The authors did not recognize the source of the U.S. commission data. See NAR, Public Comment 208, at 15-16; Delcoure & Miller, supra, at 15. 173. Roughly half of the public comments submitted to the Agencies in action to their ask for public comments were some variation of a kind letter that NAR composed, posted on its website, and encouraged its 1.
This letter applauded the competitive nature of the real estate market. Commenters using this type highlighted local competition in between private representatives as an outstanding example of rigorous competition to which the rest of the economy ought to aspire - what is cam in real estate. In addition, they claimed that the tens of thousands of brokerages, more than two million certified property specialists, and various service designs across the country supply customers with a terrific offer of option.
realtor.org/law_and_policy/mls/ild/regulator_letters. html) for more information on the association's directions and recommended content. 174. NAR, Public Remark 208, at 1 (remark). 175. Id. at 2. 176. Blann, Public Remark 250, at 1. But see NAR 2006 STUDY, supra note 4, at 74 (69% of sellers called only one representative; 74% of sellers discovered their agent through either a recommendation or a prior relationship with the representative).
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Reppert, Public Remark 294, at 1. See likewise Tradii, Public Remark Article source 340, at 1; Wharton, Public Comment 179, at 1. 178. See, e. g., Earman, Public Remark 73, at 1-2 (average commission is "well under 6%"); Giorgianni, Public Comment 200, at 1 (" My average commission has dropped over the last ten years from 3% to about 2.
179. Paulsen, Public Remark 364, at 1. A number of panelists and commenters cited Real Patterns price 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 Comment 55, at 1.
There are a range of options how to legally cancel a timeshare contract available to purchasers and sellers from full service representatives to extremely restricted service agents with a wide range of cost structures."); Big, Public Comment 241, at 1 (" our average commission per transaction side has dropped 13% this year compared to last year as a result of competition from discount brokerage company models operating in our market").
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GAO REPORT, supra note 3, at 12. 184. As gone over in Chapter I of this Report, the commission "rate" is the percentage of the house sales cost that the broker maintains as a commission, and commission "charges" are the total dollar quantity paid by customers for real estate brokerage services.
185. Weicher, supra note 167, at 121. how to get into commercial real estate. 186. NAR a rational source of commission information, offered its size and access to MLS information through its local associations does not study or report commission rates. A NAR financial expert explained at the workshop that any typical commission rate reported by a popular entity such as NAR could be utilized by market individuals as a centerpiece for collusion on commission rates.
at 225-26. See also NAR, Public Remark 208, at 12 (comment) (" [NAR] does not conduct research study on commission rates out of issues that the research study outcomes have the impact of setting a 'focal point' for professionals to set their commissions."). 187. Weicher, supra note 167, at 124. Weicher's computations use average home list prices, not mean home prices.
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Id. 189. See Hearing, supra note 1, at 5 (statement of David G. Wood), offered at http://financialservices. house.gov/ media/pdf/072506dgw. pdf. 190. Id. at 6. 191. See Realogy Corporation 10-K for financial year ending Dec. 31, 2006, readily available at http://www. sec.gov/ Archives/edgar/data/ 1355001/000095012307003335/e31090e10vk. htm #tocpage. 192. An extensive evaluation of the empirical research study conducted in the property how do i get out of a timeshare contract 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 FINANCING AND ECONOMICS 47 (2004 ); John D. Benjamin, G. Donald Jud & G. Stacy Sirmans, What Do We Understand About Property Brokerage?, 20 JOURNAL OF REAL ESTATE 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 Prices of House Brokerage Solutions, 10 JOURNAL OF THE AMERICAN REAL ESTATE AND URBAN ECONOMICS ASSOCIATION 331 (1982 ). 199. Id.
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200. Id. at 336. 201. Id. at 348 (" [O] n average, a $100,000 increase in the price of the house 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 Real Estate and Urban Development, U.S.
2006) [hereinafter "HUD REPORT"], readily available at http://www. huduser.org/periodicals/ushmc/fall06/USHMC_Q306. pdf. At that price, the research study's statistical outcomes forecast a corresponding 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 fee of $9,901.
Carney, supra note 198, at 339 (omitting 5 areas with inadequate observations for new homes, in 59 percent of the remaining market areas the mean commission rate paid was statistically substantially higher for existing houses than for new homes). 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 substantial at the one percent level for each of the formulas checked. See id. at 83. However, Weicher notes that the magnitude of the prices result seems small. See Weicher, supra note 167, at 121 (" Goolsby and Childs discover that the commission rate decreases about 0.
11 portion points for each $10,000 increase in house price, e. g., from 5. 90 percent to 5. 84 or 5. 79 percent."). 208. Goolsby & Childs, supra note 205, at 85. Because the authors only observed the cooperative commission rate, they keep in mind that their conclusion rests on the assumption that the cooperative split is a fixed share of the overall listing commission.
See id. at 81 n. 1. 209. See C.F. Sirmans & Geoffrey K. Turnbull, Brokerage Rates under Competitors, 41 JOURNAL OF URBAN ECONOMICS 102 (1997 ). This research study apparently includes the information and appropriate findings of an earlier research study conducted 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 carried out regressions evaluating how the contract commission rate was impacted by numerous 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 changes that might be renegotiated in between your house seller and the agent at the time of sale." Id.
213. While it is not possible to quantify the relative inflexibility based upon details reported by the authors, supplemental information can be used to compute a rough approximation. Weicher, supra note 166, at 121, reports that Sirmans and Turnbull computed a typical contract commission rate of 5. 8% in Baton Rouge over the duration 1985-1987.