The Biggest Loser: NAR
Chuck Ponzi November 10th, 2006
While I have been on the record many times that I see nothing wrong with good real estate agents, it has been clear that the National Association of Realtors (NAR) is attempting to perpetuate a stranglehold on the real estate industry that puts buyers and sellers at a disadvantage such that milks both of their hard-earned money.
Such is the case with this week’s NAR propaganda campaign to sucker fence-sitters into a clearly declining price market. Many other bubble bloggers siezed on the opportunity to show how incredibly two-faced it is to state that it is both a good time to buy and to sell. (Imagine a stockbroker, or any other advisor trying to tell you anything similar about the product they deal in). The Truth is that it is A Great Time to Generate a Commission.
Such is also the case with the arrogant prick (is there any other way to describe him?) Allan Dalton of Move.com (aligned with the NAR) who led a heated attack against competing information broker Zillow. And, might I add, a personal attack against Zillow’s founder, Lloyd Frink.
Perhaps, taken apart, these 2 incidents only show a single facet of the information-mongering stance the NAR has taken. A stance, by the way, that the Attorney General is considering to be anti-competitive and monopolistic and has hauled them to court to prove it. These practices attempt to bully discount brokers and information outlets into submission. The NAR’s arrogance, it appears, knows no bounds.
So, the question remains… why buy with them?
Simply, they still control the information. They control whether you know which houses are for sale. They have money, and lots of it, from grafting nearly every real estate transaction. They are fools if they believe their industry is not changing. They are even having dissent within their ranks.
While I don’t believe that commissions will completely go away, I do believe that Selling agents will become more and more competitive to reflect increased competition through the massive influx of new agents, and I believe that Buying agents will continue to do what Brad Davidson of HelpUBuy realty does… give away much of their commissions to attract self-serve buyers.
The fact is, most people have access to MLS data already through the internet. It is only a matter of time before a Google, MSN, or Yahoo breaks ranks and trounces the MLS to oblivion by offering their own similar information-brokering services. Not only will a new player in the arena help buyers, if their services are priced competitively, they might replace some of the local MLS systems altogether. Once a few fall… it’s only a matter of time before it snowballs.
David Hume said it well:
Where men are the most sure and arrogant, they are commonly the most mistaken, and have there given reins to passion, without that proper deliberation and suspense, which can alone secure them from the grossest absurdities.
David Hume - 18th Century Scottish philosopher, historian, economist, and essayist
The NAR is sowing the seeds of its own destruction.
Sounds like the realtors are starting to sweat bullets. Perhaps this is because November pending sales are tanking..
Such is also the case with the arrogant prick (is there any other way to describe him?) Allan Dalton of Move.com (aligned with the NAR) who led a heated attack against competing information broker Zillow. And, might I add, a personal attack against Zillow’s founder, Lloyd Frink.
Nah. I think you have hit the nail right on the head.
I think they’re well past sweating bullets. Hard reality is upon them. Marginal performers are being fired just to, hopefully, up the numbers for the more tried-and-true agents. The NAR ad is the direct equivalent of the band’s music on the deck of the Titanic. Heroic, for the constituency, but futile.
I don’t think they have a monopoly on house information. I think it’s a monopoly on the horribly complicated housing purchase process. I must have signed 30 documents at my last house purchase.
Someone needs to create a website where one good realtor puts up all the necessary documentation for any particular state for free download. That would greatly help getting rid of these do-nothing-make-30k losers.
Without a doubt, this is the best commentary I have ever read on this subject. Very well done!
Apparently DQ thinks they have a monopoly on housing info.
Silicon Valley’s reported medians appear to be holding up but we increasingly see signs the data is manipulated.
We see signs in our own neighborhood:
http://www.viewfromsiliconvalley.com/id277.html
and also in reported county-wide stats:
http://www.viewfromsiliconvalley.com/id125.html
Keep checking
http://www.viewfromsiliconvalley.com
for all the latest numbers and news.
Thanks!
This in the news
Is a 6.9% drop supposed to be a bubble bursting? LOL! That’s nothing! My home has appreciated 120% since I bought it in 1998…I don’t mind giving 6.9% of it back! And how is a 7% drop going to change anything as far as affordability is concerned? This housing downturn is starting to sound like a non-issue!
“Is a 6.9% drop supposed to be a bubble bursting? LOL! That’s nothing!”
wow, you’re about the stupidest person i’ve ever seen post on the internet. unless you’re just some shill real estate agent.
your comment above is like saying the day after the dot-com bubble burst, my Amazon stock has only fallen from $400 to $389, what bubble burst!
by 2009 your home will be worth about what you paid for it. unless you’ve taken cash out, in which case you’ll be under water and out on the street and living in a homeless shelter before long.
LOL!
the NAR seems to think all is fine:
Slight slump and not a bust
From Ben in Oside…
I hope someone is documenting all these semi-rosy quotes from the NAR so they can be exposed in the next 2 years for the frauds they are.
More news
I like the last paragraph:
Some experts are predicting that 2007 could be as big as 2003, which was the third biggest year ever in real estate,” he said
AHAHAHAHAHAHAHAHA!!!! Can you say dellusional? When the consensus is that 2007 is going to be a horrific year for Real Estate this guy is still dreaming…looks like he is even more optimistic than the NAR…LMAO!
“…Some experts are predicting that 2007 could be as big as 2003, which was the third biggest year ever in real estate,” he said
AHAHAHAHAHAHAHAHA!!!! Can you say dellusional?
No. He just has this condo he needs to flip before it drags him down and is buttering up potential suckers.
Mr. John Doe is right to call the recent NAR comments “propaganda”,
but why bother, and what’s the big deal?
No one but Baby Jesus can accurately predict the direction of markets. Sure, there are indicators that when expertly analzed with perfect data (good luck with that one)can bring us a few degrees from “clueless” towards “certain,” but no amount of analysis can bring us anywhere close to certainty; in fact, we’re lucky if it gets us to probability.
As we look to the future, we have no way of knowing with much certainty if the fed will raise interest rates soon, if there will be a recession soon, if mortgage rates will rise or fall, etc. ANY time a public figure makes a public statement including a prediction for the housing market, it’s propaganda. Do you really think that propaganda didn’t play a major role in putting the housing market on the slick slope down which it now slides?…specifically, statements from the Fed prior to the beginning of the decline suggesting that a decline might be coming, statements maybe in fact designed to cause such a decline.
What’s the point of propaganda afterall? To influence future behavior by instilling certain beliefs. The more people believe the housing market will level out soon and then resume growth, the more likely it will do that. The more people believe its gonna freefall, the more likely it will. That’s why the arrogant pricks at NAR and Move.com make such statements, knowing their words will be published and syndicated across the nation, hoping their message will self-fulfill.
So why be mad at the NAR when they’re just trying to help (themselves mostly, but still?) Maybe a few suckers will bite, but my guess is that most of you don’t really care much about them, unless of course you are one of them.
I doubt their propaganda will have much of an effect: Seems to me most people believe the market will keep sliding for a while, and so it will.
People want to talk about value as if its something tangible and concrete and based on undeniable truths like 2+2=4, but it’s not. It’s relative and illusory. That’s why prices can change even while everything remains constant but the thoughts in people’s heads. It’s all bubble.
even in a declining market its better to buy then rent.the tax credits are substancial,real estat is generally a long term investment.the market goes up down at times however in the next up market values will surpass todays high prices & the buyer buying today will lock in a very low rate on financing.you need more education in real estate before you spout your dissinformation.you might spoil a prospective families american dream of home ownership.as long as the buyer in todays market can be sure of making their mortage payment & is prepared to stay in the property thru the drop in values,it will be a money maker when values go up which in ca. they always do.you can never compare renting to buying.buy when you can.a primary residence is normally long term.it is also a good time to sale if you know you will be selling in the next 5 years over 10 it wont matter.the drop in values began in 6/90 and did not come back until 98 then it went up at warp speed.now if the buyers did not buy in the early nineties they would have missed the equity that they have now.it will do the same thing again.go buy a property today,then see what happens in 10 years.you will thank me then.for the record rates were 14 % in 1988 and people were standing in lines to buy.how much did they make if sold in this declining market.do the math.you have been educated in realestate.you can never lose by buying realestate.in the long run
Home prices up
Inventories are down as well. Prices have definitely stabilized which is great news for buyers.
John Doe, close down your blog and do something more useful with your time.
Why is price stabilization good news for buyers? Personally, I’d like to see prices drop till late 2007 when I will have saved up enough for a hefty down payment. Let them fall! And John Doe, please keep your blog up and running to continue spreading the negativity.
Anon:
Inventories are always down in the fall… happens every year.
I’m willing to bet a substantial amount of money that inventory next year will surpass this year’s records in Orange County and San Diego.
Put your money where your mouth is. If you’re willing to place 100K into an escrow account to be released contingent upon next year’s total inventory compared with 2006 inventory or at the conclusion of 2007, whichever comes sooner, I am willing to take that bet.
BTW, other anon:
Disinformation only has 1 “S”. You are spouting disinformation, and most people are smart enough to see right through it. That’s why buyers arent’ buying. Without guaranteed appreciation, there is no reason to buy now.
As for buying better than renting… only in the long term… and as Keynes said in the long term we are all dead. People care about the medium term… the next 5 to 7 years. The average family used to mover every 7 years in the 90’s. Now, I’ve heard that stat is down to 5 years. Selling a house at a loss, or postponing life decisions based on an underwater property is relevant to nearly every family.
anon said “buy a property today,then see what happens in 10 years.”
yeah, maybe it will be back up to it’s purchase price!
hahahaha
You guys are preaching to the choir, everyone here knows that over the long term, real estate pays off, just like the stock market, but IT DEPENDS ON WHERE YOU BUY IN THE CYCLE. That’s the point. This crazy cycle is crested, and it won’t recover quickly (despite all the NAR propaganda) because the runup was too fast and too quick and the common man simply cannot afford to buy a SoCal home on a conventional loan. They can only wedge themselves into a mortgage with toxic loans that ultimately set them up for failure.
Damn you real estate agents… it’s 3am, the party is over and yes, we CAN have ‘just one more drink’ but I think I will be sick enough anyway in the morning, the one extra shot ain’t gonna improve my buzz, so let’s just call it a night.
Anon 4:07.
Agree with your assessment of preaching to the choir. Some have mistakenly suggested that bubble bloggers are bitter, unemployed, priced out renters.
Far from the truth. Most love real estate. Otherwise, why would they devote so much time to blogging for next to nothing and invite all of these ignorant flames?
interesting segment:
Foreclosures
My wife and I have a combined income of about $275,000 per year and are happily renting in Rancho Cucamonga and will continue to rent until sellers either get drastic or go broke sitting on their duffs hoping against hope that a miracle will occur.
IF YOU REALLY WANT TO SELL YOUR R.C. HOUSE, IMMEDIATELY DROP YOUR PRICE AT LEAST 20% AND DO IT NOW! The sooner you do it, the sooner I might be interested in looking at your house. I’m NOT gonna buy it until you get serious with your price cuts. Guess what… no one is buying anything and it ain’t gonna change anytime soon. Get smart and get the ball rolling. My next door neighbor had an open house after dropping his price $10,000. Whoopie fricken doo. No one came all day.
A cookie and a few closing costs aren’t going to do it. You sellers need to get serious. I laugh at the real estate agents (even mine who I like a lot)… “we are still selling homes… blah blah blah.” Whatever.
The arrogance of sellers and their agents is amazing. Phrases like “won’t last at this price” make me chuckle. The verbiage on the listings has changed a bit. Now you see stuff like “very anxious seller” and “very very very motivated seller.” As if the number of adverbs makes a difference. The one I like the best: “will entertain all offers.” No shit. Are you stupid or something?
Fire your agent if your listing doesn’t have photos, has photos of only the outside, etc. I cannot fathom the agent who posts BLURRY photographs on the websites in this kind of market. Mind blowing. Just goes to show you the quality of individuals still in this business, and how completely out of touch many agents are.
Get rid of the cottege cheese ceilings, the worthless media niches that you put couches in front of and which fits no modern tv set… the ugly, shiny, white kitchen and bathroom tile squares, the $8 home depot light fixtures and the master bathrooms that have no place to hang a towel that you can conveniently grab on the way out of the shower.
Take a close look before you buy. Opening the dish washer in the kitchen of my current rental makes the kitchen island a major liability. Look at all the walk in closets where the door gets in the way of hanging clothes on about half the shelves.
Have you seen some of the new construction in North Rancho Cucamonga. Holy Hell! The builders put full bathrooms on the main floor with no bedrooms or options for bedrooms. Do you think people will be living in the garages? How about the 1.5 story house with the one upstairs bedroom with 90% of the whole house’s linen closets at the top of the staircase. Yeah, sure, I look forward to running upstairs for sheets every time my daughter pees in her bed.
Mind boggling that builders aren’t using half a brain on their designs. Seriously, go through some of the houses they are trying to sell for a million dollars and the added gift of $250 per month gate (HOA) fees that will drop to about $100 once the 13th phase of the development is done. That should be about 2030 or so. Let me know if you find anything you like. I can’t find a house that I walk into and say “wow” this is where I want to raise my family.
Within walking distance of Victoria Gardens is code for postage sized lot.
Yeah, you can’t get anything past me and people like me sitting comfortably on the fence. Drop the prices. Now.
Anon,
if your combined income is 275K, I wouldn’t worry about the bubble too much… you can afford quite a nice residence regardless. Yes, you will be able to afford more in a few years, but why wait?
John Doe
AnonNov15,2:07PM said:
Inventories are down as well. Prices have definitely stabilized which is great news for buyers.
John Doe, close down your blog and do something more useful with your time.
Why don’t you just start a blog of your own and tell everyone that now has never been a better time to buy?
And BTW, prices are not going up. They are instead coming down in LA..
[Link]
“even in a declining market its better to buy then rent.”
“you have been educated in realestate.”
this made me laugh. yeah, educated by a retard.
“even in a declining market its better to buy then rent.”
This made me laugh too. It is better to double my monthly housing costs to obtain the same housing stock so I can have the benefit of decreasing values?
“you have been educated in realestate.”
… but apparently not in finance.
You said:
“It is only a matter of time before a Google, MSN, or Yahoo breaks ranks and trounces the MLS to oblivion by offering their own similar information-brokering services.”
Ummm, hate to break it to you, but the MLS is already mirrored on realtor.com and homeseekers.com. When you input a listing in the mls (yes, I’m a realtor), at the end it gives you the option of publishing it at those places.