Real Estate Agent Glut in the San Francisco Bay Area Prompts Commission Rebates; SFBayRebates. com Offers Resources and Information
The overheated housing market in the San Francisco Bay area is creating unprecedented competition among realtors as people from all walks of life rush to take the real estate exam and become agents. The increased competition is prompting some agents to offer commission rebates to their clients. SFBayRebates. com is a new website which offers information and resources about the commission rebate trend for both home buyers/sellers and real estate agents.
(PRWEB) August 10, 2005
The overheated housing market in the San Francisco Bay area is creating unprecedented competition among realtors as people from all walks of life rush to take the real estate exam and become agents. The increased competition is prompting some agents to offer commission rebates to their clients. SFBayRebates. com is a new website which offers information and resources about the commission rebate trend for both home buyers/sellers and real estate agents.
While housing prices in the Bay area continue to rise, the commissions paid to real estate agents have remained relatively stable, generally in the 5-6% range. Real estate commissions are paid by the seller and are generally shared equally between the agent representing the seller and the buyer's agent.
In the Bay area's overheated market, homes tend to sell almost instantly. The sale of a million dollar home can give both the listing (seller's) and buyer's agent a check for nearly $30,0000--not bad for a couple of weeks work.
Because of the high commissions, the area is saturated with agents. Currently, there are more than 10,000 licensed real estate agents in Santa Clara county and only about 2500 homes listed for sale. The number of agents grows monthly as thousands of new applicants pass the state real estate exam.
Commission rebates offer a way for agents to compete for business by refunding a portion of their commissions back to their clients. Rebates are not yet widely accepted in the Bay area and are understandably viewed with hostility by established agents.
However, there is increasing acceptance that rebates are a healthy form of competition. The Federal government recently sued the Kentucky Real Estate Commission on anti-trust grounds because the Commission passed regulations forbidding rebates in the State of Kentucky. The suite was recently settled in favor of the Justice Department, and rebates are now allowed in that state.
SFBayRebates. com was created by a software developer, entrepreneur and licensed real estate agent, as a way to make information and resources about the trend toward commission rebates available area residents.
According to Marty Ford, the website's creator, "In the Bay area, competition is so intense that the average agent is involved in only one transaction per year. That means that the business basically consists of thousands of agents competing with each other for a tiny slice of the pie. The huge commissions paid by sellers (and indirectly by buyers) go almost entirely to support this competition among agents rather than actually deferring the costs of marketing and selling the home. Rebates offer a very reasonable way increase completion, make the market more efficient and shift some of the excess profits in the industry from agents back to the principals in the transaction."
SFBayRebates. com can be found at http://www. sfbayrebates. com (http://www. sfbayrebates. com). The website offers information and resources about commission rebates for home buyers/sellers and real estate agents, and also a directory of area agents offering rebates.
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