The authors did not determine the source of the U.S. commission data. See NAR, Public Comment 208, at 15-16; Delcoure & Miller, supra, at 15. 173. Around half of the general public remarks submitted to the Agencies in reaction to their ask for public remarks were some variation of a form letter that NAR made up, published on its site, and motivated its 1.
This letter praised the competitive nature of the genuine estate market. Commenters using this kind highlighted local competitors in between individual representatives as an outstanding example of extensive competitors to which the rest of the economy must aspire - how to become a real estate agent in va. In addition, they claimed that the 10s of thousands of brokerages, more than two million licensed property professionals, and various organization models throughout the nation supply consumers with an excellent deal of option.
realtor.org/law_and_policy/mls/ild/regulator_letters. html) for more details on the association's guidelines and suggested content. 174. NAR, Public Comment 208, at 1 (remark). 175. Id. at 2. 176. Blann, Public Remark 250, at 1. But see NAR 2006 SURVEY, supra note 4, at 74 (69% of sellers service cancellation letter sample gotten in touch with only one agent; 74% of sellers found 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 Remark 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 Genuine Trends quotes of commission rates. See, e. g., Kunz, Tr. at 81-82; Lewis, Tr. at 172; NAR, Public Remark 208, at 12 (remark). 180. Lord, Public Remark 254, at 1. 181. Id. at 1. 182. Dwyer, Public Remark 55, at 1.
There are a variety of alternatives offered to purchasers and sellers from full service agents to very limited service agents with a wide range of charge structures."); Large, Public Remark 241, at 1 (" our average commission per transaction side has dropped 13% this year compared to last year as an outcome of competitors from discount rate brokerage business designs running in our market").
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GAO REPORT, supra note 3, at 12. 184. As discussed in Chapter I of this Report, the commission "rate" is the percentage of the house sales rate that the broker maintains as a commission, and commission "costs" are the overall dollar quantity paid by consumers for genuine estate brokerage services.
185. Weicher, supra note 167, at 121. how long does it take to get your real estate license. 186. NAR a logical source of commission information, provided its size and access to MLS information through its local associations does not study or report commission rates. A NAR financial expert described at the workshop that any typical commission rate reported by a popular entity such as NAR could be used by industry participants as a centerpiece for collusion on commission rates.
at 225-26. See also NAR, Public Remark 208, at 12 (comment) (" [NAR] does not carry out research on commission rates out of issues that the research outcomes have the effect of setting a 'centerpiece' for professionals to set their commissions."). 187. Weicher, supra note 167, at 124. Weicher's computations utilize typical house sales rates, not mean home prices.
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Id. 189. See Hearing, supra note 1, at 5 (statement of David G. Wood), available at http://financialservices. house.gov/ media/pdf/072506dgw. pdf. 190. Id. at 6. 191. See Realogy Corporation 10-K for ending Dec. 31, 2006, offered at http://www. sec.gov/ Archives/edgar/data/ 1355001/000095012307003335/e31090e10vk. htm #tocpage. 192. A thorough review of the empirical research performed in the real estate brokerage industry is beyond the scope of this Report.
Turnbull, Trends in Property Research Study, 1988-2001: What's Hot and What's Not, 29 JOURNAL OF REAL ESTATE FINANCE AND ECONOMICS 47 (2004 ); John D. Benjamin, G. Donald Jud & G. Stacy Sirmans, What Do We Know About Real Estate Brokerage?, 20 JOURNAL OF PROPERTY RESEARCH STUDY 5 (2000 ). 193. 1983 FTC PERSONNEL 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 Pricing of House Brokerage Providers, 10 JOURNAL OF THE AMERICAN REALTY AND URBAN ECONOMICS olivia nelson browning 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 the rate of the home reduces the commission rate by about 0. 5 portion points"). The typical list prices of an existing home in 1980 was $72,800. See U.S. Department of Housing and Urban Advancement, U.S.
2006) [hereinafter "HUD REPORT"], offered at http://www. huduser.org/periodicals/ushmc/fall06/USHMC_Q306. pdf. At that cost, the study's statistical results forecast a matching commission rate of 6. 25%, leading to a commission charge of $4,550. A home selling for $100,000 more, or $172,000, would pay a commission rate of 5. 73%, for a commission charge of $9,901.
Carney, supra note 198, at 339 (omitting five areas with inadequate observations for new homes, in 59 percent of the staying market areas the mean commission rate paid was statistically considerably greater for existing houses than for 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 significant 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 find that the commission rate declines about 0.
11 percentage points for each $10,000 increase in home cost, 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 note that their conclusion rests on the presumption that the cooperative split is a set share of the total listing commission.
See id. at 81 n. 1. 209. See C.F. Sirmans & Geoffrey K. Turnbull, Brokerage Rates under Competition, 41 JOURNAL OF URBAN ECONOMICS 102 (1997 ). This research study apparently includes the information and pertinent 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 affected by different market conditions and housing variables. As the authors explain, the commission rate captured in the sample is "the agreement rate and for that reason does not show any modification or modifications that may be renegotiated in between your home seller and the representative at the time of sale." Id.
213. While it is not possible to measure the relative inflexibility based upon details reported by the authors, extra details timeshare rescission letter sample can be used to compute 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 period 1985-1987.