So, just why do Realtors have an unfavorable reputation? (buyers agent, buying a house, buyers)
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If you only have 2 hours in this then from experience, I can say that you have not done your job. Just to meet with a client at the office and go over a buyers advisory, or whatever you have in Texas, determine what the buyers need, discuss agency, etc., can take 2 hours. Going to visit one house is going to be 1 hour from start at the office to return.
Running comps will take 30 minutes to an hour. Writing the contract with the necessary Arizona addenda will take an hour. Then there is the discussion with the other agent, and reading the accepted contract to check for signatures and initials in the proper place and that no changes have been made. That's another hour.
Checking with the buyers lender, the title company, scheduling inspection; being at the inspection with the buyer. Reviewing the inspection and termite report with the inspectors and the buyer. Writing up the request for repairs. That all takes a lot of time.
(I have worked today for 6 hours on negotiating repairs on one of my listings and going to see that some repairs were done properly. Fortunately it's 5 minutes from my house)
Then when the HUD 1 comes, it will take close to an hour to review that for accuracy, then explain it to the buyer. Then work on any other of the myriad of issues that come up during escrow, such as a bad appraisal, where the sale can be lost. Then meeting the client at signing, which if you're lucky will take an hour. And then there is the final walk through inspection that is going to take at least an hour on any house, and can take up to 2 hours on a larger home. Then if something is wrong, the fit hits the shan because now things have to go in overdrive to make sure negotiations will cause the problem to be cured in time to close.
There is no way that an agent can do a proper job for any client, whether it's a $50,000 or a $1,500,000 house in two hours.
And you need to know that those of us who are really good agents, and know our business do not get paid by the hour. We get paid for our knowledge, and skills.
You have done some transactions on your own, but you are a new agent, and you have a lot to learn. One thing to learn is to not try to BS experienced agents into believing you can do a transaction in two hours because we know better.
And I think you said before that you were getting your license so you could save your friends and relatives money. I didn't hear you mention in your post that you were sharing any of this money with your relative. Or did I just miss that?
Not a whole lot to do on an all cash purchase of rural agricultural real estate, with zero improvements and zero mineral rights. I coordinated a new survey with a survey company that I have used in the past for my own ranch properties. I rode the property over the weekend with my uncle on a side by side utility vehicle while we chatted about life. That could be considered work, but I enjoy that immensely...I guess we actually went to lunch after looking at the property...if you count lunch I could probably add another hours....so if you count lunch and riding the property then I guess I have 5 hours into the deal.
Admittedly not a standard transaction...but still very easy....I used the state of Texas mandatory form to make the offer, coordinated a survey, and opened title at a Title Company. Negotiations were non-existent as it was take it or leave b/c the property we are buying borders his current property which he wanted to expand upon...he would have paid 2x the asking price and he had no interest in negotiating with the older gentlemen who just wanted to cash out before end of year for tax reasons.
That may seem like a once in a lifetime piece of cake transaction to you, but I have quite a bit of family who do transactions like this more often than you would think...I got my license just to be able to service myself, my family, and my close friends - I have no interest in running down business for myself full time...I got licensed solely so I could do my own transactions without running into the multiple road blocks I ran into when buying my last property.
I think there are a couple other huge factors that have not been discussed:
1. The NAR
2. MLS Systems
The National Association of Realtors, due to its size, has significant lobbying abilities. NAR lobbyists are able to influence law makers and create legislation that protects the association, even though many times it adds additional cost to the buyer/seller for little return. The also draft common sales contracts and enforce the normal 3% commission per side.
Local MLS systems are run as a controlled monopoly. The MLS is used as a way to extract fees from agents which is passed on to buyers/sellers. The fees are used to pay for unnecessary bloat like luncheons, meet and greets, etc. The fees are extremely high for agents and the market areas are constantly being divided to create more MLS areas which generate more fees.
It is my opinion that 90% of the marketing of a property for sale is in the MLS listing and its pictures. No matter how good of an agent you are, the buyer will always seek the best bang for their buck. I agree with Mr. cmg in that agents now are a commodity. It is an outdated business model which is being sustained by the clout of the NAR, legislation and standard protocol.
Please help me understand how the NAR increases costs to home buyers and sellers. And where you got the "normal 3% commission per side," I'd love to introduce you to all the HUD-1 forms processed through our office.
I think your opinion is a lot of bunk based on false conceptions. You obviously don't have a clue regarding how my business functions and the compensation models we must work with.
Rebating was a huge part of Marksmu's deal. He is an attorney. He had stated on another thread that he wouldn't be showing buyers homes or do listing showings, generally speaking. So it is kind of a limited representation situation but with an attorney as your limited representation. Not a bad deal for those wanting limited rep, but it isn't regular real estate.
Then he should have disclosed up front that he is an attorney.
Then he should have disclosed up front that he is an attorney.
I openly disclosed that in another thread. I didn't see how it was really relevant in this thread. Just for full disclosure I'm also an engineer....not a PE just someone with a degree in engineering.
Do you buy his claim that the "idiot" (I think that was his description) Remax agents caused him to lose the contract with the builder, who was the ultimate decision maker?
Or would you rather believe, like I do, that the builder had confidence in the company he had chosen, and that the marketing package failed on it's own merits.
Yet when someone fails, it's easy to put the blame on others. Especially to blame "idiot" agents.
Actually, you didn't read that correctly. The ReMax idiots had not the slightest collective idea how to market a development. Instead, they wanted to treat the assignment less like a development of 200 homes and more like 200 individual listings. They had no understanding of brand as a way to create additional value, no understanding of how to achieve economies of scale by marketing a development, etc. Idiots is really the only possible way to describe them.
All they did was throw sand in the gears, chiefly because they wanted to take his marketing budgets and allocate it towards their commissions. So we had to tread water while they politicked and offered one objection after another, which led to a three-month delay in getting everything underway. Finally, when it became completely apparent that they had no clue how to market the development in question, he fired them and hired another brokerage with the explicit instructions to work with me.
Here's the thing. If the ReMax people (Heretofore known as 'the idiots') had simply followed along with the plan, they would have likely seen much more revenue, much more easily made. Because a good marketing plan drives people to a development and makes the asking price a good deal more defensible. The buyers would have come to them. Instead, they had to be greedy and stupid. And it cost them.
I have to ask you the same question Heidi; how do your select the Realtors you've dealt with. How is it you keep having unethical experiences?
If filling out a form was all there is to real estate.... wow, there is a definite need for the NAR to do something to educate the public.
I wish I had known that all I have to know is how to fill out a form. I wouldn't still be taking classes.
Typical, shift the blame to others to avoid the truth. Taking classes doesn't change the behavior outside of the classroom as it only teaches how to fill out a form and not improve the character.
If someone doesn't like the answer, don't ask the question.
There are many posts regarding the integrity of sales people who are commission driven. I shared a story of my 80 year old friend with cancer who had a salesman knocking on her door daily with solutions to all her problems such as getting rid of her antiques collections to finding a "home" for her to move to disregarding the fact that she never wanted to leave her home. He even opened an escrow account but she never signed any contract for the sale of her home. I ran the numbers for his commission at the 7% he demanded for my friend and she was horrified that he expected over $60,000 of her equity which would impact her heirs. Together we wrote out a script to kick that rat to the curb. If he ever showed up again we were well prepared to report him to Adult Protection Service or the police!
The food chain needs to be broken up and the commission structure should not be a part of the home sales process since it is such an important purchase. A lawyer is the only qualified person to provide legal advice, especially since they have no interest in the final outcome.
What I see being avoided by the same agents that chime in here time and time again, is that they refuse to adapt to a changing market and admit that people are fed up by the current method of buying/selling real estate.
What CPG35223 is enunciating to you Bill and Zyngawf is the public perception about your industry....While you may feel he is off base in his belief system, the general public will disagree...you will refer to statistics compiled by your industry to say he is wrong, but in reality he is not wrong....no matter what statistics you show me I wont believe you because I have never once talked to someone who said they felt the amount of compensation that their agent received was commiserate with the quantity or quality of work that went into their transaction.
I completely understand the problems agents/brokers have with people who waste your time, but you have to understand that the people who dont waste your time are tired of subsidizing those who do...If you have to sell 8 houses at little to no commission to get 1 house that earns you a good commission, that one should not have to pay more just because it sold for more. The amount of work is not directly correlated to the price and that is a BIG problem that the industry as a whole refuses to recognize and adapt to.
I was so fed up with it I got my own license....I flat refuse to pay it. I had planned that my first transaction would be my own house, but as luck would have it, my first transaction will actually be a relative...Its incredibly enlightening to be an "agent" now and see that, so far, all of my perceived thoughts about agents are actually reality. Good property, with good buyers who are intelligent, know what they are buying, and know how to navigate real estate make the job of the agent unbelievably easy. Easy to the point that its hardly work. I will close on this property (roughly $1,400,000) in 2 weeks and I literally have less than 2 hours of time in it....How anyone can believe that I have earned $35,000 for the work I have done is crazy, but that was the split 2.5%.
I will reiterate as I always do on threads like this - I believe there is a place for agents, I believe some are agents are great and are worth a good paycheck - but those agents are few and far between and that paycheck needs a good solid look to see if the value/service ratio is actually there.
The industry has a powerful lobby that has successfully kept Agents/Brokerages in business despite the changes in every other marketplace. It is incredibly short sighted to believe that these protections will last indefinitely. The internet and State mandated forms/contracts/closings has simplified your jobs tremendously yet the compensation has not changed. That can not go on indefinitely...the longer you dig your heels in and refuse to adapt and offer better services for the same or less money, the deeper you are digging your own grave.
I never disagreed that the industry is changing. It is. The point is that CPG sells marketing programs, so of course in his mind we are all bad if we don't give him our money. Go ahead. You be first and let us know how it works out for you. What you don't know yet is there are lots of hacks out there like him that want to sell you useless and expensive stuff that does nothing. That part of the business has not changed and likely never will.
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I realize that I'm not winning a popularity contest here. But while you scoff, just realize that I have made four separate brokers into very successful brands within their respective markets. In fact, one brokerage now has a 50-55% market share in its metro..
Help me to understand why are you on this thread anonymously, and listing your occupation as Bon Vivant?
If you are so good, why would you not be transparent and show us your web site that has testimonials from these four brokers that you made so successful.
It seems to me that transparency would do more to help credibility than coming on anonymously and bashing the real estate industry and calling them all "idiots".
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