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Real estate sales is an industry rife with anti-competitive and corrupt practices. Appraisals, home inspections, lending, and sales are all in it together on th

by sidlls 3y ago

Real estate sales is an industry rife with anti-competitive and corrupt practices. Appraisals, home inspections, lending, and sales are all in it together on this. I absolutely loathe them.

userinanother 3y ago
Add mortgage insurance in there too
- choppaface 3y ago
  And title insurance
  - lotsofpulp 3y ago
    I feel like we have had electronic databases with backup capability for so long that errors in titles should have long been a thing that does not happen anymore.
    - calciphus 3y ago
      Same thought. You'd think title insurance would only kick in if the last title transfer predates say 1980, or some other relatively-likely-to-have-county-digital-records date
      - gpm 3y ago
        My parents bought a house in ~2003 new from the builder that ended up having a title issue when they tried to sell it (work orders of some kind)... in a big city that I certainly assume was using digital records by then.
    - pixl97 3y ago
      I did computer support and had a couple of title companies all though the 2007 boom and 2008 crash. I may seem impossible, and yet suits brining up chain of title going back into the 1800s do happen more commonly than one would think. In the rural south there are some insane claims of title across families. I've seen title work where they had thousands of pages of paperwork involved with hundreds of possible heirs that had to be located.
  - idlewords 3y ago
    And the underbody coat that totally failed to rustproof my home
  - koolba 3y ago
    Of all the scams associated with real estate transactions, title insurance is kind of legitimate. The title chain itself may be recorded, but there may be some lien against the property that was not properly recorded. That’s the situation you protecting against. Now whether that’s worth .5-1% is debatable.
    - photonbeam 3y ago
      The seller really should be liable for all of that
      - echelon 3y ago
        They'll just pass the cost on to the buyer in the price.
      - gpm 3y ago
        Yes, but if you only discover a decade later and the seller is long gone...
        latency-guy2 3y ago
        If so then there are laws to consider that any property that is not protected becomes legally owned by the one who has been servicing/inhabiting it, which is a bit before that decade would end. The core problem of the lien is solved, the only thing left is to ensure the lawyers who seem to always get their cake no matter what aren't bloodthirsty enough.
    - danans 3y ago
      > Of all the scams associated with real estate transactions, title insurance is kind of legitimate As someone who has submitted (and failed to collect) on a claim against title insurance for legal fees incurred to correct a mistake in the original title that the title company missed, I'm skeptical of its value, at least for things like erroneous lot lines.
      - 3y ago
bmitc 3y ago
I find that it's very similar to mob tactics. Prospective homeowners just get passed and funneled from person to person that they effectively have no choice but to interact with. And each of those people take a piece of the pie.
- SoftTalker 3y ago
  And there are a lot of fear tactics used as well. Or FUD, at least. "Don't skip the inspection, what if something is wrong" sounds sensible but pre-purchase home inspections are quite surface level, will only find visible, obvious problems, and in the fine print they disclaim responsibility if they miss anything.
  - pixl97 3y ago
    I mean yea, but also not yea. It's definitely you get what you pay for. If you have a good home inspector they may be able to tell you something like "Yea, the roof is fucked", or "That crack you didn't notice in the foundation is really bad news". I don't build homes nor do I troubleshoot them on a daily basis. Someone that does, and has a at least a modicum of experience will still notice more than I.
    - hibikir 3y ago
      It definitely isn't: There is little repeat business, and realtors do a lot of the recommendations. So you absolutely can end up paying top dollar for an inspection that appears thorough, but is nowhere near good enough. It's just a very inefficient market, fraught with dark corners. That's why people hate it. A world where an expensive inspector actually meant higher quality would be far better than what we have
  - bmitc 3y ago
    In my area, you won't get an offer accepted if you don't waive the home inspection. In fact, it's basically required to waive all inspections, such as radon and others. So the state says you have a so-called right to these, which divests the state from liability, but on a practical level, you need to waive these. Buyers end up having to buy ~$1M homes based upon just looking at them once or twice over just a couple of hours with basically no history given at all. It's such a messed up process. I get to do more due diligence buying something off of Reverb or eBay than I did with our home. And as you say, all of the people you're forced to interact with force you to sign papers that says that they have no responsibility for anything whatsoever.
brandall10 3y ago
I recall reading a section in the California DRE salesperson training book 20 years back on canvassing for new clients. They actually discussed perusing local obituaries and contacting next of kin, because you know, there's a likely sale to be had. But they cautioned waiting 2-3 days as it could be seen as being insensitive.
- lotsofpulp 3y ago
  What is wrong with that? It is a fact that many homes are sold when their occupants die, and offering your services to a potential customer when the customer likely needs it does not seem out of bounds.
  - lcnPylGDnU4H9OF 3y ago
    A phone call is a request for the person on the other end to stop what they’re doing and pay attention to the phone conversation. Plenty of people are annoyed when that happens in many contexts, not least of which includes telemarketers. Add on top of that the fact that the advice is to allow 2-3 days’ bereavement before the unsolicited possible annoyance... I genuinely don’t get the question. Be available as a realtor and market well; allow such customers to find you instead of chasing this particular kind of lead.
    - lotsofpulp 3y ago
      I did not realize contact meant phone call. It could be as simple as leaving your business card or sending them mail.
  - zeusk 3y ago
    You'll realize when you lose a parent but some schmuck just wants to be the first to get that 3% off of you.
  - saxonww 3y ago
    But you're not offering your services. You're trying to get a potential customer to pay you for your services. And you're doing this during, presumably, a time of grief when the potential customer already has a lot to deal with physically and emotionally. And you're doing it because of the event that put them in this state. So in that way, it's not so much kind as it is exploitative.
wyldfire 3y ago
Home inspections aren't compulsory are they? I thought that they weren't even required by lenders. Of all the things listed they sure seem like real value to the buyer. If you're not borrowing to purchase a home you probably wouldn't need an appraisal. I think lenders just want objective evaluation of the collateral. Who can blame them?
- Libcat99 3y ago
  Some lenders do require inspection, and FHA loans do require one. They have some value buyers for sure but inspectors also have an interest in finding something to make it seem worthwhile.
- wredue 3y ago
  They won’t catch much anyway. Most inspectors take a short stroll through the house, test one or two receptacles and call it a free $400 after that. Their visit is shorter than when you looked at the house. Maybe there’s good reputable inspectors. Ours weren’t
deleted 3y ago
[deleted]

by sidlls 3y ago

Real estate sales is an industry rife with anti-competitive and corrupt practices. Appraisals, home inspections, lending, and sales are all in it together on this. I absolutely loathe them.

userinanother 3y ago

Add mortgage insurance in there too

choppaface 3y ago
And title insurance
- lotsofpulp 3y ago
  I feel like we have had electronic databases with backup capability for so long that errors in titles should have long been a thing that does not happen anymore.
  - calciphus 3y ago
    Same thought. You'd think title insurance would only kick in if the last title transfer predates say 1980, or some other relatively-likely-to-have-county-digital-records date
    - gpm 3y ago
      My parents bought a house in ~2003 new from the builder that ended up having a title issue when they tried to sell it (work orders of some kind)... in a big city that I certainly assume was using digital records by then.
  - pixl97 3y ago
    I did computer support and had a couple of title companies all though the 2007 boom and 2008 crash. I may seem impossible, and yet suits brining up chain of title going back into the 1800s do happen more commonly than one would think. In the rural south there are some insane claims of title across families. I've seen title work where they had thousands of pages of paperwork involved with hundreds of possible heirs that had to be located.
- idlewords 3y ago
  And the underbody coat that totally failed to rustproof my home
- koolba 3y ago
  Of all the scams associated with real estate transactions, title insurance is kind of legitimate. The title chain itself may be recorded, but there may be some lien against the property that was not properly recorded. That’s the situation you protecting against. Now whether that’s worth .5-1% is debatable.
  - photonbeam 3y ago
    The seller really should be liable for all of that
    - echelon 3y ago
      They'll just pass the cost on to the buyer in the price.
    - gpm 3y ago
      Yes, but if you only discover a decade later and the seller is long gone...
      - latency-guy2 3y ago
        If so then there are laws to consider that any property that is not protected becomes legally owned by the one who has been servicing/inhabiting it, which is a bit before that decade would end. The core problem of the lien is solved, the only thing left is to ensure the lawyers who seem to always get their cake no matter what aren't bloodthirsty enough.
  - danans 3y ago
    > Of all the scams associated with real estate transactions, title insurance is kind of legitimate As someone who has submitted (and failed to collect) on a claim against title insurance for legal fees incurred to correct a mistake in the original title that the title company missed, I'm skeptical of its value, at least for things like erroneous lot lines.
    - 3y ago

bmitc 3y ago

I find that it's very similar to mob tactics. Prospective homeowners just get passed and funneled from person to person that they effectively have no choice but to interact with. And each of those people take a piece of the pie.

SoftTalker 3y ago
And there are a lot of fear tactics used as well. Or FUD, at least. "Don't skip the inspection, what if something is wrong" sounds sensible but pre-purchase home inspections are quite surface level, will only find visible, obvious problems, and in the fine print they disclaim responsibility if they miss anything.
- pixl97 3y ago
  I mean yea, but also not yea. It's definitely you get what you pay for. If you have a good home inspector they may be able to tell you something like "Yea, the roof is fucked", or "That crack you didn't notice in the foundation is really bad news". I don't build homes nor do I troubleshoot them on a daily basis. Someone that does, and has a at least a modicum of experience will still notice more than I.
  - hibikir 3y ago
    It definitely isn't: There is little repeat business, and realtors do a lot of the recommendations. So you absolutely can end up paying top dollar for an inspection that appears thorough, but is nowhere near good enough. It's just a very inefficient market, fraught with dark corners. That's why people hate it. A world where an expensive inspector actually meant higher quality would be far better than what we have
- bmitc 3y ago
  In my area, you won't get an offer accepted if you don't waive the home inspection. In fact, it's basically required to waive all inspections, such as radon and others. So the state says you have a so-called right to these, which divests the state from liability, but on a practical level, you need to waive these. Buyers end up having to buy ~$1M homes based upon just looking at them once or twice over just a couple of hours with basically no history given at all. It's such a messed up process. I get to do more due diligence buying something off of Reverb or eBay than I did with our home. And as you say, all of the people you're forced to interact with force you to sign papers that says that they have no responsibility for anything whatsoever.

brandall10 3y ago

I recall reading a section in the California DRE salesperson training book 20 years back on canvassing for new clients. They actually discussed perusing local obituaries and contacting next of kin, because you know, there's a likely sale to be had. But they cautioned waiting 2-3 days as it could be seen as being insensitive.

lotsofpulp 3y ago
What is wrong with that? It is a fact that many homes are sold when their occupants die, and offering your services to a potential customer when the customer likely needs it does not seem out of bounds.
- lcnPylGDnU4H9OF 3y ago
  A phone call is a request for the person on the other end to stop what they’re doing and pay attention to the phone conversation. Plenty of people are annoyed when that happens in many contexts, not least of which includes telemarketers. Add on top of that the fact that the advice is to allow 2-3 days’ bereavement before the unsolicited possible annoyance... I genuinely don’t get the question. Be available as a realtor and market well; allow such customers to find you instead of chasing this particular kind of lead.
  - lotsofpulp 3y ago
    I did not realize contact meant phone call. It could be as simple as leaving your business card or sending them mail.
- zeusk 3y ago
  You'll realize when you lose a parent but some schmuck just wants to be the first to get that 3% off of you.
- saxonww 3y ago
  But you're not offering your services. You're trying to get a potential customer to pay you for your services. And you're doing this during, presumably, a time of grief when the potential customer already has a lot to deal with physically and emotionally. And you're doing it because of the event that put them in this state. So in that way, it's not so much kind as it is exploitative.

wyldfire 3y ago

Home inspections aren't compulsory are they? I thought that they weren't even required by lenders. Of all the things listed they sure seem like real value to the buyer. If you're not borrowing to purchase a home you probably wouldn't need an appraisal. I think lenders just want objective evaluation of the collateral. Who can blame them?

Libcat99 3y ago
Some lenders do require inspection, and FHA loans do require one. They have some value buyers for sure but inspectors also have an interest in finding something to make it seem worthwhile.
wredue 3y ago
They won’t catch much anyway. Most inspectors take a short stroll through the house, test one or two receptacles and call it a free $400 after that. Their visit is shorter than when you looked at the house. Maybe there’s good reputable inspectors. Ours weren’t

deleted 3y ago

[deleted]