Mr Johnson,

I’ve read your posts and thought you had defended the need for real estate agents reasonably well. You seemed a bit pompous, but that’s OK. If you’re successful in the field you can blow some smoke. However, I’ve had second thought.

Here’s why…
1.
“Most professional agents would prefer not to work with the Help u sells. “

What a load of cow dung !!! Does that mean discount agents aren’t professionals? I work with “professional agents” regularly who haven’t got a clue as to how a real estate transaction works. They couldn’t tell the difference between liquidated damages and liquid nitrogen if they drowned in it. All agents though, are thrilled to work with me. Why? Because I bring them offers and get deals closed.

2.
“How hard to you actually think your agent is going to work for you when their (you’re spelling error) barely making anything in the transaction.”

You’ve managed insulting and arrogant in the same line.

I closed almost $2.4 million in three transactions last month. My one percent was a tidy sum and I worked plenty hard for my clients to get it. I negotiated good prices for them. I ran the inspections and had repairs made on their behalf. I competently explained the contract and walked them through the escrow process.

The only thing I didn’t do was find the houses they bought. Each client found their own house through an internet search engine and only contacted me when they found the property they wanted. In return, I rebated back almost $45,000 to those clients. That made a difference in their lives and I’m damn proud of it. Not only did I make over $20,000 but I have three clients who appreciated what I did for them and couldn’t take enough cards to hand out to their friends.

There is still a need for real estate agents but this stuff isn’t rocket science. I’m the consummate professional who provides value and service for my clients. You might want to come out of your ivory tower and take the temperature outside. It’s changing

Brad Davidson

Brad,

I respect what you do. Believe me, when I first started with Prudential and received a 50/50 split, I wondered what I was doing in this business. When I switched over to REMAX, my success skyrocketed.

Believe me, I’ve given back to my buyers tens of thousands of dollars in credits. Even to millionairs (no joke).

The reason my success skyrocketed is because I was receiving more $$$ back when a transaction closed. This allow me to invest more into my websites, advertising for my clients, brochures, business cards, etc…

When you have more coming in, you’ll be better able to handle clients who will demand more of your time and money. You’ll also feel more confident and able to focus when you have more money in your bank account.

I know this firsthand. Also, I recall reading that 70% of buyers/sellers don’t use the same agent. Not to say thats happening to you, but don’t expect your past clients to bail you out with leads if you fall on hard times.

I spend a considerable amount of money staying in touch with past clients, internet leads, etc. I coudn’t do that if I discounted my commission.

Sincerely,

Richard M. Johnston, GRI, ABR, e-Pro
RE/MAX OTB ESTATES
President’s Advisory Council Member

Realt-whore smackdown…

Fight!

Fight!

Fight!

Just to add a few embers to the fire. I still have my real estate license. If I was to pay all the yearly license and MLS fees, I’d be out about 3 grand a year. i didn’t enjoy working in the field and got out.

There is an issue here that revolves around legal hassles after the sale, which are quite common. Anyone that thinks that a buyer and a seller sit down calmly and finalize the transaction, has got rocks in his head.

Anybody that thinks that the buyer and seller are just what they pretend to be is rather naive.

I would have enjoyed strangling several clients of mine in the escrow office alone. Not to mention shooting a few others for wasting my time.

As with anything, the more you do it the better you get at it. Plus you can sue a real estate agent if he messes up. My Error and Omissions insurance ran about $900 per sale.

Most buyers and sellers are so incompetent, that they really do need the help a Realtor offers.

The bad thing about the For Sale by Owner route,the thief or rapist gets to case the house first. Its kind of like making out your Christmas shopping list. You’ll be back to pick it up.

It might be that the Realtor of the future will be paid a set fee, no matter what the cost of the house.

The realtor’s fees are chump change if you consider what a loan broker makes. I saw a refi that a client did (no out of pocket) that cost him an extra $35,000. He would have been none the wiser, and it took several hours to explain to him, what had been done to him legally.

Anonymous said…

Fight!

First rule about Realtor Fight Club, you don’t talk about Realtor Fight Club.

I wish all the luck in the world to Zillow. The fact that I paid my real estate agent anything during my last sale infurated me!

Also, I released today’s FREE report on Chicago. And it’s a fairly normal market – that’s strange for us CA natives… It joins prior FREE reports on Boston, Bakersfield, San Francisco, Seattle & Los Angeles.
thebubblebuster.com

Hey johnston, boycotting discount brokers is illegal. Also talking about it is as well. Your statement here:
“1. Most professional agents would prefer not to work with the Help u sells. “

Could get you in trouble if someone files a complaint with the dre.ca.gov (ca dept of RE) you should post anonymous when advocating illegal behaviour.

This is from realtor.org

Never say things that could be understood to suggest a
conspiracy or falsely disparage a competitor:
•
This is the rate every firm charges.
•
I’d like to lower the commission, but no one
else in the MLS will show your house unless
the commission is X%.
•
I have to charge you this rate because this is the
rate the Board of REALTORS® set for all real
estate agents.
•
Before you decide to list with XYZ Realty you
should know that because they are “discount”
brokers, members of the association won’t
show their listings.

This whole Blog link just proves why I started a website called http://www.35Total.com. I previously started a pretty big real estate company in San Diego and got tired of having my clients listings boycotted by the rest of the stuffy high-commission agents. All they (my clients) wanted to do was save a little money, but the industry hated us, stole our signage, probably steered clients away and who knows what else. Now with this new discreet matchmaking system, clients are able to pay about the same amount or less than your normal discount company, without facing the incidious nature of the industry protectionists. We even have several Re/Max agents using the site (it actually works good for them, because thier splits are higher than the average). The best thing is is that it allows agents to bypass thier brokers (minimum hold the line on commission) rules. Sorry, Have to remain anonymous so they don’t figure out who we are. (although many are trying)

Love to see others as passionate about doing the right thing for people as you all are. Especially Brad, I hope you make millions, cause it means your saving people even more……

Anon 9:01 PM

If you’re interested, email me (socalb@gmail.com) and we can do a discreet interview… the listing agent portion of your business is where I think listing agents are going… especially for savvy sellers.

Good luck,

John Doe

These “anonymous” posts really make me laugh. It’s funny how many people think they know about this industry when they have no clue.

Mr. Johnston,

Stock brokers used to have the exclusive market access now enjoyed by realtors. They fought against the erosion of their income by discount brokers as well, even making the same arguements. They lost: so will realtors.

60% to 80% of practicing realtors will likely leave your industry in the coming price/volume collapse. The desparation of sellers will cause them to list anywhere they can, particularly online. This will further erode the NAR’s exclusive grip on the flow of information. This will lower commissions further and cause even more to leave the profession. Some of you will survive because some sellers will want personal service and will be willing to pay the price. Hopefully, you will be one of the lucky ones.

The last five years have been the NAR’s golden age. Face it, the party’s over.

Finally the realtor/mortgage industry comes under scrutiny and much needed competition. We have all been subject to the absolute control of this industry for decades. In colusion with the mortgage industry we have been taken on a roller coaster ride of higher prices/fees etc all from commission based sales people. All of them seem to have only short term memories and tell us that real estate never goes down and it has never been a better time to buy. The NAR has spent millions on this spin campaign, especially of recent times to get buyers back in the game. There has to be a more open and effective way of selling homes without huge commissions. Perhaps Zillow is the start of an internet based real estate market which can simplify the whole process. A bit like E-bay with all information available allowing buyers to make an informed decision. Zillow has a long way to go but I believe it will be the way of the future. Trusting commission based sales people to give open un-biased opinions on the biggest transaction most people make, is playing with fire.
When this bubble unfolds over the next couple of years, this will be even more apparent and perhaps we can go back and re-visit some of the commentary from the NAR and either chuckle or cry.

I’ll have to disagree with the the two posts above this.

I think what most people do not realize is the delicate situation in negotiating and keeping everyone on the same path to closing. There are so many things that can go wrong and only an experienced Realtor will be able to help keep things moving.

Selling a house is not the same as selling a book on ebay. There is a tremendous amount of paperwork, contracts, disclosures, etc…

It’s true many realtors will leave the industry in the coming years, but I strongly doubt 60-80% will. More like 10-15%. And these are most likely the ones who should not have been a Realtor from the beginning.

2007 will be another great year!
If your a first time homebuyer, be sure to visit my blog for some great info and local market update.

Mr. Johnston,

I honestly hope that none of your clients listen to you about something you do not know.

2007 will not be a kind year.

Mr. Johnston.

I find it amazing that you could predict that 2007 will be a stellar year in RE. It appears that you and your friends in the NAR (National Association of Cheerleaders) have been drinking way too much cool aid and have just spent boot camp with Jim Jones. What I find more amazing is your request for first home buyers to contact you so they can lose their proverbial shirt. 2007 will not be good for anything except put options and short selling or buying bank REO’s. It appears that agents are only required to think in 5 year periods and talk about the boom times, ignoring the fact that markets can and will correct. People who bought 3-4 years ago will be insulated from the downturn to some extent but the unfortunate people who jump on the merry go round at the end of the cycle (now) will get hurt. Why would you buy now in a down market when you can rent a much better house for about half? Down markets usually take from 3-6 years to rise again, so capital appreciation will not be a part of the rationalle.
As mentioned in other posts-the stock brockers fought competition and eventually lost. The new system will take some time but there will be a changing of the guard and a simpler way to buy/sell homes.
I would hope that this up market would continue but one has to face reality. Will you call all of your first home buyers who buy next year when the market continues to go down when they are upside down? Maybe you could post it on your website along with all of the NAR mortgage industry spin.

From the following blog post:

“Here is the key thing to keep in mind:

The income of Realtors (and thus number of Realtors that can be supported) depends primarily on the number of transactions – NOT the price of houses!

I know what you’re thinking – that if housing prices go up more realtors can be supported because each one needs fewer sales. There is a small amount of truth to that, but not as much as you might think – because this is offset by inflation. The appreciation of homes is only slightly above the inflation rate (in the long term), so the impact of an increase in housing prices is small compared to the impact of the number of transactions.

Conclusion:

As you hear stories about dropping housing prices nationwide or in your area, keep your eye on the median home price. That’s the number that discusses housing prices in your area. Panicky reports on the number of transactions are more likely to reflect panic on the part of real estate agents, mortgage brokers, and others whose livelihood depends on transactions.

As for the Realtor bubble? It’s hard to say, but to return to historical levels; it wouldn’t surprise me if there are 30%-40% too many Realtors for a normal down cycle. “

I predict that the inventory to realtor ratio is going to return to a more ‘normal’ value that was last seen in the early 70’s.

Inventory to Realtor Ratio Graph

[Link]

Great blog as always.

John Doe, You Rule!

Huge fan.

For some reason I have the techno song “All your base are belong to us.”

Thanks for always watching out for the little guys.

” There are many people, and I do mean many people with Law Degrees, Doctorate degrees who have not been able to make it in this business.”

Why would they become realtors if they could do what they were really trained for? Educated people become realtors when they fail at their chosen occupation. They fail at realty when they lack the used car salesman mentality they need to compete in that arena.

The internet may be great to do some investment research for neighborhood info, searching through your agents IDX system for available homes. But if your seriously looking to invest in a home. you should call a professional Realtor to help you.

Dwayne West
http://www.seegeorgiarealestate.com

Real Estate agents are just like car salesmen.

I have a ‘funny’ real estate story. I didn’t have an agent, so i posted an ad on craigslist saying in detail exactly what i was looking for in a house/condo. I got an e-mail from an agent saying, “im the best, contact me i’ll help you”

So, time goes by and i contact her. We talk on the phone for at least an hour and go over every little detail in what i’m looking for. So, guess what happens?

She e-mails me the next day and says, “i got this great house for you…”

The house was 200k more than i wanted to spend and it was nothing like what i wanted or specified. Neeless to say, she never heard back from me. I thought i made a ‘connection’ with her and she would really work for me and find me what I wanted. I was disappointed that she treated me like i was some kind of fish that she was going to reel in.

She did no work and just pushed some house she probably needed to get rid of and just hoped i’d jump at the opportunity.

Richard Johnson should change his name to Richard Cranium.

Hey Cranium, get that resume polished, you’re gonna need it.

I hear cemetary plot salesmen make good $. LMAO

Vocky Nelson,

Get a life. And please…take a good look at your first name.

2007 will be another great year!

To what? Buy a home in a DECLINING market of Souther California? You are a douche bag that drank too much of that RE man juice.

“real estate is not as easy at is seems.

Who here has a real estate license and actively work in the industry? “

You make it sound like getting the license is rocket science. The entry bar is low hence the amount of ex cons, car salesmen, truck drivers and uneducated houeswives. Get real scumbag.

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