Another type of restraint that is likely to reduce competition and consumer choice in real estate brokerage-related services is overly broad licensing requirements, particularly those applicable to firms that advertise FSBO homes. See 1% Realty, Buying a New Home, http://www.onepercentusa.com/buy.htm (last visited Mar. 43. Second, consumers may be unaware of the possibility that their brokers may have conflicting interests that lead them not to provide the consumer with the best possible advice. Fulfill your COE training requirement with free courses for new and existing members. REAL ESTATE RESEARCH 30, 34-35 (2000). 93. The obstacles discussed so far in this Chapter represent concerted efforts of real estate incumbents to insulate themselves from new and innovative types of competitors. 100. NAR 2006 SURVEY, supra note 4, at 37. Transaction-level data on commission rates and fees are not publicly available, but broad national aggregate data suggest that commission rates and fees move in tandem with housing prices. Including Legal, Agent & Broker, and Property Rights Issues. Although consumers benefit to some extent from all of these forms of competition, the available data suggest that brokers may compete less on price than would be expected in a competitive market. Id. See, e.g., Glenn Roberts, Jr., "Secret Agents" Quietly Offer Real Estate Rebates, INMAN NEWS, Mar. 51. See also Perriello, Tr. 283. For example, the most recent NAR survey of home sellers and buyers found that the majority of home sellers contact only one listing agent before hiring one to assist with the sale of their home.129 Further, there is evidence that some consumers of brokerage services are not necessarily aware that commission rates are negotiable.130 This may be especially true of buyers who pay for their brokers' services indirectly via the purchase price of the home.131 Although some Workshop comments suggest that consumers' awareness of their ability to negotiate over the price and terms of brokerage services is increasing,132 perhaps due to the increasing numbers of discount brokers that have entered the industry over the past few years, some consumers do not negotiate over commission rates. 310. 122. at 237. Blanche Evans, Where Real Estate Associations Stand On MLS-Entry-Only Listings, REALTY TIMES, Feb. 24, 2005, available at http://realtytimes.com/rtapages/20050224_mlsentryonly.htm. In this Section we discuss the following non-traditional business models: (1) full-service discount brokers; (2) fee-for service brokers; (3) VOW brokers; (4) websites that provide advertising and other assistance to sellers who choose not to use a broker; and (5) referral networks.65, Discount brokers offer buyers and sellers full-service real estate brokerage services at a price lower than the prevailing commission fees.66 For example, a discount broker may offer all of the services provided by a traditional broker for a 3 or 4 percent commission in an area where 6 to 7 percent is the prevailing rate.
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