If News Corp helps to clear out all the buyer-agents, and the listing agents end up being paid less, to do less – how will that affect the market? It will probably burn a little hotter in the good times, and colder in the slow times.
The people who have the most to lose are the big-corporate real estate franchisors who count on their share of commission splits. Expect a long battle!
Buyers – at least the ones making the market – haven’t cared too much about getting good help, they just want to buy a house. The internet tools have given them enough information that they feel empowered, and heck, it’s just money. Who writes the deal, and the commission amount doesn’t concern them much.
Real estate will keep selling at some price!
The low-inventory environment should continue. Home auctions will be the next gimmick to tempt people to sell their house, but unless you need to sell, who cares? Without easy financing, the demand side should stay tempered too, so expect low sales counts from now on.
It’s amazing we’ve done as well as we have – here’s the comparison:
NSDCC Summer Sales (June-August)
| Year | |
| 2002 | |
| 2003 | |
| 2004 | |
| 2005 | |
| Total |
| Year | |
| 2011 | |
| 2012 | |
| 2013 | |
| 2014 | |
| Total |
With mortgage qualifying at the polar opposites, it is remarkable that sales are only 17% fewer than the last peak. Did better agent-advice contribute to the strength of sales? Maybe, but not as much as other contributors, like big-cash, internet tools, newcomers, and Qualcomm/bio-tech. Agents aren’t known for being strong advisors that might sway a market; instead, most are order-takers.
Commissions might get softer as (more) desperation overcomes the realtors who are on their way out, but we should lock into a mid-range of sales and pricing that will be fairly steady – at least until rates rise, or the next crisis!
Jim- My agent does a good job putting purchases together for me but I always wonder if they are doing enough when it comes time to sell. I know I can always lower the price and usually do after 2-3 weeks if we don’t have enough action, but if they are just doing the following each time is it enough in a normal market? Homes are always near the coast (west of 5), move in ready, and are in the entry level price range for the specific area/street.
1. List on MLS
2. Caravan
3. Couple Open Houses
4. Ad in local paper (I could care less, it helps their brand more than me)
5. Reactive to income calls & emails
Those 5 things seem like table stakes to me and I don’t know if I could trust that other agents are highlighting the property to good prospects. Can more proactively be done, or is that just how the game is played?
The only two things that matter are price and salesmanship.
If you have both, then all you have to do is be in the MLS and you’ll sell.
If you don’t have both, you can spend a million dollars on advertising and not sell.
Salesmanship = saying the right things, the right way, at the right time to cause a top-dollar sale.
And I could spot you the list of the right things to say, and it wouldn’t be enough. Saying them the right way, at the right time makes the sale.
NOBODY ever talks about this, but it is the truth.
The big-team agents want you to think that having handfuls of people around to be ‘specialists’ at their role makes a difference, but only if they are refined, experienced salespeople who are experts at saying the right things, the right way, at the right time. Anybody who is really a good salesman doesn’t work for somebody else as an assistant – it is a job for trainees.
What is the real reason there are big realtor teams? So the boss can take more vacation and have his people minding the store. It is for their benefit, not yours.
I think your underestimating the 20-25 year olds,
Did you own a home at that time in your life?
I was 33 when I bought my first home, I was fairly typical I think of boomers (OK maybe a bit late but with 5 years I think).
Yes they will want big homes and nice cars Tooo!, just wait.
Despite what the “experts” say LOL.
Did you own a home at that time in your life?
No, not ’til I was 27.
Are you referring to this post? Or the hot and cold articles lately on millennials?
Probably both but in this case I was talking about the “demand side should stay tempered”
But in general I think the people in their early twenties are being underestimated in current and future aspirations.
Yea I wanted to live in a party commune too when I was that age.
I agree, and it’s probably not limited by age.
I think most people have current and future aspirations about owning a home – right up to when they take a tour and see what they get for their money. Every other choice pops up then, including the party commune!
This may be of interest
http://www.nytimes.com/2014/05/24/business/younger-turn-for-a-graying-nation.html?_r=1
There is not a person under 30 in my family without a masters degree Two are working on their PHD’s
Being buried in student loan debt isn’t going to make that first home purchase any easier.
The model won’t be the same as in older generations when college wasn’t such a high expense.
Secondly, the millennials aren’t growing up as fast. Families don’t start until well into their thirties. I’m not sure what this all means but its something to consider.
Jiji: As Tim alluded to, would you have a rough estimate of student loan debt (if any) that your under 30 family members are servicing?
Well in the case of the two working on their PHD’s “ZERO” (They work for the college)
The other I am not sure, but I don’t worried as they are engineering students.
Now I would worry if there were political science majors.
but I am not worried as they are engineering students.
And we can stack up the excuses why people won’t be buying – there are many:
Student debt
Tight credit
No jobs
Stagnant wages
High commissions
Chargers
Point fingers in all directions, but these people aren’t making the market, and have no impact.
We still have enough people who are ready, willing, and able to buy if they could just find a decent house for a decent price.
The only two things that matter are price and salesmanship.
If you have both, then all you have to do is be in the MLS and you’ll sell.
If you don’t have both, you can spend a million dollars on advertising and not sell.
Thanks Jim
Is there a need for experts? Can’t answer that question definitively one way or another. However having owned five houses and sold four of them I am still not comfortable going alone. I guess that says something.