And handling a money transaction is mostly orthogonal to the amount yet many (most?) are charged as base fee + percentages.

But that's not really a competitive market either.

Yes it is. Becuase the hard part is not selling it, its getting the listing. And you bet your ass that a the 10 million dollar home goes to the well dressed, swanky offices top ads agent, not your "aunt's best friend".

You took my word "selling" replaced with "customer acquisition" then argued I was wrong.

You're right, that the majority of the work of a 10 million dollar house is customer acquisition. And this isn't true of a 100k condo.

But this was my point, 3% of a 100k home is close to the competitive market price. But 3% of a 10 million dollar home is pretty far away from the competitive market price.

I'll try to rephrase it:

100x the comission might have 100x the competition. As a seller of the house, you pay more but you also get better agents.

You're not getting a 100x better agent, and most of the best i.e. most successful agents I've seen weren't necessarily better negotiators, better at contracts, or more responsive. They were specifically better @ marketing and selling themselves.

The most successful agents I know close houses twice as fast as other agents. But they close them twice as fast as other agents because they're listing them under market value.

My wife was a real estate agent for 5 years but she got out of it because all of the most successful agents she met were more successful in ways that hurt the client not helped them.

Examples - convincing their clients to settle for homes quickly, convincing clients to list their house less than market value, weeding out easy clients.

My wife is also in the real estate market: the reality is that people's incentives are not maximized on house value, they also care about other things , like safety, patient, attention, etc.

It is what it is. RE is not a perfect market because goods really cant be commoditized.

I reiterate my point with one more argument: the average income of a realtor is very low: they make very little money. The number of active realtors is almost perfectly correlated with house prices: that means a highly competitive , and thus relatively efficient, system.