Don't Let The NYC City Council Cap Your Income

Don't Let The NYC City Council Cap Your Income

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Linecity and Online Residential NYC started this petition to brokers & agents

The New York City Council is strongly considering passing new legislation [Int 1423-2019] that would limit your income as a real estate agent by capping the amount of commission you can earn on a single transaction.

How Will This Affect Real Estate Agents?
The proposed legislation would cap the commission on a rental transaction to a maximum fee of one month’s rent. You will be collecting roughly half of what you can currently earn on the same transaction. You will no longer be able to earn a full commission. No matter the circumstances, the amount of time that you might spend with a client or the uniqueness of the rental property, the income that you can earn will be capped.

Why is the City Council Doing This?
The real estate industry is an easy target and this round of legislation focuses on the commission fees earned by real estate agents.

What Can I Do to Stop This Legislation?
So we ask you to do two things to stop this infringement on our industry and your income.
1) Sign our petition against this punitive legislation.
2) Send an email to members of the city council [district36@council.nyc.gov] and demand that they drop this proposal to cap your income.

Our Thoughts
Linecity is against any legislation that would truncate the commission that a real estate agent can earn from a single transaction. Real Estate brokerage is a fee-based industry and the decision to use a real estate professional in the search for a new home is entirely a voluntary action initiated by the consumer.

How Do Agents Help Consumers?
Renters believe that a real estate professional brings valuable experience and industry-specific knowledge to the task of finding a home. Again, this is about choice; the consumer can choose to work with an agent, at no initial cost or go at it alone and navigate the urban landscape and the thousands of apartments available to him/her. Others may carry on and trudge through the various web sites and open houses and find their dream home. It’s a choice.

The Internet has made apartment listings highly visible, allowing the consumer to self-navigate through the home searching process. Consumers have the choice to rent in no-fee buildings, to use a discount brokerage or to seek out, view and negotiate a lease for a new home on their own. Even if the consumer chooses to use a specific agent, fees are often negotiable.

The consumer that decides on their volition to work jointly with a real estate professional does so because they feel that the professional adds value to the home-search process. The professional saves the consumer valuable time, adds his/her market knowledge to the process and will fulfill their fiduciary by negotiating the best deal possible on their client’s behalf. A real estate agent will also use their field experience to gently guide a client through the rental transaction, a process not for the faint of heart. One’s dream home could be lost for a myriad of reasons, including one’s unfamiliarity with the process.

Stop Unnecessary Government Intervention
Residential real estate is a fee-based industry. It is not the purview of a governmental body to step into the private, free marketplace and single out a single industry for unreasonable, punitive regulation of private enterprise. The consumer selects to use a real estate professional much as they would choose to consult with a stock agent, lawyer or doctor.

Each of these fee-for-service industries, just like real estate, are self-regulating. If the fees are too high, the consumer will undoubtedly look elsewhere.
Real estate agents solely rely on the commissions that they earn. This is how they make their living. The proposed legislation capping agent fees is wage regulation, pure and simple.

With all due respect to the city council, we believe that the council needs to be better informed on the fee structure of a typical real estate transaction. It is extremely rare that a single agent pockets an entire transaction fee. In many cases the agent actually earns less than half the total fee. The fee, often enough, is split with both a second agent that is representing the other side of the transaction and the brokerage firm with whom the agent hangs their license. The fee, originally pegged at 15% of one year’s rent, is now diminished to 3.75% for the agent hired to represent the consumer. Agents, depending on what side of the transaction they represent, can be stuck with substantial marketing or transportation costs. The great lump sum commission that is under attack actually isn’t so great at all. It is an honest, if somewhat modest wage for a ton of work.

Lastly, there is always a caveat to those who choose real estate agent as their profession. Much of one’s time is spent working clients who may never close a transaction, never move or even complete a transaction with you at their side. There is very little loyalty. The time spent servicing these relationships is worth nothing. No matter the time or energy spent, nothing is promised. No deal. No fee. Certainly a tough way to make a living. The term, “living paycheck to paycheck,” could not be more applicable.

0 have signed. Let’s get to 7,500!
At 7,500 signatures, this petition is more likely to get a reaction from the decision maker!