Real Estate sales are flawed!

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  #1  
Old 03-24-17, 06:04 AM
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Real Estate sales are flawed!

I've avoided saying crooked but you be the judge. When buying I always thought that selecting a buyer broker (BB) was good as they would have my interest in mind. We know a selling broker (SB) represents the seller, but who does a BB represent? Surprise, it's not the buyer, it's the paycheck. Both BB and SB have ONLY one interest in mind, closing the sale as quickly as possible.

I won't go into the long story about visiting and researching about a dozen houses in the Bangor area for my out of state daughter, but it was depressing. To the agent, everyone looked cute, nice, lots of potential, but after a walk though and many pages of problems I would recommend my daughter pass. For one, she rejected my complaints but did at least hire an independent inspection. When she got his even longer list of problems she withdrew her offer.

I already had a low opinion of real estate agents from many shady dealings in the past but this sent that opinion to a new low. The sad part is, every house we looked at will eventually sell and only after the closing will the new owner start to uncover all of the problems I had listed along with the ones I anticipated, and the many more that are always there.

For now she has given up on buying a house and I'm looking at the cost to build new, not good. But what I saw explains why we see so many people coming here with complaints about what wasn't disclosed about their new house.

Bud
 
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  #2  
Old 03-24-17, 06:59 AM
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Originally Posted by Bud9051
". . . who does a BB represent? . . ."
But unless there's a written Buyer Broker Contract to represent the Buyer, then Selling Agent represents the Listing Agent.

It's just like with Insurance; people will refer to "their Insurance Agent" as if s/he represents the PolicyHolder; when in reality it's the Insurance Carrier who's being represented.

Many Home Buyers will refuse to sign anything, especially a binding Contract that ties them to the Agent and forces a set of fiduciary responsibilities onto the Agent; but without such a Contract, the Agent's allegiance remains with his Broker and with the Listing Agent of the specific property in question.

Most States require that these relationships be clarified early on in a relationship and the Buyer is supposed to acknowledge in writing that they understand that without a written Buyer Broker Contract, they are not represented by anyone. Maine is among the States requiring that Agency Disclosure.

What perceived malpractice did the Agent in your example perform ?
 
  #3  
Old 03-24-17, 07:27 AM
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I suspect home sales discloser's vary state to state. Out this way, the seller has an enormous amount of questions asked by the listing agent of the owner. Amazing how many pages and various questions. Experienced this while listing my mom's home after she passed away. All required by state law. Even if some one died in the home. Many of the questions seemed irrelevant to me as I had not lived there for well over 40+ years and a few I had no answer to. Thankfully, house was in trust and the lawyer oversaw every aspect.

Both line. Buying a house is one of the largest financial and long term investments you'll ever make. Pays to have a real estate lawyer you hire whom is on your side only over see the entire process. At first and up front might seem an additional expense but all to often proves well worth the money in the long run, IMO. More so then an inspection agent you hire. Read their small print contract!!!

Comparison: Real estate agent hired by the seller and you having no lawyer on your side, representing only you the buyer and/or buyers agent, is like buying a used car from a used car seller on his/her car lot. BUYER BEWARE!!!...

 
  #4  
Old 03-24-17, 09:13 AM
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Hi Vermont, that is how it is supposed to work, but neither BB nor SB will risk sinking a sale to point out problems they are aware of, ignorance is bliss. One house my daughter was seriously interested in was listed at half a dozen web sites all of which should have a reasonable knowledge about the area (within view of S Kings home). Not one mentioned the property was located inside an historic district which would greatly affect the cost to make repairs, like windows, siding, and roof. Even when pointed out to our agent the significance either went over her head or she was still trying to down play it to get the sale. We even received the disclosure and most of it was "unknown" but nothing mentioned about being historic.

Sharp, those disclosures are just another case of lying.
Some questions:
"any mold issues" unknown
"lead issues" unknown
"asbestos" unknown
"radon" (very common in this area) unknown
Most of these houses listed were built in 1900, which must be close enough but not correct. The answer to all of the above questions in all of the houses I visited ended up being yes and even if the owner is claiming ignorance the listing broker does know better, lying and fraud to allow those disclosures to go through.

On one foreclosed property the agent/broker was misrepresenting the property to prevent others from selling it, build in 1632 ?? WE had our agent try to get more information and she was told condemned due to toxic mold. It is a duplex with 2 families still living there and after being pushed the listing agent put up his own web site saying "well kept by two very nice tenants".

Like I said the story is too long to give all of the examples and my bad relationship with agents goes all the way back to NJ in the 70's. They are basically unregulated and hide behind a lot of fine print to allow them to maximize their sales in any manner possible.

Tell me why the agent supplied home inspectors have such a bad reputation for not finding many of the problems, fraud and collusion and a lot more fine print.

I need to splash some cold water in my face.
Bud
 
  #5  
Old 03-24-17, 09:44 AM
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Originally Posted by Bud9051
The sad part is, every house we looked at will eventually sell and only after the closing will the new owner start to uncover all of the problems I had listed along with the ones I anticipated, and the many more that are always there.

For now she has given up on buying a house and I'm looking at the cost to build new, not good. But what I saw explains why we see so many people coming here with complaints about what wasn't disclosed about their new house.
That sounds accurate about used houses, but a bit harsh about real estate agents.

People forget that their real estate agent isn't a home inspector, which is why there are
all those "Get a Home Inspection" brochures, and many states have "Seller's disclosure" laws
so that the person who lived there is supposed to tell you what they know is wrong.
If you're looking at foreclose homes, there will not be any seller disclosure,
the bank didn't live there, and obviously the bank and former owner are on bad terms.

The real estate agent is supposed to know what's for sale, what has sold,
and what would be a amount to offer on any particular house.

I'm a bit perplexed, given your concern about repairs and good condition,
why weren't you looking at new construction? Or only "excellent condition" homes?
If you asked for clean homes, but were only shown fixer-uppers, then that's the agent's fault.
If there ARE only fixer-uppers in your price range, then it's not really the agent's fault.

-Those who give you a serpent when you ask for a fish,
-may have nothing but serpents to give.
-It is then generosity on their part
-Kahlil Gibran
 
  #6  
Old 03-24-17, 10:20 AM
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Thanks Hal, I basically agree, but daughter was shopping by way of long distance, thus the need for me to do the onsite visit and frankly, I know too much. And that is the sad part. Home shoppers who know little about homes will get sold something with NO ONE to point out the problems. It cost my daughter $600 to get the one home inspection so that just isn't possible when looking at many houses. New or newer would have been great, just add on $100,000 to the prices.

My biggest complaint is less about the individual agents and more about the structure that has evolved that not only allows deception but encourages it. It is a commission based industry and if an agent wants to put groceries on the table they quickly learn to not say too much.

Bud
 
  #7  
Old 03-24-17, 10:44 AM
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The Real Estate Commission is charged with the responsibility of protecting the Public Interest and was set up to address specific complaints. You or your Daughter out to avail yourself of that governmental service:

Maine PFR - File a Complaint - Maine Real Estate Commission Complaint Procedures

Originally Posted by Bud9051
". . . neither BB nor SB will risk sinking a sale to point out problems they are aware of . . ."
Having been a Broker for over 25 years, I can say my experience includes walking away from several transactions where the Sellers (and some Buyers too) were engaged in trying to deceive one another. My E&O Coverage cost too much and my License was worth too much to be placed in jeopardy for a lousy Commission.

I have also had the distinct pleasure of being drawn before the Vermont Real Estate Commission to answer charges that I KNEW where several dormant Septic Systems were located in a paper sub-division, when I didn't . . . . and the only person who did know was now suffering from Alzheimer's Disease. It took over 500 days to resolve, and cost the State many thousands of dollars; but it was pretty easy to refute having knowledge that I didn't possess.

The point is that while I may have sold 1100 or 1200 homes, and I acquired "some" knowledge of probably 75,000 others; but I never knew enough to say anything about any one of them with absolute certainty . . . . it's understood that that information gets merged and generalized. I'd be wary of giving specifics about the house that I've lived in for the past 30 years, let alone some stranger's house . . . . and even if I had sold that same house 5 times over.

You'll have a real case IF your Daughter had a Signed Buyer Broker Contract with an Agent and was relying on her advice in all aspects of this potential transaction. That's why the Commission exists as a Licensing Authority . . . Contact them.
 
  #8  
Old 03-24-17, 11:20 AM
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@ Vermont, what you say sounds nice and I'll trust you are one of the good ones, but the reality is the fine print and the lawyers will protect the less than honest agents (and home inspectors). Where a house may be 6 figures most problems will be far less and thus not worth paying a suit to chase after them. Had those issues been noted before the sale they very well may have reduced the purchase price, an intangible that is hard to claim after the fact.

My hope with this thread is to warn some home buyers to be careful and as well informed as possible. The challenge when buying is, a seller doesn't have to accept your reduced offer where you identified many problems because there will be a long line of starry eyed shoppers to follow who will knock off the expected $5K and buy the house.

Bud
 
  #9  
Old 03-24-17, 12:17 PM
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Originally Posted by Bud9051
". . . Where a house may be 6 figures most problems will be far less and thus not worth paying a suit to chase after them . . ."
But I'm sure that filing a Complaint with the Maine Real Estate Commission would be FREE, and certainly get the attention of the Agent AND his/her Broker who is vicariously responsible for all of her failures) and it would certainly give you more satisfaction than venting here.

If there is truly a basis for the Complaint, the Commission can (and will) gingerly suspend their Licenses and livelihoods, exact a monetary penalty or require additional Continuing Education so that they get their heads screwed on straight . . . . and down Maine, they may even have more creative mechanisms of torturing Real Estate Licensees.

How many Agents did your Daughter have working for her ?

PS: And if there was a basis for your Complaint, their E&O (Errors and Omissions Insurance) Premiums will surely escalate.
 

Last edited by Vermont; 03-24-17 at 12:47 PM. Reason: Added PostScript
  #10  
Old 03-24-17, 01:33 PM
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Originally Posted by Vermont
But I'm sure that filing a Complaint with the Maine Real Estate Commission would be FREE, and certainly get the attention of the Agent AND his/her Broker
Originally Posted by Bud9051
It cost my daughter $600 to get the one home inspection
so that just isn't possible when looking at many houses.

New or newer would have been great, just add on $100,000 to the prices.
Wait.

What in the Wide Wide World of Sports is going on here....

Sorry, but gotta be devil's advocate on this...

The buyer is shopping for a house.
The buyer, or parent, wants a "clean" house with no problems.

A "no problem" house costs $100,000 MORE than the buyer is willing to pay.
The buyer doesn't want to see "no problem homes" at $100,000 more than they can afford.

The realtor showed the buyer homes that the buyer IS able to afford.
They buyer doesn't like those homes.

The buyer, or parent, only likes the more expensive homes that the buyer can't afford.
This is somehow the realtor's fault?!?!
Excuse the vocabulary, but WTF?

It sounds like, the homes you want are $100,000 more than you want to spend.
The solution is for the buyer and parent to start looking at homes they can afford,

I don't see how this the Real Estate agent's fault?
 

Last edited by Hal_S; 03-24-17 at 04:29 PM.
  #11  
Old 03-25-17, 06:21 AM
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Sorry Hal if I didn't explain properly and I'm not going to spend more time doing so. Point here is these agents and agencies make money selling homes and they don't care about the details. I mentioned the poor ethics of agents bringing in home inspectors who knowingly overlook problems so as to not jeopardize a sale. That's a well known problem in the real estate industry and frequently discussed right here on this forum. And that is just one on the list of "how to quickly close a sale" tricks they use.

If you trust them, fine, but don't criticize our efforts when we can't post every detail, far too long. If you don't trust what I'm saying that your right, but I stand by it.

Mods can do what they want with this thread but I won't be visiting it again, steam rising from collar.

Bud
 
  #12  
Old 03-25-17, 11:37 AM
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Ah, not a problem, I see the frustration;
I'm curious about the distinction you've raised:

"professional duties" versus "public PERCEPTION of professional duties"

Yes, the process if frustrating, but finding out WHY people are frustrated,
what creates the disconnect between what they expect, and what they get,
that's actually quite interesting.

It's those times when we are at wit's end, and things-just-don't-work, that we learn more.
An example. I've got a 1969 Plymouth Barracuda convertible. I learned at a young age,
the hard way, that pre-1970 Mopar, the left-hand wheels have left-hand threads.
I bent the wrench, scraped my knuckles, and snapped the stud.
Won't make that mistake again.

Point here is these agents and agencies make money selling homes
and they don't care about the details.
Um, you want details about repairs, but won't pay an expert to find out what needs repairing?

Fixing things costs money. Figuring out what needs fixing ALSO costs money.
Knowing "what to fix", is usually MORE important than knowing what it costs to fix things.

Nobody is going to crawl through the crawlspaces or check the attic, for you, for free.

That's a well known problem in the real estate industry and frequently discussed right here on this forum.
Yes, "{that profession} are crooks" is a common point of discussion here--

"auto mechanics are crooks"
"contractors are crooks"
"electricians are crooks"
"HVAC techs are crooks"
"plumbers are crooks"
"realtors are crooks"

I think everybody with a tool belt or clipboard has heard that at one time or another.

I mentioned the poor ethics of agents bringing in
home inspectors who knowingly overlook problems so as to not jeopardize a sale.
That does not make sense. The BUYER chooses, hires and pays the home inspector.
If the buyer chose a bad home inspector, who's fault is that?

It is becoming common for Sellers to hire a home inspector and provide a free copy to buyers.
And now we have Buyers complaining about the quality and qualifications of a free service.
The initial post mentions "a walk though and many pages of problems". It's not clear,
but that sounds like the buyer getting "many pages" of free information on the home.
Really? Complaining about the quality of a free service?

Later, there's mention of $600 to have a home inspection.
Really? Complaining about having to pay an expert for their time?

C'mon it's a used house, something is broken somewhere, other things are just waiting to break.
A used house has risk, but buyers get the reward of a lower price. It's a fair bargain.
A house where everything is guaranteed to work is worth more. That is why they costs more.
THAT IS WHY USED HOMES ARE AFFORDABLE. Risk versus reward.

If somebody wants to know everything that has to be fixed in a house, that has a cost-
either time checking all the systems, or money to have an inspector check them for you.

I still don't see why it's the Realtors' fault...
 

Last edited by Hal_S; 03-25-17 at 11:54 AM.
  #13  
Old 03-25-17, 01:42 PM
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Well the Building Inspector got paid, and the Agent had the pleasure of chauffeuring a prospect around to 12 Bangor Houses that she may not have seen before . . . . so that better prepares her for the next candidate. It's safe to say that she didn't walk away with any money from this effort; only the experience (if it can be put to use).

I mentioned earlier that I had probably shown about 75,000 houses around here; but had only sold 1100 or so . . . . quite a waste of time, one might say.

This industry is organized on the Commission basis for a reason. NO ONE would work this hard and be so friendly, and be on call 7 days a week without some prospect of getting some kind of paycheck. But really, most of the activity involves duds.

We only get paid for about 1% of the work we do; but you never know which 1% is the lucky one and which are the 99% that are just a waste of time (except for familiarizing oneself with the local inventory). You just have to make your very best effort with every wide eyed prospective Buyer (or Tire Kicker) that makes some noise about wanting to see a house.

There's wisdom in the way that this has developed, and it is only through experience that new Agents can learn to smell money and identify serious "qualified" Buyers. Most (88-90%) of Agents wash out in their 1st two years, before acquiring that skill and they waste their time trying to showing everything to anyone who can fog a mirror.

In a perfect world we would burn or bulldoze all used houses instead of re-cycling them . . . . but my experience with new construction indicates that segment is not entirely free from defects either.

I wouldn't change much about this business (and I'm saying that as a RETIRED Broker).
 
  #14  
Old 03-25-17, 02:00 PM
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Reading this thread I think I see what Bud is objecting to.

Some forty years ago, shortly after getting married we decided that even though we were planning on moving to a different part of the country in two years it simply did not make economic sense to rent a home. We pushed the pencil hard and determined the amount we could spend for the mortgage payments as well as the other costs of owning vs. renting and came up what we thought was a reasonable price for a house. I won't state that price because few people would believe it to be realistic, but it was.

We contacted several agents, some recommended by friends or family and others just from advertising. Some were full-time agents, some were older people doing it to supplement retirement earnings and a few were just second-income for their own families. Agents were both men and women and their ages ran from mid twenties to mid sixties. We gave them our maximum price as well as a few desired qualities and a few required qualities for the house we would desire.

The younger agents ALWAYS asked what our total income was as they wanted to sell us the absolute most expensive house we could qualify for. They are the ones that pooh-poohed the price we had calculated, always telling us we would "qualify" for a much larger loan. They would also routinely ignore our "needed features" such as minimum bedroom size to accommodate our king-size bed. Many times we would look at a house and the bedroom was far too small for the bed and the agent's response would be, "Oh, you could knock out this wall here and then have plenty of room." It didn't matter to the agent that the wall might be load-bearing or would encroach upon some other important room.

Likewise, we wanted off-street parking, no shared driveway and a few other things I don't remember. We did see (on our own) houses that would qualify but no agent ever showed us one. There are lots of other horror stories that go along with this period in my life but I will spare you. We finally bought a house, sold by the owner, that met every criteria. It had its problems, to be sure but I lived in that house for 22 years.

I also want to state that I agree with most of what Hal has also posted. Sometimes a buyer simply doesn't "know the market" and in these instances it pays to have a good agent. When I bought my present house I had an agent I trusted completely. It helped that she was a personal friend and the friendship preceded her going into to real estate sales.
 
  #15  
Old 03-25-17, 02:47 PM
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Originally Posted by Furd
Sometimes a buyer simply doesn't "know the market" and in these instances it pays to have a good agent.
Glad that some of what I was saying gets through.

I have an uncle who was an auto mechanic in the 50th and 60s.
He can go to a car show, read VIN tags, and tell whether the car is stock or not.
It's like the scene in "My Cousin Vinny" with "Mona Lisa DiVito" on the witness stand-

"That's not the factory color",
"That's not the right engine",
"That's the wrong power steering pump, 66' was square bolt, 67-72 had a hex bolt"

Evaluating the value of a used house is alot like evaluating the value of a used car:
You go to the going rate / blue book value, for the general make and model, but it's the expertise
about the little things that make a difference.


Good Real Estate agents are like local auto mechanics- they known the history of that "model",
they know what problems to look for, and what suggests a "good" unit.
But, imagine that instead of a Realtor, you are a mechanic.
Somebody wants to buy a 40 year old used car. They show up at your garage,

They want - a summary of everything that's wrong with the car.
They want - a guarantee that nothing will break in the foreseeable future.
They want it NOW, and they want it for FREE.

How long would it take for you to escort them out of your office?
This is what being a Realtor is like.
 
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