How Real-Estate should work

Ardell’s blog entry: What will consumers think? over on ActiveRain (who I used to work for) had me ranting in the comments. The real-estate world REALLY pisses me off – which is a huge reason I’m not working at ActiveRain anymore. Background – Ardell was my agent and, while I like Ardell a lot the whole “you sell my house thing” went about as badly as I could have imagined for numerous reasons (some of them my fault). Anyway – here’s the comment for anyone interested (since I’m half betting they’ll just delete it):

Good grief. I’ll try not to go off on a tangent here and just say that, as an industry outsider, my friends and I couldn’t give a damn about any of this. We want to sell our house (I honestly can’t understand why anyone uses and agent to buy a house though). We’re making the biggest financial sale in our lives and paying your fees (often outrageous, though Ardell’s fees are VERY reasonable) to have everything go very smoothly – no surprises. What you say had better happen. We’re not paying for guess work, optimism, crazy unprovable theories that change with the weather. Results – that’s all anyone with any intelligence gives a damn about.

Would you hire someone to do [“enter whatever you want here”] who might not be able to finish it, couldn’t really tell you before hand what it’d cost you or how long it’d take and wanted to change any numbers (by factors equal to a years salary) they gave you when they started every couple of weeks because of a hunch? (geeze – sounds like dealing with programmers who were dumb enough to agree to the waterfall model!)

Really – in a perfect world (or, might I say, in the real world) – you guys would buy our houses from us and sell it yourself and get your commission that way. If you know what you’re doing that shouldn’t be a problem. If you, as a professional, aren’t willing to take that kind of risk why on earth should we be expected to? Of course – I’d be willing to bet there isn’t one person on all of ActiveRain who has that kind of confidence (if there is, let me know – I’ll sell you my house, I’m dead serious). That’s pretty telling and is why I’ll be FSBO for the rest of my real estate transactions. While not completely criminal – I think the Real Estate industry comes pretty close and, to be perfectly honest, I’ve yet to talk to an “outsider” who didn’t think the same thing. You guys are sales people – and that comes with all the usual trust and affection that a used car salesman gets.

BTW: Not that AR would ever mention this to any of you (another “pretty telling”) – but I don’t work for AR anymore. So, this doesn’t represent ARs stance on anything. And, if they delete it – I’ll just put it up on my blog http://mudabone.com/aietc and stop commenting on AR.

Ooops – guess I went of on a tangent.

Her reply…

Ben,

I still love you and always will. You just don’t get what we do for a living. We don’t buy houses and we don’t know if your house is going to sell and at what price anymore than we know if a certain stock is going to be up on Wednesday or within the next 30 days. It’s a market, not an asset with a hard and fast defined value.

You can get the same roof in busy season for $7,000 that you can get in slow season for $5,000. Some things are subject to market conditions, and those conditions change all the time. Then there’s supply and demand and demand for all houses is not equal.

We give you our best answer and then we test the market with that best answer and the market gives the real answer…kindof. Sometimes the market just says no. Then you try something else and the market says yes or no again…repeat. Sometimes you change the price and sometimes you change the condition and most times you do both and you keep doing that until you are “Positioned to Sell”. Your house isn’t worth what “a” buyer will pay. It is worth what the buyers generally will pay, if they want it at all.

The reason you list your house with an agent is so that more eyes see it in the mls and so that you have someone to help sort out what the market is saying until it says yes.

And then when one person does say yes, the person you hire helps you answer all of the other yesses and no’s that come up until the house records in someone elses name and you have money in your hand.

The right price is the one that is not too low and not too high and often it’s a process and it never is a science and it always is an artform with many artists including all the people and factors in the marketplace including interest rates and availability of financing and all of the other people trying to sell their houses and all of the buyers who may or may not buy within a given timeframe.

It’s a huge big mess of what if’s and an ongoing process that sometimes takes a week and sometimes takes 30 days and sometimes takes a year. Getting through that process is what we help people do. Circumventing the process (by buying the house ourselves or any other means) is not what we do.

P.S. Ben,

You are allowed to go off on a tangent. There’s no law against it last I looked. Besides, you’re special :)

Jo replies…

ARDELL, Your response to Ben needs to be a blog so everyone can see. You have some very very great points!! I know others that haven’t followed this blog will really enjoy that – and on to the top of WA :)

Ardell replies

ben-said: Ardell – It’s the internets (they created a backup for us) – it’s public information.

You can do lockbox plus mls only, but you have to be in the mls to be on the Internet in a big way, like the Windermere site and the Redfin site, etc… It is not “public information” until it is IN the mls and that means listed by a member of the mls. You can do that for $500 bucks or so, but then you have to offer something to the agents who are members who come and show it. I think the minimum is a dollar. So you can be on the internet for say $501. :) Of course you can be Craig’s List. You can be “on the internet” in a blog post. But if you want to be on the internet where most people are looking for houses, then you have to be “listed” to be “public”. See if MLS4Owners will let you do the one dollar thing. The only reason someone wouldn’t is because it could harm their other clients if agents start boycotting the company. You’re not going to tell me they’re not allowed to do that now, are you? :) They can’t, and they won’t and don’t, are two different things

ben-said: I’m also missing the privacy gene – everything should be public. So, if my asinine babbling is actually of interest to anyone publish away.

She asked me to publish my words as a blog post, not yours.

ben-said: That said – I disagree with your response. It’s probably all that glue I sniff making sock puppets 24/7. Seriously – you don’t think you could talk me down $10-15K off whatever you could sell the house for?

It wouldn’t have been fair to you at that point, as you would be underselling it if you tried to sell it with no access. That wouldn’t have been in your best interests and I can’t recommend or do anything that is not in your best interests. BTW…go look at the post I wrote before I met you where I did the proposal. You may see “double yellow line” in that post a couple of times, and not 3 weeks later :)

ben-said: Maybe I’ll start a real estate firm that does what I suggest (just need to find someone with Donald Trumps [that ass monkey] credit rating) :)

It already exists. Take a walk over to 2nd and Central or so and look up. It’s called “We Buy Ugly Houses” and it’s on the second floor of a two story building. Pretty sure it’s between 2nd and First Mutual. See what they’ll give you for it. They are not licensed so they are allowed to rip you off, so be careful. But what you want is their business model and it’s right down the street. You don’t need Donald Trump LOL

I replied… (and am seriously thinking for doing this, finding the non-extradition server farm)

I think you misread my comment (or didn’t “get it”) but – what a shinning example of “Real Estate is the most screwed up industry in America”.

This is exactly what I meant by Real Estate is criminal. That 99% of realtors jobs are being a member of some cartel is pathetic and is why all this banter about being professionals is just laughable. There’s a reason MLS data is better gaurded than the holey-grail … and it’s all about money and limiting competition (No, it’s not because there are 1 or 2 lines of private information in the MLS that could be completely removed without effecting a thing). It’s in the customers best interest, right, to keep all this crap locked up behind a $500+ entry? Consumer couldn’t possibly benefit from having MLS be an open/free system. Oh yah – these regulations are here for our protection. You’re only permitted to be fleeced by a licensed professional. What a joke. This is what any educated consumer thinks of the real estate industry.

I’m really tempted to find a extradition-free-server-farm-country (Caymans, several South Pacific islands, etc.) to run a 10 line perl script that scrapes and publishes all the MLS data in the US just to to screw with the man. Maybe have it auto list everything on CraigsList at the same time.

I’m still waiting to hear why selling a house needs to be different than selling a car … which seem to happen all the time without proprietary data, archaic rules and all the other nonsense that’s involved in real-estate.
rant, rant, rant