Promise Acre: Our Journey

[promiseacres]

OK, I'm not understanding this. 25%-35% of what? If it is the selling price then people in Indiana are getting ROYALLY screwed. Like @Latestarter said, 6% is normal and paid by the seller. If there are both buyer and seller agents involved they split the 6%.

It's a percentage my mom's agent gets as referring my agent as our buyers agent. So if we buy this house the moms and my agent splits the buyers agent cut of the sale....the half of 6. my small understanding of how it will work. My agent only agreed bc she represented us as the buyers agent when we bought this, our friendship and she'll be our agent when we sell.

 

[Bruce]

I think I hurt my head trying to figure that out. I'm not even sure I DID figure it out.
Your Mom's Agent is A
Your Agent is B
Agent A referred Agent B to you? And as such gets 25-35% of the buyers agent's 3% if you buy. Why would an agent refer a different agent to anyone? Is that the "not driving the distance" bit? Agent A doesn't want to drive outside a certain radius of "home" so tells you about someone who is either "out that way" or is willing to do the driving? Yeah, screw you. I guess it is between Agent A & Agent B, some "reciprocal" thing and maybe Agent B refers people to Agent A and gets that same percentage.

Yep, my head definitely hurts.

 

[Latestarter]

Oh... OK, that's just as clear as mud... Bottom line is this is a further split of the sales commission (of 6%) between the "consenting adults" who "claim" to be real estate agents. It's not further dollars out of your pocket (seller - WHEW!), which is what I at first thought. Wow talk about making something supposed to be simple into the equivalent of brain surgery... Still don't "get" the referral business... Buyers agent gets 50% of the 6% commish and the sellers agent gets the other 50%. What you're describing is that one agent or the other will then take 25/35/whatever percent of their share and "give it away" to the other as referral fee? How can that work when the agent proper only gets a small portion of the 50% as their pay? The actual business/RE broker gets the lion's share of the 50% as the business income...

So on a 100,000 sale, commish is 6,000. 3000 to the selling agent and 3000 to the listing agent. Of the 3K the listing agent got, 50% plus goes to the brokerage so his/her pay is normally $1,500 +/-. (More experienced/high producers normally get a bigger cut, newbees get a lower cut) That's why agents always try to sell their own company's listing first if they can... they get to keep 100% of the commission, or in this case the full 6,000 making the agents pay double as well to $3,000. +/-

My head hurts... need an excedrine.

 

[promiseacres]

All I know is it's dumb but very glad to have someone I trust showing us houses. I told after I heard about the extra $ not to do it but she insisted. She recently lost her Dad to cancer, I know she's ready to get back to work.

Anyways saw the 30 acres that's 5 minutes further than we (dh) wants but it definitely has potential. Has a 50x 70 shop for DH....with concrete, so what Sandy but not a beach. 20 acres of rolling grassland surrounded with a few trees. Small but adequate house, very nice full basement, potential room down there for a school area. Plenty of space for a mil cabin or home.

 

[Bruce]

I know "only another 5 minutes" can creep to "only xx more" but it is only 5 more minutes, right? If it is the right place, the 10 min/day won't be too much. He might find that huge shop is worth the extra drive.

 

[promiseacres]

I know "only another 5 minutes" can creep to "only xx more" but it is only 5 more minutes, right? If it is the right place, the 10 min/day won't be too much. He might find that huge shop is worth the extra drive.

yeah, he REALLY liked the shop... LOL

 

[Bruce]

I bet. Mine is about 1/4 of the upper part of the barn which is about 35'x70'. While much more space than I had at my other house (in the basement), it is still too small for what I would like to do. The entire barn footprint (upper and lower) is about 50'x70' so I do have a good idea of just how big that shop is!! He could so easily set up all the tool stations and work without having to move stuff around every time he needs to use one.

 

[Baymule]

Here real estate agents include a disclaimer; your agent must be present at any showing, or something to that effect. In other words, if you have an agent, they ain’t getting doodley squat unless they are with you when selling agent shows you the property.

 

[Bruce]

Sounds reasonable. Around here if you have an agent you probably never see the seller's agent unless maybe at the closing. People who see a house with the seller's agent likely do so only if they find the house listing and contact the seller's realtor. And they may not realize that the agent's allegiance is to the seller, they don't care squat about the buyer other than convincing them to buy at the highest price they can get. Thus it is better to get a "buyer's broker" who has the buyer's interests at heart. They are still paid from the same 6% sales commission.

 

[promiseacres]

So we're going to see it a 2nd time.... the 20 acres. Feeling bittersweet, excited to move forward but know it means change. And with our little league drama well not much but our church (and DHs job)ties us to our county. Even though we're 4h project leaders... our 4H really is a headache. We can homeschool anywhere and our co op too is at a point I wonder if it will continue to meet our needs in the future. In any case it feels like God is cutting our ties.
Had a good conversation with my Mom. Still feels like a crazy plan but....
one more cold day then hopefully spring will be here for a bit.