The authors did not determine the source of the U.S. commission data. See NAR, Public Remark 208, at 15-16; Delcoure & Miller, supra, at 15. 173. Around half of the public remarks sent to the Agencies in reaction to their request for public remarks were some variation of a kind letter that NAR made up, published on its site, and encouraged https://paxtonzzwu749.hpage.com/post2.html its 1.
This letter applauded the competitive nature of the property industry. Commenters Go to the website using this form highlighted local competition in between individual representatives as an outstanding example of extensive competition to which the remainder of the economy must aim - what does mls stand for in real estate. In addition, they declared that the 10s of thousands of brokerages, more than two million licensed property professionals, and numerous organization designs across the country provide consumers with a good deal of option.
realtor.org/law_and_policy/mls/ild/regulator_letters. html) for more information on the association's directions and suggested material. 174. NAR, Public Comment 208, at 1 (comment). 175. Id. at 2. 176. Blann, Public Remark 250, at 1. However see NAR 2006 SURVEY, supra note 4, at 74 (69% of sellers called only one agent; 74% of sellers found their agent through either a recommendation or a previous relationship with the agent).
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Reppert, Public Comment 294, at 1. See likewise Tradii, Public Comment 340, at 1; Wharton, Public Remark 179, at 1. 178. See, e. g., Earman, Public Remark 73, at 1-2 (average commission is "well under 6%"); Giorgianni, Public Comment 200, at 1 (" My average commission has actually dropped over the last 10 years from 3% to about 2.
179. Paulsen, Public Comment 364, at 1. A number of panelists and commenters pointed out Genuine Trends quotes of commission rates. See, e. g., Kunz, Tr. at 81-82; Lewis, Tr. at 172; NAR, Public Remark 208, at 12 (remark). 180. Lord, Public Comment 254, at 1. 181. Id. at 1. 182. Dwyer, Public Comment 55, at 1.
There are a variety of options available to buyers and sellers from complete agents to extremely minimal service agents with a wide range of cost structures."); Large, Public Comment 241, at 1 best timeshare in usa (" our average commission per deal side has actually dropped 13% this year compared to in 2015 as an outcome of competitors from discount rate brokerage company models running in our market").
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GAO REPORT, supra note 3, at 12. 184. As gone over in Chapter I of this Report, the commission "rate" is the percentage of the house prices that the broker keeps as a commission, and commission "costs" are the total dollar amount paid by customers for real estate brokerage services.
185. Weicher, supra note 167, at 121. how to get leads in real estate. 186. NAR a rational source of commission data, provided its size and access to MLS data through its regional associations does not study or report commission rates. A NAR financial expert discussed at the workshop that any typical commission rate reported by a popular entity such as NAR might be utilized by market participants as a focal point for collusion on commission rates.
at 225-26. See likewise NAR, Public Comment 208, at 12 (comment) (" [NAR] does not carry out research on commission rates out of concerns that the research study results have the result of setting a 'focal point' for professionals to set their commissions."). 187. Weicher, supra note 167, at 124. Weicher's computations utilize average house list prices, not median home sales costs.
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Id. 189. See Hearing, supra note 1, at 5 (testament of David G. Wood), offered at http://financialservices. house.gov/ media/pdf/072506dgw. pdf. 190. Id. at 6. 191. See Realogy Corporation 10-K for ending Dec. 31, 2006, offered at http://www. sec.gov/ Archives/edgar/data/ 1355001/000095012307003335/e31090e10vk. htm #tocpage. 192. A comprehensive review of the empirical research study performed in the realty brokerage industry is beyond the scope of this Report.
Turnbull, Trends in Real Estate Research Study, 1988-2001: What's Hot and What's Not, 29 JOURNAL OF REAL ESTATE FINANCE AND ECONOMICS 47 (2004 ); John D. Benjamin, G. Donald Jud & G. Stacy Sirmans, What Do We Know About Realty Brokerage?, 20 JOURNAL OF PROPERTY RESEARCH STUDY 5 (2000 ). 193. 1983 FTC STAFF REPORT, supra note 9, at 45.
Id. 195. Id. at 46 (49. 6% of sample paid 6%, while 27. 9% paid 7%). 196. Id. at 48. 197. Id. at 52. 198. See Michael Carney, Expenses and Rates of Home Brokerage Solutions, 10 JOURNAL OF THE AMERICAN REALTY AND URBAN ECONOMICS ASSOCIATION 331 (1982 ). 199. Id.
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200. Id. at 336. 201. Id. at 348 (" [O] n average, a $100,000 rise in the cost of the house lowers the commission rate by about 0. 5 percentage points"). The average sales price of an existing house in 1980 was $72,800. See U.S. Department of Real Estate and Urban Development, U.S.
2006) [hereinafter "HUD REPORT"], readily available at http://www. huduser.org/periodicals/ushmc/fall06/USHMC_Q306. pdf. At that rate, the study's statistical results predict a matching commission rate of 6. 25%, resulting in a commission cost of $4,550. A house offering for $100,000 more, or $172,000, would pay a commission rate of 5. 73%, for a commission cost of $9,901.
Carney, supra note 198, at 339 (omitting five locations with insufficient observations for new houses, in 59 percent of the staying market locations the mean commission rate paid was statistically significantly higher for existing homes than for brand-new houses). 203. Id. 204. Id. at 248. 205. See William C. Goolsby & Barbara J.
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206. Id. at 84. 207. This finding was considerable at the one percent level for each of the formulas tested. See id. at 83. However, Weicher notes that the magnitude of the list prices impact seems small. See Weicher, supra note 167, at 121 (" Goolsby and Childs find that the commission rate declines about 0.
11 percentage points for each $10,000 boost in house price, e. g., from 5. 90 percent to 5. 84 or 5. 79 percent."). 208. Goolsby & Childs, supra note 205, at 85. Considering that the authors only observed the cooperative commission rate, they keep in mind that their conclusion rests on the assumption that the cooperative split is a set share of the overall listing commission.
See id. at 81 n. 1. 209. See C.F. Sirmans & Geoffrey K. Turnbull, Brokerage Prices under Competitors, 41 JOURNAL OF URBAN ECONOMICS 102 (1997 ). This research study obviously integrates the data and appropriate findings of an earlier research study conducted by the authors. See C.F. Sirmans, Geoffrey K. Turnbull & John D.
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210. Sirmans & Turnbull, supra note 209, at 111. 211. Id. at 113-115. 212. Id. at 113-14. The authors performed regressions analyzing how the agreement commission rate was impacted by various market conditions and housing variables. As the authors discuss, the commission rate captured in the sample is "the agreement rate and therefore does not reflect any adjustment or changes that might be renegotiated in between the house seller and the agent at the time of sale." Id.
213. While it is not possible to quantify the relative inflexibility based on info reported by the authors, supplemental details can be utilized to compute a rough approximation. Weicher, supra note 166, at 121, reports that Sirmans and Turnbull determined a typical contract commission rate of 5. 8% in Baton Rouge over the duration 1985-1987.