HB 4313: Substitute procuring cause language re IL HB 4313

[bestbid]

"In order to be deemed the procuring cause, a licensee representing a buyer shall show the property to the buyer at the property site and provide the buyer with the necessary contract and related forms properly completed to enable the buyer to make an offer."


I Feel that:

This is clearly a restriction of competition - This is again an anti-competitive Bill. The DOJ should see this as restriction of competition – It kills my business model and it kills Redfin's and Buyside business model as well.

HCA is using any language that will stop Redfin from coming to Illinois - Which is there objective Right? But this is far worst then the loss of Cash Rebates – This new bill makes it too expense to operate our (BestBid Realty;Buyside; Redfin) business model this bill hurts the consumer in the long run - This Bill would essentially wipe out this business model-

Illinois is presently not a state that makes it mandatory for an agent to go to the showing – Bill 4313 would favor the Traditional Real Estate Model and basically eliminate the Rebating large commissions to buyers Model.

This would restrict competition – And in todays Bearish Economy this Bill will make it more expense for a consumer to buy a property in Illinois. This Bill 4313 will force the consumers to pay an inflated higher costs because some Traditional Real Estate Brokers who have nothing to lose from this Bill is pushing it to keep competition from hurting their business model. You can make an argument that the Buyer is paying the Commission by paying an inflated market Price – The consumer would be the biggest loser – They would be force to pay a net higher price to buy a property in Illinois -

[Michael Paul Eau Claire]

So has this replaced the original bill you posted about awhile back?

[Morristown]

Bestbid,

I have to say that writing a contract for a client on a home you have never been in is a dereliction of duty and should be illegal in all states.

The rebate model to me gets you nothing but clients who don't value the service the a REALTOR provides.

sounds like you want to build your business model on the backs of full time full service REALTORS.

[Dallas Broker]

yes, I agree, this is one of the problems with discount rebate brokerages. Hardworking agents show a prospective client multiple properties and waste endless hours/days of time, educating, directing, advising....and ultimatley loose their client to a discount brokerage offering rebate with common marketing ploy...if you've already found a home, give us a call and take advantage of our rebate program. What they are really saying is abandon all the realtors/agents you've called upon for the last year viewing properties and let us take credit for their hard work. Most agents I've spoke with that work for these type of discount brokerage models which advertise and stamp 1,1.5,2% buyer rebate all over their site and marketing materials complain they are unhappy with broker pawning their commission out before they were even able to approach client, esp. when they are still taking 50-60% commission split after the 1-2% rebate is settled. They all usually figure out down the road it is very difficult to make a living working with these types of models. An agent would have to sell twice as much real estate just to barely make ends meet. Ex. 20 homes, 150K each, 1.5% buyer broker rebate model, 3% buyer commission for each transaction, 60/40 split with leads provided. With this example, agent makes 1350 on a 150K home and would end up at 27,000 for year....wonder how they can survive.

[Morristown]

yes, I agree, this is one of the problems with discount rebate brokerages. Hardworking agents show a prospective client multiple properties and waste endless hours/days of time, educating, directing, advising....and ultimatley loose their client to a discount brokerage offering rebate with common marketing ploy...if you've already found a home, give us a call and take advantage of our rebate program. What they are really saying is abandon all the realtors/agents you've called upon for the last year viewing properties and let us take credit for their hard work. Most agents I've spoke with that work for these type of discount brokerage models which advertise and stamp 1,1.5,2% buyer rebate all over their site and marketing materials complain they are unhappy with broker pawning their commission out before they were even able to approach client, esp. when they are still taking 50-60% commission split after the 1-2% rebate is settled. They all usually figure out down the road it is very difficult to make a living working with these types of models. An agent would have to sell twice as much real estate just to barely make ends meet. Ex. 20 homes, 150K each, 1.5% buyer broker rebate model, 3% buyer commission for each transaction, 60/40 split with leads provided. With this example, agent makes 1350 on a 150K home and would end up at 27,000 for year....wonder how they can survive.

Yes, I totally agree with what you are saying but it is even worse than that. According to NAR's own statistics, the average buyer broker commission side is considerably lower than what you state already, so reduce that income for one of their agents to more like 22,000 a year under the numbers you provided.

Considering the number of agents these companies go though I would have to guess that an agent working under the above model would have to be in the companies top 2% to even make more than 50K a year before taxes. Very sad considering Burger King assistant managers make 50K + in many parts of the country.

[bestbid]

Any model that benifits the consumer should not be illegal - You are assuming that I do not visit the property - That is incorrect - I am in the property on all 2nd showings and all inspections - I don't think not being at the first showing should weight over what Procuring Cause is really designed for.

[bestbid]

yes you are correct - but the DOJ is trying to losen the grips of the Local Monopoly's that control and keep costs high to the consumer - I think if you show many properties to a buyer and then you lose the buyer to a discounter - you have a very good case for procuring cause - But if the consumer all ready knows where they want to live - I the value of the agent should not be the same as if a buyers agent needs to show many homes over many weeks to a buyer?

[bestbid]

Yes - The first failed to get to the floor - this is HCA's second attempt to get a bill to the House Floor

[AaronSOLD]

Broker Cooperative Compensation simply shouldn't be discussed by a state legislature... EVER. This should be left to the local boards to decide & arbitration panels to judge.

If Illinois wanted to do something, they should address minimum requirements for what is considered agency representation, not what activities are required for compensation.

[Michael Paul Eau Claire]

Aaron, that sounds reasonable. I know many states have minimum service levels, and they vary greatly from one state to another. In my state, for example, listing agents are required to physically walk through each listing. The effect is to keep competition strong but to keep non-local competitors out.