Realtors often get the crap kicked out of them on this site. Some deserve it. Some donâ€™t.
As Iâ€™ve said, because real estateâ€™s the biggest thing most people buy, consumers need and merit professional guidance. So when young couples are pushed into too much debt, sellers are seduced with an unrealistic asking price, buyers are spooked by phantom competing offers or a real estate board president fabricates market facts to manipulate the media, the beating’s richly deserved.
But many experienced and professional real estate agents and brokers know this hurts everyone. Especially now. Weâ€™re into the start of a multi-year decline in housing values and if buyers and sellers are herded into rash decisions by lies and misinformation, this market could be poisoned for a long, long time.
Two snapshots from my inbox. First this weekend note from a real estate broker. We need more guys like Kyle, who writes:
â€œFor about the last 4-5 months I have spent the first 30-45 minutes of my listing presentation apologizing about the misleading press releases our real estate board/president of our board have been issuing. Although I feel that most people including myself should have a personal residence for their family needs, comfort & enjoyment, I do feel that owning second properties for investment reasons is a mistake.
â€œPersonally, I have taken a big hit in the stock market but I feel that I will make my money back there a lot quicker than I would in the real estate market. In fact I doubt that real estate will come back during the rest of my career as an agent ( probably another 10- 15 years), given the present money crisis/recession and then when that is over the baby boomer effect should just start kicking in more every year for about 15 years. This will result in an over-supply of listings for the number of buyers available during that span. I find that other agents & the general public have their head buried in the sand saying ” IT WON’T HAPPEN HERE, WE HAVE TECH INDUSTRIES”. Unless I am wrong they are under estimating the effect that the mass number of boomers are going to have on the downward pressure on prices of the housing market in ALLÂ centers across Canada.
â€œI have an appointment to try to keep an existing listing. My vendors are happy with our relationship but are frustrated that their home has not sold in many months. They recently said to me that they are thinking of renting their home for a year or so in the hopes that the market will get better. I am taking 2 of your books with to read a few of highlighted paragraphs to show them that there is a good chance that their home if worth more today than it may be 5 or even 10 years from now.â€
Now, letâ€™s contrast that sentiment with what Gary encountered last week in one of our big cities. Heâ€™s 59, the father of three young kids and he and his wife both work, live in a paid-for house in midtown and have ambitions.
Theyâ€™ve been eying a bigger, very expensive house in a nice hood, and put in an offer conditional on financing â€“ without yet selling their existing home. Gary sent me an email asking for advice and said, â€œthe financing is tight and if we need to bridge finance on the chance we donâ€™t sell our house, we are screwed, to put it mildly. The question is, can we sell our place? We have two days before the offer expires and we need to waive the condition. The bank is nervous about approving the possible loan if the worst case scenario happens, which is not selling in three months. Any suggestions on what to do?â€
My response: â€œDo you have a death wish? This is an insane idea. The last thing you want to do is gamble like this in a falling market. List your home first and only act when you have a firm offer. Things are about to get worse.â€
Three days later, this report:
â€œWow , that was close and yes completely insane idea to purchase a house at this time before selling ours.Â We got out of the deal by not signing the waivers on financing. The sellerâ€™s agent and our agent were on us like a pack of wild dogs to get the deal to happen, but my wife and I held tight and didn’t even answer the phone orÂ email messages that kept coming the last day before the deal was null and void….we are now waiting for our $30,000 deposit back and needless to say they don’t seem to be in a big hurray to deliver!!! Thanks for tipping the scale and being blunt, I think your advise tipped the balance and wake me up to the potential disaster we could be headed for had we proceeded in this deal. My wife and myself are realizing we should be thankful for what we have now and not try to get more and bigger when we really don’t need it. Life is not about that at all as we know deep down.â€
Some realtors are shepherds. Some are wolves.
But on this blog, we know what matters.