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2. Invitation to the Realtor Ghost Dance

Realtor Ghost Dance

It would seem that anything, any idea, if combined with aesthetics can be made to stick.  Someone will embrace it and buy into it.  Apparently, there is no idea too preposterous, or so idiotic that it can not find a home.  From young men wearing big baggy pants, put on backwards, to Indians wearing "special shirts" that will stop bullets, there is always someone who is all in.

There is an endless supply of wonderful ideas from well-intentioned and those who only pretend they are well-intentioned about what "ought to be done with the MLS".  Most of these ideas would radically change or pervert the purpose of the MLS (an offer of compensation) to the point where it would not be recognizable. 

One of the more destructive ideas is "divorcing buyer agent commissions".

Most of the arguments seem to be based on it is "still sub-agency", and it isn’t right because the buyer’s agent is being paid by the seller (via the listing agent).  It is like we are lawyers.  We are not.  We are salespeople.  Our job is to sell homes or find one for the buyer.  Also advanced is the entirely false premise that the buyer pays the commission via the seller and the listing agent.  If that were true then you could see the commission shown as a cost on a FNMA appraisal.  But it isn’t there because it does not belong there.  A FSBO can get their identical home appraised for the exact same price as a home listed by a broker.  The reason that sellers believe they pay the commissions is because they do pay the commissions.

Setting aside that fact that "divorced commissions" is a completely destructive (towards Realtors and the public) idea, what is interesting is that virtually all of the wonderful new things that could be done if only the commissions were divorced can be done right now with no change being made by anyone else.  That’s correct.  Want more commission than is being offered?  It can be done.  Want less?  It can be done.  All, right now.  What the people working on this are really trying to do (as they have a "better" idea)  is to regulate how YOU do business.  Not how they do business.

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MLS is working just fine, thank you.

Could a buyer agree to pay an agent "X" per hour to show them homes and write an offer?  Sure.  I believe there are lots of agents who would welcome a set fee per hour, regardless of if the person ever bought a home or not.  Various people (who can’t think clearly) like to insist what a wonderful world it would be if we could all do something like that – it would be so honest.  Many lawyers get paid like that, in fact, some of them insist on being paid like that.  Why wouldn’t that work for Realtors?  Simple: because most buyers of most houses would not be interested in making an agreement like that.  Ever. They strongly prefer the lawyer "contingency" method – you, Mr. or Ms. Realtor, collect your money at the end.  No sale, no pay.

Few buyers are going to pay by the hour for agents to show them houses, regardless of if they buy or not and in most cases they are not going to agree, at all, to pay an agent’s full commission if they can buy a home direct from the seller or through the listing agent and not have to pay any commission.  Most buyers (unless they are in litigation) do not find "agency" worth paying for or even talking about all that much.  Buyers want – and are looking for – a house, not an agent.  If you wanted to buy a new car, can you even imagine thinking, "I sure hope I can find a really great car salesman to help me and explain all that confusing paperwork"?  Or is it far more likely you would be willing to tolerate talking to the salesman in order to get the information you wanted?  "Enforcing agency" on the public will amount to NO agency.  They won’t pay for it.  Buyer agents who are "for divorcing the commissions", would, if "successful", only succeed in putting themselves out of business.

It can be remarkable the things people will sometimes do on the subject of failure.  To work on something like this a working Realtor would have to have at least a low-grade death wish for themselves and others.  Those outside the industry working on it have one for us.  Not necessarily low-grade.

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Written By

Russell has been an Associate Broker with John Hall & Associates since 1978 and ranks in the top 1% of all agents in the U.S. Most recently The Wall Street Journal recognized the Top 200 Agents in America, awarding Russell # 25 for number of units sold. Russell has been featured in many books such as, "The Billion Dollar Agent" by Steve Kantor and "The Millionaire Real Estate Agent" by Gary Keller and has often been a featured speaker for national conventions and routinely speaks at various state and local association conventions. Visit him also at and



  1. Mark Eibner

    February 24, 2009 at 9:16 am

    we’re at it again 2. Invitation to the Realtor Ghost Dance: Get out of your feed reader and com..

  2. sheilabragg

    February 24, 2009 at 9:29 am

    2. Invitation to the Realtor Ghost Dance: Get out of your feed reader and comment on this post- we PROMISE that ..

  3. Dan Connolly

    February 25, 2009 at 12:51 am

    Here here Russell, I agree completely. I think most of the people who write these articles aren’t really realtors (non capitalization intentional), they may have a license, but at heart are writers and just trying to pull the chains of their readers.

    As the recession continues, and the banks discount their foreclosed homes by 50-70%, more homeowners than ever will be willing to pay the pros who can actually bring a buyer willing to pay a decent price.

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