LAFAYETTE PARISH — “That whole big six percent, who’s actually getting that? It always comes out of the seller’s pockets.”
When Morris Hoffpauir Jr. put his late parent’s home on the market to sell…
“This is the last little hurdle we have in settling their estate and selling the house…”
He never imagined he would be doing so amidst a national conversation on real estate. As the executor of his parent’s estate, Morris is in charge of selling the home and decided against working with a realtor because of the commission rates.
“They can’t really justify 5, 6, or 2.5% percent, what is that final number? It’s a lot regardless. I shouldn’t be responsible for paying your commission to work against me…”
And that’s the feeling of many home sellers around the country. It’s also what prompted a national lawsuit against the National Real Estate Association.
The lawsuit alleges that NAR and four of the country’s largest real estate firms conspired to keep commissions high. The lawsuit resulted in a $418 million dollar settlement.
How do commissions impact the market? According to Redfin, the typical real estate fee is set at 5-6% of a home’s price. Buyers and sellers agents charge between 2.5% to 3% commission each.
That’s a difference of amounts to about fourteen thousand dollars on a 240,000 home, the average cost of homes in Lafayette Louisiana.
Christie Theaux, President of the Realtor Association of Acadiana says while there’s a lot of noise about the lawsuit, it’s important for buyers and sellers to understand the implications.
“One of the main changes that will come is that buyers will have to sign a buyers agreement…”
She says reports that the real estate industry is doing away with commissions are untrue
“There’s never been a six percent fee. Everything is negotiable...There’s always concern when there’s so much noise, at the end of the day the consumer needs a realtor in a transaction, just like you need doctors, are we going to do business a little different on paper, probably so.”
