I spotted this commercial recently. Maybe you’ve seen it.
[flv:/Video/2008/JAN/Realtor.flv 440 330]
Hey, good to see they’re hanging onto the LPs!
Real estate agents must be very scared right now. The good ones that have been around a while know there are market slumps, but this one is particularly bad, because it’s everywhere and not just regional, and it seems likely to be around for a while.
The wording of this commercial is, of course, self-serving. But what do they mean by saying, “family conditions often outweigh market conditions”? Are they talking about families that have to move for one reason or another? That part of the market is always present. What’s changed is the disappearance of speculators who “flip” properties, and the market being flooded with foreclosed homes that marginal buyers couldn’t really afford. But the market is such a mess right now, and credit is so tight, that even many of the families this ad is targeting are frozen out.
The ad refers to the “millions of homes that will be sold this year,” as if the market is still a go-go thing, and it assures buyers they’re “making a good move” financially. Maybe, but if it hasn’t reached bottom yet, in the short term it would be a bad move.
I recall one Realtor asking me how much money I made. My reply was, “I’ll pretend you didn’t ask that question.” She wisely backed down immediately. Realtors represent the SELLER and not the buyer. That’s the #1 thing to keep in mind when talking to them. It’s to their advantage to get you into a more expensive house, because their commission will be bigger. Ten years ago, when I applied for a pre-qualified mortgage before house-hunting, I had to provide full financial information, of course, and the salesman said I could afford a much bigger mortgage than what I’d requested. “No thanks,” I said.
Realtors and banks need to accept the blame for the mess we’re in. I really resent the tone that conservative commentators make, that the fault is with the suckers who went for these deals. It reminds me of a joke in the movie “Airplane” that made fun of the old “Point/Counterpoint” segment on 60 Minutes — “They bought their tickets, they knew what they were getting into. I say let ’em crash!”
To a Realtor, NOW is ALWAYS the best time to buy. What galls me is how they are a HUGE factor in market inflation, then when things reverse they cry foul, as if “market forces” have nothing to do with their methods. Having said that, we were very happy with the agent Carol picked ten years ago.
It seems that the airwaves are choked with realtor ads. Every one of them ends, of course, with the realtor sliding that “SOLD” sign into the slot. “Now is the best time to buy!” Then there are the inescapable “reverse mortgage” ads, the most prominent one featuring actor Robert Wagner.
Now, about those rebates …
I don’t know if I believe anything in that ad. For me, the crux of the whole situation we’re in is that everybody was told by real estate agents and mortgage lenders to trust them. And, obviously, they couldn’t be trusted.
“60% of the average homeowner’s wealth comes from their equity”… I wonder if that number used to be significantly higher?