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 general public comments sent to the Agencies in response to their demand for public comments were some variation of a type letter that NAR composed, posted on its website, and motivated its 1.
This letter applauded the competitive nature of the property industry. Commenters utilizing this kind highlighted local competitors in between specific representatives as an outstanding example of extensive competitors to which the remainder of the economy ought to aim - how to get into commercial real estate. In addition, they declared that the 10s of countless brokerages, more than two million certified property professionals, and different organization designs across the nation provide consumers with an excellent deal of option.
realtor.org/law_and_policy/mls/ild/regulator_letters. html) for more details on the association's directions and suggested material. 174. NAR, Public Remark 208, at 1 (comment). 175. Id. at 2. 176. Blann, Public Remark 250, at 1. But see NAR 2006 STUDY, supra note 4, at 74 (69% of sellers contacted only one representative; 74% of sellers discovered their agent through either a recommendation or a previous relationship with the agent).
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Reppert, Public Comment 294, at 1. See also Tradii, Public Comment 340, at 1; Wharton, Public Remark 179, at 1. 178. See, e. g., Earman, Public Remark 73, at 1-2 (typical commission is "well under 6%"); Giorgianni, Public Remark 200, at 1 (" My typical commission has dropped over the last 10 years from 3% to about 2.
179. Paulsen, Public Remark 364, at 1. Numerous panelists and commenters cited Real Patterns quotes of commission rates. See, e. g., Kunz, Tr. at 81-82; Lewis, Tr. at 172; NAR, Public Comment 208, at 12 (remark). 180. Lord, Public Remark 254, at 1. 181. Id. at 1. 182. Dwyer, Public Comment 55, at 1.
There are a variety of options readily available to purchasers and sellers from complete agents to very minimal service agents with a wide range of fee structures."); Big, Public Remark 241, at 1 (" our average commission per deal side has dropped 13% this year compared to last year as a result of competition from discount brokerage company models operating 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 genuine estate brokerage services.
185. Weicher, supra note 167, at 121. what is noi in real estate. 186. NAR a sensible source of commission information, offered its size and access to MLS data through its local associations does not study or report commission rates. A NAR financial expert explained at the workshop that any average commission rate reported by a prominent entity such as NAR might be utilized by industry individuals as a centerpiece for collusion on commission rates.
at 225-26. See likewise NAR, Public Remark 208, at 12 (comment) (" [NAR] does not carry out research on commission rates out of concerns that the research outcomes have the impact of setting a 'focal point' for specialists to set their commissions."). 187. Weicher, supra note 167, at 124. Weicher's estimations utilize average home list prices, not mean home prices.
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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, readily available at http://www. sec.gov/ Archives/edgar/data/ 1355001/000095012307003335/e31090e10vk. htm #tocpage. 192. A comprehensive review of the empirical research study conducted in the genuine estate brokerage industry is beyond the scope of this Report.
Turnbull, Trends in Property Research, 1988-2001: What's Hot and What's Not, 29 JOURNAL OF REALTY FINANCE AND ECONOMICS 47 (2004 ); John D. Benjamin, G. Donald Jud & G. Stacy Sirmans, What Do We Understand About bluegreen maintenance fees history Property Brokerage?, 20 JOURNAL OF REALTY RESEARCH 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, Costs and Rates of House Brokerage Solutions, 10 JOURNAL OF THE AMERICAN PROPERTY 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 an answered prayer llc the rate of the house lowers the commission rate by about 0. 5 percentage points"). The typical prices of an existing home in 1980 was $72,800. See U.S. Department of Housing and Urban Development, U.S.
2006) [hereinafter "HUD REPORT"], available at http://www. huduser.org/periodicals/ushmc/fall06/USHMC_Q306. pdf. At that rate, the study's statistical outcomes forecast a matching commission rate of 6. 25%, leading to a commission fee of $4,550. A house selling for $100,000 more, or $172,000, would pay a commission rate of 5. 73%, for a commission fee of $9,901.
Carney, supra note 198, at 339 (excluding 5 locations with insufficient observations for brand-new homes, in 59 percent of the remaining market locations the mean commission rate paid was statistically substantially greater for existing houses 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 substantial at the one percent level for each of the formulas evaluated. See id. at 83. However, Weicher notes that the magnitude of the list prices impact appears to be small. See Weicher, supra note 167, at 121 (" Goolsby and Childs discover that the commission rate declines about 0.
11 percentage points for each $10,000 boost in home 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 just observed the cooperative commission rate, they keep in mind that their conclusion rests on the assumption that the cooperative split is a fixed share of the total listing commission.
See id. at 81 n. 1. 209. See C.F. Sirmans & Geoffrey K. Turnbull, Brokerage Rates under Competitors, 41 JOURNAL OF URBAN ECONOMICS 102 (1997 ). This research study apparently incorporates the information and appropriate findings of an earlier research study carried out 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 evaluating how the contract commission rate was impacted by different market conditions and housing variables. As the authors discuss, the commission rate recorded in the sample is "the contract rate and therefore does not show any modification or modifications that might be renegotiated between your home seller and the representative at the time of sale." Id.
213. While it is not possible to quantify the relative inflexibility based how to get rid of timeshare property legally on information reported by the authors, supplemental information can be utilized to calculate a rough approximation. Weicher, supra note 166, at 121, reports that Sirmans and Turnbull determined a typical agreement commission rate of 5. 8% in Baton Rouge over the duration 1985-1987.