That's indeed one interpretation of how things could be incentivised against the interests of the buyer. Another incentive that buyers agents (and seller's agents) have with percentage based fees is to encourage their client to reach a deal - any deal - and make a deal promptly without much effort from the agent, and make their money based on volume. 3% on two quick, low-effort $1m deals is better than 3% on a single $1.5m deal that required a large amount of effort. 3% on a quick, low effort $1m deal is much better than 3% on no deal because the client walked away.So the buyers agent gets a commission based on a percentage of the sale price. Is there some reason nobody's seen the flaming, waving red flag here? The buyers agent gets more money, the more the house sells for. So they're going to try to get you to pay as much as possible.
See also: in the last few years there have been class action lawsuits re: how industry groups of buyers agents & sellers agents collude to set prices. E.g. Real estate lawsuit settlement upends decades long policies that helped set agent commissions (AP, march 2024)
Statistics: Posted by pseudoiterative — Wed Jun 12, 2024 5:09 am — Replies 11 — Views 1559