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Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: Dan3 who wrote (77997)	5/22/2007 1:26:32 PM
From: Tradelite	Read Replies (2) \| Respond to of 306849

<<The few buyers willing to "go it alone" are well aware of the savings that accrue to the seller and generally that buyer then wants market price minus the value of a commission.>> And therein lies the reason that FSBOs seldom succeed in reaching their goals, and buyers who deal with them don't either. Two people are trying to save ONE (1) commission. There's only one commission to be saved, and reasonable minds could compromise on that somewhere along the line, but seldom do two reasonable minds meet up with each other in these situations. This is partly because neither party has solid knowledge of what the true "market value" actually is, so they keep on fishing until they get disgusted with each other and the entire process. (Often, the seller wakes up and realizes he won't know his market value until he opens up the property to the entire market, not just one or two buyers who approach him.) Yet now we're being told that technology is going to enable a new system that dehumanizes the entire thing and makes it run smoothly and at less cost. Heh....if we take humans out of an equation, the equation will always work. If you put human nature in there, the works get gummed up.

To: Dan3 who wrote (77997)	5/22/2007 1:54:06 PM
From: bobby is sleepless in seattle	Respond to of 306849

<The key is that realtors control the buyers> if only that were true how simpler the process would be. Buyers create their own demand, maybe a lemming effect, and the vehicle to allow the buyer to flex their muscle could be a realtor and/or agent...control remains with the buyer. What about the appraiser who justifies an inflated price? Reject too many appraisals and they better start looking for another sugar daddy...lots of hands in the cookie jar. ya think the fsbos out there adjust their price down by eliminating the middleman? It is the buyer who ultimately controls price. They are the ones that create demand, or lack thereof...

To: Dan3 who wrote (77997)	5/22/2007 1:57:31 PM
From: GraceZ	Respond to of 306849

I've done it both ways on both the selling side and buying side. Whether it makes sense to do one or the other depends on the type of market as well as the skill of the agent. A good agent in a difficult market will more than earn that commish, not because they do x number of hours of work you might be able to do yourself but because they'll maximize the potential selling price of your home by giving you the best possible information about where to price it (this is where FSBO sellers frequently screw up and when I've sold houses on my own I ALWAYS get an agent to give me a price)/. The agent can be a source of invaluable advice on how best to present the assets in the home but most of all a good agent knows how to drive traffic to your house, they get the numbers in there and in a buyers market it is a numbers game. Plus they qualify the buyers. Saving on the commish is hardly worth it when a sale falls through due to the fact that the buyer is a lying sleazeball and you then have to put the house back on the market months later and miss the best time to sell it. As a buyer, the people who sold me my current residence sold it at a serious discount because they botched the FSBO and then ended up selling through an agent eventually anyway after carrying an empty house for 18 months. The pain and suffering attending carrying two mortgages was hardly worth the price of the commish they might have saved. They even ignored the advice of the agent they eventually got to get rid of the dump they created in the yard, cost them around 60k on the sale price and us about $500 to get rid of it. Sellers are often totally clueless about what it is they need to do to maximize their profit. Buyers are sometimes equally dumb about what is a cheap or expensive fix. I watch these house hunting shows on HGTV sometimes and it cracks me up some of the reasons people like or dislike houses. They'll turn a house down because they don't like the color of the bathroom or the furnishings and ignore the fact that the house they did buy happens to be on a busy street getting busier. OTOH when I sold my father's house in Cape Coral as is, it would have been a waste of money to hire an agent to list it because the only market for houses like his that existed were speculators/flippers who avoided agents like the plague. They were all cash buyers. I did hire a very good agent to do a market appraisel/analysis for me, I needed to know what the house was worth and what I could expect in return if I decided to fix up the property before selling it. It was a RE market I wasn't even slightly familiar with and RE is very local. What is important to buyers in MD isn't necessarily so in So West Florida. There was a completely different set of criteria there than what I was used to here. A good agent who has good selling numbers is a great source of local conditions for both buyers and sellers. That said, there's no reason in the world to pay commish to a bad agent and there certainly are enough out there that sooner or later, if you do enough RE transactions you'll be sitting across the settlement table from one even if you didn't hire them. In fact, one could design an investment strategy based solely on trying to take advantage of bad agents.