Do we need realtors?

[SD Realtor]

Guys –

I will be the first one to say that the industry is a screwed up industry. I will also be the first one to say that I took the do it on my own path for many of the reasons you all all posting about. I spend ALOT of time doing this and at a cut rate commission I would not be able to support my family in the same manner as I do now. That IS the bottom line.

sdr and I don’t agree on much and that is reflected in many posts. However what he says is true. I know it first hand because if I did not have my engineering career I would be needing to do other things as real estate alone would not cut it.

What irks me is that there is alot of complaining and not much doing. I commend the people that have posted about how they did do it themselves, whether they sold on their own home, or used an attorney, or however they did it… I think that is great. However what I don’t like are speculative statements made by people who did not, like you only need to do this or do that….Well if you have done it, great but if you haven’t well… that doesn’t sit well with me.

Again, people have PLENTY of choices. It is so much easier to bitch and moan about it though. FSBO your home, hire a real estate attorney, go see Jeff Karchin. Use a low cost Realtor… Rustico is out there, guys like me are out there. What I really don’t understand is why the antagonism given the wide range of choices that are out there?

Everyone has a unique situation with different needs.

SD Realtor

[SD Realtor]

Guys –

I will be the first one to say that the industry is a screwed up industry. I will also be the first one to say that I took the do it on my own path for many of the reasons you all all posting about. I spend ALOT of time doing this and at a cut rate commission I would not be able to support my family in the same manner as I do now. That IS the bottom line.

sdr and I don’t agree on much and that is reflected in many posts. However what he says is true. I know it first hand because if I did not have my engineering career I would be needing to do other things as real estate alone would not cut it.

What irks me is that there is alot of complaining and not much doing. I commend the people that have posted about how they did do it themselves, whether they sold on their own home, or used an attorney, or however they did it… I think that is great. However what I don’t like are speculative statements made by people who did not, like you only need to do this or do that….Well if you have done it, great but if you haven’t well… that doesn’t sit well with me.

Again, people have PLENTY of choices. It is so much easier to bitch and moan about it though. FSBO your home, hire a real estate attorney, go see Jeff Karchin. Use a low cost Realtor… Rustico is out there, guys like me are out there. What I really don’t understand is why the antagonism given the wide range of choices that are out there?

Everyone has a unique situation with different needs.

SD Realtor

[JJGittes]

Phew, I’m glad I vented all that out of my system, now back to the condition of the SD market….:)

[JJGittes]

Phew, I’m glad I vented all that out of my system, now back to the condition of the SD market….:)

[Anonymous]

Steveno
Still stand by my statements:

1. You probably need an agent when:
a) you don’t know the area
b) you are not around to sell the house
therefore agents working with corporations who move employees around would be the best place to be if i were an agent.

2. An agent or broker is not required in a real estate transaction, period! I have not acted as either, just a homeowner optimizing my profits and spending 40-60 hours or so to do it.

3. the more people know this, the more they will act in their own best interest. Then there will be more money in the seller’s pockets (100 billion per year) and less probability of real estate bubbles and shenanigans. this assumes that central bankers will not make money too easy too.

Bottom line is that with computers and the internet, there are only the reasons mentioned above to have an agent.

Businesses and individuals have been eliminating middle men for a long time and that this has lasted this long is very surprising indeed.

What was funny this latest purchase is that many seller agents were trying not to let us in the door without a buyers agent. I had to threaten the agent to go and see a property listed for sale? This is a good sign that this industry is crumbling and times are getting hard.

I was in CA in 1991 and paid 25% less for the final phase than the buyers in the first phase. It should certainly get that bad or even worse this time around. My price was 212K, the 1st phase sold for 285K and I got one of the largest homes in the hood. There is far more inventory and there are far less buyers, and more buyers are losing their homes this time around so i expect that there will be about 1-2 years of inventory and empty homes on the market before this is finished.

the last bubble took a good 8 years until the 285K guys could get their prices again, I waited 12 years and netted 100K. so this time too, it should take longer..around 10-12 years. if you have any questions at all, rent the same house you would buy for less than the current payments. people are not just standing on the sidelines and waiting, they are renting the same place in the same or better neighborhood for much less than the payments and taxes would be if they bought at current prices. No one in the RE industry is buying today, my cousin who owns 50M in real estate is not buying anything, RE developers are not buying land or options, RE companies are going under. Why would anyone in their right mind speculate in RE today….especially in the bubble areas?

If you can’t hold out 10 years then Sell while you still can get 2004 prices. They will go down to 2001 prices or worst before it is over. I feel bad for so many of my friends in CA who are now in houses over their heads. When they got ARMS and more home than they needed with high carrying costs and taxes, I told them not to. Any one who disputes this does not know simple economics or the banking industry. It will be a blood bath when all the derivitives and other instruments based on RE, crash taking the US down like Japan! when 2 million buyers are eliminated and 2-3 million homes are sitting vacant, supply and demand will take years to work through the inventory, then it will take double that time to recover and it may never EVER get back to these levels again. Florida crashed in the 30’s and most of those prices never recovered even today!

Good luck and God bless all. I am now at less than 15% of my gross for housing/insurance/taxes which is covered by my consulting and side income streams. I hope to pay off my home in less than 15 years. And to think that 20 years ago when I said that it was better to pay off my home and save for retirement, my friends told me that this idea was dangerous as I should be leveraged in RE. Today I am a hero to my family while I can afford to pay for my kids college with my regular pay and help my wife’s family climb out of their housing debt in their retirement years.

[Anonymous]

Steveno
Still stand by my statements:

1. You probably need an agent when:
a) you don’t know the area
b) you are not around to sell the house
therefore agents working with corporations who move employees around would be the best place to be if i were an agent.

2. An agent or broker is not required in a real estate transaction, period! I have not acted as either, just a homeowner optimizing my profits and spending 40-60 hours or so to do it.

3. the more people know this, the more they will act in their own best interest. Then there will be more money in the seller’s pockets (100 billion per year) and less probability of real estate bubbles and shenanigans. this assumes that central bankers will not make money too easy too.

Bottom line is that with computers and the internet, there are only the reasons mentioned above to have an agent.

Businesses and individuals have been eliminating middle men for a long time and that this has lasted this long is very surprising indeed.

What was funny this latest purchase is that many seller agents were trying not to let us in the door without a buyers agent. I had to threaten the agent to go and see a property listed for sale? This is a good sign that this industry is crumbling and times are getting hard.

I was in CA in 1991 and paid 25% less for the final phase than the buyers in the first phase. It should certainly get that bad or even worse this time around. My price was 212K, the 1st phase sold for 285K and I got one of the largest homes in the hood. There is far more inventory and there are far less buyers, and more buyers are losing their homes this time around so i expect that there will be about 1-2 years of inventory and empty homes on the market before this is finished.

the last bubble took a good 8 years until the 285K guys could get their prices again, I waited 12 years and netted 100K. so this time too, it should take longer..around 10-12 years. if you have any questions at all, rent the same house you would buy for less than the current payments. people are not just standing on the sidelines and waiting, they are renting the same place in the same or better neighborhood for much less than the payments and taxes would be if they bought at current prices. No one in the RE industry is buying today, my cousin who owns 50M in real estate is not buying anything, RE developers are not buying land or options, RE companies are going under. Why would anyone in their right mind speculate in RE today….especially in the bubble areas?

If you can’t hold out 10 years then Sell while you still can get 2004 prices. They will go down to 2001 prices or worst before it is over. I feel bad for so many of my friends in CA who are now in houses over their heads. When they got ARMS and more home than they needed with high carrying costs and taxes, I told them not to. Any one who disputes this does not know simple economics or the banking industry. It will be a blood bath when all the derivitives and other instruments based on RE, crash taking the US down like Japan! when 2 million buyers are eliminated and 2-3 million homes are sitting vacant, supply and demand will take years to work through the inventory, then it will take double that time to recover and it may never EVER get back to these levels again. Florida crashed in the 30’s and most of those prices never recovered even today!

Good luck and God bless all. I am now at less than 15% of my gross for housing/insurance/taxes which is covered by my consulting and side income streams. I hope to pay off my home in less than 15 years. And to think that 20 years ago when I said that it was better to pay off my home and save for retirement, my friends told me that this idea was dangerous as I should be leveraged in RE. Today I am a hero to my family while I can afford to pay for my kids college with my regular pay and help my wife’s family climb out of their housing debt in their retirement years.

[gary_broker]

JJ,

You have extrapolated much into the lawsuit debate. I mean there are a lot of “what if” scenarios that one can theorize. I guess if I came home and found my client / co-defendant in bed with my wife that could also dissolve the “team” too. In the end you seem to be set on your beliefs that a knowledgeable, competent and well insured agent would be of no benefit to you in a litigated transaction…well then, so be it.

As far as your statement questioning the intrinsic value of an agents service doubling over the last seven years (an affect of inflated home price increases), well.. I do agree with you on this. Just remember that real estate commissions are negotiable. I live in Ventura County and the homes here are expensive. I routinely cut my commission (often deeply) to make a deal work. I own my own company so I am liberty to do this, note that some agents out there are not. Many brokers enforce a nothing less than 5% rule on their agents.

Our current RE market is filled with new agents who got in when the market was booming. Many of these folks quickly came to believe that they deserved a large commission check on each transaction (regardless of the amount of work they put in). These agents believe this simply because they know no different, for them the money has always been easy. I know from past experience that many of these agents will not be working in real estate by this time next year.

Understand that I am going to rant here and that this is not directed at you or anyone in particular, however this needs to be said and I guess this space is as good as any, so here goes.

I am certainly not a defender of the average salesperson. However I have been lurking on this board for quite some time and I realized straight away that what first appears to be a pent up hatred for real estate agents is actually a bipolar form of jealously. Allow me to explain.

There are a lot of post here from people that go on and on about how stupid agents are, what little service they provide, how little they really know and what little actual work they do for those big, fat, tremendous commission checks..yada..yada..yada.

Lets face the facts, If these people truly believed in their heart that being a realtor was so easy and the money so tremendous and the life style so grand, they would not be wasting their time posting here, they would be rushing out to get their license. It is kind of like they want believe what they are writing but in the back of their minds they either know better or worse yet, don’t know better and lack the balls to plunge into the business. In either case it is silly. It is analogous to someone believing their gardener makes $300K a year for pushing around a lawn mower. Then that person spends hours on end posting on a gardening site complaining how stupid and overpaid gardeners are, instead of going out and buying a lawn mower.

[gary_broker]

JJ,

You have extrapolated much into the lawsuit debate. I mean there are a lot of “what if” scenarios that one can theorize. I guess if I came home and found my client / co-defendant in bed with my wife that could also dissolve the “team” too. In the end you seem to be set on your beliefs that a knowledgeable, competent and well insured agent would be of no benefit to you in a litigated transaction…well then, so be it.

As far as your statement questioning the intrinsic value of an agents service doubling over the last seven years (an affect of inflated home price increases), well.. I do agree with you on this. Just remember that real estate commissions are negotiable. I live in Ventura County and the homes here are expensive. I routinely cut my commission (often deeply) to make a deal work. I own my own company so I am liberty to do this, note that some agents out there are not. Many brokers enforce a nothing less than 5% rule on their agents.

Our current RE market is filled with new agents who got in when the market was booming. Many of these folks quickly came to believe that they deserved a large commission check on each transaction (regardless of the amount of work they put in). These agents believe this simply because they know no different, for them the money has always been easy. I know from past experience that many of these agents will not be working in real estate by this time next year.

Understand that I am going to rant here and that this is not directed at you or anyone in particular, however this needs to be said and I guess this space is as good as any, so here goes.

I am certainly not a defender of the average salesperson. However I have been lurking on this board for quite some time and I realized straight away that what first appears to be a pent up hatred for real estate agents is actually a bipolar form of jealously. Allow me to explain.

There are a lot of post here from people that go on and on about how stupid agents are, what little service they provide, how little they really know and what little actual work they do for those big, fat, tremendous commission checks..yada..yada..yada.

Lets face the facts, If these people truly believed in their heart that being a realtor was so easy and the money so tremendous and the life style so grand, they would not be wasting their time posting here, they would be rushing out to get their license. It is kind of like they want believe what they are writing but in the back of their minds they either know better or worse yet, don’t know better and lack the balls to plunge into the business. In either case it is silly. It is analogous to someone believing their gardener makes $300K a year for pushing around a lawn mower. Then that person spends hours on end posting on a gardening site complaining how stupid and overpaid gardeners are, instead of going out and buying a lawn mower.

[NeetaT]

No!!!!!

[NeetaT]

No!!!!!

[SD Realtor]

This was quite a thread…

Newguy – One thing, you never answered my question about whether you actually told or asked your sales agent to show you any new homes. I am still kind of curious about that.

I think everyone made alot of good posts and it seems clear to me at least that it is more of a situation of “to each his own”… Rustico noted how he offers reduced commission and rebates buyers commission, there are guys like me that list homes for 1% commission and rebate buyers commissions, there are Help U Sell brokerages, there are guys like Jeff Karchin that put your home on the MLS for like 500 bucks and let you negotiate the deal with buyers. There are websites like forsalebyowner.com as well. There are full service traditional brokerages as well.

Once more, there are all kinds of alternatives out there. Different use s for different buyers and sellers.

SD Realtor

[SD Realtor]

This was quite a thread…

Newguy – One thing, you never answered my question about whether you actually told or asked your sales agent to show you any new homes. I am still kind of curious about that.

I think everyone made alot of good posts and it seems clear to me at least that it is more of a situation of “to each his own”… Rustico noted how he offers reduced commission and rebates buyers commission, there are guys like me that list homes for 1% commission and rebate buyers commissions, there are Help U Sell brokerages, there are guys like Jeff Karchin that put your home on the MLS for like 500 bucks and let you negotiate the deal with buyers. There are websites like forsalebyowner.com as well. There are full service traditional brokerages as well.

Once more, there are all kinds of alternatives out there. Different use s for different buyers and sellers.

SD Realtor

[NotCranky]

“there are guys like me that list homes for 1%” Those debates you and sdr had before I got to know you, about full service brokerages ect., I think I understand now!LOL.
You can have it my friend. 1% start to finish + 2.5%-3% for cooperating broker on listings and you more or less complete all traditional listing agent responsibilities? So you shut down escrow at 3%-3.5% with 1% for your office and nothing more? I am not going to challenge your service or get competitive with you because I think your clients are lucky to have you.I just want to make sure I understand you clearly?

[NotCranky]

“there are guys like me that list homes for 1%” Those debates you and sdr had before I got to know you, about full service brokerages ect., I think I understand now!LOL.
You can have it my friend. 1% start to finish + 2.5%-3% for cooperating broker on listings and you more or less complete all traditional listing agent responsibilities? So you shut down escrow at 3%-3.5% with 1% for your office and nothing more? I am not going to challenge your service or get competitive with you because I think your clients are lucky to have you.I just want to make sure I understand you clearly?

[Duck]

1% is surely the future. The problem is that NAR has seemingly made it so hard to do a transaction while 95% of the forms are not required by law.

With the internet anyone with an IQ above 20 can make a good purchase. The bigger problem is listings where the Realtor mafia won’t show FSBO’s including those that will pay a CBB. It will change in the next 10 years.

You don’t think a Google/Zillow partnership has their sites in it? As a NAR member I am ashamed.

[Author]

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