Do too many agents spoil the real estate pot? The Consumer Federation of America thinks so.
Roughly 1 million agents and brokers compete for the country’s 5 million to 6 million annual house sales, resulting in high commission rates and poor service, according to a recent report from the consumer group.
”A large majority of practicing real estate agents have recently received their license or work part-time,” says CFA Senior Fellow Stephen Brobeck. “These agents usually charge the same commission rates as experienced, full-time agents, yet in general offer worse service and deprive experienced agents of needed clients.”
Brobeck has produced a number of reports challenging the status quo of the brokerage business. Among other things, he has taken on referral fees, dual agents (who unfairly try to represent both buyer and seller in the same transaction) and the “uncoupling” of commissions (allowing buyers to negotiate their own fees).