Lets wonder this too, is your job incredibly beneficial to society? is it not something many other people can do like "opening a door"? I'm sure to you your job is very complex and interesting, but to me and everyone else don't you just get paid to open or unlock a series of doors metaphorically? It's soo odd that you people think that somehow our jobs are the meaningful ones lol.
Also never use the term "top preformers" ya sound like a d-bag.
It reminds me of IT recruiters in the UK a few years back: [1] sums up the situation very well and applies just as much.
[1]: https://gist.github.com/CumpsD/696599d1bd4cd472a056586967293...
It's also a job which accomodates way more scum type people than you'd see in typical office jobs. As you note the incentives are very different, the pressure as well, and the recipes for success can involve screwing people over a lot of money.
The profession doesn't seem to have much interest in dealing with moral hazards.
Also, be really good looking.
1) Home inspections that aren't really "inspections" and are just there to grease the skids 2) Buyer's agents don't have a fiduciary duty to protect the buyers. 3) Pricing "knowledge" that is typically public info, just locked behind access restrictions 4) predatory lending practices
It's a very incestuous market where the agents are friends with mortgage loan officers at banks, handymen, inspectors, and law offices that handle closing.
The fact that it costs somewhere between 10-15% of the value of a home to actually transfer ownership is highway robbery.
An agent is only getting 5-6% of the home value (assuming no split with a second agent). And a big chunk of that goes to the brokerage.
We searched and vetted and found our own inspector. On Yelp of all places, one of the least trustworthy websites. It took us less than a day to find someone good.
And he found absolutely every single imaginable problem even down to the most hysterically unimportant detail. Like the tension on one of the kitchen/garage door hinges being slightly higher than the bottom door hinge. This was on a list of over 100 other things.
The point is, inspectors are jobs like anyone else. Some are good, some bad.
And then you have home insurance which isn't a whole lot better. They might fix the problem or they might manage to declare is pre-existing and deny coverage, but even if they do fix it, it'll be the lowest bidder installing the cheapest parts possible.
The laws for insurance are very complex, and all of the material standards are locked behind paywalls. For an average person (me before I worked there) insurance is basically a black box; you can't argue against any of their points because they hide the criteria.
>but even if they do fix it, it'll be the lowest bidder installing the cheapest parts possible.
This is true, but illegal. You are owed for "Like Kind And Quality" according to the law. This means that the insurance company can't downgrade your materials, and they have to repair the property to AT LEAST pre-storm conditions. Additionally, it is your legal right to choose a construction crew or contractor of your choice, and the insurance company can't veto your decision. After the work is complete, make sure that you, the construction company, and the insurance company have copies of the specifications of your materials and what work was done. This way it will be much harder for insurance to fuck you over on your next claim.
Most contractors in my area are genuinely trying to help the clients. There are some contractors who take advantage of the innocent and gullible population, though. I hate them just as much as insurance companies.
Two very different products, the former being a borderline scam much of the time, the latter being a requirement for financing (and common sense).
Current example for me... house is 50+ year old, with copper pipe for water supply. We're starting to get pin-hole leaks on some pipes. AFAIK, insurance considers this a maintenance item. They'd probably fix a major burst and the damage it causes (after the fact) but have no interest in even subsidizing preventative work to avoid the costly repair.
The fact an inspection document is impressive to read doesn't mean it is accurate. If he blew you away with his ability to name 100 minor things, but missed a structural issue, you'd be screwed, and would have no way to know this until the structure starting cracking.
Thank you for this - the public should redirect a lot of their anger away from the agents and toward their brokerages. Likewise - please don’t use Zillow, Redfin, etc to contact an agent. Call the agent directly, as these online sites take a big pile of money out of the agents pocket as well.
I want to believe changes are coming in real estate, as the long standing brokerage model exploits agents and confuses the public.
Sample of 1, but my agent was frequently closing several homes/week during peak season (Spring, early Summer). At the time (2017), typical listing would be $500-$1 million (Fairfax County, VA).
So I'd guess 20-30/year for her.
Broker keeps 30-50% of the commission.
So, a good agent in NoVA is probably making $250-$500k/year (but has to pay their own payroll taxes and stuff out of that, IIRC).
I hear this a lot on here and I wonder what state people are in or if the laws are somehow different elsewhere. In the states where I do business, there are state mandated checklists of systems and inspectors could be held liable if they don’t show reasonable care and professionalism in gathering the data for their report. The inspectors I use pride themselves on the adoption of technology (drones for checking out roofs, thermal imaging for heat loss and insulation, etc) and often take the better part of a day on even small houses. So, I dunno man - I hear this stuff about inspectors a lot, but it doesn’t jive with what I expect the ones I refer to people to actually do.
There were many, and varied things missed in my inspection. The biggest was the entire HVAC system being messed up. The furnace was incorrectly installed, improperly sized for the house, and didn't even have any return ductwork installed.
The air flow seemed really bad in the bedroom and so one day I decided to climb up into the attic and take a look. The problem with the return air missing was immediately obvious. When I called the inspector to ask why they'd miss something so obvious I was given an excuse and pointed toward the part of the contract that states they're not liable. I eventually got them to refund the cost of the inspection, but it was hundreds of dollars back for over ten thousand dollars in missed issues. I was only able to get anything because I worked for a real estate company at the time and knew the right people who could apply pressure.
IMO Home inspections are a total scam.
Also - I’m about to stop recommending one of my recommended inspectors, because he’s at best a “B”. He catches most issues, but the level of care isn’t what I want for my clients. There’s another guy I used to recommend but again, he’s nearing retirement and getting sloppy.
They tried to get the inspector for the obvious bullshit roof inspection but after getting ran around multiple times to the point of needing to hire lawyer to go any further. But eventually dropped it when some roofing company came by and offered to do the roof for "free" through their insurance because of supposed hail damage in the area that basically replaced half the roofs in the town. That too was probably a scam on the insurance by the roofers because we never had big enough hail for damage, but they weren't going to complain about a free new shingle job.
TL;DR Don't just grab any random inspector, and especially never take recommendations from anybody connected to real estate.
The county inspector was fired, but the county is not taking financial responsibility.
https://abc11.com/chatham-county-forever-home-dream-nightmar...
https://www.wral.com/family-says-chatham-county-inspectors-m...
The outcome of a building inspection is a certificate of occupancy where the authority is stating the home is safe to live in, the outcome of a purchase inspection is a report of things to ask for a discount on, part of the purchase negotiation.
The Chatham County thing is crazy, I’m hoping the family manages to find someone accountable in that mess — clearly either the original architect, the builder, or the county let them down somehow. I’m just not sure it’s really an indictment of the “inspector” profession as discussed in this thread.
Let's not pretend like this doesn't apply to almost every industry either...
Definition: A person who criticizes the group they are in, without realizing that they are also implicating themselves in the criticism.
Do such things exist? Are there real estate agents who are like "and if you buy today, we'll throw in this grill!"? Genuinely curious.
On the general utility of real estate agents... Really knowing a market and understanding construction/houses/permitting, etc... is a pretty important knowledge/skill set. I had one excellent agent figuratively drag me away from a condo that she understood to have serious foundation/construction defects. The good ones will help you understand what's good/bad about a house, problems to be alert for, etc...
Like a lot of middle men, I think they do provide a some service of value. Now, is that worth 3%/6% of a houses value? In many cases, undoubtedly not. We sold a house in Austin when the market was so hot that we got an eye popping offer the day after the agent put a "pending" sign in the yard. I think he did like 4 hrs total work. So afaict, the profession as a whole acts as sort of a rentier over the MLS listings.
High-pressure job, not high-pressure sales. Real estate sales is not a business that's kind to underperformers (in the long run).
I don't agree.
In my experience, there are people with a talent for talking, and have a natural attraction. People just want to talk to them. But that's not most people in sales (even if they are often top).
The key skills to be successful in sales are similar. Dedication, problems solving, and an interest in what you're doing. Many here could pick it up.
Rental brokers on the other hand… now they’re absolutely useless and you can sometimes pay astronomical brokers fees just so they can sit between you and the landlord.
He also didn’t mind seeing a bunch of houses because even if we weren’t interested in a house it built up his knowledge about the market and could possibly recommend the house to others.
We did have another realtor that wasn’t like that though when we were considering moving to another state, who mainly was just there to show houses and never pointed anything out, in fact she barely talked.
Didn’t really see the value with her, although shortly after the mortgage rates jacked up fast and made moving less appealing (we looked just before the Fed jacked up interest rates), so we didn’t go any further in the process anyway.
I've seen cases where the sales agent knew the seller's minimum and basically told that to the buyer. They didn't negotiate on the seller's behalf so much as negotiate to get the deal done quicker.
I'm sure the buyer's agent looked good to the buyer. This scenario and the one you describe are almost indistinguishable, depending on which party you are.
Without the agents, you'd have two people attempting to negotiate a 6 (or 7, nowadays!) figure purchase directly. Before it was over, you'd hate the other party too much to ever complete a sale.
Agents sit between the two parties and have a vested interest in seeing a transaction take place. They talk to each other and soften the communication so that you can tell someone you want to pay them fifty-fucking-grand less money for the single largest asset in their life that they were counting on to fund their retirement, and have that met with a counter-offer instead of an angry storming off.
Sure, you can do all that yourself if you want, but for the average person, they are providing value.
I remember reading about the fact that, at the time, most apartments in NYC were "broker only" (aka you can only see and then rent an apartment if you are using a licensed real estate broker).
The more I thought about this, I started to see the benefits for both sides:
- for the landlord: the broker acts as a filter for people who are serious vs "looky loos" (actual quote from a real broker)
- for the tenant: the broker wants repeat business so they will, in theory, only deal with reputable landlords
- for the tenant part 2: if you are a busy, hard working individual, the broker acts as your "agent" (in the principal agent sense of the word) to save you time by going and finding apartments for you so that you can focus on your high paying job.
The job literally could not exist anywhere else because no one would pay it. But they aren't making any more land in Manhattan and they aren't building subway lines quick enough so landlords get to pass that expense off to tenants
* They've seen a lot of houses, and know what to look out for even before you commit to calling in inspectors.
* They've seen a lot of closings, and can handle all of the title/law crud. "Quick closing" can be a big plus to some sellers.
* They've seen a lot of negotiations, and can help you get a feel for how the other party is thinking.
There certainly are people who unlock the door, stare at their phone all day, and collect their commission. Those aren't very good agents, even if they can get the job done when the market is extremely short on supply.
Heck, you can buy over 1000 security cameras and still save money.
Not once you pay your electricity bill, though :)
I was curious and did the math. I'm using motion sensitive security cameras that only record and upload when motion is detected. At the places with the most expensive residential electricity in the US or the EU 1000 of those cameras would need under $5 of electricity per year. There's also the thing that the cameras upload to. I don't know how much power that uses, but it is powered by a 5 W USB power supply so can't be more than $22/year.
Oh no, we had a bug once when our software uploaded the property to the web with the address unlocked. The place got swarmed by people who would just enter the property at any time, not giving a damn about the owner's privacy. They were ringing the doorbell, asking about the price and if they could see the place right then and there. Agents are the first line of defense against shitty people.
Interested to hear about the experience.
Not having an agent is generally a big asset when buying a home, much more than anything an agent will bring to you.
Ooof. Gotta be careful with this one and understand agency law in your respective state. That listing agent may not actually be working for you the buyer, even if they help you fill out the paperwork.
I can’t speak to California law, but this isn’t explicitly true in either market where I work. Non-agency is a thing in some places, and depending on the terms of the listing contract the listing agent might pocket both sides regardless if there isn’t a buyer’s agent.
I’d also argue that there are a lot of properties where a buyer benefits from expertise on the part of an agent - either negotiating strategies or local market concerns. In my market for example understanding environmental and construction issues and value add that a buyer won’t know without doing meaningful research on their own.
I did a FSBO in a tiny town and the property was purchased directly by a buyer that was also without a realtor, but both sides had a mortgage from a national bank, and inspections happened, there was a boilerplate contract (the same one the previous realtor used for us buying the house, the lawyer’s name was on the contract) and a title company. The transaction was on rails. Could not have been smoother or cheaper.
For that place we knew the local market was small and the rumor mill active and figured we could FSBO for a bit before we contacted a real estate agent if we needed access to the MLS and non local buyers.
As for the time we purchased without an agent, we purchased a few 100 acre ranch from our family and did so with a real estate contract, seller financing and no mortgage. It would have been difficult to get financing at a reasonable rate for a property of this kind. This involved a fair bit of time dealing with lawyers and neither party is happy with the lawyers but the deal got done.
Anyhow - both experiences were good.
Alternately in the North East then I had a much different experience (albeit only on the buying side) - estate agents were almost exclusively women who answered phones, and viewings were done by the sellers themselves.
Did dropping acid enhance your vacation, or does LSD also stand for something else?
“So I once played poker with a gorilla and [insert point]” and everybody only talks about the point and not the gorilla???
¯\_(ツ)_/¯
Our agent (used twice, 15 years apart) was great. Both times, in strong sellers markets, so lots of offers made and rejected. Lots of last second "OMG, just listed, can we see it NOWNOWNOW!"
Very expensive, but so is a house.
Now that I've been through the process a few times, could I do it without? Probably. At the right price, would I use an agent regardless? Absolutely. The old 6% rate seems quite high for a basic sale given online MLS listings, though for a very specific home in a small market, might still be worth that (I'm think lake homes in my neighborhood - rare listings, selling for $50k+ premium over non-lake on same street, often have a buyer lined up before listing, so really hard to actually buy one without an agent who knows people).
It’s because most agents work as self-employed contractors under the auspices of a brokerage, and the brokerage is not going to allow that. And/ or, in a state using standardized legal documents, we don’t even have a form for that, which means we’d need to come up with an hourly contract from scratch - and the brokerages will put their foot down on that too.
I admit finding a real estate agent who you can trust is not easy. I don't know how to do it, other than from who you know. I was lucky, and ours was a friend of my wife's family.
Think of real estate agents through the perspective of the 10x programmers we love to talk about here. The multitude of agents are as you describe - they publish listing photos from their phone, they know how to open a door, and then can mostly write down what you tell them on standardized forms. A 10x agent on the other hand, will absolutely benefit you in the same way that a 10x programmer will outproduce. Classic 80/20 rule stuff, where you want to be working with the 20 and ignore the 80.
They get 5% of most single family residential transactions. And recently it was 6% that was standard. And the industry works really hard to protect those profits.
It is a lot of money that comes right out of consumers pockets.
He never actually said "don't buy this house" at any property we looked at, but he would point out things I wouldn't have thought about like, "it's nice, but I wonder if there's a lot of noise from that street later in the day when people are home from work" or "I guess you wouldn't want to play with marbles in here" (house with a sloping floor likely due to foundation shifting) and a lot of other remarks to point out things that I, as an apartment dweller, wouldn't have considered.
I may have gotten that first house entirely due to him: I wanted to lowball the offer, but he pointed out that that neighborhood was a hot area and the house was very reasonably priced. I later found out that there was actually a slightly higher offer than mine, but since I had offered the asking price and came in first, the owners thought it was only ethical that they sell to me.
I've certainly met useless RE agents since, but there are definitely some that earn their percentage! The guy who sold my last house was also a builder and he fixed a problem that would have held up the sale on his own dime!
Taking hints from realtors is a skill. They are so subtle. I got exactly the same experience.
> Who are real estate agents? We can all think of a few real estate agents, none of them are top performers. They are usually on their ~4th career before the age of 30. They are the type of person to wear a suit in public to pretend that it makes them important.
Let's not pretend the software engineering world isn't full of hubris. Even the title itself is illegal in parts of the world because our career isn't a real engineering field.
"It requires professional help to facilitate emotionally charged, million+ dollar transactions" would be the more useful insight.
Very few people chose to forego aan agent when dealing in RE, there's a reason for that. I am a finance dude quite capable of negotiating etc and I still found out agent super valuable and would use her again.
It's possible you know crappy agents who deal in low-end transactions but again that may reveal more about you than the field.
I think it depends on the local market, but this was certainly my feeling when trying to rent a place in London. I visited 15 properties in a couple of days. Most agents just unlocked the door, sometimes seeing the place for the first time, most often clueless about the place. Actually a couple of them weren't even able to open the door and didn't have the right key.
That doesn't mean I won't try the easy/cheap way first next time, but it does mean I no longer dismiss all realtors as useless parasites who need to be "disrupted" at all costs.
What does a real estate agent do? They unlock doors.
Who are real estate agents? We can all think of a few real estate agents, none of them are top performers. They are usually on their ~4th career before the age of 30. They are the type of person to wear a suit in public to pretend that it makes them important.
I know an exception to the rule, except he sells multi-family real estate, and owns ~10 single family homes himself. I'd hardly call him a real estate agent at this point, he is a landlord.