Craigslist user seeking a real estate professional’s services

There will always be DIYers, but this is an interesting ad. I'm not sure how CA licensing works, but I can't imagine this being a smart move in Texas. Fannie Mae is going to look at that "rebate" for one and TREC is going to look at it as well. In addition, this person may have filled out the paperwork, but I wouldn't put my license (and my broker's) on the line and hope they didn't mess something up enough to open up future legal action.

I know people will always argue about our commissions, but I see two major components to why we're able to charge what we do (removing the obvious that we actually do more than just open doors and play Mad Libs with contracts): liability and risk. First, there's liability. My commission doesn't even cover my ass if something goes wrong. That's not to say that I expect things to go wrong or that I don't work to make sure they never do, but let's face it, people love to sue and we're at the top of the blame list. I take that liability in my hands every time I open my mouth. Of course, with proper training and attention to the "rules" I can limit that liability, but it is always there. I've seen some amazingly silly lawsuits since becoming an agent (not my own).

Then there's risk. I really feel the current models of commission-based pricing are based in risk. I can't guarantee that every interaction (or even transaction) is going to end in a successful closing. I work hard to make sure they do, but there is no accounting for some things. Unfortunately, we have to account for our "lost time" in working to move a person from looking to buying to closing. There are ways for us to tighten up that process (simple pre-approval both from the lender and agent sides is a great example) and I think we move closer to that goal as we give more data to the consumer through IDX, blogging, and education. The better informed the consumer, the more likely they are to know when they are ready, willing, and able to buy.

I think if the liability levels came down and consumers got (I hate to say it this way, but it was the best way I could think of) more "serious" about the buying and selling process, prices could come down. Would they? That I'm not sure of, because we do have a tendency in our industry to cling to the "way things have always been."

One other thought – when listing homes, the emphasis used to be on marketing, which meant printing, mailing, advertising…which had a cost associated with it in hard dollars. Now, much of that is free, but takes more time (which is also a valuable commodity). I know I invest a lot of time in any listing, but the consumer may not see that – and might not see its cost in quite the same light as me sending out 1000 flyers (tangible goods). I think the trick here is to define time as a cost and show how the two, although very different, are both valuable goods.