Apparently, the agency fees to represent the buyer and seller transaction have caused the real estate boom that has made housing unaffordable.   How much truth is in this new indoctrination?

In 1940 the realtor commission was 5%.   In 1980, the realtor commission rose to 6%.   The same 6% it is today.   But somehow, despite 40 years of paying the same commission, The Economist powers that be, have decided this isn't equitable.   It isn't fair.   And therefore, elimination of this fee will reduce the cost of a home and make it affordable…   That would be the logic.   But what is the reality?

Homeowners have the option of selling without a realtor.  They also have the option of using the flat fee companies..   Or they had the option of utilizing the expertise of a realtor who has passed rigorous courses and exams on contract law, title law, foreclosures, and inspections.  A choice.  That choice is being removed by the Powers.  Why?

HINT:  it has absolutely nothing to do with affordable housing.  

When you remove an industries ability to charge a fee and make money, you are attacking the industry – not helping the poor.   Let's say doctors are no longer allowed to charge a fee, does that mean healthcare costs will drop?   No.  It means there will be no more doctors and healthcare won't exist.  For the Real Estate industry that translates to  homeowners being left to mitigate scams, fraud, theft, liability, and corruption.   And the tight housing market will become that much more tight as homeowners decide to renovate instead of move.

Builders reap the benefit.

Builders can dangle the carrot of discounted interest rates.  They run the show. When no agent is there to represent your best interest – for free – you pay top dollar.   And who is selling at top dollar?   The Hedge Funds that scooped up entire neighborhoods at a 2% fixed rate of interest and now want to divest their inventory – charging a 'discounted' interest rate of 5.5% when the market is 7.25%.   Now you are buying more home for the same price because of the "interest rate" – not because of realtor fees.