4 ms·

I see where you're coming from, and I also agree that most real estate agents suck. One of the few bright points in this economy is that many of the most corru

by Shooter 17y ago

I see where you're coming from, and I also agree that most real estate agents suck. One of the few bright points in this economy is that many of the most corrupt agents have left the industry since it is no longer "easy money." Of course, there are still plenty of crooks left to go around, and some are more desperate than ever to make payroll. I also agree that the incentives in the industry are massively misaligned, and I'm definitely not here to defend the industry. As I said in another post, I'm actually trying to change the industry from the inside. One thing that many people don't realize is that if they don't have an agent representing their interests as a buyer of an MLS-listed property, it usually just means the listing agent gets a double commission. The fact that there is not a buyer's agent doesn't lower the price for the buyer at all. The listing agent just does a "notice of no agency" and pockets both commissions. FSBOs (and some REO properties) are pretty much the only exceptions, because they don't go through the MLS, which has its own arcane rules. So, if you're going to pay the money anyway, you should try to get representation. Just educate yourself about the process, stand strong about what you want, and try to find one of those two or three honest agents ;-) Or pay for a RE attorney. FSBOs are usually overpriced, especially during market corrections like we're in now. I admire your honesty in listing YOUR property but, unfortunately, not all sellers are as honest. Agents have more accountability, legally speaking, than a random dude on CraigsList. You have more avenues open to you if an agent screws you over than if a private seller screws you over. In fact, you should report your bad agents to your state licensing agency. Many state agencies use 'mystery shoppers' to check out agents when they've been reported a few times. The fewer bad agents out there, the better for everyone.

SwellJoe 17y ago
One thing that many people don't realize is that if they don't have an agent representing their interests as a buyer of an MLS-listed property, it usually just means the listing agent gets a double commission. The fact that there is not a buyer's agent doesn't lower the price for the buyer at all. Which I view as merely another good argument for buying or renting directly from the home owner. Leave the sellers agent out of the picture, as well. MLS is a 20th century idea. While many houses sold are still listed that way, there is no reason other than inertia for it to remain that way. When we sold our house, we explicitly stated in the craigslist ad, "We will not be responsible for buyers agent fees. If you have a real estate agent, that's your problem, not ours." Our buyer was working with a friend who was an agent, and was able to work out a deal they were both happy with which I wasn't privy to the details of (and given that the buyer found the house himself with no help from the agent, who had showed him lots of houses that weren't right for him, I'd say the agent got more than they deserved, whatever the amount was). But, the buyer did get a better deal on the house, because we didn't give any percentage to a realtor. So, we could sell the house cheaper than a realtor listed house and walk away with more money than the seller. Anyway, as you may note, my own personal experience with realtors has been so bad that pretty much nothing will convince me to use a realtor again. This could be a case of two bad apples. But, the one that took me for a ride was a 30 year veteran, and had won awards and such. The industry rewards those most effective at screwing people. So, now that it's an industry that serves no real purpose other than injecting themselves in between buyers and sellers in large transactions (marketing real estate for sale and finding real estate to buy can now be done on the Internet; legal stuff has always been handled by the title companies and the lenders, anyway, and realtors just stake a claim to providing guidance in navigating the process...but if you call a title company, they will happily provide all the guidance you need), I simply have no use for the industry. Realtors are selling wagon wheels, and I don't have or want a wagon. I think you, as a technically savvy individual, probably well above the average intelligence of realtors, would be well-served to think long and hard about whether the industry will change or die...and get yourself at the head of that curve, whatever it is.
- Shooter 17y ago
  A really detailed response would be a book, and I'm not sure this is HN-worthy material...so I'll try to be somewhat brief. I realize that your mind is made up, and since I'm (finally) starting to learn how hard it is to change a mindset, I'm not even going to try to change yours. I actually agree with much of what you're saying, and we can agree to disagree on the few other parts. As I said before, I invested in this industry because I hated it and because I thought the incentives were misaligned. I definitely have a different background than any other agents or brokers I know, which puts me at odds with most of them. That being said, I think there IS a role for a (much smaller number) of good, honest real estate agents if the incentives are realigned and consumers can be made to understand more of the process and what they're actually paying for. As with any industry, SOME intermediaries do create value. To think that no intermediaries create value is, in many ways, just as ignorant as trusting agents too much and paying the 6% "like everyone else does." I just want consumers to be able to separate those that do create value from those that don't, and to pay a fair price for the value they receive. Those seemingly small goals will probably not happen industry-wide in my lifetime the way things are going, but I'm slowly working on it... I initially tried a more revolutionary attack on the real estate industry (and MLS), and was severely beaten by the experience just like so many that came before me. One of the main obstacles is the entrenched players in the industry and their power over the regulations, etc. Even more powerful and disturbing, for me anyway, is that most consumers simply don't care if the industry changes because they don't even understand financial basics. Most alternatives to the status quo fail because of consumer inertia, not competitors. I think the industry WILL change, but not die. I've looked at where I think the industry is going, and right now I'm satisfied to educate consumers and to save them a substantial amount of money. A website can't replace an agent in all cases, on either the buy-side or the sell-side. Of course, in some cases, it can. I believe my company is doing better work by operating in the customer's interest on the leading edge of the industry, versus working on an idealized version of where we or others might WANT it to go. This is probably the least lucrative company I'm involved with, but it is very satisfying when some people do get it and we can help them out.

by Shooter 17y ago

SwellJoe 17y ago

One thing that many people don't realize is that if they don't have an agent representing their interests as a buyer of an MLS-listed property, it usually just means the listing agent gets a double commission. The fact that there is not a buyer's agent doesn't lower the price for the buyer at all. Which I view as merely another good argument for buying or renting directly from the home owner. Leave the sellers agent out of the picture, as well. MLS is a 20th century idea. While many houses sold are still listed that way, there is no reason other than inertia for it to remain that way. When we sold our house, we explicitly stated in the craigslist ad, "We will not be responsible for buyers agent fees. If you have a real estate agent, that's your problem, not ours." Our buyer was working with a friend who was an agent, and was able to work out a deal they were both happy with which I wasn't privy to the details of (and given that the buyer found the house himself with no help from the agent, who had showed him lots of houses that weren't right for him, I'd say the agent got more than they deserved, whatever the amount was). But, the buyer did get a better deal on the house, because we didn't give any percentage to a realtor. So, we could sell the house cheaper than a realtor listed house and walk away with more money than the seller. Anyway, as you may note, my own personal experience with realtors has been so bad that pretty much nothing will convince me to use a realtor again. This could be a case of two bad apples. But, the one that took me for a ride was a 30 year veteran, and had won awards and such. The industry rewards those most effective at screwing people. So, now that it's an industry that serves no real purpose other than injecting themselves in between buyers and sellers in large transactions (marketing real estate for sale and finding real estate to buy can now be done on the Internet; legal stuff has always been handled by the title companies and the lenders, anyway, and realtors just stake a claim to providing guidance in navigating the process...but if you call a title company, they will happily provide all the guidance you need), I simply have no use for the industry. Realtors are selling wagon wheels, and I don't have or want a wagon. I think you, as a technically savvy individual, probably well above the average intelligence of realtors, would be well-served to think long and hard about whether the industry will change or die...and get yourself at the head of that curve, whatever it is.

Shooter 17y ago
A really detailed response would be a book, and I'm not sure this is HN-worthy material...so I'll try to be somewhat brief. I realize that your mind is made up, and since I'm (finally) starting to learn how hard it is to change a mindset, I'm not even going to try to change yours. I actually agree with much of what you're saying, and we can agree to disagree on the few other parts. As I said before, I invested in this industry because I hated it and because I thought the incentives were misaligned. I definitely have a different background than any other agents or brokers I know, which puts me at odds with most of them. That being said, I think there IS a role for a (much smaller number) of good, honest real estate agents if the incentives are realigned and consumers can be made to understand more of the process and what they're actually paying for. As with any industry, SOME intermediaries do create value. To think that no intermediaries create value is, in many ways, just as ignorant as trusting agents too much and paying the 6% "like everyone else does." I just want consumers to be able to separate those that do create value from those that don't, and to pay a fair price for the value they receive. Those seemingly small goals will probably not happen industry-wide in my lifetime the way things are going, but I'm slowly working on it... I initially tried a more revolutionary attack on the real estate industry (and MLS), and was severely beaten by the experience just like so many that came before me. One of the main obstacles is the entrenched players in the industry and their power over the regulations, etc. Even more powerful and disturbing, for me anyway, is that most consumers simply don't care if the industry changes because they don't even understand financial basics. Most alternatives to the status quo fail because of consumer inertia, not competitors. I think the industry WILL change, but not die. I've looked at where I think the industry is going, and right now I'm satisfied to educate consumers and to save them a substantial amount of money. A website can't replace an agent in all cases, on either the buy-side or the sell-side. Of course, in some cases, it can. I believe my company is doing better work by operating in the customer's interest on the leading edge of the industry, versus working on an idealized version of where we or others might WANT it to go. This is probably the least lucrative company I'm involved with, but it is very satisfying when some people do get it and we can help them out.