The End of Realtors?

[legion]

Tribune buys Real Estate Web Site
CHICAGO (AP)--Newspaper publisher Tribune Co. on Monday said its online unit acquired Internet real-estate Web site ForSaleByOwner.com for undisclosed terms.
The Web site allows home owners to advertise directly to buyers.

Tribune's Interactive unit, which handles the online operations of Tribune papers such as the Los Angeles Times and Chicago Tribune, will operate ForSaleByOwner.com.

Tribune shares fell 22 cents to $27.80 in late afternoon trading on the New York Stock Exchange.

This is interesting, as it puts realtors in direct competition with newspapers. I know that in my area, realtors use some questionable methods to keep FSBO listing operations sidelined. Not to mention that my state rep owns the largest realty office in town.

Could a powerful newspaper break the realtors grip on home sales?

[VaSteve]

Originally posted by legion


Could a powerful newspaper break the realtors grip on home sales?

Doubt it. Most people are CLUELESS when it comes to buying RE. They need someone to hold their hand and help them get it done. Others don't want to deal with the "By owner" portion of selling.


Plus, there's a big difference between advertising and *selling*. I'd rather not meet the PITA people that would buy my house.

I think one of the paper companies owns Career Builder... don't think it hurt job recruiters business.

[Jim Richards]

As an aside, we just bought / currently selling (not quite done, yet) with Realty Direct, a discount brokerage. Their sales commissions are lower (3.99%) and if you use them as buyer's agents, they give you a kickback on the 3% commission they earn from the seller. This kickback ranges from 1/3 to 1/2 of what they get. Not too bad. Anyway, to make a short story long, they are another outfit that's putting pressure on the traditional real estate brokers.

[RANDY P]

Don't forget the new laws they're trying to pass which make RE agents "full service" only - meaning, no discount brokers allowed..There's also another one they're working on up here, redfin.com. However, this one is run by a group of realtors (obviously, who didn't do so well as listing agents...)

Usually, the Realtors don't show or cooperate in FSBO's - since the sellers don't want to give the realtors money to bring 'em buyers, who can blame 'em?

Frankly, I doubt that it will adversely affect the market for Realtors, I'm pretty sure the vast majority don't have the time to DIY, and are largely clueless to the whole selling / buying process. However, as listing shrinks, commission levels will drop..

rjp

[Porsche-O-Phile]

I honestly don't see what realtors (in general, there are exceptions) contribute to the process any more. . . They remind me of travel agents from years ago - self-serving overpriced middlemen that resort to fiercely self-protective practices in order to justify their own existences. . . Sorry, but common sense tells me if a particular industry has to be SO secretive and protective of what for any other market would be open and common knowledge (listings, prices, etc.) there's a reason - namely that they wouldn't survive the "cleansing truths" of the free markets.

The notion of a realtor being "necessary" to buy or sell a home is dying, if not already dead. They don't even offer much from the seller's point of view other than listing your property in their uber-secret databases. Not necessary. They don't do much from a buyer's point of view other than trying to do a "pump and dump" on whatever property they think they can get the most commission off of. Any "pairing" of properties in the uber-secret listings databases to prospective buyers' search criteria is done by software far easier and more efficiently than they could ever do themselves. . . So why do we need these guys?

Realtors should take a clue from the few travel agents that survived the "internet-ization" of airline travel a few years ago. The ones that survived successfully were able to reinvent themselves to offer more than simply access to pricing databases - they became travel CONSULTANTS. They offer meaningful services - they keep tabs on what's going on at various travel destinations, incentives, package deals, changes in customs, and (yes) prices - although pricing alone is common knowledge - you don't need a travel agent for that piece of information.

Similarly, the realtors that want to survive will be the ones that actually contribute meaningfully to the process of buying or selling. They are the ones that will actually listen to their clients and work FOR them - not simply try to shove something down their throats in order to milk a quick commission out of them (for buyers) or passively list a property in a database and a couple of local papers with flowery B.S. adjectives in a pathetic attempt to make a property appeal to some sucker without putting any footwork into it - then collect 5% for it (for sellers).

Sorry, I just don't see how they earn their keep in the majority of the cases. Add to that the market saturation and it's even more ridiculous. Everyone has wanted to in over the last couple of years - why? Because it's the lure of easy money. Do next to no work and get paid 5%. In theory a great deal for them, but sooner or later reality has to catch up - and I believe it has.

GOOD realtors (which are rare) are the ones that realize you're a long-term investment and are willing to give you personal attention. They're career-minded and willing to put work and effort into working with you. Unfortunately the market has been overrun with deadbeats of the "flipper" mentality that just want to make a quick buck and work 15 hours a week to make $200k a year.

Given my druthers, I'd buy property sold "by owner" or sell my property "for sale by owner" any day just to contribute to the breakdown of this archaic and self-protective system. To the realtors here that might get offended by this - think you're worth 5%? Prove it. Tell me what you're going to do for ME. Specifically. Trial by fire - the fire of the free market. It's a great equalizer and imposer of honesty. The only realtors that should be worried are the deadbeat ones - a shift to "for sale by owner" thinking will actually help their industry by weeding out a lot of the deadbeats and making it not worth their whiles. Back to "work at home" businesses and stuffing envelopes for direct marketing companies for them. . .

Thanks for the web link - I'll be visiting that one regularly.

[Jims5543]

2 out of my last 3 house purchases were without a realtor. I prefer to not use them and work a sweeter deal with the homeowner when no commision is at stake.

Most realtors do nothing for their commision hence my reason for avioding using them.

I actually waited for a house for sale to go out of contract so I could approach the owner and buy it. I contacted the owner with my phone # and told him to call me when his contract was up.

[Dantilla]

I've bought and sold a few "fixers", and have gone to foreclosure autions, looked in the paper, county tax lien sales, yada yada....

But the houses I've actually bought have been through my realtor. I hope she sticks around for the long haul. She has her fingers on the pulse of the market so much better than I ever could. When I list a home with her, she nails the listing price every time. Starts out a couple grand high, and if it is not sold in a couple weeks, drops a couple grand, and it always sells pretty quickly. Never quicky enough to think we listed too low and left money on the table, but always several lookers, and an offer or two withing a few weeks.

In my opinion, she is worth her commission. She makes me money, and deserves to be compensated for it.

[VaSteve]

Jeff, you're a man of strong opinions, some which I don't agree, but I think you nailed what I was too lazy to type.

[Dantilla]

Another thing I greatly appriciate about my realtor-

When looking at potential purchases, she has actually talked me out of buying way more houses than she has talked me into.

There's been a couple of times I'm ready to sign an offer, and she says "we can do better". She's worth listening to.

She is with me for the long haul. She knows if she makes me money, I'll list more properties with her.

Bottom line? I'm not sure I would want to play the "fixer" game without her knowledge.

[techweenie]

If you look at how the large realty firms are growing -- affiliating with escrow and lending services and even inspectors, it becomes apparent that the only uncontrolled aspect is agents.

There is going to be a push by some RE sales companies to 'bureaucratize' agents -- taking them off commission. My friends who are Realtors are very aware of this trend.

[widebody911]

Dantilla, you're starting to sound like a realtor shill. Lemme guess; your wife or mistress is a realtor?

[legion]

My realtor for my house was worthless. I hoped for some insight into the local market, I got none. I hoped for some advice on bidding (due to her knowledge of the local market), I got none. I had to push here into doing a walkthrouhg...she didn't want to bother. All she did was pull up houses from the super-secret MLS...she would type in the data while I was sitting there, it was about as difficult as a Google search. I paid here 3% for her Google skills.

The thing is, in my area, all of the reality firms are in cohoots. Once a house is "in the system", you effectively can't get it out. Further, all the realtors refuse to touch the FSBO houses ("You don't want that house, he's trying to sell it FSBO because of a major structural defect he's trying to hide").

[Porsche-O-Phile]

Sorry Steve! I should learn to bite my tongue more - I can be a little opinionated at times, you're right!

Anyway I certainly don't mean to say that all realtors are deadbeats/slackers, but the housing insanity of the last couple years certainly seems to have swelled their ranks with people of that mindset. Sorry, I have very little tolerance for people that aren't willing to work for their keep and too many of these guys just seem to want the easy ride to millionaire-dom. Would I pay the 5% for a GOOD realtor that really sat down with me and explained things and made the process understandable and friendly and non-confrontational and wasn't just trying to sell me a used car? You bet.

Those guys are a rare breed though. Long-term thinking has become a dinosaur in society these days and it's no different in the business/sales world, sadly.

[Moneyguy1]

A good realtor has to be part psychologist, part banker, part marriage counselor (most fatal maritial arguments revolve around money and the lack thereof), and financial advisor. A good agent looks to the future in terms of word-of-mouth advertisement. Agents that have to advertise on TV should be suspect since their "satisfied customer base" is not sufficient to keep them busy.

[lendaddy]

The motivations are all messed up. The realtor's biggest motivator is speed. That's f'd up.

When they are you buying agent they will push you to pay more as they want a sure thing, on to the next deal.

When they are your selling agent they will push you to take less as they want the sure sale, on to the next deal.

It's not a consumer needs driven profession.

[RANDY P]

Biggest thing stopping a true FSBO site from working is that it is considered illegal to advise in buying and selling property UNLESS you practice Law, are a Realtor, or it is your own property you are selling. You cannot fill out a legal purchase and sale agreement, nor can advise someone how to do it unless you are one of the three listed above.

Therefore, it is difficult to find the process available on a website or DIY...

If you advise, you are practicing real estate - if that rule is ever overturned, then it would be over for Realtors..

Frankly, I don't like realtors, mostly for ethical and reasons based on professional courtesy. My realtors rely on ME for referrals, not the other way around.

Good when you have connections.

rjp

[RANDY P]

Originally posted by lendaddy
The motivations are all messed up. The realtor's biggest motivator is speed. That's f'd up.

When they are you buying agent they will push you to pay more as they want a sure thing, on to the next deal.

When they are your selling agent they will push you to take less as they want the sure sale, on to the next deal.

It's not a consumer needs driven profession.

Bingo. And the industry is loaded with ex-housewives and hacks that paid the $200 class fee and think they're royalty now, or at least legitimate professionals.

Oh, and who can't forget the "faahhhabblooous" endless self promotion Realtors think make a difference? Tacky, tacky industry.

rjp

[widebody911]

Originally posted by RANDY P
Oh, and who can't forget the "faahhhabblooous" endless self promotion Realtors think make a difference? Tacky, tacky industry.

+1

WTF do they have to have their picture on everything?

[GDSOB]

Originally posted by RANDY P

Frankly, I don't like realtors, mostly for ethical and reasons based on professional courtesy. My realtors rely on ME for referrals, not the other way around.

I send referrals to our lender daily for prequals - have yet to get a client from a lender...

[lendaddy]

Originally posted by widebody911
+1

WTF do they have to have their picture on everything?

It's not for us, it's for them. Most have read every "positive self image" book on the market and they really live by it. They need to pretend they are confident and important so that they will act confident and important (which theoretically leads to more and quicker sales)