I saw an interesting interview on CNBC today of Colony Capital CEO Tom Barrack whose firm has $34 billion under management. He spoke about the many changes in housing but touched on a real interesting point. He compared realtors fee`s to brokerage fees and said its days are numbered. He states that these fee's are the last of this type of fee left in the market place. I have to agree. I think its only a matter of time before this goes away. As a stock trader it would have been unheard of and impossible to have traded without a broker. Now you still have brokers but they are for a select few that need some hand holding or large portfolios. I can certainly see this evolving the same way with Zillow and Auction.com. I know the brokers went away kicking and screaming as all those good paying jobs went away. I would expect the same reaction here but times do change. Some may pop up oh we will need them to open the door and show the homes and all the other things a realtor does but again the same was said of brokers. I for one would like that 6% in my wallet. Some may feel different. Here is the link to the video if you care to view it. http://video.cnbc.com/gallery/?video=3000311073

Most Realtors do just 4-5 transactions per year and make about $20k. Many, including me, practice real estate in their spare time. My goal is to do 4-5 transaction per month. My goal is to provide a level of service that makes my clients feel comfortable, proud and grateful for choosing to use me as their Realtor. I think that goals separate the 4-5/year, just get by crowd from those that choose excellence. Many of my investor friends deride Realtors, sometimes even in good humor. The fact of the matter remains that 9 out of 10 houses are sold using Realtors. I don't see this changing any time soon. A good agent is more than just a robot that enters information in the MLS. A good agent can tell a tale of your home that will interest the internet viewer to want to come by and take a look. A good agent can take photos or hire a great photographer to highlight your homes best points. A good agent can steer you to deals, whether they are on the MLS or wholesale. A good agent looks out for your best interests before their own. In a world where many folks are more and more overworked I don't see people wanting to take the time to show their home, or figure out contracts and disclosures. I don't see people relocating to new cities driving around aimlessly trying to find a good home in a good neighborhood. As far as the fees I will just quote a friend of mine who introduced himself at a REIA meeting immediately after a $295 listing service guy, he said; "I am a Realtor and I charge 6%, because I am worth it.". If you don't value your Realtor's service, fire them. Realtors are not essential, but neither is your car. You can buy a home without a Realtor just like you can get to work without your car but both will make the journey a whole lot easier.

I want everyone to realize something. Do you think FSBO is new?? Do you think flat fee is new?? Do you think discount agents are new?? We have been hearing the sky is falling for decades. HASN'T HAPPENED people. You must understand that for every do it yourself investor or buyer the whole population doesn't think like you do. There are many different type of buyers and sellers. I do commercial real estate and let me tell you business has never been better and I am setting records every year for myself. There are people out there that see minimal or no value to brokers or agents. I say to that GREAT and do what works for you. I do not need all the business and frankly I am selective about who I take as a client. I qualify them which I believe is one of the biggest things brokers and agents need to be doing and most do not. They accept a warm pulse buyer or seller and hope something happens. That's NOT how you run a successful business. Residential agents do fadeout more quickly and commercial is more specialized. Discount companies have been funded hoping to be the next big thing and they last a few years and then go out of business or contract. I have seen tons of them churn and burn over the years. Some people want to eat at Taco Bell for 1.00 and other will always want Ruth's Chris. There is business for everyone.

Realtors are going nowhere. This is one of the strongest and well-funded lobbies in Washington...

@Jay C. The reason you feel this would happen is because like a lot investors, you want everything cheap (free) but you want full profits! As a business owner, investor, and Realtor I learned a long time ago. You have to evaluate what is money well spent, what will I spend that will generate me more profits. Just like when a car accident happens, you can file a law suit without a lawyer but if you have a lawyer you would have a better chance at winning. Zillow was created by a savvy business man that took some information that was not available to the public, and provided access. It's not perfect and doesn't have all the information. It's a good starting point for a consumer. I guess you forgotten what happen a few years ago that caused a crash in the economy? The result of that experiment brought on new and strict regulations in the industry. Housing is the biggest financial decision of most people lives. Do you really think a website will be the facilitator of this transaction? So you would trust a website to sell you home because you think your saving money? I guess next you would not want to pay closing cost? That includes a fee to the lawyer for filing. Roughly $600 to $1000. I once spoke to a respected business guru and he said expenses are not loses but ways to create more money without having to deal with headaches in areas. He has an accountant, lawyer to take care of legal issues that he never hears about, advisory board, driver, etc. You can not compare the stock market brokers to Real Estate. That's an entire different animal. @Doug Merriott you're dead on. Oh whenever you watch CNBC the guest has an agenda - Tom Barrack has an agenda and since he received a law degree, it's something that will benefit his pockets.

Another thing worth noting is that the majority of people who come onto this website & post on the forums are different than the majority of people. The people who regularly post on this site are generally looking to be hands on investors and have an "i'll do it myself" mindset........which is great, more power to you. What you do not get to see a picture of is the ones in the background. The ones who are not on a site like this & the ones that are on this site who come onto this site, create a profile & have never made a bp forum post. Maybe they have not even made a profile maybe they just read the blogs....These folks are doing deals ALL THE TIME & they are happy to have RE professionals do their jobs. I'd say I have about 40 or so properties under management for bigger pockets members & almost all of them are from members who NEVER post on the site. That is just from the investor side. Joe homeowner who has made 1 real estate purchase in the last 15 years is going to be even more hands off when it comes time to sell & then eventually buy.

Joel, It is wishful thinking that the real estate broker's days are numbered. They have been saying that for the 25 years I have been a broker. The reality is that real estate agents have gotten better. I think a few people on here need to search for better agents. They probably don't know the 20/80 rule. That rule states 20% of the agents do 80% of the business. Mark

Well, I didn't listen to the link. My opinion is that there is a successful guy in what he does attempting to branch out his business experience in an area he has no knowledge of seeking more fame and influence. Why didn't he speak to the cut a bookie takes on a bet? Realtors have been working by the hour, on a salary, by consultation arrangements and for discounted commissions as well as under full commission arrangements for over 50 years. They have become more specialized. I agree that today, you need to be more tech savvy than we were in the 90s, that doesn't throw out the techniques of the 90s, or 80s, or 60s or even the 50s. The reason the kids don't get it is that they have no clue as to the basics of RE as they begin on the third floor of the building of knowledge and then struggle to get up to the 4th floor. Turning bits into atoms is not as easy as the techies believe. In chapter one of the book of RE basics, it mentions that real estate is unique, no two parcels on the face of the earth are identical, this is mentioned before location, location, location. In the same subdivision there can be a 40K difference in lot prices, lake front to lake view to no frontage an no view. Techies want to convert these atoms to bits and there is not enough data to produce a reliable analysis. Hang in there, I'm getting to Realtors. Real estate has an emotional element unlike any other market, I may love a stock but a stock should not be based on an emotional response. Remember, RE is unique and a round lot of GE stock is pretty much the same as the next 100 shares you might buy. Realtors are more than widget sales people, the are social workers, they are personal financial advisors, they are community representatives introducing new comers to a new area, they inform of social, business, religious, health care and educational systems within a community. They employ psychological assumptions about people as to preferences, their expectations, how they live, work and how they recreate in their life style. There is much more to it than opening a door and letting people walk through a house. I have had techies calling me for several years, wanting to develop an app for that, build some software program to revolutionize the industry.....I tell them they can't do that until we have artificial intelligence! As to Zillow, good for them making money, but the product is crap, not worth any seasoned real estate professionals time using the site.....maybe they have pictures, that's nice. Valuations are subjective and objective, we can't get the subjective side until we have artificial intelligence! And, then, that will only be one opinion. So, where are Realtors going? To the people to serve the public to facilitate real estate transactions. How do they get compensation? Anyway they can that is socially accepted and legal. What that guy was predicting was predicted in the early 80s, with Real Estate Consultants!

I definitely think the role of the real estate agent has changed over the years. Not everyone. NEEDS an agents, but my clients seem genuinely happy to have me in their corner. I'm typically working with people who have never bought a home, or maybe are on their second or third home. They are not savvy RE buyers. They appreciate my advice on what to offer, what to expect during negotiations and what steps to take from contract to close. These are all things people can learn on their own, but they won't ever have the same market knowledge an experienced, local agent will have. An analogy that comes to mind - I am currently in the process of hiring a Wordpress developer to build me a new website. I know how to make a Wordpress website myself, but he is an expert where I am not. I could fiddle with it for a few days or weeks and learn more, but I will never know what he knows. Therefore, I made the decision to pay him 500-600 to do the work instead. He will be much more efficient, get the site done faster, and it will look better than anything I could have made. RE agents who learn new technology and who are not stuck in the 1990's ways of transacting business will go much further as times change. You have to be open to the new environment and accept change, not fight it.

Maybe this new wave of information will weed out the lazy real estate agents and encourage those that really do bring value to the table. Seems positive to me!

I have heard this conversation many times as a Realtor. In hear realtors compared to travel agents and stock brokers, but there is a big difference. Stock brokers and travel agents sold fixed price assets. The entire market knew what they were worth and there was no 17 page contract involved, lender involved, title company involved and possible attorney in some states. A real estate agent is dealing with a different asset on every deal. No house is the same because they all have a different location. Since nothing is the same, a new valuation must be done every time and a computer algorithm wont be accurate. A real estate agent is more like a lawyer. There have been many cheap services pop up for legal services but lawyers aren't going anywhere. You pay a lawyer for their knowledge, expertise and education. Its the same with agents and in most states agents are actually practicing law on a limited, very regulated basis with contracts. The stats from NAR showed FSBO sold for almost 20% less than MLS homes an take much longer to sell. Buying a house is the biggest purchase most people ever make, it is not the same as buying a stock that is easy to value and easy to sell.

Are Realtors days numbered?

Joel OwensBusiness Member

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Real Estate Broker · Canton, GA · Member since 2010 · 15k+ posts · 11k+ votes

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Jay what you are saying has been said over the last few decades and those people that said it will happen it hasn't happened. I have seen all kinds of technology touted as the new future only to fall flat on their face.

I am just saying there have been many before you saying this for along time and the sky hasn't fallen.

Software can't replace the relationship in the business. I respect your opinion but disagree with it.

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Are Realtors days numbered?

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