Let's talk about the basics just a minute. The real esate business works the way it works, and is not always logical. Guessing about these things, or assuming things work the way you want them to work, can get you in trouble and cost you lots of money. A broker and a realty company are special entities, created under the real estate licensure laws of the state where the people involved in that business work.

A licensee is presumed to have special expertise which is considered (under license law anyhow) to be an unfair advantage in a real estate transaction. Any individual may have more or less knowledge about the real estate market than any other, but a working real estate salesperson would be looking at market activity every day, and would have access to much more and better information than someone who is not in the busines.

A broker may manage a realty company and may or may not be an active salesperson as well.

Either way, the licensee is required to disclose those facts in advertising, in documentation, and on contracts. Other posters have also noted this.

In the St Louis area, if a Realtor doesn't declare up front that they have a personal interest in a home that they are selling or buying (either as an owner or buyer or as a close relative or future relative of the owner or buyer ) it is a huge violation and can end up with the Realtor in all sorts of trouble. It is seen as taking unfair advantage of the other side because of the professional knowledge, experience and skill set that the realtor would be bringing to the table that the other side would not have if they are not represented by another realtor, or the unfair advantage if the other side thinks that they are negotiating with someone without the professional skills.

When an agent is a dual agent (handling both sides of a transaction), the agent does a lot of work. They have to keep both sides on track and ensure that all the deadlines are met and that both sides are treated equally and neither side is given an unfair advantage. I would think however, that for an agent who is selling his own home, it would be very difficult to truly be objective in doing that.

An agent who is dealing with both buyers and sellers where he is friends with one side can have a difficult time stepping back and ensuring that he is truly being impartial and ensuring that both sides are being treated correctly. When the seller is the agent and is also representing the buyer, I think it would be very difficult to be truly impartial when it comes to making sure that he doesn't favor himself. I would think that you would seriously want to have another agent represent you to ensure that you have someone protecting your interests, but depending on where you are in the process, it may be too late to do anything about it. If I were you, I would call Trisha Lee and talk to her in person and get her advice before you go any further. I can help you in St Louis, but she is the Columbia expert.

Now for the second part of your question on the seller giving you back some of the commission savings if you don't use a Realtor, please keep in mind that while some Realtors will waive some or all of their fees, they will typically still have to pay their company or franchise if they are a "worker bee" level realtor and if they are management level, their staffs. They still have costs to market the home, costs to maintain their license, gas to get to the home to service it if they are not living there, administrative costs and much more that you aren't seeing that they will have to pay regardless of whether they waive their fee or not. Approximately 50% of what a Realtor makes goes to pay their taxes since they are self employed and are paying out not only their share but also what most people consider the "company share" of the taxes if they work for a corporation. Then the realtor has to pay for additional insurance in case they get sued for something they said that was mis-interpreted and for extra insurance for their car. Next they have to pay for maintaining their real estate license and the continuing education that is required each 2 years to maintain their license and to stay current on all of their designations and on all of the changes that are constantly occuring in their profession (which right now is a lot). Then they have to pay for the franchise fee if they belong to a large national company such as ReMax, or Prudential or Coldwell Banker. Next they have to pay for marketing themselves to potential buyers and sellers and the homes that are listed with them. They have administrative costs such as their cell phones, computers, internet access, MLS access, supra access (the lock boxes that the keys are kept in), on top of costs for plain old every day administrative supplies like paper and pencils, they have to maintain their cars and put gas in them so they can maintain their listing and show property to their buyers. These are just a very few of the day to day costs that a Realtor pays. If he cuts his commission for you, he still has to pay all these costs and others. It's not like, he cuts the commission and all his costs magically disappear.

Homefun -
Last time I sold my own home as a REALTOR, I would have sold it to anyone either represented by a buyers agent or someone without one. The price would have been the same. If they were using a buyers agent the buyers agent would have handled 1/2 the work on the transaction and earned the commission involved. If I had to handle both sides of the transaction I would have wanted that extra compensation for my time and effort.

I had someone who wanted to buy directly with me and it didn't work out. I ended up selling it to someone using a buyers agent from another firm. To get my house sold I advertised it in the MLS and through all the marketing arms I use for my clients. If you're not using a buyers agent, who's on your side in this transaction? You're all alone and probably only do this once every 5-7 years or longer. I do this every day. I'd want someone guiding me if I weren't a REALTOR.

By the way, I have another REALTOR selling my mothers house in another city and am glad to pay the commissions involved. They're doing a great job and even though I could do it myself I choose not to...they can do it better being right there in the trenches every day knowing that particular market. When professional REALTORS choose to use other professional REALTORS you should be asking the question...if they do...why don't I.

Good luck with your transactions. By the way, I am in Columbia and would love to help you either with the sale of your home or as a buyers agent if you are not currently represented by anyone. My contact information is below or go to my website for further information.

Trisha Lee REMAX Boone Realty, Columbia, MO - Broker/REALTOR
ABR - Accredited Buyers Representative, CRS - Certified Residential Specialist
e-Pro - Real Estate Internet Professional, GRI - Graduate Realtors Institute,
WCR - Women's Council of REALTORS

573-999-1000 or 573-876-2897
TrishaLee@Remax.net

It can not be listed as a fsbo, he could write owner/broker but he has to disclose that he is a broker. he can choose to waive his commission or take it off the price. but he must disclose up front he is a realtor and again on the purchase and sales agreement.

Technically, it is a for sale by owner but with the perks of a REALTOR. As mentioned, commission would be completely subject to the broker and agent/seller.

No, not FSBO, but he can choose not to pay himself commission. - We do have Realtors who sell their own homes thru our brokerage and we can get one free (or something like that) commission from our brokerage, more than that, will be treated like normal sales.

Still quite different from FSBO though.

Best,
Sylvia Barry
Marin Realtor

No, it is not considered a FSBO because the fees still get paid to the brokerage. If you show up, unrepresented, more than likely, you won't be saving anything. This is a common misconception. A good buyer's agent will save you much more than the 3% you think you may be saving. The reason is because there is so much more that goes into a real estate transaction than the initial purchase and sale agreement. I strongly encourage you to get a Buyer's Agent to look out for your best interests, during the initial agreement, the inspections and closing. A good agent can save you thousands. Best wishes!

If I come over by myself, without a buyer agent, is it fair to think I'm dealing with the seller himself, the savings on buyer agent could be reasonablely reduced from the offer price? The listing clearly states the buy agent comission is 3%, you know, any savings on comissions goes back to the owner-broker, any saving on this need to be on my side. How your business rules interpret this?

Hmmmmmm,

Only if the owner-broker-agent decided to disassociate himself from his brokerage........