Morris Massre's Blog

Thoughts on South Florida Realty and the Planet in General

Death of a realtor

It was only a matter of time, the death of the realtor as we know it. I know this because I am one. There was once a time when the majority of the public counted on realtors for help. But, over the last decade the real estate landscape has been altered by factors that realtors simply have no control over.
Does the public really need realtors anymore? Only those that are either too busy or have no knowledge of the business hire realtors today. The factors that have contributed to our downfall and the way in which we do business are as follows; Tighter lending rules by banks. Before the housing meltdown everyone was lending money like it was going out of style, but banks today are much stricter because they do not want to get burned again. If you cannot get a loan you cannot buy a home. This leaves realtors with mostly cash buyers that are hard to come by. Lenders are tightening the noose even more in 2014 as evidenced in this article from HousingWire.com. http://www.housingwire.com/articles/28192-headwinds-ahead-for-housing
Buyers and sellers alike also have a great deal of access to realtor’s listings in the MLS via websites such as Trulia and Zillow. Sellers can even advertise on some of these housing sites, which begs me to wonder why on earth would the websites that are trying to help realtors actually hurting them?
The internet, of course, opened up all kinds of doors for buyers, renters, and sellers. Instead of calling an agent they can simply go to any of a numerous real estate sites and conduct a search on their own, study photos and videos, investigate taxes and maintenance fees, and even make an offer. This essentially eliminates the Multiple Listing Service that agents use because those same listings are taken from there and posted on these various sites while we as realtors still have to pay dues to the local, state, and national boards.
Unscrupulous realtors who only look out for themselves are a back breaker for any of us who take this business seriously and treat it with the utmost professionalism. Unfortunately, there are way too many of them, especially in South Florida because this area of the country is ripe with fraud. As an industry we also make it too easy for anyone to obtain a license. It is not about the quality of the realtors out there, but for those at the state level, the quantity of agents they can collect dues from. These same realtors go so far as to charge a very low fee for service for sellers who want their home listed in the MLS, but want to save the 3% on the selling or listing side. Every time one of these realtors collects $250. to list a home in the MLS they are hurting the another realtor that much more.
The fickle housing market has a tendency to change like the weather. I have come to realize that America’s economy depends heavily on the housing market because the industry employs so many people on so many levels that most people do not even realize. Every time the market takes a nose dive every realtor and those they do business with feels it. It has a negative trickle down affect. What else can a realtor do when the market tanks? There is no golden parachute for us. We have to wait it out and hope the market makes a comeback as quickly as possible.
If a bad economy coincides with a housing meltdown, as we discovered in 2006, then we have a recipe for disaster. The downturn can last for years. When this happens most realtors who cannot wait it out leave for another industry, usually something that just pays the bills because they are not qualified for anything else. And since housing dictates a large part of the economy, one cannot rehabilitate without the other.
Lastly, greed comes to my mind when I think of our death. A buyer always wants a property for as low as he can get it, even if it requires dirty tactics. The seller wants more than his property is worth. It is a never ending cycle in which the hired realtor is always trapped in the middle. What matters is what is fair and how it will affect those in your neighborhood later on down the road, but everyone is always thinking of himself. If things do not go their way then the realtor is to blame, so next time they attempt a sale on their own to eliminate us and try to make even more money off of those unsuspecting buyers.
Everytime you eliminate a realtor from your property sale consider this; You have just put a small business out of business and small business is the backbone of this country. Without small business you are left with nothing but big box stores and the internet.

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Filed under: Real Estate, South Florida, Thoughts on Life, , , ,

Housing’s Perfect Storm Erupts in Florida

South Florida's Perfect Real Estate Storm

South Florida’s Perfect Real Estate Storm

Housing Perfect Storm is Upon us

Housing Perfect Storm is Upon us

Welcome to Florida; The Hurricane State

Welcome to Florida; The Hurricane State

Some thought Hurricane Wilma of 2006 fame was the perfect storm that started the housing meltdown in South Florida.  Well, if you coupled that with mortgage fraud, rising home prices that were out of control, and unscrupulous realtors, mortgage brokers, and appraisers, then maybe it was.  I believe that it was simply the beginning of the end.

Today we have a perfect storm of other sorts.  I like to think of it as the perfect storm for our housing recovery.  Whether or not you like it makes no difference.  Housing is the single factor in the US economy that dictates whether or not we fail or succeed economically as a country.  Not Wall Street, not the auto industry, and not banking.  This is why everyone should be paying close attention to the market, especially here in your own backyard.  Housing’s success or failure has a domino affect on America’s economy.  Choosing to ignore it is simply not the right attitude. 

Sometimes I wonder if the Native Americans had it right all along because they had no concept of ownership of any kind, including their own country.  This is why they never had to worry about defaulting on a loan.  They shared in everything willingly.   And that is why it was so easily manipulated away from them though.  On the one hand they never had to worry about a mortgage payment, insurance, HOA dues, or even cutting the grass.  On the other hand, this type of cultural mentality led to their loss of land.  One could argue that there simply were not enough Indians to stop the influx of White immigrants flowing into the country and that it was bound to happen anyway, but if there were some kind of national government in place perhaps a deal could have been arranged to avoid the takeover. There is no going back now and we have to live with the current economic conditions.   

But Indians did not use money at the time, so an economic collapse due to housing would have been impossible.  But it sure would be nice to not have to think about money or bills for a while.  Today’s society has no concept of sharing because we are all out for ourselves when it comes to home ownership and getting the best deal possible.  Nobody cares about whether or not the sale of their over-priced home will have impact on the rest of the community as long as they get what they want.  Hopefully, we have learned from our mistakes and will be more conscience of  our actions in the future. 

What South Florida is experiencing now is not unlike pre-meltdown housing numbers, but make no mistake about it, everything has changed in the way we conduct business.  The perfect housing storm arises first from rising seller prices.  Although not enough to bring a lot of homeowners from the abyss, it is still enough to rescue many others.  Another factor that has been taking hold are buyers who are coming to the US to invest for various reasons, although mostly political.  All of the political and economic unrest in various parts of the world have led to foreign investment in US housing.  These buyers are coming in droves too, and this has led to a shortage of inventory, thus driving up demand and prices.  In particular, Canada, Venezuela, Argentina, Brazil, and China are the biggest movers and shakers in the home buying business. 

American buyers, on the other hand, are driven more by simple economics like interest rates.  Foreigners do not have to worry about that because they buy with cash, but with Americans who finance it is the single biggest factor in the purchase of a home.  Give out zero percent interest rates like the auto industry and the run on housing would be so great that we would surely run out of homes to sell in record time. 

So, given the fact that we have a great deal of buyers for homes, low interest rates, higher home values, and a shortage of inventory all point to a housing perfect storm.  This time, however, it is all for the better. 

 

 

Filed under: Real Estate, , , , , , , ,

Realtors Not Dead Yet

I sometimes wonder if realtors really are a dying breed.  In the old days before the internet people would always look for an excuse not to use an agent, but in the end always did.  Today they don’t even have to use an excuse.  There is plenty of free help out there online and television on the nuances of selling or buying a home.  And we do not help ourselves by giving anyone with a breath a license in a week.  I can’t think of any other business that does that.  You should have to earn it and go through much more rigorous training.  This will weed out the deadbeats.

Perhaps we are our own worst enemy too.  Cutting commissions, shafting our brethren, seeking out shortcuts to get rich quick, breaking all the rules and laws, and so on.  I liken this to when I was a kid.  My parents were in retail and had lots of competition who were always doing the same exact things just mentioned.  So my father took it upon himself to contact each of his competitors and offer a solution to the war.  Why not everyone just carry the same items at the same price and let the customer decide for himself who he or she wants to buy from?  This same philosophy can and should apply here.  Yet it doesn’t because everyone is looking out for him or herself.

If we band together and give the customer the service and attention they deserve they will stick with you.  No need to sell yourself short.  The more you do, the more respect you lose from the customer.  Once the public realizes this, and they will, they will come back to using agents the way they used to.  Afterall, how much attention can a computer give a customer?  As far as customers are concerned, the only good a computer should do for them is give them information on all of the qualified agents in their area.  If a client took the time to research who they are interviewing and eventually hiring they just might eliminate a lot of headache later on down the road.  Anyone can claim they are a “specialist,” but we all know that’s just branding.  Does the customer know that?

Filed under: Real Estate, , , , , , ,

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