Why do we need agents?

check out posts from agent rachel (aka agent liar). will confirm your belieft

It is a free country. You can sell your assets by yourself as a FSBO - For Sale By Owner. As for renting, I have rented apartments for the last fifteen years and have never once used an agent. Most people are lazy and do not want to do the work to find and screen tenants, so they use agents.

I think agents are important if you're looking for something that's hard to find or just don't have time and do not want to be hussled. As a broker, I think the internet has really made it harder to be a broker. On the flip side of things, some owners/management companies who higher agents feel they need agents less than before because of craigslist and other apt websites. If you don't think you don't need an agent, then don't work with one.

egad...if you are an indication of agents...

i think you meant "hassled," although hustled is probably the truth.

Hold on, Kemosabe. Let's not be showing Realt-whores the door just yet. True, they are, on average, dumber than a bag of hammers, and in fact NO ONE has been more gleefully consistent in pointing this out But I wouldn't want to get rid of them, either: They DO serve a purpose on earth, although that purpose has nothing to do with real estate. They serve as a NEGATIVE EXAMPLE to the rest of us, of what our kids might turn out to be if we don't parent them right.

Every society needs its outcasts, its ne'er-do-wells, its problem children. Realtors, deficient and practically sub-human as they are, serve the same role in modern society as the Eloi and the Morlock in HG Wells "The Time Machine": To remind us of what the rest of humanity might degenerate into if we aren't careful.

Let's all give a round of applause and show some appreciation to realt-whores for playing this valuable role in society.

Thank you, realtors!

I will never forget finding the perfect apartment some years back. 2600 sq. ft. loft in Tribeca, 4 bedrooms, had to have it. Saw it at a party, turns out the 3 guys living there were moving out in a month. So I jumped all over it. They gave me the number of the managing agent. Managing agent tells me I have to call the broker in order to rent it. Sooooo, long story short, I had to pay a 15% commission to a broker who did nothing but wait for the phone to ring. It still bugs me, almost 10 years later. Some buildings have exclusive deals with brokers where they are in breach of contract if they don't route everything through the broker.

"I had to pay a 15% commission to a broker who did nothing but wait for the phone to ring".

No! You paid that 15% so society could have a tangible embodiment of the parasites that wait to assail it. See my post above about realtors serving as a negative example.

Look, all kinds of parasites and other fungi exist in nature - mushrooms, athlete's foot fungus, that stuff that grows on the grout in your bathroom. And, all of them serve one purpose: To contribute nothing of value while sucking life out of the host. Some of these fungi, viruses, and similar creatures are REALLY dangerous to human health, and they are so microscopic you couldn't easily see them with a microscope. So how do remember to wash your hands after touching the pole in the subway? Easy! Realt-whores, ever in our midst, flitting about, trying to skim money they didn't earn off of transactions they didn't add value to, serve as a CONSTANT REMINDER! They are, to use Shakespeare's phrase, "hourly promise-breakers", and therefore serve as a very effective reminder of the sort of nasty creatures lurking about waiting to feed off of us.

Somebody's angry. i didn't know people that go by the name Dwayne pms on SE boards.

Asking myself the same question, at some point brokers probably had a reason did actual work finding listing places. But the internet makes me feel that they are like those elevator operators in the 1920's.

not even...at least they took you to the right floor.

lvbv,

I just asked this same question in a slightly different way in the rentals forum: http://www.streeteasy.com/nyc/talk/discussion/9051-be-my-own-broker

My own conclusion -- if you don't feel like reading that whole thread, "In the end I think this problem would take the energy and ingenuity of someone like Google to get right, but the market is so small relatively speaking, and so provincial (where else do tenants pay the fee?) that we're unlikely to see real change in this system anytime soon. Current price drops/concessions are probably an anomaly."

I think CL is doing his share here, don't we all agree. And webpro you are right is a small market but a company like google could see the advertisement revenue as enough to do it. Then we could see brokers go the do do way.

Prince deburg said: "Somebody's angry."

To which Dwayne replied "Somebody's a realtor".

Given all the choises at our grosery stores, why is there a need for Starbucks coffee? If I buy my own cofee machine, why in a million years should I go down and pay $5 for a cup? To be honest, it even bothers me to pay $0.75 to a local street vendor (to pay someone for pouring me a cup when I can make my own close to nothing). Am I just being harsh or have I totally missed something? I feel that in this market more than ever, Starbucks corporation with all its employees and street vendors need to justify their existence. What do you guys think?

At the risk of getting the wrath of D.Pipe....I wrote a piece about using a broker;
http://nycrentrant.blogspot.com/

"Given all the choices at our grocery stores, why is there a need for Starbucks coffee? If I buy my own coffee machine, why in a million years should I go down and pay $5 for a cup?"

I agree, I never give Starbucks $5 for a cup of coffee. Support Peets coffee, founded by Mr. Peet, who taught the Starbucks guys how to get started. After that, the Starbucks guys went on to burn all their beans.

http://www.peets.com/fvpage.asp?rdir=1&

I think my problems with brokers is their price tag. That, and the way they try to control all aspects of the deal and cut off communication between the buyer and the seller. In addition to that, my main complaint is that brokers in New York do not negotiate the contract, unlike brokers in the rest of this country. So, I have to pay thousands of dollars for a lawyer as soon as I agree on a price with the seller.

>>I had to pay a 15% commission to a broker who did nothing but wait for the phone to ring. It still bugs me, almost 10 years later. Some buildings have exclusive deals with brokers where they are in breach of contract if they don't route everything through the broker.<<

Same thing happened to us when we were looking for our current rental 4 years ago... I spent several weekends and afternoons hoofing around the nabes that interested us. Literally knocking on doors, talking to doormen and supers about vacancies. Found one that was a perfect fit--excellent deal in great location--but the building had an exclusive agreement with a broker. So even though I found the place MYSELF, we STILL had to cough up a commission to the dragon lady with the frosted hair and acrylic nails and the ever-present stink of Chanel No 5. Sure, we negotiated the fee down a few points. But it was a mugging, plain and simple.

All this said, though, we DID have a choice between this apartment and other units in buildings that would not have required any fee (renting directly through owner/mgmt). We CHOSE to rent in this building because it the best bang for the buck even with the commission. So, though I do still occasionally feel irked over the great highway robbery of 2005, I still would have made the same decision.

By the way, in this climate, LLs are generally more than ready to absorb any broker fee--no need for a tenant to be held up in a dark alley by the lady with the Bluetooth permanently stuck to here ear. It's a whole different world now.

^^her not here in last graph^^

There is a difference between data and brokerage, and at the low end of the market, especially in times when there is a lot of supply of product, tenants may not need brokerage. You're only going to live in the place for a year, so if there are flaws that you haven't found that you didn't hire a pro to reveal to you -- see the example on another thread about a poster complaining about his/her rental on Wall Street -- you can just serve out your lease and move on.

However, you're all giving stories of having to pay brokers because the landlords have wanted it -- to protect themselves from bad-apple tenants, of whom I can assure you that there are many. So in those cases, blame the landlords, or blame your fellow tenants who behaved so badly that the landlords had to set up a ring of protection.

Squid, I will think of you as I deck myself out with the Chanel No. 5 and the bluetooth.

ali r.
{downtown broker}

Ali-- we all know you're a class act. But that cannot be said for everyone in the field... But hey, that's what makes the world more interesting, no?

Your problem with brokers is not a price tag, but your thoughts that a broker does not bring any value to the transaction. You think that if you give buyer and seller ways to communicate directly there will be more deals and they would be cheaper, when in reality both their EGOs stand on the way: seller gets offended because he thinks offer is low, buyer gets cold feet and so on...

And in NYS brokers do not negotiate contracts, because lawyers lobbying in the Albany in order to protect its jobs.

What I am trying to say is -- It's wonderful that you have many ways to do business. One can work with or without a broker nobody puts gun to his head. So if one has a choise to make his own coffee, why bash at Starbucks? Looks like one wants to bring his own home made cup of coffee inside Starbucks, and make coffeeshop responsible.

"Your problem with brokers is not a price tag, but your thoughts that a broker does not bring any value to the transaction"

Yeah, I do not see the value for my 6%, especially when I see that agent-based sales are inefficient. That commission money goes to huge advertising budgets for the big real estate firms, office space rent, "free" food, and all kinds of other perks.

In this tough market, I wonder how often the 6% fee is standing in the way of a deal between a buyer and a seller. The rest of the world has much lower transaction costs, more like 1.5%, but, you know, we have the National Association of Realtors to exacerbate the problems of the housing slowdown.

As for the lawyers, I don't blame them for protecting some turf, and they have helped me out on many occasions and I do see the value for the few thousand I spend on my lawyer. The fact that the agents do not negotiate contracts diminishes their usefulness. By the way, I sold a house in the suburbs with an agent and he worked his tail off to get the house ready for market. I don't see the same level of service in the city.

I bash Starbucks because it is a free country and I do not believe that Starbucks delivers a quality product. Ubiquity does not indicate quality. Don't worry, I don't bring my coffee into their shops.

As far as agents go on the buy side, it seems that they perform a very important function as key keepers. Other than open houses, we need them to get in to see the place. I don't think there is any way around that. I wish there was a less time consuming method, but for the most part, these are still people's homes that we must intrude on. I'm grateful that my realtor organizes all of that for me.

"seller pays broker's fee"

Not correct, buyers pay more for properties because the prices are inflated to take into account the commission. The seller's net is reduced by the commission, of course. Commissions raise the price of housing for everyone.

As for helping someone fill out a board package, I have done that before as a FSBO seller and it was not a big deal. If a buyer can follow directions and make a run to Kinkos to make all the copies, everything is fine. After all, the sellers have to find all of their own financial information, no broker is going to do that for them.

As a seller, I don't want some jackass buyer made up to look good. I want a good, solid buyer, or I risk losing the deal at the board interview.

"If you look at the FSBO's out there they are trying to keep the brokers percentage not pass on to buyer, and have no qualifications to assist you in one of the most important tasks a broker does, the co-op board package."

Who says a broker is entitled to a percentage of a sale of a person's home? When I sell all of my other assets, I can do it without having a broker's hand in my pocket. In the end, Price is Price. If some people want to pay a 6% commission to sell their assets then fine, but it does not mean every seller has to pay 6%. If some brokers charged 50%, would everyone else have to pay the same?

As a FSBO, I know more about my building and the board package than the brokers. Funny, I have spoken to buyers who have visited agent-represented apartments in my building and I have corrected the lies they were told by the agents.

I mean, I get why people use agents, sellers like to hire people to do their lying for them so that they can distance themselves from that ugly business. Some is lying by omission and some of it is lying by commission. Haha. Witness the thrashing that AgentRachel is taking on the square footage lie with regards to the Majestic apartment. You don't see the owner defending his own property from these slurs.

TheBurkhardtGroup said:

"At the risk of getting the wrath of D.Pipe....I wrote a piece about using a broker"

You are WISE not to invoke the wrath of Dwayne Pipe...these people antagozined Mr. Pipe, but paid the ultimate price to The Monkey...http://apnews.myway.com/article/20090309/D96QN3P01.html

Actually, I thought your blog post was well written, and provided an excellent example of the value a good realtor can add to the process. The problem is, this doesn't happen in 9 out of ten examples. The helpful, courteous, diligent, industrious agent exists ....mostly in your example! You give the example of using a broker to help with your real estate transactions "the same way you'd use a CPA to do your taxes or a CFA to do your investments". Problem is, both the AICPA and the CFAI, of which I am a member of both, have HIGH ethical hurdles. Some of the under-handed behavior i've seen realtors pull would have gotten any CPA or CFA BARRED from either professions, stripped of their license.

Look, I don't have any ideological persuasion against realtors and in favor of, say, doctors, lawyers, CPAs or CFAs. On first principals, I agree with you: Use a cardiac surgeon for your triple by-pass, a CPA for your taxes, a realtor for your real estate transactions. The problem is, I've probably used about 50 doctors in my life; 2-3 stand out as lemons. I've known hundreds of CPAs and CFAs, 5-10 stand out as lemons. I've used probably 20 lawyers in my life; 2-3 stand out as awful. And i've used about 15 realtors in my life; 13 stand out as awful, one as mediocre, one as good.

And you realtors wonder why people hate you?? You do the math.

Before one of you grammar-police point it out, I meant to say "first principles", not "principals".

I do not spell check or grammar check my posts. Like something scribbled quickly on a cocktail napkin, i prefer the authenticity of hurried errors...