patrick.net

This is a great story, because it shows the level this kind of argument was directed toward: people who need pictures to confirm an investment strategery [sic] for bright fifth-graders. I hope you have more of these to share.

Sounds like the Tom Vu infomercials from the 80s & 90s on how to get rich flipping RE...

I will share one more for now. It was the day I found Patrick.net!

As I mentioned, I'm a computer guy. In the late 90s I was living on the east coast. Overall this was a glorious time for me because I was riding the dotcom wave.

One of the things I remember keenly about the dotcom days was all the "we're gonna get rich" thinking. We are in a "new paradigm". "We are in the 'new economy' due to the internet revolution." "The old metrics no longer apply." (Side note, check out this gem: http://www.wired.com/wired/archive/8.02/newmoney.html)

Seriously I always had this nagging feeling I was doing something wrong because I didn't have a big stock portfolio and wasn't rich yet.

Fast forward, it's now some time in 2005 and I'm sitting in my office at the Realtor Association.

At the time, my mom was pressuring me hard to buy a condo because my cousin just bought one and he was three years my junior. My mom had tons of money in financial stocks and was making huge returns.

Our political lobbyist was even getting caught up and thinking she HAD to buy, and as I mentioned previously, even a low paid secretary got a loan for a 225k condo. So again, I had that "nagging feeling" like I wasn't doing something I should have. I was missing the boat.

I researched local condos and based on all the affordability ratios I wasn't even close! So I asked a couple friends, who were about five years my junior, how they were able to afford a house. They said they had a tenant the first year who helped pay the bills. We talked more and then it came out that they paid less for their 1500 sqft townhouse two-year's prior than what 500 sqft condos were going for at that time (in 2004/2005). But they said, "Don't worry. After you buy it, the price will go up. Eventually you can buy an investment property or two, like we did, and parlay that money into the house you *do* want." "But what if it doesn't go up?" "It *always* goes up."

At the end of the hall from my office is a training room, most often used to train new agents on the MLS Software. A class had just ended and the green agents were now coming out.

Two young, pretty female agents, stopped outside my office. My guess is they had become friends in the training and now were exchanging contact info. I could hear their whole conversation. They were really excited, and somehow I couldn't stop listening. They were basically talking about how they were going to get rich.

"Well, there's only so much land in the bay area!" "Yes, and real estate has always gone up!" "Plus, it's not like a tech stock, which is just an idea and paper." "And the population keeps going up, people have to live somewhere!"

I suddenly had an acute sense of deja vu, like I had heard this exact conversation before. I wanted to keep listening to these girls but I tried to frantically remember... and then the light bulb came on: I had heard this same conversation, nearly verbatim, during the dot com bubble.

I turned back to my computer and google'd "real estate bubble" and suddenly that nagging feeling I had all along made sense...

Back in the 2004-2005 time frame, when I had graduated college, my buddy (who was a commercial real estate developer) told me to buy in his new neighborhood. Bunch of ugly, cheaply built townhomes. They were going for low $200's. According to him, the location was great and if I got a couple of roomates, it would be a killer investment.

I considered it, but was only making around $40k/yr. and no way could i afford it comfortably by myself.

Anyhow, the townhomes are now going anywhere between $90-130k.

This was back on the east coast.

This kind of toxic ideology led to "creative financing" instruments like the 40 year Option ARM. When borrowers were paying less than the fully amortized "option", they were surprised at what they could afford. Of course, these types of financing instruments only worked in an appreciating market, cuz when the loan was recast .... it blew up in their face....

I moved out to the Bay Area right when the dot-com imploded.It was pretty awful. If some of you were around back then it was crazy. I recall walking downtown literally the week I got to the Bay Area: There were crazy, colorful signs hanging from buildings for this dot-com and that. I swear it was a month later that I went back and most of those places had closed. I distinctly remember driving up some steep hill in SF and the street was lined with moving vans: people were moving the heck out. Downtown was like a ghost town for a year.

For a recently graduated college kid with a degree in the tech field that was a really... really bad time. I could not have timed it worse. Me and all of my friends all got cruddy minimum wage jobs. A job in tech? Forget it. They were laying people off and there was suddenly a glut of people with experience out of work in line for the jobs we had no chance of getting. It was 2-3 years before any of us got "real" work. By that time the housing bubble was under full-swing. This was circa 2003-2004. One of my friends was getting married and was desperately looking for a house to buy. I didn't really care about real estate because I wasn't married anyway. Anyway, he spent what seemed like every waking minute looking at houses. Not just any house, but A house period. We're talking houses that were falling apart, in pretty bad neighborhoods and so on. They were getting out-bid every single time. They wound up buying this absolutely tiny little house with no yard and no garage for something like $675,000. This was my introduction the Bay Area price insanity.

I got married a two years later and started thinking of buying a house. I called up a realtor and at one point in the conversation I asked her how the prices were still going up and the answer was that as long as people were willing to pay then the prices would go up. At that point I simply asked her what happened when people couldn't pay the prices anymore. Radio silence.

I guess you could say that for most of my adult life all I've experienced has been back-to-back bubbles. Both of which have had a major impact on me and the life I have. I sometimes wonder if we were just a tad older perhaps we could have avoided those bubbles and be living like "normal" people and not like it is now where its freakishly weird that we make a six figure income yet are stuck with the prospects of 500k "starter" homes.

Its all timing.

If you had loaded up on RE during the tech bubble (98 to 2002) then sold during the RE bubble (04 to 07) then you would have the stacks of cash as promised from the cartoons.

Tales of Real Estate Part 3: The Title Companies.

It always struck me as odd when I worked in Real Estate that the Title Companies basically sponsored everything, every social Realtor/Agent event, tons of advertising beyond that, why? I didn't even know what they did. What the hell is Title?

And lots of people wanted to work in Title.

At the Realtor Association, we were required to provide support to the agents for the MLS software, and, it was implied, general tech support. Many agents came to us, but likewise, they received support from others - Title Companies.

This always seemed odd. Why provide secondary support, gratis, for what we were already providing and the agents were already paying for? And frankly, we were pretty good - we did our jobs well.

Turns out, in the RE Boom, Title Insurance companies were making money hand over fist (probably still are).

Why would Title, such a "small" line item in the overall purchase of a house, be so lucrative? I think the "typical" title cost was around 1%" of closing cost.

How lucrative? I will tell you, by example. The Title companies employed their own tech teams. These teams would buddy up to Brokers and Agents and basically offer to do, well, anything. They would install their LAN or Wireless networks at new Brokerages, help their agents with the MLS software, drive to their houses to fix their computers. Whatever was asked.

All to earn their business.

And that's where the money came in. See, cause back in the old days, a Title search required digging through paper records, dealing with city bureaucracies, lots of homework.

With everything being computerized, Title searches were far easier and less risky, less costly, yet the fees remained the same.

I read in a few different places that the average cost of research AND payout (in the event of dispute) for each Title search claim amounted to around $90.

So closing on a 400k "shack" in 2005, 1% = 4k. They just banked $3100!!

The genius of Title Insurance was, and probably still is, relativity. As I said, it's a small line item in comparison to the whole house price, agent fees, and all those fixes/upgrades you probably have on your mind after you "bit the bullet and decided to jump" on a purchase. Title Insurance flies low under the radar, only comes into play after you've emotionally and financially decided to commit, so you just pay it. What's another few thousand? Better safe than sorry, right?

http://www.insurance.ca.gov/0400-news/0100-press-releases/0070-2008/release029-08.cfm

With real estate, I feel as if, a decade later, I'm still tilting at windmills.

It started in 2001. I had a year under my belt at my first "real" job, and my apartment lease was almost up. I called my local credit union, the one I has used since I was a youth, to inquire about a mortgage. I figured I was making almost 50k a year - there's no reason why I couldn't afford a small condo.

I'll never forget what happened yet. The guy laughed at me, and proceeded to tell me that "no one in their right mind would give you a mortgage given the amount of student loan debt you have." I was crushed.

Now looking back there was two things I should have done 1) check my credit report (many years later I came do discover that the loans were listed twice on two of my three credit reports) and it never occurred to me to shop around and try to get a second opinion. I did however find patrick.net (It must have been in its infancy back then.)

Some time passes and I don't worry too much about it. Met a girl, fell in love, all that good stuff. Life goes on.

By 2004 it was evident that a move was forthcoming. The company I had started with back in 2000 had just been sold and was moving out of state. I wasn't sure what my next move would be - but it was evident a move would occur. I was working full time AND going to school full time (trying to finish up the masters degree before the company closed its doors.) but it seemed that none of the companies in the area were hiring. I had the brilliant idea that If I could just by some land out by where my (soon to be) wife's family grew up, we could hold onto it - perhaps even move out that way. We came VERY close to buying a 20 acre parcel with a dilapidated shack on it. It was an estate sale - but to close the transaction, we needed a significant buyer concession in order to have enough money down - since the banks saw it as a land loan, not a mortgage, given the structure on the property was "uninhabitable". Seller agreed, but their lawyer killed the deal, saying that "that much of a concession was not legal". Frustrated I put the idea of home ownership off.

Ironically, I ended up staying with the company I had been with from the beginning - moving to keep my job. The downside was that my cost of living went up - dramatically as a result. We managed to find a small rental in a "changing" neighborhood. When we moved in it was mostly older Italian. By the time we moved out it was almost all young Hispanic immigrants.

Everyone was nice, and the area had a youthful vibe to it, but I kept wondering how the heck everyone could afford it. I mean, they did have larger families - cousins, uncles, etc. all living under once roof, but a half a million for a small house just on the other side of the tracks from the ghetto didn't seem to make any sense. Ironically, my landlady was a mortgage broker. By this point I was making about $65k - still had the student loan debt though. I had her prequalify us for a loan. When she prequaled us for 400k I almost fell over. Certainly that couldn't be right! I had been laughed out of the bank just five years before, and my situation hadn't changed THAT much. If anything, my expense were higher, not lower.

This time wanting a second option I checked with my accountant. He ran the numbers and came to the conclusion that we could only afford about half that much. And at 200k, all we could find were shacks in the boonies - far removed from where we were living and working. So again we put the idea on hold. I also "rediscover" patrick.net, and have been here off and on since then.

That brings us more or less today. We finally live up near where my wife grew up. (Really makes me wonder what would have happened if we have bought the 20 acres). We both have stable jobs, and make well over $100k as a household. But we still rent. We aren't willing to pay more than $300k for a house. Most houses out here are still in the $300k to $400k range - but it has slowly been getting better.

The reason why we don't want to spend more than $300k is the taxes. Even at that price, most homes have 3k to 4k in property taxes PLUS 7k to 9k in SCHOOL taxes. It's the school taxes that put ownership out of reach.

We have had a few close calls. One we lost out on because it was an inside job (multiple bid situation, when it came time for best final offer we actually bid MORE, but did not get the house.) One we walked away from because it was (I kid you not) a half mile from a toxic waste dump, and still another slipped through our fingers (we were trying to arrange a short sale but it never came to fruition - ultimately the owner declare bankruptcy in order to avoid foreclosure - which was imminent.)

So we rent and wait. Over the years some good has come out of it. Thankfully despite the turmoil we've been able to maintain steady jobs. We've paid down and/or consolidated student loan debt. We have 20% down plus an emergency fund, and if this goes on much longer, may start to switch our strategy, by land (every now and then I come across a 20+ acre lot for under $150k) pay it off as soon as we can, then build on it.

But at the end of the day, despite all of our efforts, I still feel as if I'm on the outside looking in. I still belvie that houses this way are not in line with incomes (although they are far closer). and quite frankly, as long as I'm unwilling to pay more than I think a property is worth, I will always be outbid by someone who has more money than sense.

That's my tale of woe. It could be worse, but it still frustrates the heck of out of me. That's why I keep coming back to patrick.net. to remind myself that its not me, its the system. That the "normal" rules of the game, the idealized "American Dream" of the 1940's to 1960's no longer applies. That as long as the powers that be change the rules to promote "home ownership" rather than letting the free market dictate prices. As long as rates stay low and lending remains loose, my only hope is to buy in cash a decade from now. (or buy land an build, which is more and more becoming an option)

Thanks for listening to me vent.

It's really tricky how these so-called lenders deal with "land only". Hardly anyone that was born into this can get used to the idea. That land is absolutly free. The largest of problems being that if your a debt slave, your going to believe your owners in "Everything" first and everyone else last. Lenders will typically apply the value of the land to loan amount. It's sneaky true. Land swindel's basically are directed to major cities. Where land is parceled off and assigned. For taxation purposes. "Hey were in" say the local tax swindlers. See America is territory not a fucking kingdom.

You can't make land your own, not live on it and sell it. Land is not for sale. It's a fucking God given right. You either live there or you don't However once again if your a debt slave you won't believe it. The land swindler's started things like parcel land way back when. Hey come into the city we will get you a loan for a pre-built house. There it started with a few suckers. Then they started drawing the other suckers in.

I sound like a doom and gloom bastard I know. However I will tell you this that even the dumbest city-manager knows full well. That America is territory and the land if you live on it is well free. You go out into the wide open spaces like hundereds of thousands of other people that live in America and the land is free. The city, county and state swindlers in cooperation with the land swindlers can't do a fucking thing about it.

Get free. If you owe more than likely your screwed. The debt dosen't go declare yourself bankrupt. Then all you are is an idigent debtor. You got kids? Keep the fuck away from them. These usury bastards love sucking in new flesh. Seriously you need to pay attention to your behavior with your children. Getting them into any kind of loan or bonded servitude by them having a jobbie. Just means your more than likely being influenced in a real bad way to get your children into debt slavery for the rest of their lives. Would you do that to your kid?

I don't hate the politico's and the new's people of course. They are just debt slaves for the most part and almost all are bonded servants. There is no point appealing to them. Why not just go direct to the usury people. Why not? If they own the above (way to slick to bribe that would be a horrible thing of course). They simply own them by debt and bonded servitude.

SERVITUDE. 1: a condition in which one lacks liberty especially to determine one's course of action or way of life.

A servant and a slave are two different things of course.

Just appeal to the usuor's. You see a lot of well, young people that don't owe in the occupy deal. There is a reason for that. Many of them don't fear an owner and are sick and tired of their crap. They want a life and are confused. Hey, if their parents don't understand all of this? If they are prevented from doing so. What direction are they going to go in? Your children don't want to be slaves or bonded servant's. They just don't get what's going on. However as free from debt servitude. They are reacting. To a lot of things they see but don't understand as being the result of debt servitude. You know what? The fucking usuor's DO UNDERSTAND all of this. However it's damn hard to reign in someone, that is not under their thumb in some way. They just have to ride it out. Before you get shit happy and think your kid's want you out of all this and what it, engenders. They don't give a damn. They just want to understand and not get sucked into all the debt and serving some really cruel bastards. In some really henious ways.

Jon137 says

We are in a "new paradigm". "We are in the 'new economy' due to the internet revolution." "The old metrics no longer apply."

Nailed it in your second post.

I'm not saying it works, but this is the gist of the world's economy.
The old metrics no longer apply. The old metrics were no matter what, you could pull your money and let it simmer in a bank account, while you wait for the next hot paradigm.

Before we get to the 2012 election, I fully expect all consumer bank accounts to pay out negative interest. They will charge you for having money in the bank. This goes beyond any service fees, the bank already charges. I wouldn't be surprised if you were charged more for a balance that increases month over month, vs a decreasing value.

If you were to travel back in time to 1980 and snatch a prudent saver, or even a financial savvy person that made money by moving money around into different money making accounts, and brought them to now.

Those people would find the current economic scheme, as some sadistic cruel Joke.

I'm also certain, that in 1980 had there had been a real estate bubble the likes of what we experienced. I don't think it would have gotten to 20% of the proportion that Our bubble grew.
The Prudent and Wise, would have out weight the Lemmings and the Suckers.
There would have been more Prudent people to sound alarms, not because of the impending doom and gloom of the bubble busting. But they would have had more consideration for their own Children's future.

The Greedy Bastards of the 2000's bubble, didn't give two shits about their own Children "Screw those lil Bastards I'm getting mines Now!". There's just no damn way, anyone that bought a house that was %50 over valued, and they couldn't afford using conventional logic, didn't once think about their kids future as they singed the Contract. At the rate RE was going, a 8 or 10 year old in 2003 could expect to pay 2 to 3 million or more for a 1200 sq ft Ham and Egg'er starter house in Burbdale America.

Just that thought alone, kept me out of the market. Regardless what any buying mantra was. "Buy now or be priced out forever..." ect.

I was making a conscious decision, to not be one of the Pricks, bequeathing a shitty unfordable world to my kids. And I had nothing but sheer disdain for those snatching up houses in Burbdale for 300K and 400K while their kids were going to the crummiest public school in their towns.

Good stories. I am glad that I was in college from 2002 - 2007, so I couldn't even consider buying a house (hell, I am glad that I didn't even have a credit card until 2008).

My fiancee is a couple of years older than I am and a number of her friends got into the RE "game" in the 2006-2010 period. With the exception of one guy, all of the others that did are now under water. The guy that isn't is/was buying up houses in Pittsburgh CA and renting them out, and prices there seemed to get hit hard enough early-on that he is faring OK. The rest of them bought in Dublin, Castro Valley, Fremont and San Leandro. I remember going around to some open houses for "cheap" condos with my fiancee (then girlfriend) in 2009, and it was a eye-opening experience.

A lot of her friends were telling her to get in on RE since "prices were down" and she had been saving her money religiously since she graduated in 2004. The whole thing stank to me...why the f**k would anyone in their right mind want to pay $350k-$500k for some condo in a not-all-that-nice part of the east bay? I rented things that were nicer than a couple of these units when I was in college, and I didn't exactly live in luxury condos either! The RE agents did not seem to take their job too seriously and were basically only talking about the properties in terms of price / future price potential. I could see why they weren't really pushing the "benefits of living here" angle very hard.

It all seemed farcical, and even a little surreal. Here we are looking to make what is supposed to be the biggest financial decision of our life, and nobody was taking it seriously. The agents were whizzing us through overpriced condos, some of which were filthy and still had loan owners in them, spouting off significant fractions of a million dollars and not blinking. A couple of my fiancee's friends also took a really blasé attitude about buying RE and talked about it in terms of a game, but their attitude suggested that it was on-par with checkers or maybe Monopoly rather than high-stakes poker or Russian Roulette.

I know one guy from my graduating class that bought a condo in Walnut Creek for ~$350k in early 2008. He said that its current value is around $195k now. He doesn't really mind since his parents ponied up the down payment, so he is going to stick it out as far as I can tell. It is at least a good location that allows him to bike to work and is close to downtown WC. A couple of others from my class bought houses, but in places like Santa Rosa and Sacramento. A far as I know, prices took most of their dives early on and these folks seem to be mostly solvent or even above-water with a small margin. They make decent engineering salaries out there, so I sort of doubt that they care too much anyway.

So yeah, it seems that for people of my age group and level of employment (25-30, engineers in high tech / biotech), buying RE has proven to be a bad deal. Someday it will become financially justifiable to purchase something in the SFBA, but that day seems to be in the distance and the government/lobbyists are working hard to keep the brakes on.

I had a similar experience. Back in the dot-com bubble I was in college, but was conservatively invested in high-fee, low yield mutual funds. My dad was killed in a car accident when I was 3 and my mom smartly invested some of the life insurance for my education. The problem was she was a 23 year old, non-college educated mom and was taken advantage of. The money grew, sure, but over the time period of 1982-2000 it certainly didn't grow even at a market performing level. You can't lose with mutual funds is all I ever heard though...

Anyway, I had a cousin who was about 5 years older than I and he got a job as a stock broker right out of college. All I heard about from him was about suchandsuch.com and how he was making all this money on his portfolio. He was my older cousin so I thought he was so smart and successful...ended up investing $5000 total in couple stocks he recommended...which of course all went belly-up.

By my senior year in college, I had taken control of paying for tuition and bills. I would simply call up the long-time broker, instruct him to sell a certain amount of a particular mutual fund (that was the worst performing) in order to pay the bills each quarter. Well one time I called him up for $4000 and he told me that there wasn't enough value in that mutual fund anymore...which was funny because I had looked at the account statement a few months before and it was over $10K...I was increduous...I thought you couldn't lose in mutual funds...so I had to sell the other mutal fund I held. I asked him for a current account statement and found out that I was down about 60% for the year at that point. The thing that still pisses me off is never in any of that did he give me a call to let me know what was going on. He knew I was in college and not paying attention to it...but he just kept going on collecting his broker's fee.

Needless to say I fired him after I graduated.

Fast forward to a couple years after graduation (2004-2005), and a couple of my friends from college were working as mortgage brokers out in Phoenix. Every group of friends has the harder partiers and the less hard partiers..these two were on the hard partiers end of our group (which had to put them in the 99.99% of all partiers) but somehow, and they showed me their bank statements, they were depositing over $10k per month (and spending $11k but I digress) in wages. Soon after, I went to visit them at their new house they just had built. It cost over $600k and it was ridiculous. It had a fountain waterfall that ran off of their roof and into their pool. They also told me about how they were in to flipping houses..they would put no money down, buy a house, immediately put it back on the market and sell it the next month making $20-$40k each time. By this time they were going to Vegas a few times a year and I went with them once..they were betting huge at the tables and craps, probably losing $20,000 or more. Our room was better than the room in "The Hangover" at Caesar's Palace and it was all comp'd.

Luckily, at this point I had seen this before (though not to this level) I knew there was something wrong with all of this easy money, and no matter what I saw, I knew it wouldn't last. I kept the rest of my relatively small, slowly growing nest egg (what was left over after I paid for college) No way was I investing anything in this crap and I rented. Discovered HousingPanic and Patrick around this time.

This year, I finally bought a house. After watching them fall 25% in my area, and seeing rent actually 10-15% higher than the PITI, I thought it was time.

In case you are wondering, my friends have both filed for bankruptcy and lost their waterfall house. After getting out of rehab, one went back to mortgage brokering but now does mostly FHA loans and makes, he says, 20% of what they did back then. The other is a personal trainer and might make $25k. They had a falling out over the bankruptcies and crash, got into a fist fight, and are no longer friends.

The point of all of this is encouragement. Dont worry, eventually it will end. Even in the Bay Area, I know that someday houses will fall back to where it is affordable for a median family to afford. Be patient.

Jon137 says

I read in a few different places that the average cost of research AND payout (in the event of dispute) for each Title search claim amounted to around $90.

So closing on a 400k "shack" in 2005, 1% = 4k. They just banked $3100!!

The genius of Title Insurance was, and probably still is, relativity. As I said, it's a small line item in comparison to the whole house price, agent fees, and all those fixes/upgrades you probably have on your mind after you "bit the bullet and decided to jump" on a purchase. Title Insurance flies low under the radar, only comes into play after you've emotionally and financially decided to commit, so you just pay it. What's another few thousand? Better safe than sorry, right?

I've heard estimates of payouts on title insurance ranging from 2% to 5%. Not sure what the actual number is. They make good money on this stuff, although they also provide insurance on something potentially very risky (and mortgagees often require it). I think a huge percentage goes to marketing/sales agency costs.

A good way to save money on title insurance is to find it before you're ready to close and not to use the company that your mortgage company or used house salesman suggests (probably a kickback being sent).

Still, the risk of not having title insurance is very high unless you've had a lawyer look over the chain of title. Especially when you consider that many banks have not been foreclosing properly because of their faulty mortgage recording habits, the risk of a problem in the chain of title for former REO/short sale properties is probably higher than usual.

david1 says

Back in the dot-com bubble I was in college, but was conservatively invested in high-fee, low yield mutual funds.

Why high fee? High fee is not usually a good thing.

david1 says

The thing that still pisses me off is never in any of that did he give me a call to let me know what was going on. He knew I was in college and not paying attention to it...but he just kept going on collecting his broker's fee.

So this wasn't self-managed? Is that why there were high fees?

Good job waiting to buy a house. It must have been tempting hanging out with the partiers and qualifying for large loans during the boom.

bmwman91 says

The RE agents did not seem to take their job too seriously and were basically only talking about the properties in terms of price / future price potential. I could see why they weren't really pushing the "benefits of living here" angle very hard.

Yeah, I've definitely seen that. I've been to my share of open houses, and the realtors are always talking about pricing, instead of the property, because the property is often a piece of crap. There might be deferred maintenance, stupid additions to the house that never made sense and were done unpermitted and without an architect, bad structural issues, etc., so of course they don't want to talk about it, because they want their client to cash in and pay the fee.

Ridiculous shit like this: PMI hires firms to weigh restructuring, faces pressure on loan payments. A stupid believer would believe this of course. Someone that is a little smarter might say layoff's. So one guy shows up with a cantaloupe and he's the restructuring guy. How people can continue to pretend and function within the structure of stupidity and daily bullshit shooting out of the hinders of usury owned news, financial news and just plain ole swindel. Then again if your a debt slave or bonded WTF can you do? You have to believe. It's like watching a giant jellyfish in some ways. I am going to go out again and hopefully find someone these bastards don't own so I can have a conversation with someone not connected to the plough of the jellyfish. I just hope it doesn't fart while i am in Starbucks.

MarsAttacks! says

I can tell you there were a LOT of times where I was asked how to rig CMAs (comparative marketing analysis) in their favor. And I am not talking about tweaking the inputs to get the desired outputs, either. I am talking about requests on how to outright override the output with blatantly false information.

Ah... CMAs. This reminds me of a funny story.

As you mentioned, 20% of the agents make 80% of the money. Part of this was learning the business, finding a niche, etc. But part of it was just plain DNA. I regularly met agents who I knew would be gone in a year, or their real estate "career" would mainly be crawling under their broker's desk to pleasure him during long conference calls.

There were many agents who really should not have been anywhere near a house. They should have been working jobs involving a paper hat and a name tag. There were tons of agents with no real skills, no higher ed, just plain dumb. Many had criminal pasts.

I met quite a few agents who were dotcom refugees. During the dotcom, my coworkers and I identified a certain class of "IT Worker". The demand for tech workers was so great that a secretary could basically call herself a "tech support" person and double or triple her pay over night. I had to work with and manage a lot of these flunkies. When someone called with a problem ANY problem, they would tell the person to reboot. If that didn't fix it, they would tell the caller they had to escalate it to "Tier 2". Seriously, I knew many, many people who were being paid $25/hour for this back in the late 90s.

Well, with the dot-crash, these fakers all lost their jobs, but they weren't quite ready to give up their $25/hr lifestyle and go back to their Burger King career tracks. Many ended up in Real Estate.

One day I'm working the tech support line and I get a call from a woman with a Japanese accent. She's asking for help with a CMA, however, like many bone-headed agents calling about CMAs, she basically wanted me to do the whole thing for her. This is, at best, an hour-long process, and we offered a couple classes for it anyway. Once I clued in her real intentions I started pushing back. That's when it started to get a little weird.

She started begging, pleading and borderline crying to me in this little girl voice, seriously like a little girl character from an anime cartoon! So I backed off a little and we got a couple more steps in, then I would say, "Okay, that's it, you have to do the rest." And she would start anime crying/begging again!!

Finally I got her off the phone, kicking and screaming, practically had to hang up. I tell my coworkers about it, and we call her "Project C-Ko" (for those of you familiar with the Project A-Ko series of cartoons).

An hour later, she comes in to the Association.

She is somewhere between 40 and 50 years old but basically dressed like a 15 year old Japanese schoolgirl, or, rather, the typical anime stereotype of one. She had the sailor dress, her hair in pigtails, cutesy anime purse, the whole deal.

Put any thought that this could possibly be somehow attractive straight out of your mind. It was simultaneously scary, gross and very, very pathetic. She was a very worn-out looking middle aged woman lost in some crazy fantasy.

Seeing this freak and recalling my earlier story of her call, my coworkers quickly established with her that she spoke with me on the phone and sent her my way. I guess I couldn't blame them. (coughAssholescough)

We get into it pretty quick and I re-emphasized that I was not going to do a CMA for her. She again does her anime crying routine and leans against a cubicle for support. At this, my coworkers and boss realized I was not exaggerating in the slightest about the earlier call.

I look at my boss and he is just staring, mouth open, in disbelief as I tell this woman-anime-child over and over she has to take the CMA class. Back and forth we went. Finally my boss gets it together enough to come out of his office and back me up. We calm her down a little, get her signed up for a couple classes and refer her to a couple competent agents who could do the CMA for her (for a fee).

Never saw anime lady after that. The moral of the story is, 20% of the agents make 80% of the money. But a certain percent make 0% of the money.