May 21, 2008 at 11:23 am
· Filed under Buyers, Real Estate Bites, Sellers, Silverdale WA Real Estate, Sparks from Sparky
As the market continues to correct itself, the usual suspects typically surface.
BROKE BROKERS
Brokerages are closing or consolidating. Several of our local real estate offices are playing ‘Musical Chairs.’ Many agents are switching from offices that charge rather exorbitant desk fees, over to the more traditional split commission agencies. The Agent exodus which started last Summer continues to build up momentum. Many of the “Get Rich Quick” set have come to the stark realization that there is no quick anything in this business. It takes hard work, commitment, and perseverance. Real Estate is not for the faint of heart. So long, farewell, Auf Wiedersehen Goodbye!
IMPATIENT SELLERS
Most of the more astute Sellers are now coming to the conclusion that the market has shifted. Pricing and preparation are ‘everything’ to achieving a successful sale. Gone are the days of “Well, let’s just put it on the market and see what happens.” The next tendency that Sellers need to avoid like the plague is price reductions. Price your property right from the start. It’s not what ‘You,’ the Sellers, think the house is worth, or what your neighbor’s house sold for last year. The market determines the price. What are people willing to pay ‘today’ for your house? In a slowing market, Buyers can find themselves in a game of ‘catch up,’ and always ending up a few steps behind the market.
LOW-BALL BUYERS
And lastly, slowing markets breed over-demanding ‘low-ball’ Buyers. Don’t get me wrong. I have nothing against getting a good deal. In fact, that’s a big part of my role as a licensed real estate professional - skillfully negotiating the very best price for my clients, whether Buyers or Sellers. Let’s face it, everyone likes to think they got a sweet deal. But if a Seller has done their homework, priced the home aggressively, properly prepared the home to show well, etc., why insult them or waste their time with a ridiculously low offer? With that said, I recognize that there may actually be those rare occasions where a particular property has been languishing on the market for an extended period of time, and the Sellers are much more motivated or desperate to sell. Bargains are always out there. Just don’t unduly penalize the efforts of a hardworking Seller just because you want to be a greedy Buyer.
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Well written, concise and way too true. I actually interuppted a shortened work day to read this, and you know what? It was well worth it. 
Sparky wrote @ May 21st, 2008 at 12:07 pm
Bill - thanks for the kind comments. Just so you know, I clicked on your name/link, and it directs me to an expired/deleted Blogger account? Thanks for taking valuable time out of your day to stop by!
This is exactly what is also happening in my neck of the woods. My employing broker Homesmart acquired Dan Schwarz Realty, Inc and now is the largest brokerage in the state of Arizona with over 3000 agents. Both brokerages apply the 100% model, however the luxury brokers are merging as well. Equitable and Russ Lyon, both players in the luxury segment, apparently also have merged. It will be interesting to see what effect the shift of the market will have on the various real estate brokerage business models. As far as buyers and sellers go, they need more professional guidance now than ever. The Greed factor has shifted from the Sellers to the Buyers and the Sellers seem to be catching on to reality. Just the buyers need to be careful not to fall into the trap of “Two Fools” mat. There is just to say: Guten Tag!
Don’t you wonder why people still think there is something for free? Sellers can’t get agents to work for free, buyers can’t buy a house for nothing and agents can’t run a real estate business out of a brokerage firm for free either.
I continue to enjoy reading your insightful blogs. Your description of broke brokers, impatient sellers and low-ball buyers reminds me of my experience as both a broker and sales associate many years ago in a transitioning market. A recent comparison I did of list prices to assessed values suggests that many sellers still think we are still in an appreciating sellers market. When these sellers become motivated and realistic enough to accept realistic prices for their property, the sales volumn will return to more normal levels. It doesn’t help that unrealistic sellers can almost always find a realtor to accept their over-priced listing. But that hasn’t changed since I was in the business many years ago.
I bet this sums up most markets. We have a lot of agents starting their own brokerages here as they are shifting from the higher fees required by some of the large nationals.
I’ve been prepping ever seller to expect the low ball. Buyers will act in accordance with the market.
Jim: Great to see another one of your comments pop up again. You really should join Mark and I for coffee some time. We meet 8am Thursday mornings at Global Bean in Silverdale. It’s on the 1st floor of the building Pacific Northwest Title is in.
We’re finally seeing more and more Sellers coming to terms with the realities of the market slowdown. Hopefully things will correct and flatten out, and return to a more reasonable measure of appreciation.
Thanks for stopping by. Still looking for that article of yours!
I do have some free time on my schedule this Thursday. I’ll try to make it to the Global Bean. I did write something up a couple weeks ago about how we do mass appraisal and then forgot about it. Send me an email address and I’ll send it to you. javery@co.kitsap.wa.us.
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