That’s my mortgage broker, letting is all hang out.
My Realtor? When my wife and I sold, I knew exactly what she netted. I knew her split. I asked.
The closing costs on my recent refi were of course conveniently broken down for easy scrutiny. “Document preparation fee” sounds like bullshit, can we get rid of that? Done.
Many called for “transparency” in the real estate business over the past few years. It became an easy Web 2.0 buzzword. I put a lot of stock in it too: If we just make the information available and uncloak the sales games, the real estate experience will improve. Zillow raised $87 million dollars on this idea.
I was wrong. Very little changed. Buyers and sellers, though armed with comps, Zestimates, school reports and trend charts, still ended up paying an under qualified agent too much money far too often. Brokers got less profitable. Good agents suffered armies of fools. And the public’s view of real estate is more jaundiced than ever.
In reality, consumers could always see the compromised links in the real estate value chain quite clearly. They certainly knew the score on commissions. The light of day can shine with the power of a thousand suns into the dark corners and clauses of the real estate transaction. The real problems, which are structural, remain.
Yes, some people did get burned. But that
wasn’t for lack of transparency in most cases. It was a double helix of
profit motive and magical thinking that is, in retrospect, nearly impossible to untangle.
So as I head off to Inman’s Real Estate Connect conference today, I am looking for a new clarion call for all of us who want the real estate business to be better.
See, real estate matters. We’re not selling ringtones here, folks. We’re talking about shelter. Lives. Families.
We can do better. But can has seldom been enough. Perhaps now, in a time of must, it will happen.
Coming down
Well I woke up Sunday morning,
With no way to hold my head that didn’t hurt.
And the beer I had for breakfast wasn’t bad,
So I had one more for dessert.
Then I fumbled through my closet for my clothes,
And found my cleanest dirty shirt.
An’ I shaved my face and combed my hair,
An’ stumbled down the stairs to meet the day.
I’d smoked my brain the night before,
On cigarettes and songs I’d been pickin’.
But I lit my first and watched a small kid,
Cussin’ at a can that he was kicking.
Then I crossed the empty street,
‘n caught the Sunday smell of someone fryin’ chicken.
And it took me back to somethin’,
That I’d lost somehow, somewhere along the way.
That’s Kris Kristofferson’s Sunday Morning Coming Down. Real estate’s coming down pretty hard too. And many are finding they’ve lost something along the way: Perspective. Business sense. Integrity.
I’m hoping we can get it back this year. But to do so we’ve got to move beyond believing that if we open things up a little it will all be okay.
With what, then, do we lead the charge to a better industry?
Honestly, I’m not sure. People smarter than me have suggested possibilities in the past few months, but it’s not clear to me yet.
I am hoping I’ll come back from Connect with some answers.
But please: Let’s drop transparency. It didn’t do the trick.
Stay tuned.
– Brian Boero
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Greg Swann, Jim Duncan, and others know the answer: divorce the commissions.
Some might think that the word for 2009 is TRUST. Chris Brogan's new book will be called Trust Agents. Jeff Gitomer's Little Teal Book of Trust just hit shelves today. I think Trust is a good start.
Local may be another important word for 2009. We tried "hyper-local" in 2008, but I think local will always be key and something we tend to forget when crafting our media presence.
Along with those two, Connections is my third key word. Not more friends on FB or LinkedIn or followers on Twitter, but real Connections, relationships with people who I care about and who care about me.
I am a Google Adwords Professional in Australia focusing on the Real Estate industry and just wanted to say what a great real estate blog you have.
Awesome post Brian! Realtors have lost business sense, perspective and integrity! But, they've lost something far more important than the Principles of Real Estate 101. They've lost the fight!!! It's a tough market out there and it's about to get a lot tougher. I say to the economy, and the impending real estate forecast: BRING IT ON!
Transparency still sorely needed in many emerging markets where house price data is not available from property institutes or central bank databases.
It is still highly irritating that when someone speaks of bad, unprofessional, just give me my commission Realtors, that we are all grouped as one entity. Are all Attorneys, Doctors or Builders bad? of course not, like anything else it boils down to each individual. The past 5-7 years brought allot of bad apples into the Real Estate business but most of this people are either gone or are on their way out. Why do people beat up Realtors on their Commissions? I feel that not only we work hard for our money but we carry an extreme amount of liability on every transaction. Not all Realtors are the same, some of us who have morals and ethics should not be bundled up with those who would sell their souls to the devil.
Real Estate has been and, for the foreseeable future, will be a true asset with real value. And because of this fact, people will always look to make money off of it, even without owning it. Hence, commissions and fees.
Remember this awesome quote from Superman:
"Son, stocks may rise and fall, utilities and transportation systems may collapse. People are no damn good, but they will always need land and they'll pay through the nose to get it! Remember,land."
[...] only confusing part of complete transparency in real estate is when fiduciary responsibilities aren’t clearly defined or understood by all parties [...]
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