6% Real Estate Commissions a Thing of the Past?

[Gregory Delmonico]

https://www.cnn.com/2019/05/15/economy/real-estate-commissions/index.html

[Russell Brazil]

@Alexander Felice probably not. Technology hasnt disrupted the industry and likely wont because the actual reason agents exist is to provide liquidity to the market. Why do 90% of FSBO attempts end up listing with an agent eventually....because the transaction falls apart. Getting buyers across the finish line, keeping things moving forward, being the voice of reason when someone is freaking out of a nothing issue in a home inspection is the only reason the industry exists. There would need to be a major cultural shift by the general public for change to occur in the industry.

Zillow.....how do you think they actually make money? Selling leads to agents. They have no desire to disrupt the industry, because if they did they would be out of business.

There is exactly 1 factor that affects commission rates....the number of licensees in the market.  When the number of licensees goes up, average commissions go down, and when the number of licensees drops, average commissions go up.  

Here on the site we get a distorted view because the site is inherently filled with people who have bought and sold dozens and hundreds of homes....but that isnt the general public.  Those of us who deal with the general public on a daily basis (and I work primarily with investors!) can easily tell you 90% of buyers would never to make it to closing without all the hand holding, and calming of fears, and all the stuff that technology cant do.