The latest lawsuit will cause people to consider different pay structures for realtors.
If realtors were paid less, could they at least get some of it up front? Yes, if approved by the commissioner:
Before a broker may solicit, advertise for and agree to receive an advance fee, the paperwork material is to be submitted to the Commissioner of the California Department of Real Estate (DRE) for approval at least 10 calendar days prior to use.
If the Commissioner, within 10 calendar days of receipt, determines the material might mislead clients, the Commissioner may order the broker to refrain from using the material.
To be approved, the advance fee agreement and any materials to be used with the agreement will:
- Contain the total amount of the advance fee and the date or event the fees will become due and payable;
- List a specific and complete description of the services to be rendered to earn the advance fee;
- Give a definite date for full performance of the services described in the advance fee agreement; and
- Contain no false, misleading or deceptive representations.
Further, the advance fee agreement may not contain a provision relieving the broker from an obligation to perform verbal agreements made by their employees or agents; or a guarantee the transaction involved will be completed.
It sounds like slipping a few thousand under the table won’t be tolerated! The paperwork involved will probably make the big brokerages shy away from the idea, but we should consider alternative ideas.
You gotta love the timing. The bill for 2024 membership came today:
Local: $186
CAR: $231
NAR: $201
Total: $618
Payment due by 12/31/23
I’ve heard that we’ve already had 60,000 realtors quit this year, and hopefully these fees will keep a few hundred thousand agents from renewing.
Of the three, which is the best value? I’m thinking CAR just because Sacramento cannot be trusted.
CAR and NAR do spend a lot of money on lobbying. CAR paid for the last ballot initiative that allows seniors to take their property-tax basis with them, and assorted others that were good and bad.
That was the same prop that buried the lead that you can’t leave house to kids and keep property tax basis. That’s why a lot of homes are being sold in coastal NC that were part of a long-term estate plan. A lot of people planned to leave homes to their kids, the realtors had other plans to drum up business and screw everyone with kids.
Haven’t been a big fan of NAR, CAR etc, but the blatant screwing of their customer base with prop 19 was outrageous.
Nope, nope, nope. I never pay for any service in advance. Removes the primary incentive to perform. Why should anyone be paid for work they haven’t done yet?
Nope, nope, nope. I never pay for any service in advance. Removes the primary incentive to perform. Why should anyone be paid for work they haven’t done yet?
Ross, thank you for being a long-time supporter here! I’m with you, and I’ll live with the current agent pay structure. I’m going to go further into the lawsuit/commission thing but for now I’ll predict that the whole conversation comes down to a ~1% difference between the radical disrupter discount brokerage and JtR. Consumers don’t look too hard – they grab and go. Grab me!
We’ve never “fired” a seller agent, but have known people who did. Somehow I don’t see sellers going for a pay in advance scheme. If anything, they’re going to want to see itemized lists of fees for services and some kind of performance metric in a new commissions system.
Getting paid in advance is probably the last thing that will happen….mostly because it won’t be much!