Price Fixing

I believe it is price fixing. How is it fair for realtors to get a fixed percentage of the sale price, and it not be considered price fixing. I would venture to guess that beacuase it is a percenatage, and not a fixed dollar amount, it is not considered price fixing.

This is a dangerous subject, tread lightly. The last time this subject came up I received a phone call from a local surveyor that warned me about this type of discussion. He knew some of the surveyors that were caught up in that situation with the Arkansas surveyors situation.

> 1. Is this truly not price-fixing?

It's only price-fixing (collusion in restraint of trade) if the realtors agree to charge the same commission rate. At one time in the distant past they may have done that, to the extent that 6% is (around here, anyway) the commonly-accepted rate for real estate transactions. However, a prosecutor would have to prove collusion, not merely infer it from the prevalence of the customary rate, in order to obtain a conviction. I very much doubt that commission rates are discussed at realtor meetings, so that's an unlikely outcome.

Customary or not, the rate is negotiable. In a hot market you might not be able to get an agent to drop the rate, but in a slow one I bet it's done regularly by savvy sellers. (I'm not sure it's a good strategy, because agents invest a lot of time and money marketing a property, and in a slow market you want a motivated agent.)

> This is a dangerous subject, tread lightly.

I disagree. Unless you're promoting a plan to fix rates, you can talk pricing all day long. You can publish your rates, even distribute them directly to your colleagues, and not violate federal law. (There may still some state laws on the books forbidding certain professionals from advertising, but that would be a different matter.) The bright line you don't want to cross is colluding with other surveyors to establish rates; that's the big no-no.

My understanding of the Arkansas case is they actually agreed on prices for various products. This is very different from just trading information.

It is okay to discuss but illegal to agree.

If you get the rate sheet from the various mid-sized Engineering firms around here, their rates will look very similar.

Negotiating a lower commission rate with an agent is common. You can generally get them to accept a lower rate for a sale where the sellers and buyers agents are from the same office.

A non-no.

Prices are influenced by what the market will bear, that is why a standard percentage seems to work for real-estate.
Surveys have (or should have a minnimum reccomended base charge) but the work varies greatly for urban to rural, where surveys are required, or where a survey is sought to evaluate some kind of real-roperty risk. Fixing sounds impractical as well as a big non-no.

I would rather see effort expended on educating clients on the true value-risk equation for going too cheap, or eschewing a survey altogether (as so many do when times are tight)

Off the topic a bit but I always wonder how it is that hundreds of gas stations in a city can all change the price (make that raise the price) overnight and all come up with the same exact $/gal. Amazing... and no one ever looks into it..... seems like price fixing to me.

There are a/lot of price-fixing examples. I believe them all. I wonder how the realty industry has been able to come off as a professional organization. I am totally baffled. We are professionals. We should have a fixed rate and charge it. Period. We aren't a commission- based profession. You want your property evaluated by a surveyor? you pay what it costs. Why can't we figure this out? Realtors got it figured out. Surveyors are gullible while at the same time being more knowledgeable than Realtors by ten times. Yet we can't eke out a living.

Why can realtors and lawyers fix our prices and we can't?

I think it has much to do with impressions. When people see a surveyor, many times said surveyor may be in somewhat dirty cloths. Lets face it, there is No way of looking our best when it is 105 or 15 degrees, we have to attempt to dress for the weather. At around 100 degrees, folks see a hot sweaty (and often smelly, no way to avoid that) guy out doing their work.

There have been times when I have approached a field crew and the person I talked to has no clue how to complete a sentence without a boatload of curse words.

Meanwhile, realtors can dress with a dress coat and tie in most types of weather and look quite presentable.

No matter how much I don't like it, most people judge me on first appearance. How am I dressed? How do I talk? I truly hate wearing coat & tie, but am perceived quite differently when I do so.....

Addition: don't many folks view manual labor as menial and a desk job as "better"?

That plumber who shows up in an emergency to fix something according to code that you could have fixed yourself, with the fragrance of his last job lingering, stains your carpet on the way in, hand prints everywhere, leaving bits and pieces of his handiwork for you and who as a union wage earner working into the night and charges 3 times what you make and reminds you that it will take a union carpenter to fix the wall properly leaves an impression also.

There are many price fixing situations, too many actually.

😉

Quite true. I forgot about plumbers since I have the ability to do some things myself......

One time when I called a plumbing company on a weekend, I promptly said "forget it" and found out how to do the job myself.

I completely agree with Jim Frame on both counts.

The realtor percentage is completely negotiable, although naturally, you won't find them advertising that too much. How much negotiable depends on what side the market favors and which side you fall on.

And whenever this topic comes up, several are sure to quickly urge caution and suggest the discussion be suspended. There is no need to do that. Until that line of collusion is crossed then free speech prevails.

Stephen

Realtors

I've negotiated price on commission with realtors in the past. Why on earth would someone not ask them? Since we know the standard rate is all the same, and some may have some other benefit, the only reason to go with one, is price.

Our industry is nothing like realtors.

What About This Scenario?

A "Blue Book" is published listing prices for land surveying services. The book expounds purported studies made concerning the costs of performing various types of surveys, including breakdowns of acreage, vegetation, planimetrics, client difficulty, time frame restraints, number of monuments to be set, research costs, GPS availibility, mobilization costs, topography, drafting costs, value of land, certifications, availibility of undisturbed original monuments, time of year, overhead costs, equipment costs, location price differentials, national economic factors, etc. It seems to be a masterpiece. Everyone begins to use it as THE price estimator. As a matter of fact, when one disputes the cost of a survey and asks to only be billed by the hour at a premium rate, he is told, "We are not capable of calculating that price, we only use the book". All local surveyors begin to quote the same price to each and every client for each and every job. What a difference!

This is EXACTLY what AC repairmen, auto mechanics, plumbers and many other businesses do every day, all day long. I've often wondered if this is price fixing.

What About This Scenario?

Last time I went to an auto body repair shop, the owner punched in the type of truck and repairs needed into a nationwide "we-fix-it-for-this-much" system. The printer spit out the "quote" and he said "This much".

How is this not price fixing?

What About This Scenario?

Where do you get this "Land Surveying Blue book"...? Never heard of one, never seen one, wondering if it really exists...?

What About This Scenario?

I think where flat rate pricing is not price fixing is that different shops are free to set their own rates, sure they are all looking in the flat rate manual (or PC program) for the time required, BUT they multiply that by their own shop rate.

Having said that, almost ALL of the reputable shops charge essentially the same hourly rate, so it is in a sense price fixing, BUT they don't get together and agree on a rate, that would be "real" price fixing, there are probably still some low ball shops out there. Doesn't matter the business, somebody wants to sell on low price, that is the whole premise of Wal*mart's marketing.

I don't know how "illegal" it would be considered by today's laws and rules (probably highly), BUT I know there was just such a "blue book" for surveyors (in Oregon, at least) in the 1950's through maybe the 1960's because I have seen pages from it reprinted once in a while in the state society magazine.

SHG

In my experience, no plumber (or anyone in any related profession) has EVER showed up in a suit&tie. And if they did, I would consider them insane.

The professional bit comes about laying down protective covering, etc., making sure they don't damage the existing structure.

But how that applies to Surveyors...? Who never go inside...? Confused about that. It would be expected that such people are wearing outdoor equipment. That varies widely depending on your location. In some places, it's wearing winter weather. In others, it's loose-fitting white clothing that reflects heat and allows sweat to evaporate easily (Bedouin style). Or anywhere in between.

If on a construction site, other concerns come into play. Such as wearing steel-tip boots, for protection. Or even such as wearing snowshoes, depending on where you're at.

When you show up at a construction site, you should be expected to be dressed accordingly. The deal has already been made. So dressing in suit & tie sounds to me like looking like a penguin in summer.