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Home sales have fallen throughout most of the country, but real estate agent commissions appear to be holding steady at just over 5%, according to a new report by Foresalebyowner.com.
The total amount of commissions paid to agents and brokers dropped this year as home sales tumbled. Agents are expected to collect $55 billion in commissions this year, compared to about $65 billion in 2006, $68 billion in 2005 and $61 billion in 2004.
Americans paid $19 billion more in commissions in 2007 than in 2000 largely because of the surge in home prices during the boom. But Realtors aren’t celebrating. The number of agents ballooned during the boom when business was plentiful. These days, listings often linger for months.
BusinessWeek editors Chris Palmeri, Prashant Gopal and Peter Coy chronicle the highs and lows of the housing and mortgage markets on their Hot Property blog. In print and online, the Hot Property team first wrote about the potential downside of lenders pushing riskier, "option ARM" mortgages and the rise in mortgage fraud back in 2005—well ahead of many other media outlets. In 2008, Hot Property bloggers finished #1 in a ranking of the world's top 100 "most powerful property people" by the British real estate website Global edge. Hot Property was named among the 25 most influential real estate blogs of 2007 by Inman News.