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Re:Almost No One Pays a 6% Real-Estate Commission–Except Ame... by underseacables on Friday November 17, 2023 @08:07AM (#38302949)
I think something that is partly to blame is the expansive licensure scheme, and how those licenses become a monopolistic edge to protect and expand. Many professions have required license, and it is the responsibility of the organization that issue those license to protect an expander authority, preventing competition, and pushing up prices higher.

The license requirement creates a perpetuating lobby, which I think is partly to blame for real estate agent commission issue.

Do we really need to enshrine into law every professions market corner? A certification law would do just as well, but it would not have the effect of blocking competition, preventing market, disruption, and forcing people who want to practice that particular profession to constantly pay a private association for the right to be licensed.

Re:Almost No One Pays a 6% Real-Estate Commission–Except Ame... by Tangurena2 on Friday November 17, 2023 @08:24AM (#38303156)
Occupational licensing was originally developed to prevent black people from being employed. Many of them (like for engineers) require positive letters from 2 people who are currently licensed as engineers. The other side of that hammer was the peculiar American crime of "vagrancy" - the crime of not having a job. Vagrancy was almost only enforced against black men. Who would then be sentenced to prison, then rented out as slaves on a chain gang.

> Neither slavery nor involuntary servitude, except as a punishment for crime whereof the party shall have been duly convicted, shall exist within the United States, or any place subject to their jurisdiction.

https://en.wikipedia.org/wiki/Thirteenth_Amendment_to_the_Un...

Re:Almost No One Pays a 6% Real-Estate Commission–Except Ame... by CPLX on Friday November 17, 2023 @08:29AM (#38303233)
> Occupational licensing was originally developed to prevent black people from being employed.

You’ll need to cite some evidence for this. Occupational guilds and membership associations stretch back a lot further into the Middle Ages in Europe versus the timeline you’re suggesting here.

There are also some very common sense public policy issues at play like making sure people who say they can cut hair or fix your teeth actually know how to do it.

Granted they’ve been misused as well for various less honorable reasons but the narrative you’re presenting here doesn’t totally hold together.

Re:Almost No One Pays a 6% Real-Estate Commission–Except Ame... by walthamstow on Friday November 17, 2023 @08:47AM (#38303459)
Fix teeth, yes, cut hair, absolutely not. How can you conflate those two things? It is utterly bizarre for the state to license barbers and hairdressers, especially in the so-called land o' the free.
Re:Almost No One Pays a 6% Real-Estate Commission–Except Ame... by underseacables on Friday November 17, 2023 @09:08AM (#38303744)
It has gotten much worse. Flower arrangement, interior decorators, every profession wants in on the licensure monopoly. There are definitely things where you want the state to make sure that someone has a minimum level of education and training. Medicine, law, engineering, but some things are not really necessary anymore, such as the dietetics license. Certainly not a license to be an interior decorator, or arrange flowers.

The license locks in professionals to continually give money to a private organization every year, and keep out everyone else.

https://www.washingtonpost.com/business/you-shouldnt-need-a-...

https://bostonrealestatetimes.com/advancing-commercial-inter...

https://citizens.org/dietetic-association-and-efforts-to-mon...

Re:Almost No One Pays a 6% Real-Estate Commission–Except Ame... by walthamstow on Friday November 17, 2023 @09:14AM (#38303840)
I remember the John Oliver segment from a few years ago

The added layer that blew my tiny British mind was that the licensing is done by states (because somehow licensing barbers was omitted from the constitution)

The consequence of this is that if you want to move or if you live in a state border city like KCMO, you have to do the licensing all over again with another state. Bonkers, as we say here.

Re:Almost No One Pays a 6% Real-Estate Commission–Except Ame... by PaulDavisThe1st on Friday November 17, 2023 @10:52AM (#38305218)
Imagine living in Dover, and deciding to move just 26 miles to Calais. Quelle horror! You will need to do the licensing all over again!

(at least, you certainly will post-Brexit; not 100% sure what the pre-Brexit story was on that, but I have a feeling it may have similar)

Re:Almost No One Pays a 6% Real-Estate Commission–Except Ame... by walthamstow on Friday November 17, 2023 @11:21AM (#38305644)
I'd rather not imagine living in Dover if you don't mind
Re:Almost No One Pays a 6% Real-Estate Commission–Except Ame... by PaulDavisThe1st on Friday November 17, 2023 @07:39PM (#38313123)
I missed your nick :) Fellow E11 (or rather, ex-E11-er) here.

I just picked it because it was closest to the border. You can have Brighton or Hastings or Rye if one of them works better for you.

Re:Almost No One Pays a 6% Real-Estate Commission–Except Ame... by amluto on Friday November 17, 2023 @10:46AM (#38305155)
Having been injured (not particularly badly) by a hairdresser who didn’t know what they were doing, I’m not entire sure I agree with you.

I’m not saying that the actual licensing regime makes sense (I don’t know much about it), but requiring that one demonstrate knowledge of the rules before professionally cutting hair seems fine. At least California does this for restaurants, too.

Re:Almost No One Pays a 6% Real-Estate Commission–Except Ame... by eldavido on Friday November 17, 2023 @01:52PM (#38308154)
The problem with licensure is that there are many markets where the number of licensed professionals is zero. My wife reminds me of this--she grew up in rural Idaho, where many things I take for granted (e.g. electricians, medical care) growing up in the Chicago suburbs, weren't available.

Let's consider the choices of a homeowner in this market, who needs electrical work done: (a) pay a licensed professional to travel into their market (expensive), (b) have someone unlicensed do the work (or DIY it), or (c) just don't do it.

This is why I think certification (not mandatory licensing) is the way to go. It's not clear that criminalizing economic activity when it's someone's only real choice--and there may be major health/safety hazards if the work isn't done--is beneficial.

Re:Almost No One Pays a 6% Real-Estate Commission–Except Ame... by camgunz on Friday November 17, 2023 @08:50AM (#38303510)
Literally the first ddg result for occupational licensing racism: https://www.minneapolisfed.org/article/2022/how-occupational...

EDIT: oh I guess I read too hastily and this is about the original motivation. For that you'd probably want to read Competition and Coercion by Robert Higgs. A lot of statutes and ordinances were adopted in the wake of the South's loss in the Civil War to maintain the status quo of white dominance in business

Re:Almost No One Pays a 6% Real-Estate Commission–Except Ame... by aftbit on Friday November 17, 2023 @11:58AM (#38306279)
Vagrancy is not a particularly American crime.

https://en.wikipedia.org/wiki/Vagrancy_Act_1824

Re:Almost No One Pays a 6% Real-Estate Commission–Except Ame... by DennisP on Friday November 17, 2023 @09:06AM (#38303725)
A real estate license mostly teaches what you need to know about the laws around real estate transactions. It's pretty easy to get. Take the courses, pass the test, and you're in, there's no restricted access. You can set up your own brokerage and everything.

But if you want your brokerage to have access to the MLS system, you have to join the Realtor organization. That's where the monopolistic behavior creeps in.

Re:Almost No One Pays a 6% Real-Estate Commission–Except Ame... by philips on Friday November 17, 2023 @09:43AM (#38304263)
Except in Oregon you also have to have a minimum number of transactions per year or have a “senior broker” sign off on all your deals (for a price).
Re:Almost No One Pays a 6% Real-Estate Commission–Except Ame... by judge2020 on Friday November 17, 2023 @10:52AM (#38305222)
Most states require some years of experience before you can become an independent broker, in Florida it's 2 years of active work / 5 years in the system.
Re:Almost No One Pays a 6% Real-Estate Commission–Except Ame... by poulsbohemian on Friday November 17, 2023 @03:51PM (#38310080)
Your location may be different, but what you are describing is not universal or even common in my experience working in multiple states. Yes, it is absolutely true that there should be a higher barrier to entry and even after "first renewal" (which is normally a second round of education), there isn't enough training before we let new agents loose into the world. That said - in every state I'm aware of, you work under a licensed broker who has additional licensing, training, and legal responsibility. Until you've reached that level of licensing it is not possible to set up your own brokerage. I've seen a work around where a non-licensed business owner paid someone to be their broker, but that regardless there has to be someone with the right licensing running the business.

Also - whether MLS members must also be Realtors is a rule of the MLS and not a universal requirement. The NAR, nor MLSs, do not set commissions. In fact, much of the MLS rule changes in recent years that I've observed have been about making sure non-Realtor licensees have market access. It's right there in our paperwork that I show clients where we ask permission so that the seller knows who will be entering their home.

Re:Almost No One Pays a 6% Real-Estate Commission–Except Ame... by jjoonathan on Friday November 17, 2023 @09:17AM (#38303888)
We should always have several competing licensing bodies.

1 licensing body: never considers the cost of gatekeeping, only the self-benefit.

2 licensing bodies: they are forced to weigh the cost of gatekeeping against the self-benefit, but you might get a race to the bottom.

3 licensing bodies: they are forced to weigh the cost of gatekeeping against the self-benefit, and if they race to the bottom too hard we can decertify one and retain competition until we can bud off a replacement.