patrick.net

"There is no way a real estate broker can survive, much less profit, for 10 years in the business without absolute integrity and unassailable ethics. It’s just not.

Since realtors have a 90% failure rate–9 out of 10 new licensees will quit before two years–only the very best and most honest will make it for 10 years. And they are the only realtors worth doing business with."

ScottC,

I don't want to reignite another pointless "all Realtors are crooks" debate, but it's quite a leap to go from "9 out of 10 new licensees will quit before two years" to all those who survive have "absolute integrity and unassailable ethics". I'm sure that many wash out due to incompetence & inexperience, but that's not the same thing as failing due to dishonesty and a lack of ethics.

There are tons of talented "closers" in every sales-oriented profession under the sun. It does not logically follow that all long-term closers are also exceptionally ethical --just good at closing. Of course, this does not prove that they are exceptionally unethical, either.

Again, not a slam against you personally or your profession --just an observation. There are ethical and unethical people in every profession. I agree that most of the johnny-come-lately's will wash out quickly.

@Mother Ocean,

I was gone for a long while myself. I understand that Surfer-X hasn't been posting for several weeks now. As far as Mr. Fuchs' fate, that would be a question for SQT, Jack or Peter P.

What happened to Surfer-X?

Maybe he caved and bought a house.

Well this article cracks me up What home buyers really want I think what buyers really want is sane prices.

"There is no salary. All of your business expenses, and all of your personal living expenses, are paid solely by the commissions you earn...You get a reputation for dishonesty and poof, you’re gone. ...In real estate, only the ethical survive."

Now, don't take this personally, but the cynic in me wonders how any sales-driven business weeds out the unethical types. Oh, the rules. Well, when money is involved, rules are often bent, broken, or ignored. Even physicians do screwy things for money. I'll grant you're the exception, but many of us here have first-hand experience with realtors acting poorly. Perhaps it's all a matter of viewpoint on what is ethical, but I would venture to say the average homebuyer doesn't know how "ethical" any given is, until they work with them. To suggest that every realtor is as ethical as you would mean that everyone has the same personality and motivations. I wish the world were so! :)

ScottC, you seem to believe that there are no (zero) dishonest realtors who have been in business for more than a couple of years and you will not give up trying to prove a point that cannot possibly be proven. Sure, if you are caught being dishonest in the public eye (make the headlines or such) , you might have a hard time getting work again in the business...you might not get work in other business as well depending on what it was! The fact is, people lie, cheat and steal every single day....and many of them don't get caught. You can tell a client that RE prices will never fall and you cannot be sued for it when it does.....it is just an opinion. The client may be pissed that they trusted their professional opinion and they may tell their family and a few friends not to do business with this dishonest realtor...but do you think that their career will be damaged by this? Hell no.........Do you know how many people complain about being ripped off by a car repair shop,....thousands...but the shop continues to do business. There are some shops out there that have been in the headlines and the shop owner put in jail......and then he gets out and goes back to his business as usual. Would I ever bring my car to this shop? No, but I could drive by there any day of the week and see his garage is full and business is as good as ever. The fact is that there are some unethical people in all occupations, but the best salesmen are the ones who can make the sale whether it is worth it for the buyer or not!

Another thing...when most people become interested in buying a house, they don't go through the yellow pages looking for a realtor, they see advertisments for houses, see a house they like and call the realtor who listed it. The realtor will then answer their questions about the property....if they aren't interested, the realtor will find other properties for them. The realtor will convince the client to come and take a look at some houses, even offer to drive them around and thus a relationship is formed. Do you think the client is going to look up the realtor in the "big book of dishonest realtors" to decide whether or not to do business with them? No, there is no such book available...and if you try looking up the company on the bbb.org website, you will not find any companies there. Why? I don't know, but I can tell you I have reported an online company to the bbb that ripped me off....they called the company....no answer, wrote to the company and the letter was returned undeliverable. The issue I had was never resolved and if I were to go to the site to look up the company, it would return no results, I have made several attempts to find out why they are not listed on the site, but I get no answers.....yet I can still go to the company website,...so he is still in business, go figure.

"big book of dishonest realtors”

LOL, and to Scott's credit, I hope that book is small.

Then again, how would we define "dishonest" or "unethical" in regards to realtors?
Poor market advice, questionable appraisals, pushing bad financing--or worse?
A realtor doesn't have to be a full-fledged grifter to be viewed as dishonest by me.

Then again, how would we define “dishonest” or “unethical” in regards to realtors?
Poor market advice, questionable appraisals, pushing bad financing–or worse?
A realtor doesn’t have to be a full-fledged grifter to be viewed as dishonest by me.

Precisely.

The chain of dishonesty, distortion and greed does not start nor end with the Realtor. The Realtor is actually one of the weakest links in that chain (made up of dishonest Fed, GSEs, banks, sub-prime lenders, appraisers, brokers, speculators, dumb borrowers, etc.).

Even so, in the most Bubbly markets, a Realtor ultimately must choose between serving this rotten system or (very likely) going broke. That system is currently rigged against the reasonable homebuyer's interests, against transparency and against setting sane valuations. Realtors who feed into this cycle must share some of the blame, though by no means all of it.

If you can buck the overwhelming tide of deceit and still make a good living, ScottC, I salute you. If staying honest AND staying in business is the norm in Texas, then I salute Texans. This is not the norm in CA, I can assure you.

By the way, I have great sympathy for those long-term Realtors out there who have managed to stay honest and have had to put up with this crap for the last 5+ years. As ScottC has pointed out, you're up against ridiculously inflated ('hit the mark') appraisers, unscrupulous lenders, greedy sellers, ignorant buyers, unqualified greenhorn agents (giving the rest of the industry a bad name), etc...

FSBY signs are springing up at a greater rate than the realtor variety. Probably because these people bought recently and would be OOTM with a realtor's commission.

You know someone once told me that there are more real estate agents than people.

FSBY signs are springing up at a greater rate than the realtor variety. Probably because these people bought recently and would be OOTM with a realtor’s commission.

....or maybe no realtor will list their house for what the price the seller is expecting.

"All realtors are assholes!" declared a man in a bar.
"I resent that!" someone replied.
"Why, are you a realtor?"
"No, I'm an asshole!"

"...or maybe no realtor will list their house for what the price the seller is expecting"

There you go assuming there is such a thing as an ethical realtor again! ;-)

A doctor told his patient that she had only six months to live.
"Isn't there anything I can do?" pleaded the patient.

"Marry a realtor," the doctor advised. "It will be the longest six months of your life."

NewYorkAddick says - http://investedinterests2005.blogspot.com/2005/11/house-of-cards.html

Some good points. Thanks!

In real estate, only the ethical survive.

Rather like in politics, eh?

OK, OK, that was offsides.

Cheers,
prat

Actually, it is in the realtor's best interest to make a quicker sale and move on to the next deal. This means persuading the seller to accept less and the buyer to pay more.

By their nature, realtors tend to be optimistic about the product they sell. This should not be a surprise to anyone.

I have also noticed that they generally have a bias toward believing prices will go up. Well, again no surprise since in most individual years and over longer periods of time this is the proven result. Some do seem to have amnesia about prior market declines.

@pop, frank & Prat,

Thanks, guys, I needed that! Sometimes the mood here gets WAY too serious. :mrgreen:

ScottC,

We've just about beaten this topic to death, so all I have to add is this:

Yes, we all agree that there are honest, ethical Realtors out there who manage to be successful, and you appear to be one of them. Despite the provocative title to this thread, there is nothing inherently disreputable about being a Realtor or in any sales-driven profession. Realtors do provide real, tangible services for their customers, primarily home sellers.

Yes, we all agree that full disclosure is a nice concept (though rarely practised as advertised), and that escrow, appraisals, property inspections and the title search are all critical parts of the transaction for everyone concerned.

Are we communists? Nyet ;-).

Where we part ways is whether or not honesty and integrity automatically equates with financial/professional success, not only in RE but in ANY business. As SQT illustrated so eloquently with her husband's sleazy broker example (and pbass with Trump), not only do success and ethics not always positively correlate, quite often they are INVERSELY RELATED.

If you would like to explore this topic further, I recommend renting a copy of In the Company of Men, or Glengarry, Glen Ross. These films are not only entertaining, but surprisingly illuminating about what typically passes for "business ethics".

"Coffee is for closers!"

ScottC...What do you think of David Lereah?

Article about yesterday's housing numbers:

http://www.philly.com/mld/philly/13287854.htm

Does any one have the skinny on the ongoing fight about the MLS monopoly? Many thanks in advance!

DinOr-
I haven't followed that, but I agree if the realty business wants to appear transparent, then property listing and sales history should be public knowledge. In the meantime, I've found ways to get some of that info...

"I’ve found ways to get some of that info… "

Aside from having a relative in the business?

Aside from having a relative in the business?

Nope, haven't gone there yet; we may consult a friend when we do buy a new place.

There are a few sites that will show how many days on market, last sale price, and since many realtors are sloppy at updating data, tracking price reductions isn't too hard either. Perhaps these sites have been mentioned before, but when I have a moment I'll post the links.

ScottC, it is hard to believe someone who doesn't answer a simple question. What do you think of David Lereah?

From the article Now and Then

[snip]
Let's take a look at what David Lereah, chief economist for National Association of Realtors is saying now :

"It’s not too late to increase your stake in the greatest real estate boom of our generation. Whether you are a first-time buyer or already own your home, Are You Missing the Real Estate Boom? will show you how you can dramatically increase your overall wealth. Author David Lereah, chief economist for the National Association of Realtors, shows why the real estate market is poised to climb higher over the next decade—and explains what you can do to profit from it."

What do you think of this guy Scott? Save the speeches and just answer my simple question.

This is so true. I swear politicians must be taught this stuff in the crib to be so proficient at it.

Same goes for realtors.

In ancient Greece & Rome, sophistry was actually a respected art, taught at the finest learning institutions of the day. Though it's fallen somewhat out of public favor, it has never fallen out of use. Given human nature, and the never-ending struggle over power and scarce resources, I suspect it never will.

There are a few sites that will show how many days on market, last sale price, and since many realtors are sloppy at updating data, tracking price reductions isn’t too hard either. Perhaps these sites have been mentioned before, but when I have a moment I’ll post the links.

KurtS,

It would be very helpful to have these for future reference (aside from the typical Domania & Realtor.com). When you get the chance, please do so, thanks.

Speaking of honesty and business ethics...

Real Estate Articles from Inman News
--------------------------------------------------------------------------------
Is real estate fraud getting the greenlight?
Industry executives point to lenders' tolerance of fraud
Wednesday, November 30, 2005
inman.com/inmannews.aspx?ID=48992

Speaking at a Texas Mortgage Bankers Association event in Dallas earlier this month, Morris complained that too many industry members tolerate fraud. "We are our own worst enemies, believe it or not," he said, demanding that "we can't have a tolerance for it, we just can't."

David Lereah is an economist. He analyzes market data and presents reports. He doesn’t sell real estate, so I don’t give his analysis any more credence than I would any other economist, which isn’t much.

Ok....maybe so after reading his biography, I just figured someone who is supposed to be an expert on RE would have started out selling RE.

Anyway.....

Have you read about Mugford deals

[snip]
Even though the vast majority of Ontario real estate agents are honest, other agents tempted to pull a "Mugford" scheme have now received a signal from RECO that if they are caught, they won't lose their licence.

David Lereah is an economist. He analyzes market data and presents reports. He doesn’t sell real estate, so I don’t give his analysis any more credence than I would any other economist, which isn’t much.

Ok….maybe so, I just figured someone who is supposed to be an expert on RE would have started out selling RE.

Anyway…..

Have you read about Mugford deals

[snip]
Even though the vast majority of Ontario real estate agents are honest, other agents tempted to pull a “Mugford” scheme have now received a signal from RECO that if they are caught, they won’t lose their licence.

Here’s a link to david Lereah’s biography. Interesting.

Yes...I sent that same link in a previous post, but it's caught in moderation purgatory.

Here is the link to Mugford deals since my previous post got corrupted.

If you let the threadmaster know a post is in moderation, they can take it out. Otherwise, we don’t know that something has ended up in moderation.

SQT aren't you a moderator? If so, I give you permission to take it out.

David Lereah doesn’t have a clue. NAR doesn’t have a clue. Tierre Grande doesn’t have a clue. You won’t find any information about this market in any state or national publication.

And yet this is where there is a whole lot of money to be made. This is the area that is the center of commerce between the US and Latin America. They are building a transcontinental superhighway from McAllen to Canada to facilitate the transport of goods and produce. It is not hyperbole to say that this area is perhaps the single best market to invest in in the entire United States. The potential profits to be realized here are exceeded only by Las Vegas.

Step right up folks! You won't find this info anywhere!

hmmmm.....Sounds like a promo for real estate in Texas. ScottC, you sound like you want all the speculators to come into your market!....kind of like a local David Lereah!

Now my posting of Lereah’s biography is redundant. Oh well.

Huh? Are you starting with my SQT? :)

I’m getting phone calls from people in California every week. Hell, I’m getting phone calls from people in Idaho and several other states. People who are getting out of overinflated bubble markets and investing where there’s money to be made.

At cursory glance, I see some conflict with one location being a "bubble market" and another "where there's money to be made".

I don't want to lump ScottC in with cheerleading realtors around my locale, but by now any informed buyer should question those who pull a host of buzzwords from their hat to support a continued runup in prices. I live on the SFBay, in one of the priciest, over-hyped economies (and housing markets) around. It's not like we haven't debunked this all before.

SQT, I thought what you meant by "take it out" meant delete it and that was what I expected you to do. If you want, you can delete it....I give you permission. :)