An increasing problem for Realtors these days is the stiff competition they face from discount real estate firms that offer similar services for as little as half the price. Th estimated one million real estate agents from all across the nation have considerable stake in this problem as their careers may be jeoparadized if this trend continues to increase.

Rising commissions of real estate agents have increased with rising home prices boosting arguments that Realtors are overrated and overpaid. Van Davis, a CEO with the discount brokerage firm, Foxton, says, "A lot of people are looking at that and going, 'What has changed so much that justified me spending literally tens of thousands of dollars to conclude a deal that I did just five years ago for half that amount?'".

Typically, two realtors involved in a purchase divide the commission fee, which is generally 5-percent of the sale price. Bargain-priced firms offer considerably lower commissions. ZipRealty refunds 20 percent of its commissions to homebuyers, and Foxtons, advertises 3 percent commissions.

Realtors argue with the familiar mantra, "You get what you pay for". By hiring a traditional Realtor, customers will "have someone who knows how to market a home, who knows how to complete a transaction, not just someone who throws up a sign", says real estate agent Dusty Showers. Realtors have access to the Multiple Service Listing (MLS), the most influential database of homes for sale. The MLS is often the first place where many homebuyers look to begin their house hung, thereby generating more attention for the property for sale then a discount brokerage would get.

Realtors also offer more that just providing access to listings services. Realtors offer market knowledge and negotiations savvy. A realtor is involved in many transactions a year so they have the experience in creating interest and closing a sale.

Critics of traditional real estate agents have embraced the discounters, saying they offer a more reasonable price considering how much legwork customers can do on their own for free. These discount firm strongly claim their commitment to efficiency lowers prices but doesn't lower their quality of services. Foxtons, for example, assigns agents to buying or selling, not both, allowing for specialization, says Davis. Davis continues, "The buying agents average about 40 deals a year, more than four times as many as the typical agent in the industry".

"There's no one right approach for everyone", says John Baen, professor of real estate at the University of North Texas. Baen advises home buyers and sellers to examine three options: a discounter, a traditional Realtor, and a do-it-yourself arrangement. "They (sellers/buyers) need to search their heart, and find out which one they feel most comfortable and confident about".

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