suitable for a young internet couple looking to start a family. I told my Realtor that if I don't get X amount, then I'm not selling. He agreed to the terms.

My asking price of $1,700,000 was $100,000 over estimated market value, but he still thought a sale was possible. Given he was the one who was going to do all the staging, marketing, photographing, and showing, the burden was on him. For me, I was just going to tidy the house and get out of the way during showings.

It felt good not having to sell if I didn't get your aspirational price. It's kind of like going to a bar with your buddies and having no fear talking to the most attractive person there because you already have the most beautiful wife already. Or it's kind of like getting a free roll at the casino.

My biggest goal is to gain enough insight to write this post! I want to teach people how to choose the right Realtor because mine was terrible.

How To Choose The Right Realtor

Unfortunately, my Realtor was a bad choice. He was a tennis acquaintance that I thought could do a good job. Here are some reasons why my Realtor was terrible.

Showed up dirty to an open house.

I was shocked when my realtor strolled up to my house 5 minutes before a private showing in a sweaty shirt, shorts, and sneakers after playing a 1.5 hour tennis match. His appearance was completely inappropriate and disrespectful to the buyers, and to myself. I would never dare go to a meeting that way and am absolutely baffled he would show my house in his getup.

I e-mailed him after, insisting he keep a full change of clothes in one of my bedroom closets. His presentation caused my blood pressure to rise. Maybe if my property was a studio in a bad neighborhood, it would be OK for him to come show my place in shorts and a t-shirt. But, at least take a shower beforehand dammit!

Didn't listen to my wishes. 

My Realtor pushed me to do an open house multiple times. I told him NO each time, because all open houses do is open yourself up to nosy neighbors and potential robbery. I even sent him a report from the National Association of Realtors saying that only 2% of transactions ever come from open houses. I've personally been to over 100 open houses and I have never bought a thing!

I told him I cherished my privacy. 90%+ of buyers find their homes on the internet anyway. He continued to push back, saying he wants the house to generate this “frenzy factor.”

I asked him why can't he just host a private open house where each prospective buyer and agent is pre-screened to create a similar wow factor? I did that with my rental property and had 30 people come in a one hour window. He shrugged. Open houses are for the real estate agent to find new clients!

False assumptions.

After saying I wouldn't have to pay anything out of pocket, he sprung the $440 pest inspection fee I have to pay for the disclosure packet. I'm all for a thorough disclosure packet. However, if I'm going to pay him a 5% commission on $1,700,000, you'd think he would just cover this expense. What was originally a “no cost to you” listing, became a $440 pest inspection fee, a $1,000 paint job in the living and dining room and other things.

Not in my corner.

My realtor is on a tennis league team which I was thinking of joining. I use the word “was” because when I asked him whether I could join his team, he told me that it would be hard for me to join because the singles players have all been members for a long time already.

In essence, he didn't believe in me. He didn't even offer to talk to the captain to try and work me in as a sub. I don't want a Realtor who isn't 100% in my corner. The funny thing is, months later I took him down in a double match with ease.

Frankly, not being supportive was the main reason why my Realtor sucked. It already irked me that I would have to pay $85,000 in commissions if I sold the property. But to not have a Realtor even vouch for me felt terrible.

Today, I'm a 5.0-ranked tennis player. My Realtor is ranked 4.0. He should have gotten me on his 4.5 team because I would have had a 80%+ winning percentage.

Things To Look For When Hiring A Realtor

Here are some key questions to ask when you're thinking about how to choose the right Realtor.

How big is his or her network? 

The longer he's been in the game, the larger his network. Realtors can work from anywhere, so they don't necessarily have to be a 10 year veteran of one firm. In fact, if they've moved every 3-5 years, that could be a good sign they are in high demand. There is a virtuous cycle on one's reputation the longer they have been working.

Does s/he have a web presence? 

If your realtor doesn't have a website in this day and age where 90%+ of properties are found on-line, then you should be a little leery. The website should have basic info such as his bio, his previous transactions, thoughts on the market, some pretty graphs, and so forth.

I've been telling readers since I started Financial Samurai in 2009 to start their own website. Plant your flag on the web and you'll naturally gain tremendous amount of opportunity. It's so cheap to start one.

Does he do what he says he's going to do?

If he says he will be at your house at 1pm, does he arrive at 12:45pm to prepare the house and gather his thoughts beforehand? When he says he will handle the upfront costs, does he pay for everything or try and get you to pay some of the bill?

Does he have a reasonable level of intelligence? 

You must ask them questions about their thoughts on the markets and see if they can put together a coherent argument. Realtors get a bad wrap for being dumb by just regurgitating what CNBC, or the National Association of Realtors write.

The realtor should have his own opinions, and facts that buttress these opinions. With good intelligence, also comes good salesmanship, because the more you know, the more you are able to sell convincingly.

Does s/he have strong integrity? 

The one thing I like about my realtor is that he has great integrity. I asked him whether I should disclose a minuscule leak in the ceiling that I fixed and he said, absolutely. I asked him whether I should turn on the portable air-filter in one room to help drown out some outside noise. He said it was best to leave it off to be completely upfront. Good integrity goes a long way because it minimizes the risk of negative surprises.

Does he make people feel comfortable? 

If you don't feel comfortable being around your Realtor, the buyers probably won't feel comfortable either. The good thing about my realtor is that he leaves people alone to walk the property and doesn't pepper them with questions. He lets people take their time and follow-up with him. I generally see this as a positive sales attribute, because I dislike pushy sales people.

Can you feel and see his hustle? 

When you wake up in the morning, has he sent you some new thoughts and a marketing game plan? Has he created a Google Docs spreadsheet to track all the prospective buyers who have come through and shared the file with you? Has he suggested you go with him to make appointments to see the competitive properties on the market?  

You need to see and hear his hustle. You don't want him strolling to your house in the nick of time in his shorts and t-shirt because he had a practice match beforehand!

The Other Realtor Is Incredibly Important

The oligopoly priced 5% minimum commission fee is ridiculous for expensive cities such as San Francisco and New York. For example, why on earth does it cost $150,000 in commissions to sell a $3 million dollar house. I can maybe understand a $10,000 commission on a $200,000 house, but it doesn't take 15X more work to sell a $3 million dollar house.

Despite the price fixing, don't underestimate the power of the 2.5% commission for the buyer's agent. The 2.5% commission for the buyer's agent is an incredible incentive that makes Realtors hustle to do whatever it takes to make the buyers happy, which hopefully leads to a smooth transaction.

Paying a 5% commission makes me sick. However, I do feel I'm getting better “value” that the fee is split and incentivizing both parties to make something happen.

Don't feel their commissions are fixed, either.  Both sides should definitely be willing to negotiate down their commissions if the choice is between walking away, and making a transaction happen.

When volume is way down, like it is during a coronavirus pandemic, Realtors are naturally making less money. Therefore, I've noticed many more Realtors willing to accept 4.5% at least.

Related: A Detailed Look At The Ridiculous Cost Of Selling A Home Today

What If You Want To Change Your Realtor?

There is a situation where you may want to change Realtors given your terrible experience with him or her. Your main option is to wait out the listing agreement. Usually, you sign with a Realtor for 30-90 days to sell your home. It's only fair that you give the Realtor a chance.

However, if the Realtor is truly terrible, then you can just have a heart to heart conversation asking if you can part ways. The Realtor might decide to cut his losses and null the contract.

The large majority of the time, the dispute has to do with not getting the price a seller wants. If the Realtor can't get you to go down in price, then he is stuck. Better to cut his losses or focus his attention elsewhere.

If the Realtor won't nullify the contract, then you've got to just wait it out. In the meantime, do your market research and talk to other listing agents.

The Internet Is Your Friend

Even if you are stuck with a dud of a Realtor, it is very hard to screw up a sale if you've priced your properly correctly. The market dictates the price.

With sites such as Redfin and Zillow where you can easily find properties for sale and check out their estimated values you have much more pricing transparency.

The listing agent's main responsibility is to get the word out and show the house. He can list via the MLS or through a pocket listing if he works for a particularly large real estate brokerage house and/or is part of the Top Agents Network. So long as the Realtor isn't an idiot, the market will set the price.

You need to trust a Realtor will do everything possible to get the word out and fight for your best interests. Good work experience, a web presence, and a great network should be standard.

The problem with my guy is that I couldn't stop thinking how my Realtor wouldn't speak up for me to join his tennis team. It's that awkward moment where a friend speaks to you about another friend's mutual party. The only problem is you weren't invited to it!

Finally, paying a 5% commission to sell a property just seems wrong. I've made a promise that I will never sell my house unless someone gives me a ridiculous price or until the commission level drops under 5%.

I Ended Up Selling My House

After going through this bad experience, at least I learned how to choose the right Realtor in the future.

After trying to sell my house for $1,700,000 in 2012 with no luck, I tried again in 2017 and someone offered me $2,742,000 so I took it! I got the Realtor to lower the total commission to 4.5% instead of 5%.

My Realtor was great. She was attentive, did her market research, and was part of the Top Agents Network. She found my one and only buyer who was willing to pay more than my aspirational price of $2,500,000. In retrospective, learning how to choose the right Realtor was critical.

I reinvested $550,000 of the proceeds into real estate crowdfunding. My goal was invest in the heartland of America where valuations are lower and net rental yields are higher. As a new dad at the time, all I wanted to do was make income 100% passively, instead of manage property.

Earn Income Passively

If you're looking to buy property as an investment or reinvest your house sale proceeds, take a look at Fundrise, one of the largest real estate crowdfunding platforms today. They have created eREITs and eFunds that allow you to diversify across mid-market commercial real estate properties and multi-family properties across the country.

Fundrise returns have been stable compared to the stock market. I really like their innovation and diversification for people looking to earn passive income in real estate. It's free to sign up and explore.

Fundrise Investment Plan - how to choose the right realtor

If you are an accredited investor who is interested in buying individual commercial real estate deals, check out CrowdStreet. CrowdStreet focuses on deals in 18-hour cities, secondary cities with lower valuations, higher rental yields, and potentially higher growth rates due to positive demographic trends.

We are seeing people move away from big cities to smaller cities thanks to technology and the coronavirus. Cities like Charleston, SC and Memphis, TN are all beneficiaries of the migration trend. I really like CrowdStreet's mission. They've also created a fund as well.

Take Advantage Of Record-Low Mortgage Rates

Finally, I encourage everyone with a mortgage to refinance. Mortgage rates are at record-lows. A main reason why real estate demand is so strong in the new decade is due to a rise in affordability.

Check the latest mortgage rates online through Credible. They’ve got one of the largest networks of pre-qualified lenders that compete for your business. You can get multiple real rate quotes in under three minutes for free.

How to choose the right realtor when mortgage rates are at all-time lows

How To Choose The Right Realtor was originally published in 2012 after I tried to sell my house. I've since updated the post for the new decade. A great Realtor will help you get top dollar. A great Realtor will also provide peace of mind. Although paying a 4.5% – 5% commission is still painful, it's the cost of doing business.

68 thoughts on “How To Choose The Right Realtor Because My Realtor Sucks”

  1. Michael Woods

    Hi Sam,

    When you say you got the commission down to 4%, does your seller’s agent also pay for inspection reports and staging?


  2. Flat rate or 2-2.5%

    Just say NO to the vestige, 5-6% bloated commissions for basically pushing pre-populated paperwork and smiling. That 5-6% rate was a hold over from the days when houses were 1 5-30K. Now many houses are >800K, or start at 1M. What they heck do they do for that 5-6% besides smiling and being a glorified showman? Our experience is and has been extremely poor with these house salesmen.

  3. So what do you do when your agent is a moron? Selling my home quickly turned into a nightmare. The agent did not listen to me and in fact, was combative. When things began to unravel due to a home inspection where another moron, the inspector, suggested that there “might” be wood rot without testing for it, cost us thousands of dollars. I wanted to pull the listing and regroup. Get another inspection. My realtor fought me on it. I hired my own contractor who assessed that there was in fact, no rot and that the stucco was fine. My realtor acted like I was lying and accused me of holding up the closing. She didn’t even try to hide her annoyance and was very snarky. I felt like I had been hijacked. I felt like she had absolutely no regard for my interest and was definitely not on my “team”. And for this, I am forced to pay 6 percent commission at a significant loss, no less! I am disgusted to say the least and worse, I hired this moron because she was a friend of a friend. I would not wish the incompetence and unprofessionalism of this realtor on anyone! What can a person do? Is there any recourse?

    1. Never pay 6% commission. You can negotiate down to 4.5% – 5% all the time. Maybe even 4%. But, you probably signed a listing contract.

      Didyou gt the price you want? If so.. that’s the most important thing.

  4. 1. Flat rate with RE attorney. Offer 2-2.5% to real estate buyer agent showmen, or refund that 2-2.5% if the buyer is not represented by the real estate sales showman.

  5. You made a point about how the realtor will make you feel comfortable working with them. My sister wants to buy a house, but the last real estate agent she had didn’t answer her and made her feel uncomfortable when seeing the properties. I will pass her the tips so she can look for someone more professional to help her buy a house.

  6. Eli Richardson

    My dad wants to invest in a second home and needs to hire a real estate agent. It makes sense that he should consider an agent that will make him feel comfortable. This info will help him find the right individual to purchase a home.

  7. Jeff Wilcox

    I like the tip that you gave to choose a realtor who you could be comfortable with. My wife and I have been talking about finding a realtor to help us if we decide to find a new home, and it would be important for us to know that we could find one who we could trust in. If we decide to find a realtor, I will be sure to look for one who we could be comfortable with.

    1. You absolutely MUST trust and be comfortable. There are many personal decisions in buying a home and you need to be able to tell your realtor what you want without worrying about judging.

      Whether you need an ideal place for litter boxes or a proper fence for big dogs, or a windowless room to make a sex dungeon, your realtor can help you better if they know what you really are looking for.

      If you edit yourself they cannot find what you really need. If you try to impress them with your mad construction skills when you really want a move in ready shiny low maintenance home then they will never be able to really help.

      As Realtors, w need the information, we are not here to judge, we want YOU to be happy! For some happiness is a shiny new townhome, for others it is a run down fixer on 2 acres.

  8. It is important to understand that the old adage applies. You get what you pay for. Do you also complain about paying your Doctor? Oh, yeah, I guess you could operate on yourself. I can see the sense in that.

    Look, you are paying a professional to REPRESENT you (that’s what agent means) to the best of his or her professional ability, whether you are a buyer or seller. And that is what most agents do. Do you really feel that they should not be well compensated for their investment in education, licensing, and the time they spend on each and every client, whether they buy, sell or simply walk away? I represent Buyers most of the time and prefer not to work for free. Agents make their living based on these commissions and most actually do work for them. Would you feel as good about espousing a plan to cut your own compensation by 50% or more? B

    BTW, take a look sometime at what loan brokers make in commissions….

    1. The dumb comment of the century goes to you. You do not get what you pay for when you give a realtor thirty thousand dollars. There is no reason a $500k home should cost twice as much to sell as a $250k home. Are the doors harder to open? “You get what you pay for.” Realtors have no philosophical education because they think platitudinal, fluffy non arguments not grounded in economics constitute as sage advice. Not hiring a doctor or a plumber results in costs ten times what their fee is, that is how they can unpack and justify their value. The cost of not hiring a realtor with 3 months of training is zero. IN FACT, a scholarly study found that by owners achieve sale prices $12k higher than realtor assisted sales. When realtors sell their own homes, they too sell for more than when they sell their clients property. They undervalue homes to sell them fast. Hire a realtor and youre paying extra to sell for less. Realtors are some of the dumbest and most untrained and disorganized people in the professional world. They are former bar tenders and mattress salespeople. The 5% fee is 80 years old, and percentages fluctuate too wildly causing homeowners to pay in excess of the vakue provided. Economists refer to this as social waste. The only people that think realtors arent overpaid are realtors.

      1. The retarded comment of the century in fact goes to you. Grouping 1.2 million agents into the same bucket is of course idiotic. Like any profession, there are people really good at what they do, mediocre people, and bad people.

        And in fact different price points are harder to sell than others, as just about any layman with 100 iq could explain if they gave it a tiny bit of thought. Median priced homes, where the majority of the population would be buying will be the easiest to sell. Simple supply and demand. Where there is higher demand, easier to sell. Where there is less demand, such as above an areas loan limits, there will be less demand, and thus harder to sell.

        1. « Buying a listing » is the usual US sales tactic by those realtors. Hustlers and conartists at 5% to play price reduction games.

      2. You are not hiring a realtor for 3 months of training, you are hiring for years of experience. Higher end homes do in fact require more marketing and more work on the part of the Realtor.

        If you did not like your realtor then you should never have hired them. You demand all the professionalism, but also demanded a discounted commission. The best Realtors do not discount their commission, they do not need to, they have all the expertise and professionalism you wanted. You simply did not want to pay for that.

        1. Keep reciting the script and the typical American hu$tler talking points from that special US huckster lobbying group…. There is NO reason why USA real estate salesmen still charge 5-6%. Glorified showmen and form coordinators.

  9. The oligopoly of realtors in America is astonishing.

    In the UK, there really isn’t this stranglehold. Online agents are booming, and charging tiny fees (think hundred, not thousands). Google Purple Bricks for a budget example.

    The commission rate even for traditional agents is much lower in the UK – about 1.5%.

    I took your advice ( and have started blogging about real estate – as an landlord and property lawyer, it’s what I know.

    I just wrote an article about agent’s commissions. If you had any thoughts I’d love to hear them.

  10. I see your points. You should have tried selling your home as an FSBO. Then sharing your experience with that in this article.

      1. Wow! Congrats Sam. When you invest in proeprty which valuation do you use most often or prefer to use, GRM or Cap Rate?

          1. I have a client looking for a home in SF. Inner Sunset. Do you have any friends/associates looking to sell in that area?

  11. My wife and I have wanted to get into a new home, and I think that being able to take your advice to trust our realtor would be helpful. We’ve been looking for a good realtor, and it would be comforting to be able to trust that the one we choose is fighting for our interests. I’m going to have to make sure that we find a good realtor who is going to fight for us to make sure that we get what we’re looking for from a new house! Thanks for the tip!

  12. Derek Mcdoogle

    In your article, you stated that realtors can work from anywhere, so they don’t necessarily have to be a 10 year veteran of one firm and in fact, if they’ve moved every 3-5 years, that could be a good sign they are in high demand. My cousin and his wife have been trying to sell their home for the last couple of months and haven’t had any luck. I wonder if most realtors specialize in selling specific kinds of homes.

    1. Samantha Winthrop

      It sounds like you had my last realtor. I couldn’t agree more; especially about them getting more to fill out the same paperwork just because MY ASSET is worth more. Poor time-management skills and left town during the 17-day contingency period of a deal I had found. The only realtors I’ve dealt with were looking for a job they could do where they didn’t have to do much and make huge amounts of $$ off someone else. Lazy, disorganized and unoriginal. They pass their little test and play the same cookie-cutter template for each home sale. And the ‘undervalue to sell fast’ tactic…. had to smile. One day my home was a total re-do and the next day it was a good starter home. I think he had ADD. And zero marketing skills. NONE. Marketing consisted of the ‘post and pray’ method. The last one stomped out and slammed the door so hard, my door wreath almost fell off. I have since found out that he targets older folks.

      I was glad to hear of the recent Class Action suit against agents so that Sellers aren’t forced to pay the Buyer’s agent fees.

      It should be easier to sell your own home so people wouldn’t feel the need to hire these creatons.

    2. When trying to sell their home did they interview several Realtors and go with the one who agreed to the highest price or go with the one who explained the details of pricing and the work needed to stage the house even thought it seems they would make less from that Realtor?

      Did they choose the one who told them what they wanted to hear or the one who was skilled and honest?

  13. Suzanne Appel

    Your article rings true for me in so many ways. I grew up in a real estate family- commercial and residential. Part of my family flips houses and I’ve heard many realtor stories before I had my own to tell. As a homeowner, I’ve had mixed experiences buying and selling but was never happy about the massive 5-6% commission I saw come right out of my sales price.

    I had a vague understanding that it was going to cost me $30k to sell my first place- which seemed like a lot. But then I did the math and realized that the agent’s fee would be close to 50% of the appreciation of my home. I had put my money at risk, made the improvements, maintained the home — and someone else would get the profits?

    I’m a digital marketer and so I’ve seen every industry use technology to become more efficient and lower costs. And now it’s time for real estate. When I heard about REX Real Estate Exchange, I dropped most everything I was working on and pursued a job there. I’m thrilled about the team and the mission at REX. But why don’t you check us out and see for yourself?

  14. I am a Realtor, and some of your points are valid in terms of complaints.

    But I would have NEVER listed your property. First it’s 100K over market. And you listed it to “write an article”. I frankly do not wish to work for free on a sale that will never happen. My time is more valuable than that. Would you?
    Tell me how many people here, unless they are volunteers are going to spend countless hours and money, for no reason?

    Yeah, that agent wasn’t real sharp. He should get out of real estate. But you’re no prize yourself if you think we don’t work hard to earn our money.

    And we sure as heck don’t get the full commission.

  15. Brad Spencer

    Honestly…the thing that stuck out the most for me here was the fact he wouldn’t fight for you to get on his tennis team that you wanted to join.

    I’d have fired him there for that alone. Zero…done…non-negotiable.

    That’s like hiring a dating coach who cockblocks you around every beautiful woman you’re interested in starting a conversation with.

    Done. Gone. See Ya. True colors right there.

    I’m sitting here pretty stunned. Bad enough to show up gross/sweaty but then to not invite you in…that’s insane.

    If it were me like that and I couldn’t accomplish getting you on the team I’d have quit the team in protest…why would someone want to be on a team where the team won’t let your more than qualified client join?


  16. Love this article. I am a real estate professional and originally got my license because I didn’t know an agent that I trusted. I literally knew hundreds since I was a mortgage lender in one of my previous careers.

    Get your agent from referrals. I would also recommend checking public records to see if your agent has any foreclosures or bankruptcies as well. This may sound harsh but a top agent in my area of Colorado has over 18 foreclosures in his name. I wouldn’t want to trust someone who has been that reckless with my largest investment.

  17. I see several problems with your Realtor, but also several problems with you as the seller. If your Realtor agreed to list with no costs to you, then he should not be asking you to pay for a pest inspection. This would not be needed for the disclosures in most states anyways. He also should not be asking you to paint any part of the house. He should not be showing up to a showing as unpresentable.

    However as the seller I think you are completely wrong about the open house. Particularly in hot markets, and on hot properties open houses create a sense of competition among buyers, thus driving up the price. If you look at hot markets, San Fran, DC, Boston…particularly the desirable neighborhoods, you will find that homes that have open houses sell for more money and less days on market.

    Also as far as the commission rate, lets just say you get what you ask for. In our market, Redfin listed homes sell at a discount due to mispricing, as well as have much longer days on the market. Especially on the buy side there needs to be a 2.5% commission, because many agents brokerages will not allow them to show a discounted property, because if they do and the sale goes through, the buyer will then have to pay the buying agent the difference in commission which most buyers are not willing to do.

  18. Yes, let’s have them lower the commission rate, when a 5% commission gets broken down to 2.5% each and then broken down further to usually a 50/50 or 60/50 split with the brokerage. And in places where homes are only going for 100-200K, you are doing months of work for a commission of what, 1 or 2 thousand dollars? I’m sorry, but if you lower the rates further, it would make it not worth the realtors time. This is a realtors livelihood and sometimes people go month without a sale. I’ve seen it happen.

    1. And for the homes that cost over $1 million? That’s the median price on SF.

      Why not argue for a flat rate?

      There seems to be an oversupply of realtors now due to the Internet that enables one to find and sell online. Documents are boiler plate too.

  19. I agree. The difference for someone to sell the same product for 15x is weird. Zillow is starting to change things a little. Sellers can list FSBO without a listing fee. They can price the house right, and in your case, keep $75-150k of that fee. I shop and buy 100% (so far) without using a real estate agent.

    I am on the east coast and was looking to write a blog with a similiar title. Thats how I got here. .

  20. All this Realtor bashing…Not one of you spent a day in the business. There are probably 60k agents in the bay area… now imagine there are 60k fast food joints… the competition is crazy. The problem lies in the circumstances of each home… some homes are for sale because someone passed away… what are you gonna do? Leave your job, travel out of sate to put a for sale sign up and show it to strangers? I think not. If you selling your home you can bet you want other agents bring in the buyers and weeding them out so you don’t have to. Most of the commission is earned behind the scenes.

  21. Being in the market The Wife and I were always shocked just how shitty some brokers are! I feel like it has to do with how easy it is to get into the busy and how easy the money was a few years ago.

  22. Hey Sam,
    I have a great real estate agent that I’ve used several times. Not sure if she services SF, but she’s great, professional and easy on the eyes which always helps.

  23. I sold my last condo using a partially online service, Redfin. Loved them, so bought my house using them as well. They saved me THOUSANDS with both transactions, and did all the work I can’t do myself (contracts, offers, escrow stuff). I will never use mainstream agents again.

    Caveat: Redfin is only active in a few large cities in the U.S.

      1. I just went to the Redfin site to remind myself how it worked, and it looks like they’ve changed the way they do fees. They now get a bit more, but it’s still worth it by thousands of dollars. differs based on whether you buy or sell a place. I live in Seattle, where the traditional fee for selling is 6 %. That is split half-and-half b/w the buyer and seller agent. The buyer agent still gets their half (3 %), but Redfin only takes 1.5%. In my case, when I sold a condo for 375K, so I save over $5600.

        When I bought my house, (about 400k), I got a refund from Redfin of several thousand dollars during escrow. Their current fee info is at:

        Living in San Fran, the amount you save will be much higher, given home prices there.

      2. Redfin works slightly differently in each city, based on standard commisssions there (at least I think so, based on what I found). I went to the San Fran home search, and then looked under the Buying tab: .

        Here’s the San Fran info under Selling:

        They’ve actually changed the way they do compared to two years ago, when I bought a home. At that time, there was a flat fee. Now it looks like they work on percentages.

  24. A few modest suggestions based on my experiences…

    1) As a general rule, I wouldn’t use the same agent who put me into a home to take me out again… Different hustleupagus required for seller vs buyer agent… I sold a home in the nyc area in the early 2000s having bought it in 2000… Initially used same agent… bad move. She was great as a buyer’s agent.. not so much as a seller’s agent

    2) I have bought and sold several properties in multiple states… I have not once bought or sold based on an Open House experience, nor do I personally know anyone who has.

    3) Require your agent to be present at all showings of your home and do not agree to a lock box… if they can’t agree to make showing your home a priority, perhaps they are not the right agent? You can also ask if they willing to take responsibility for any items that might grow legs during a showing…that usually solves any reluctance pretty quickly.

    4) If you have a premium property (at whatever price level), suggest a tiered commission structure… price X gets XC%… Price X+Y gets YC% and so on. Just make sure the difference in commission is “motivational.” I can’t tell you how often I’ve heard realtors say the price difference was de minimis to them and not fight for what would be a meaningful amount to the seller…that extra $5,000 might be nice to you, but would only mean an additional $25 to an agent whose commission went from 5.5% to 6% based on that incremental $5,000…

    Great post Sam.

    1. Thanks for introducing me to the word “hustleupagus”!

      I agree on point #4 for sure as an excellent tip for all sellers. Aligns the agent with your interests for sure.

  25. I have bought and sold three homes and four pieces of income property. I only had one bad experience and I replaced that agent. I usually use referrals for real estate people and then interview them. I used a good friend (30+ years) for the sale of my home, mother’s condo and purchase of my townhouse.

  26. Make them earn their commission Jeremy? But of course, you know that I advise you to go directly to the listing agent to save a couple percent off your price. Let me know how it goes!

  27. Always a great time to buy or sell! Ugh…….. the schtick is so annoying. I don’t mind if they can back it up with concrete reasons WHY, but if no why, then leave me alone.

  28. My last real estate agent was very good. She is always professional and she was in my corner. I wanted to reduce the short sale price of the 4 plex and she agreed although it dragged out the closing period. I’ll call her again and give my recommendation to friends if I ever need the service again.

  29. I agree that you should have gotten a different realtor. At least show up in jeans and a nicer t-shirt would have said a lot about him. (Ideal->business suit attire or at least church (or mosque/temple) type clothing or something). It’s worse that the clothing was representative of his attitude towards business in general.

  30. Money Beagle

    It’s kind of funny, back in 2007 when I was putting my condo on the market, I kept asking my real estate agent about open houses and he actually kept steering me away from them for the exact reason you mentioned, that they don’t tend to be a good use of time. He ended up scheduling one, but I got an offer and accepted it the week before, so he cancelled it and took us around looking at houses instead :)

  31. I’ve bought three single-family homes, each w/o use of a buyer’s agent. Now that really incentivized the listing agent to make the sale happen. In FL, the seller customarily pays all closing costs. The last two purchases were all-cash; each cost me just $10 to close.

    The one home I sold, I interviewed two seemingly competent agents before selecting one of them. This was S. FL in 1997 well before the boom. I got little interest and no offers in four months; then a 98% offer, and closed fourteen days later, paying a 6% commission.


    When you buy another home Realtors always tells you the seller pays the 5% commission, which is untrue. The commission is baked into the selling price which is paid for by the buyer.

    Let’s say a house is priced at $2 million, and you bid $1.9 million, the difference is $100,000. Since the commission is 5% the seller will factor the commission into what they will receive after the sale. If it was a flat fee of $10,000 there would be room for negotiation on the remaining $90,000. So as a buyer you end up paying the higher price, so in effect you pay the realtor.

    You sell one house, pay the 5%, then buy another and pay an additional 5% into the sales price. Let’s say the total transaction is $3.5 million, you end up paying $175,000 in commissions! It is price fixing as Realtors often steer clients away from homes that don’t offer at least 2.5% for the buying agent.

    There is an antitrust lawsuit filed by the Department of Justice against the National Association of Realtors based on how the MLS listings are displayed on the internet. In every industry the internet has forced downward pressures on fees or costs ( travel agencies, car buying, jewelry sales, books etc.) except in the real estate industry.

    1. Exactly…. EXCEPT the real estate industry, which is why Zillow, Trulia, etc are a true disgrace to the consuming public for doing nothing to lower the oligopoly pricing.

      Buyers and sellers need to take matters into their own hands. Say “NO” to 5% commission rates!

  33. Man, sounds like this guy is inexperienced. There are a TON of agents and realtors out there and a good portion of them aren’t that great at what they do because the barriers to entry are so low. I think experience and a strong track record are really important before signing on anyone to sell a property because the commissions are painful and property are usually people’s largest assets.

    It’s really stressful trying to sell property and having to worry about your agent is the last thing anyone wants. In San Francisco a lot of properties go quickly just based on the listing agent because they know how to execute and make things happen.

    I think it’s a good idea to ask around for referrals and references too before signing a realtor if possible to save on a lot of headache and a long listing. Anything to help limit stress is usually worth the extra time up front.

    1. Folks need to match their property price/quality with the quality of Realtor. Expensive million dollar+ home? Go with an experienced and proven REaltor and not mess around with someone JV!

  34. To be fair, the open house situation is a little bit unique in San Francisco. Since most properties do have open houses and most only last on the market a few weeks (right now, anyway) most serious buyers plan to see things at the open house, and only schedule a follow-up with their own realtor afterward to write an offer. This is how it works with me anyway, and I’ve made two unsuccessful offers on properties this year!

    The stats you cite however are totally correct. In most of the country, open houses do not work and are only a way for the Realtor to generate new potential buyer leads and are popular mainly with un-serious buyers. (I used to be a REALTOR in Boston, and left the profession for all the reasons you outline… it seemed like a sham). The open house situation in SF is just very unique.

    1. That’s fine, but there are plenty of private open houses where all one has to do is pre-register. Theft is a BIG DEAL to many people, and there are lots of cases where things go missing, or random people walk in to scope your place out..

      What are you doing now that you are not a Realtor?

      1. I work for an interactive marketing agency, kind of sitting right at the intersection of tech and advertising (I’m specifically in search, but my company does all kind of creative development work for big brands all over the world). The Realtor thing was really a temporary detour that very quickly didn’t work out. Honestly, it bothered me at how inefficient it all was: most realtors spend the vast majority of their time on their own lead generation simply because there’s too many of them. To make up for it, they need massive commissions to justify all that dead time. We’d really be better off with a dramatically smaller (market-size appropriate) herd of Realtors who can devote all of their time to buying and selling homes.

  35. Sam,

    Could not agree more. In our area (Seattle) its 6%. With the declining inventory, and
    popularity of the region, the realtors are now beginning to negotiate, but usually down to
    5% or so. Personally I don’t feel that its worth it. I sold my last house myself with little difficulty, however it was a unique property.

    The new players who help the DIY folks may eventually gain ground against the traditional
    brokers, and that competition is healthy in my opinion.

    I could write all day on my feelings about this, but I’d rather not get flamed by realtors who
    frequent this board. We need to keep it civil!

      1. Jason Clayton | frugal habits

        Amen Brother! 6% is crazy for what they do – now that we have the internet.

        1. As an agent, our job no longer is to find a home for clients. The above mentioned agent sounds like a moron and I’ve done a lot of transactions with a lot of moron agents who deserve no commission and deserve to have their license revoked due to levels of incompetence.

          Zillow,, etc… all add fake listings that don’t exist to generate leads. The agents you see there are paying these companies for advertising space, they are never the listing agent. Their estimates are crap, even the CEO of and the CEO of Zillow said so (his home’s estimated price was undervalued by about $150,000 on his own website; my parents home is about $300k over what it is worth according the the “Zestimate”).

          Our job as an agent now days is to sell properties, we are high end sales people who make sure you don’t get sued for tens or hundreds of thousands of dollars. Our job is not to find a buyer a property, they have the internet. 95% of people don’t know how to sell… most people simply suck at it (including 95% of the people who think they are good at it). In the end, agents cost about the same as a lawyer, and will do a lot more hands-on work for clients. Of course all of this is based upon the notion that you have a competent agent (which honestly only about 15% of us are). Personally, I sell a home, I help paint it, clean it, get it prepped, polished and looking good so I can present it in its best light. Most agents are morons because the requirements for a license if you can fog a mirror.

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