In the past couple of years, anyone who could fog a mirror got a real estate license and got in on the plentiful commissions. I have personally seen these types of agents oversell a home.

I’ve been in the business over 10 years and have a referral only business – which means it more beneficial for me to serve the clients in the way I’ve described. I’ve seen other realtors have to go into hiding for creating a long list of clients with buyer’s remorse.

Being realistic about what a buyer can afford is a much better way to spend my time selling a house. The deals close faster (because there’s no last minute scramble for more cash to qualify for the loan, etc.).

I don’t blame you for your incredulity when it comes to realtors. Most of the newbies were caught up in the buyer’s market, especially here in Vegas and oversold a lot of homes. Besides being an agent, I am also an investor (mostly rentals) and I would not and could not endorse a purchase of any property that I wouldn’t feel good doing for myself as an investor, let alone a homeowner.

The trick is, when someone says something like “Whenever it’s right for the buyer,” this does not give me confidence that they are getting all the data, and my own few experiences with Realtors have all been of the pushing-you-to-buy-and-to-spend-more-no-matter-what variety. It doesn’t help that the NAR is running ads on the radio every day and publishing ads in the newspaper which are gross misrepresentations trying to trick buyers into the pool.

For those of you who are honest and totally up front with all the data with your clients rather than exhibiting all the traits of dishonest salespeople in other product areas, I feel sorry for you – your colleagues and industry organizations are destroying your business and reputation, and if you don’t put a stop to it, I think perhaps your business will never be the same in your lifetime.

Huh, it’s April 16 and my anti-spam word is “hightax”.

Short answer; absolutely.

Longer answer – not only do I discuss market conditions and market economics with my clients (and prospective clients), I point them to posts I’ve written that do that as well. We provide full comps to all our buyers on any offer they consider or extend, and these comps include historical data as far back as we can find it.

I never have, and never will “oversell” a home. I also refer our buyers to lenders with the same philosophy and hope they choses to work with (and the vast majority do).

I don’t doubt that there are many agents out there that try to squeeze every nickel out of a buyer’s pocket. I know there are, I’ve worked across the table from them. But there are some conservative, honest agents how keep their clients best interest at heart.

In defense of our posting agents-

I think the majority of the agents out there are as you describe- they tend to try and encourage buyers to buy as much house as they possibly can. The agents who hang here on Doom with us though, tend to be a more responsible lot. I’ve talked to some of those same folks who are all to willing to get in over their head, so I know they are out there.

I am so grateful for all of our contributing industry people. Some of them you see posting, some of them contribute behind the scenes. They make no money for their efforts and receive very little public acknowledgement. Sure we see the occasional “astroturfer”, but they are the excpetion around here, not the rule.

At any rate, I believe Deal Hunter. Too many buyers go house hunting with their rose colored glasses on. But I do concur with you that conservative agents who preach frugality are probably in the minority. I’m glad our agents fall in thid category. : )

Guys, have you told your buyers that they are buying in a rapidly depreciating market and that it is very likely that their house will be worth substantially less next year than it is now? If not, have you really given them the complete fair and honest truth about whether it’s a “good time to buy”?

It’s funny, Deal Hunter says buyers lose all sense when shopping and insist on blowing their budgets, but I distinctly remember going home shopping with several different people, each of whom, with a different Realtor, had the Realtor picking houses to show them over and over that were at the very limit of or beyond the budget, and pushing them hard to stretch what they were willing to buy, telling them they’d be making more money in a few years, etc. Funny that a Realtor would say it’s the buyers that do this, not the Realtors, but I guess that should be unsurprising. Deal Hunter, maybe you’re different than most other Realtors I’ve ever heard of or worked with (or maybe not), but I don’t think the way you represent budget pushing is a fair picture of how this generally goes. Of course, anyone else here who’s ever worked with a Realtor can decide how it works for themselves.

This may sound like a cop out, but the short answer really is, “Whenever it’s right for the buyer”.

Each case is different. I suppose one could answer, “buy low, sell high”, but that’s a gross, 10,000 foot level response, and not very realistic.

There are so many “when to buy factors” to consider that there really isn’t a one-size-fits-all answer.

Factors such as family status, credit, mortgage rates, housing inventory, job status, length of possession, current home status, and wants, needs and desires all come into play.

“Feeling cheated, homeowners sue”

http://www.lvrj.com/business/17590869.html

This lawsuit will go nowhere. If I’m not mistaken, RE agents and brokers are not fiduciaries. Maybe in the future they will be, but not now as far as I know. End of lawsuit.

Even if there’s broker fraud involved — OK, we know there was plenty — which of these plaintiff homedebtors is going to admit in court that they, too, signed a fraudulent home mortgage application? Or will they claim their income data was changed by the broker after they signed? I would bet that happened from time to time, but not in the majority of cases.

“By the way, we’ll need you to testify under oath that you didn’t lie to the broker about your income. Are you prepared to do that? Just one tip: you wouldn’t want to lie about that, or you’ll be heading to federal prison for a spell.”

“Real investing takes hard work and research”…

There are a ton of people in the investment game who are working really hard & researching like crazy. Yet…only a small percentage of these people are successful (if success is defined by monitary wealth.) It’s the old 80-20 rule.
What seperates the 80% from the 20%?

I think the insanity isn’t limited to the OOs either. I’ve talked to the investor or two who is convinced after a couple of HGTV shows that they too are gurus and their investment will take them to easy street.

Real investing takes hard work and research- but one too many late night info-mercials, and a lot of folks think they are geniuses.

Even after you sit with buyers and determine their budget, they will often go over it or forget the budget altogether in favor of that one house that captures their hearts and imagination. So often I’ve planned out a weekend of house previews only to have my prepared list thrown to the side in favor of some list the buyer has printed out from the internet.

So there is a great dance that realtors must perform with buyers. We can’t just blurt out, “Hey, the houses on this list are all 25% over your budget. Are you insane?!?!?” No. you have to say, “Have you changed your mind about the price range we discussed earlier?” MOST buyers suddenly forgot they discussed a price range with me and just INSIST on seeing all kinds of houses outside the range.

“Why is it that more buyers buy homes during a seller’s market…than in a buyer’s market?”

I stand by my statement. My definition of a seller’s market… Prices are higher during a seller’s market and there is less inventory to choose from.

“Probably because of the way you’ve defined “seller’s market” – as one with an abundance of buyers.”

Your definition, not mine.

My question to you…Since homes are more affordable now than in a seller’s market…why is it that the number of sales are down? …Interest rates are still very good.

When is the best time for the buyer to purchase a home?

Probably because of the way you’ve defined “seller’s market” – as one with an abundance of buyers.

So, you’re asking: “why are they more buyers when there are more buyers?”

See “tautology” and “begging the question” (the real definition, not the common misuse)

“peoples emotions overtake their common sense.”

Could this be what AG termed “irrational exhuberance?”

Now people are thinking “OMG! Prices keep going down and down! I need to wait. Maybe it will become even more affordable. Everybody says now is not the time to buy. Maybe I’ll wait til the market gets better when more people sre buying again.”

Why is it said that the typical buyer makes purchases based on emotional decisions…while it seems like the savy investor makes decisions w/ little or no emotional attachment? How costly are these emotional based decisions? …of homebuyers or of your co-workers?

“Sell low, buy high”…perhaps these are the people the savy investor is looking to find and cut a deal with.

“It seems like common sense for a buyer to wait & purchase in a buyer’s market like what we are experiencing now.”

Well, that’s just it – peoples emotions overtake their common sense. People were thinking “OMG! Prices keep going up and up! I need to buy now before I can’t afford anything. Everyone says prices can’t go down! I’ll make $1,000,000 in 5 years and sell and buy a BIGGER house!”

I see similar problems with the stock market now. All my co-workers are looking at their 401k statements and panicing. They see the big drops and are moving their 401k money out of stocks. Prices are DOWN and they are selling out! They say when things get better they will get back in. Sell low, buy high – how does that make any sense?

“Lots of buyers frantic to buy houses creates the seller’s market. A lack of demand creates a market favorable to buyers.”

Why are the buyers “frantic” during a seller’s market? It seems like common sense for a buyer to wait & purchase in a buyer’s market like what we are experiencing now. It would be more affordable for the buyer w/ the prices falling the way they are…right? Interest rates are still good…aren’t they?

stevec…
Interesting point about the addendum. Who’s is responsible for appreciation/depreciation?

“Let’s face facts, any person purchasing a home today is going to experience a loss in value.”

(I just closed escrow on a house 2 weeks ago. In 2005 it sold for 500k. I paid 212K.) Who experienced a loss in value?

“Why take a chance with such a big purchase?”

(Good point! That’s why I waited to buy now. I feel like I saved 288k.)

By the way…this was a foreclosure. The home was in very good condition. To make it move-in condition it required…2 days of my work. 1 day for basic interior cleaning & 1 day for basic landscaping. Nice home & nice location.
(This purchase is not my primary home. Time will tell if it is an investment.)

Your opinion is appreciated.

Maybe you’re reversing the cause/effect. I think it’s because it’s the buyers that determine a “buyer’s” vs “seller’s” market. Lots of buyers frantic to buy houses creates the seller’s market. A lack of demand creates a market favorable to buyers.

Hopefully this agent works out for you & your wife. Glad to hear your’e happy w/ your current agent. Sounds like you know what you want. Many people will say “All agents are alike!…yet…many people will say “My agent is worth (his/her) weight in gold!
Why is that?

Honesty…Openess…Loyalty

Great points!

May I add one important element? Communication between the client and the agent. In many cases there needs to be better questions being asked during the buying & selling process and also better listening. This applies to all parties involved whether it be the client or the agent. …This may lead to fewer cases that wind up in court. What do you think?

Thanks in advance for your response!

Why is it that more buyers buy homes during a seller’s market…than in a buyer’s market?

Prices are higher during a seller’s market and there is less inventory to choose from.

Prices are lower during a buyer’s market and there is more inventory to choose from.

Since homes are more affordable now than in a seller’s market…why is it that the number of sales are down? …Interest rates are still very good.

When is the best time for the buyer to purchase a home?