Why are Realtors a Toxic word?
Real Estate Agent · Anderson, SC · Member since 2008 · 11 posts · 0 votes
Ok, here is a question I know that many of you would love to answer. But, here is the deal...
Why are Realtors such a bad thing, and is there anyway I can turn the tide? Can I become the exception to the rule?
What are some of the things investors hate about Realtors?
What could a Realtor such as me do to help change the perception?
What can I do to provide a valuable service to the investment community?
Thank you for your time,
Blaine Wimberly
I wouldn't say Realtors are a bad thing at all. I work with one, and he's a big help in my investing.
The problem, if there really is one, is that most Realtors do retail deals. They work with Dick and Jane Homebuyer who buy a house once every 7-10 years. Dick and Jane don't understand RE or the process, so the Realtor has to lead them step-by-step through the process.
A big factor in the process is figuring out exactly what Dick and Jane want and what they can afford, then showing them their "perfect dream home."
Along comes an investor who does understand RE and does understand the process. Someone who's only going to buy if the price is right and who could care less about the house itself. If its a good deal and makes money, OK. If not ... next! Frankly, there are no "homes" involved. Just property.
Realtors only get paid when a deal goes down. My sense is that too often even a buyers agent gets wrapped up in getting a deal to happen. An investor is only going to buy if the price is right.
If you really want to help me out, give me direct access to the MLS. Let me pull listings. Let me look at solds. I can fully understand needing someone to go along when I'm going inside a property. But the MLS is a database. This aspect of the RE industry galls me to no end. You thrive on secrecy. Certainly its a lot better than when I bought my first house over 20 years ago. But, I still cannot see all the info you can, and I see no convincing reason why I should not be able to. The travel agent industry used to be like this, and you see what's happened to them. Even the travel providers, airlines, hotels, cruise lines, etc., have disimtermediated the travel agents almost out of business. Similar, though to a lesser extent (for now) for music, and, to an even lesser extent for video or cars. If RE agents don't want to go the way of travel agents, you need to figure out how to add real value. One of the ways is going to be to share you data more freely.
Jon,
Those are some very good points. I will be sure to keep those in mind as I progress though my Real Estate career.
There is no since in trying to hide the fact that I am interested in making a dollar on every transaction I am involved with. This is the reason anyone goes into work everyday no matter what profession they have chosen. However, the reason I got into Real Estate was to help people make money while making a decent living doing it.
Whether I am working with an experienced investor, or Joe homeowner I approach every transaction as an investment. I always bring to light the potential of making money while purchasing or selling a home/property.
You know I have to ask Jon, do you invest outside of Colorado. And if so, what type of properties do you typically look for? I can’t give you direct access to the MLS, what I can do is set you up with on my website which will allow you to search the entire MLS, set up listing alerts, save property searches, and save properties. I will provide all of the information I have available to me any time you request it. If you happen to know of anyone that would be interested in investment opportunities in the South Carolina area, please by all means contact me any time.
Thank you for your time,
Blaine Wimberly
Ok, I'll bite.
There is quite a bit of antaganism between realtors and investors. Many times, they are in direct competition with each other. Preforeclosure investors don't want a realtor involved because another middleman just eats the profits. Further, a well advertised property will generally get a higher asking price. Whether that asking price is higher than the commisions charged is debatable.
Realtors also do not like dealing with investors because many just don't understand us or don't want to. The Realtor I worked with the last few years got looks of shock and awe when he told his collegues he went to a foreclosure auction with me. Not one other agent in the office had ever been to one and many thought it very strange of him to do so (even though, if I had bought, he would have got the listing within a month on the flip.) Also, at least personally, most realtors I run into just are not knowledgable about the field they represent. I cannot tell you how many times I've run into agents where I know their job better than they do. I had one agent actually tell me it was illegal for me to put an unrepresented offer in on the house he was representing. Ignorance of this level won't last through the current downturn though.
Also, many, many of the Realtors I've run into are not exactly, well, how to put it, honest. I watched one house go into foreclosure because a Realtor came in at the last second, disrupting an investor deal with a promise of a well above market sales price. Yep, he bought the lisiting. Amazingly enough the house, in its rough condition, didn't sell in time and the house was lost. Then there's the enternal, "We already have another offer, make a better one..." line. And amazingly enough when I decline to make said improved offer, the house is reoffered to me soon after at my price, or stays on the market because said offer didn't actually exist (or the other offer fell though, but then the listing status should have changed.)
And then there's the do anything to get a sale attitude. Offer a 4% buyer's commision on a nice house and watch the feeding frenzy begin as every represented buyer within 50 miles shows up to see the house. I understand that agents need to eat, but a system where the higher the price, the more I get paid isn't too fair to the buyers.
Anyways, this turned into a bit of a rant and that wasn't my intention. I am not anti-realtor. I've sold everyone of my houses through a realtor (eventually). A great realtor is an asset. Someone who knows what I do and is a better negotiator than I. Also, first and second time home buyers do need someone to help them through the steps and to help them make sure they aren't buying a ticking timebomb of a house. It takes a lot of time to pick up the skills needed to do this. Anyone can learn the paperwork in a month or so, but real value added takes time and experience.
Why would I pay $250/yr for MLS access as a realtor and give everyone access for free? MOST people will take advantage of my generosity and buy a house from right underneath me. So now am I out on your business but I have also violated the MLS subscription rules by allowing you access.
And yes I am a new realtor . . . but it doesn't mean I act like the rest of them :)
I am a Realtor and have learned why so many do not like Realtors-assuming every Realtor is like the one they heard about/were told about/etc. Hello Blaine, good to see another Electric City person here.
Realtors should be part of an investor's power team. However, the investor just needs to train the realtor as to what he or she is looking for. Too many realtors say things like you can't do certain things. There needs to be open communication. I believe Realtors have a different mindset since they do not know much about the investing side. After all, it is still just a job.
I have worked with the same agent from the begining. She has been great for the most part, but we have had a couple issues too. I find the deals and all I ask from her is to get me in the house when I need to get in, then submit my offer. We would have a much more profitable relationship if she would give me access to the MLS and the lock boxes. This would save us both a lot of time and would possibly avoid scheduling issues. I would never go around her and go directly to another agent, what would be the benefit to me? I still pay the same whether I deal with only the listing agent or both agents.
By and large realtors
1) want the easy path to making what I consider an enormous profit for little effort
2) don't want to keep up with the market and what investors need. A good buy to a realtor normally is "market" prices.
3) there are too many of them chasing the same dollar.
4) they hate to lowball. Consider it beneath them
5) in my city which is in your state there are two realtors that can walk through an investment property and give a reliable price for you to work with. Only two.
6) never volunteer owner disclosures at the point of contract even though it's required by state law. Why would that be? Too lazy to pick up the file?
7) realtors are primarily sales people. Investors are not impressed with their personalities but what they know.
In my opinion, they've had a great run and now ...how ARE they holding on?
Wow, some harsh words and generalizations for poor Realtors.
The problem is that Realtors go to school, get their license and then begin working at an office and that is it. They have very little if any good solid training.
They get access to the mls and maybe floor time and then are expected to go it alone with very little direction. Its sad really. Mostly though it is not their fault. I can't imagine any other job or profession where you are expected to perfom without any training or experience.
That being said, there are many many amazing Realtors out there. They stay on top of the market, they are constantly educating themselves by taking classes, reading books, attending seminars and they are open to all sorts of creative deals.
Are there some bad apples out there? Of course.
In fact there is one specific real estate company that no matter what state, what town I meet with any agent from this company, they all have the same sleezy way about them. It must be something in the companys business model. I won't say here who they are, but anyone can email me and I would happily say who they are.
In any event, don't be so harsh on Realtors. They are human beings that are just trying to make a living like everyone else. Instead of thinking they are lazy and dumb, think that maybe they have not been shown the way and just have not been given any direction. Doesn't always mean they are trying to scam you or take advantage of you.
I have come across so many amazing new Realtors that had the potential to be really great but they got under the wing of the wrong person.
This market will weed out the successful Realtors from the amatuers.
If you are a new Realtor and trying to figure out how you can best service your investors, my advice would be to read as much as you can about the art of negotiating. After all, the Realtors job begins with the client says no!
Here's the thing - learn what your investor needs, don't try to sell them every property, don't be sneaky about fees and you will do well. We are looking for consistency in a realtor, not a messiah. We need to know what to expect every time.
Tim
The problem with Realtors is that by definition, they are part of the National Association of Realtors.
I should know, I am one.
Let's see:
-No barrier to entry
-No formal training
-Less schooling necessary than hair-dressers
-Access to information that is widely becoming free and available to all
-NAR propaganda
Blaine, in my opinion, to be a successful real estate sales associate, you need to separate yourself from the crowd. Realtors are the crowd.
I have experienced both good and bad realtors. I had to learn(the hard way) how to approach a realtor. We do not use realtors to buy, since I market to preforeclosure and perform short sales. So most of my run-ins are through selling.
1) I found that like investors there are many types of realtors. You must first know what you are looking for in a realtor and then seek out what you need.
2) I also put into writing what I am looking for and what is expected.
3) I also ask references. But I am also ready to provide info from my title company to also prove how I work.
As for anything else, if you are not getting what you want, discuss the issues and then if they are not resolved, move on.
I am so glad I asked this question. This thread has given me so much insight into the mind of investors. I feel that the comments here (both the good and the bad) will make me a better asset to my investors. Thank you all for your comments!
I became a Broker out of my frustrations in dealing with Realtors, and I will leave my rants about Mortgage Brokers! and Property Managers for another day!!!!
In all honesty, I do not put all of the blame on the Real Estate Agents. I place more blame on NAR for keeping the bar so low and not making education more of a priority.
At the end of the day, most folks simply "play" Realtor and got into the business thinking that it was easy money. For a while, it was for many people. The good news is that this down market is shaking many of them out of the business.
The serious folks are out there, and they get business done. Like anything else, you just need to keep plugging away to find your team, and that team will lead you to success.
Good luck!
I am saddened by the reputation realtors have. Frankly I wouldn't be part of the NAR if I didn't need too. They are becoming a self serving political entity. However my real estate career has not YET grown to exist without it.( and I will rant another day about the NAR) I finished the classes easily and then went looking for more info about how to negotiate.....nowhere are there any good classes for real estate agents with regard to this. I found some mentors and currently work with a broker who is the best negotiator i have ever met. Creative, within the law ....all of it. Anyway I came into this business with vision of developing the community. Many old-timers said I had to start with selling houses to families. I can't keep myself in that role. I work with investors, I find wholesale deals, i share. I advise about negotiations. I help people who are from out of town do research here so they can get the properties they want. I attend mosst city council meetings to stay on the pulse. I don't rely on the MLS. I also list quite a bit at retail. I am a listing agent in that sense. I refer out the families who want to see homes and the agents in my office are happy. :)
Real Estate agents do not need to be confined to being a Realtor, and in that sense we can be helpfull to investors. I earn every bit of money that I make and am fully aware that the "real " money is in the real estate investment itself.
Not all investors are cool to work with. Often I will do quite a bit of research on properties. Back taxes, infrastructure requirements, rehab costs etc....only to end up hearing that if they make a deal I will need to find someone else to pay me. I love my work and hate asking for money.
I'm sorry to rant, but I often feel as though I am going against the tide when other agents and or investors can't see beyond the "regular".
Mary Ann, you are the type of real estate agent I seek out. If I were buying in your area I would be (figuratively) camped out on your doorstep to work with you.
If anyone on here is buying in that area, I encourage you to sit down with her and see if/how you can work together.
Oh dear....I had to run out and pushed the send button. I'm running around looking for furntiture for a coorporation crew coming to town and needing to pay attention , all the while worrying over my post.
Thank you Taz.....very much :)
Working with real estate agents can be a challenge if the agent you’ve selected isn’t aware of your needs in acquiring property. They’re accustomed to selling at retail and any deviation from what they consider normal can jeopardize what could otherwise be a great working relationship. The good news is that you have the power to provide the education – if you’re willing to take the time. Here’s how you can do your part.
If you’re trying to work with a real estate agent that has never seen – much less worked with – a real estate investor, the first thing you need to do is have a sit-down meeting to explain your goals, your investing strategy, and your needs.
But don’t forget that your real estate agent also has needs.
The good news is that today’s market conditions make this a good time to forge what could be a mutually satisfying long-term relationship. Unless you’ve been living under a rock you’re pretty well aware that retail buyers have disappeared. Because of this – and low prices – real estate investors are on a buying spree. You can work together and turn incredible profits with the help of a real estate agent that “gets itâ€.
You may be an investor that typically avoids real estate agents whenever possible because you don’t want to deal with real estate commissions. That’s fine and dandy, but in some locations you may not have a choice.
More and more states are enacting rules designed to protect consumers from those who would take advantage of them. As a result, states like Oregon have passed laws requiring that real estate agents be involved in any deal that causes homeowner equity to be transferred to another party. Other states such as California could follow suit.
Instead of arguing the merits of the rules, accept them and move on. You can also use a real estate agent effectively as a negotiation tool when working short sales. If you’re new to short sales or are working with a lender with whom you’ve never worked before, you may not be aware of the specific steps involved. In addition, some lender loss mitigation departments have their own rules, policies, and procedures. If you violate protocol your offer will be delayed – or rejected.
A real estate agent is a known commodity to the friendly banker. Banks work closely with real estate agents on traditional purchases, so there’s an institutional bias that favors the real estate agent.
The bank is more likely to consider an offer that makes sense if it’s presented by someone who speaks their language. Here’s another thought to consider: If a good real estate agent can help grease the wheels and get your offer in front of a lender, you can get an answer more quickly, and potentially close more deals.
There can also be other perks to working with a real estate agent: research. Once you establish a solid working relationship, a real estate agent will be willing to share information with you that would take much longer for you to do yourself. Comps and other MLS data is available through a real estate agent; however, you don’t want to abuse the relationship.
Solid relationships with a real estate agent will open doors for you that may have been securely closed in the past. It makes sense to build relationships that will further your goals, enhance your career, and add real value to your bottom line. A real estate agent can help you as much as you can help them with repeat business and providing the means to keep earning money despite the fact that the retail residential real estate market has almost completely dried up.
This looks like the best post for me to plead my case as a new real estate agent.
I joined this website 7 or 8 months ago out of a strong desire to invest in real estate and this has been the perfect place to learn the in and outs. During that time period I think I caught up with every post on this site since it began. I also went to real estate sales training and passed the state exam in Indiana. So as a real estate agent I feel that I can meet the needs of most investors. Although I have not bought any investment property of my own yet I feel I can speak your language and work with you to get the results we are both looking for.
I saw some earlier posts that mention realtors are in it only for the money. Although I can't disagree that they are out there, I can only speak for myself in saying that real estate based relationships come before money. Don't get me wrong I have to make a living, but a win/win deal is better than no deal at all.
Where I think real estate agents shoot themselves in the foot is looking down on investors because they claim we always make insultingly low offers they are embarrassed to take to their seller mostly because they blew smoke up their nether regions to get the listing. To which I say, "Mr(s). Agent, if you can get them a higher price, by all means do it. But, I am constrained with economic realities that limit my offer to what you have in front of you."
Agents that see beyond a retail mentality work well with investors and make really great money doing it. Those who see investors as a nuisance are the types who are struggling in this market where little to nothing is selling at retail.
The Realtor/Investor feud is a classic one.
Two parties that can work together and make each other a lot of money, but both sides all to often get in their own way and harm future profits over foolishness and ego.
Both parties are guilty of stepping over dollars to pick up nickles, basically crippled by short term thinking.
I agree and am trying something out on that. I told my realtor today that I wanted to buy a property. I started at a low number and authorized him to go up to a specific dollar amount (in this case, it was list). I told him whatever he negotiated for me between my actual price and list, I'd give him a bonus of 50% of the spread. Gives him an incentive to actually try to negotiate a good price for me. I'll let you know how it goes.