Real estate forum - Re: Radical change in any direction is good news???

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Re: Radical change in any direction is good news???

Steve Horrillo

2005-07-24, 8:52 pm

On 22-Jul-2005, Renard3@webtv.net (A A) wrote:

> One result of a bursting RE bubble could be a radical change in
> marketing: More streamllined with lower commissions for RE sales
> agents. High commissions in the 5-7% range may be justifiable when
> "irrational exuberance" drives prices up in a bullish RE market and the
> seller has profits to draw from. Actually, many in the mortgage and
> real estate business have done very well over the past few years. I'm
> talking about the serious, established, professional realtors ... not
> the novice part-timers. The idea that a bearish RE market would be good
> for realtors is ludicrous. Art

It can't get any worse. You're obviously not a Realtor. What's been
happening is the sheeple hear in the media that the market is "so hot houses
are selling themselves." So they sell it FSBO. For the first time ever
discount brokerage franchises have actually had some success penetrating the
market.

Being that selling is like going "from the frying pan into the fire" most
sellers have been holding, refinancing their appreciation and fixing up the
house as a substitute for selling. Which makes for many more buyers than
sellers. It's easy to find buyer to show houses but good luck finding one
they like and can afford. My best friend has been "an established" realtor
for the past 18 years. Go many awards and top in sales mostly as a buyer's
agent. Her business gradually dwindled from and average 25 closings a year
to 7. She was able to put two kid's though college. The last few years she
barely has been able to pay her own bills. I've trained realtors for the
past year and I'm being told by old-timers it is the worst it's ever been.

--
Warmest regards,

Steve Horrillo, Realtor / C.Ht. =^..^=
http://BrokerAgentTraining.com http://over100percent.com http://HipFSBO.com
http://eLOWn.com

All the best,

Keter Pardes
(reply to me here I don't read my email)

homan4

2005-07-24, 8:52 pm

[color=darkred]

Say what?

First what is this about 5-7% being "high commissions?" I consider 5% low
and 7% normal. You have been reading too many Newsweek articles - most of
which are written by reporters who don't know what they are talking about.
The rapid rise in real estate prices and media hype has caused numerous
sellers to try it on their own, or go to discount brokers - after all, every
one knows that full service realtors are greedy. I wonder why it is never
reported that the limited service discounters are whores who cheapen the
industry. Probaably because it would be considered an insult to
prostitutes.

Second, what bubble? I haven't seen any "new" land lately. In fact, the
federal as well as many state and local governments are purchasing bulk
parcels of vacant land at alarming rates, requiring mandatory greenbelt set
asides n new subdivisions and even passing development morritoriums in order
to preserve "quality of life" in their jurisictions. Add to that the land
which is condemned for contamination, environmental and inferstructure, as
well as erosion of our coastlines and this takes tens of thousands of acres
nation wide permently off the market every year creating an artificial
shortage in addition to the already limited low supply. The actual
available land inventory in this country is decreasing each year with no end
in sight. People need homes and the shortage is only going to get worse.
Prices are not going to stop rising.

It is also clear that you not only don't understand real estate, or the law
of supply and demand. Your so called "irrational exuberance" which is
driving the prices up is in effect creating a perception that selling homes
is easy, and increasing the ranks of folks who consider selling "FSBO" or
using a limited service discount broker, thus putting a downward pressure on
commissions. If your so called bubble bursts and property sales start to
slow, people are going to look for help. If an agent has to carry inventory
for a longer period, costs are going to rise for the agents, and commissions
will rise automatically to compensate.

The people in the mortgage business who have done best over the last ten
yeare are those who do refi's. Many folk have cashed out their equity so
many times that if the market slows and they choose to sell, there will be
nothing left to even pay a limited service discount broker to sell their
homes, this is when most of he jurnalists who wrote about excessive
commissions will eat their words and strapped sellers will find out how hard
it really is to sell FSBO.

Additionally, if the last two dips in the real estate cycle are ay
indication, the number of units selling will drop less than 10% this will be
enough to discourage some real estate part timers and hobists, but will only
increase the opportunity for experienced agents to increase their incomes.
Even though I doubt it will happen, I would welcome a slow down, I like
people looking to pay higher commissions, giving longer listings and seeking
me out while weaker agents drop out of the business like flies.

Steve Horrillo

2005-07-24, 8:52 pm

On 23-Jul-2005, "homan4" <homan4@cox.net> wrote:

> You have been reading too many Newsweek articles - most of
> which are written by reporters who don't know what they are talking about.
>
> The rapid rise in real estate prices and media hype has caused numerous
> sellers to try it on their own, or go to discount brokers - after all,
> every
> one knows that full service realtors are greedy.

Why is it that the media (almost) always prints negative or misleading
articles about Realtors? There's a few good one's like the USA Today 2003
article, but for the most part these idiots are leading people to the
slaughter. Meanwhile rather than boycotting the media, Realtors waste their
money advertising in these rags. Is it that sophisticated investors are
doing a heavy amount of press releases to assure the public remains
unprotected? Are the owners of the newspapers (or the owners of the owners)
who are most probably heavily into investment, trying to play these people?
Or are they simply just telling the public what they think will interest
them?

--
Warmest regards,

Steve Horrillo, Realtor / C.Ht. =^..^=
http://BrokerAgentTraining.com http://over100percent.com http://HipFSBO.com
http://eLOWn.com

All the best,

Keter Pardes
(reply to me here I don't read my email)

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