Dear Oregon Senators:
Real estate commission rebates are good for both the people of Oregon and the economy, regardless of which side of the aisle you sit on.
Ten states, including Oregon, forbid buyer’s brokers from rebating a portion of their commission to the consumer. Should Oregon be in the same company as Alabama, Mississippi, Louisiana, Tennessee, Oklahoma, Missouri, Iowa, Kansas and Alaska when it comes to creating competition that ultimately benefits the client? A rebate equal to one percentage point of the sale price, which is commonly offered in states that allow rebates, would reduce the commission on the median-priced home by $1,843. Check out the DOJ's stance: http://www.justice.gov/atr/public/real_estate/rebates.html
Senator Jackie Winters sponsored an amendment to the anti-rebate law in 2007. The text of the amendment in its entirety was:
Nothing in subsection (1) of this section is intended to prevent an Oregon real estate broker or principal real estate broker from rebating or paying a share of the broker’s or principal broker’s commission resulting from a real estate transaction to a principal of the transaction.
According to HUD, real estate agents may rebate a portion of the their commission to the borrower in a real estate transaction. The internet has allowed real estate agents, brokers and companies to drive down costs and have enable more efficient ways of conducting business. Instead, a rebate ban (like ORS 696.290), artificially inflates the cost of real estate services. Effectively, Oregon's rebate ban prohibits real estate brokers from competing on price - forcing all brokers to charge, and more importantly all buyers to pay - inflated prices.
Besides companies like USAA and Navy Federal Credit Union, there's an online real estate brokerage company, Redfin, in Seattle, WA that has taken 19 residential real estate markets by storm. They've been able to grow quickly, primarily because they have raised the bar and are providing the people with a significant savings. Glenn Kelman, Redfin's CEO says it best: "What you have to realize is that 90 percent of the cost of real estate is prospecting for clients. So you have an enormous number of people closing six or seven deals a year who spend all their time beating the streets looking for new customers. But if you build a beautiful website that publishes more information than any other, folks are going to beat a path to your door."
Thanks in advance for listening. Commission rebates are the future across our great country. Let's work together to make sure Oregon isn't the last to the party.
Sincerely,
Chris Grubb
Founder / CEO
Physician Relocation Specialists
