Knife-Catcher: The Tim’s Home Search Timeline

As promised, I’ll be taking up some space on these pages over the next few weeks to share some of the nitty gritty details of my personal home search. To kick things off, I thought I’d just give you a rough timeline of the whole process. Let me know in the comments on this post what aspects you’re most interested in hearing more about and I’ll tailor the rest of the series based on your feedback.

Summer 2005

  • Started thinking about buying our first home.
  • Friends who recently purchased referred us to their real estate agent.
  • Real estate agent referred us to their preferred mortgage broker.
  • Broker recommended various frightening financing options, including a 5-year interest-only adjustable-rate mortgage. When I brought up my concern with this type of financing, his response was something along the lines of “don’t worry, you can just refinance it before the five years is up.”
  • Looked at a few properties we could afford without taking out insane financing. This basically included swampland in Monroe and run-down trailers in Lynnwood.

Fall 2005

  • Decided to apply my engineering mindset to disassemble the housing market and understand what was making it tick.
  • Realized that the market insanity was being driven not by sound underlying economic fundamentals, but essentially by mass hysteria.
  • Started Seattle Bubble to share my research with anyone else who might be interested.
  • Put serious home search on hold.

2005 – 2009

  • Spent lots of time watching the market:
    • set up a ton of listing alerts
    • watched homes we’re interested in
    • spent time in various neighborhoods to narrow search
    • blog, blog, blog

Early 2009

    Cliff jumping by Flickr user ccheviron

  • Based on the trajectory of housing bust, started making rough plans to target winter 2009-2010 for an eventual purchase.
  • Tax credit passed, totally screws up market dynamics, putting true price correction on hold.
  • Purchase delayed until tax credit expires.

February 2010

  • First real tour of a home since 2005—bank-owned beater on acreage in south Snohomish County.
  • Decided to hold off on making an offer (overpriced).

October 2010

  • Made an offer on the REO home on acreage.
  • After some negotiation, bank accepted offer.
  • Backed out of home after inspection.

Winter 2010-2011

  • Made offers on three other bank-owned homes.
  • Lost two of three offers in multiple offer sudden death.
  • Bank had already accepted an offer on the third home (even though it wasn’t “pending” in the MLS).

Spring 2011

  • Toured a short sale its third day on the market.
  • Made an offer the next day.
  • Sellers accepted offer same day.
  • Sellers sent offer package to their bank the following week.
  • After some minor back-and-forth with the sellers’ bank, the bank accepted the offer.
  • Inspection, financing, appraisal all went through.
  • Home sale closed May 20th.

If any of that piques your interest, let me know. I’m planning to get in-depth on various portions of the tale each Friday over the next few weeks.

  

About The Tim

Tim Ellis is the founder of Seattle Bubble. His background in engineering and computer / internet technology, a fondness of data-based analysis of problems, and an addiction to spreadsheets all influence his perspective on the Seattle-area real estate market.

211 comments:

  1. 1

    As to the third bank owned, where the bank had already accepted an offer, that happens because of the way REOs usually function.

    They’ll take your offer, tell you it’s the one accepted and that their addendum is on the way back, but that it might take a couple of days. You then have to sign and return the addendum, typically within 24 hours, even though it took the bank longer. Some agents will take the offer pending at the time the bank orally accepts, but others wait until the paperwork is actually signed. Technically you don’t have a contract without having had an opportunity to review the bank addendum.

    Bottom line is with REOs it’s even more important to call the listing agent before drafting up an offer. Nothing worse than drafting an offer, getting it signed, transmitting it to the listing agent, all just for practice. ;-)

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  2. 2
    ChrisM says:

    Looking forward to the rest of the series. In your first post, you promised a future post on WaLaw. I spoke to them shortly after their first post on your blog, and came away impressed. I’m hoping to do something similar, but I’m probably going to buy either in Oregon or southern WA. I’d appreciate hearing a contrast of them vs. traditional RE agents.

    Also, how much contact did you actually have with the sellers? I thought with typical RE agent involvement the buyer & seller didn’t get any face time. All my purchases have been repos, so I’ve never had a seller with an agent…

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  3. 3
    Ethan says:

    It still seems like you didn’t get a great price given your area and sq footage. Thoughts on what you finally paid? You’re way more into this stuff than I am, but from this vantage it seems like that was a lot of work for what ended up being a pretty middle-of-the-road price on a small home.

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  4. 4
    The Tim says:

    RE: ChrisM @ 2 – Yes, there will be a whole post dedicated to how I decided to go with WaLaw and who else I considered.

    I’ll share more about this in the future, but we didn’t have any personal contact with the sellers until the inspection. The night before closing he actually invited us over and gave us a personal tour of the home to point out all the little quirks and the various projects he had hoped to get to. I was extremely impressed with how friendly and helpful he was in spite of the obviously stressful and emotional position he was in having to short-sell the home he had hoped to raise his family in for many years to come.

    RE: Ethan @ 3 – I plan to have a post dedicated to pricing and how I analyzed each home we looked at. That said, I probably won’t go into as much detail as I did in this five-post series I put up in December while we were in the thick of our search: How To: Analyze a “Below-Market” Deal

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  5. 5

    By Ethan @ 3:

    It still seems like you didn’t get a great price given your area and sq footage. Thoughts on what you finally paid? You’re way more into this stuff than I am, but from this vantage it seems like that was a lot of work for what ended up being a pretty middle-of-the-road price on a small home.

    You need to compare it to other older houses in similar condition (e.g. nicely remodeled kitchen, exposed wood, etc.). If that’s what you’re looking for you’re very unlikely to get a “great price” compared to other types of property.

    What you’re doing would be like finding out a friend bought a 1967 Mustang for $10,000, and then looking through the want ads and deciding that was a lot of money for a used car.

    I would add that without going inside it would be difficult to determine what kind of a deal it was. So I’m not expressing an opinion on that.

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  6. 6
    Scotsman says:

    Did you have this conversation? Is that Ardell’s voice on the answering machine?

    http://www.youtube.com/watch?v=Ubsd-tWYmZw

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  7. 7
    The Tim says:

    RE: Kary L. Krismer @ 5 – To Kary’s point, here are a couple of the interior listing photos of my house that he’s looking at (only people with NWMLS access or those who saved them while the listing was active can see them now):

    Living Room:

    Kitchen:

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  8. 8

    As opposed to this older house (the picture of which some of you people outside the industry didn’t understand):

    Rate this comment: Thumb up 0

  9. 9
    Tim McB says:

    RE: Ethan @ 3

    Real Estate as with beauty is in the eye of the beholder. Its tough to simply look at a location of a home and an outside photo and come up with an estimation of value. I know based on interior views of the home my wife would have approved. Some value lots of land over proximity to job centers or original detailing (classic homes) vs. square footage (modern homes). To each his own.

    Overall, I think from photos it looks pretty good. And I think no matter what the Tim ended up buying there will be a contingent of people who scrutinize the buy no matter where it ended up being, what the price, how large/nice the home etc.

    Tim, I am curious though about what role, if any, did current interest rates play into your decision to buy? I remember many times you mentioning you’d rather purchase a home with a smaller price tag at higher rates than a home with a higher price at lower rates. This made me think all along that you were going to pull the trigger later than this since QE2 will be ending soon and the consensus has been that rates will begin to climb. I hope at one point you’ll talk a little about that.

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  10. 10
    The Tim says:

    By Tim McB @ 9:

    Tim, I am curious though about what role, if any, did current interest rates play into your decision to buy?

    Zero. I didn’t care what interest rates were at all except insofar as they dropped a little post-lock so we spent a little to renegotiate and get a slightly lower payment. We bought well below our “monthly affordability threshold” so even a few points change in interest rates were immaterial to us.

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  11. 11

    From Your New Home’s Pictures Tim

    I agree with you, it appears very likely the old homeowner remodeled it for their own use, then for what-ever reason backed out.

    I completely remodeled a Bellevue home with wood floors and put in a completely new kitchen [albeit I went one step further and put in new designer solid oak, bathroom too]. I could kick myself back then though, I found out a local company in Woodinville could have made custom solid oak cabinets for me for equivalent designer cabinet quality and half the price too, live and learn. I completely refinished the oak floors too.

    Tim, you got a rare jewel from SWE’s experience being his own contractor….

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  12. 12
    NewHomeOwnerInFremont says:

    Tim, I really like the interior of your new home. It is obvious that the previous owner put a lot of care and work into it.

    Rate this comment: Thumb up 0

  13. 13
    Angie says:

    I’m most interested in hearing detail about the start to finish process/experience of buying a short sale home, then maybe work backward to the storyline about the three different homes you put offers in on didn’t get.

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  14. 14

    RE: Angie @ 13 – I don’t think Tim’s experience with a short sale is typical. It closed quickly. Also, if I recall correctly, the bank specified the escrow, so they were perhaps involved with the sale before Tim was.

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  15. 15
    ARDELL says:

    RE: Scotsman @ 6

    Couldn’t be me…the area in which he purchased is not in my defined “service area”. I’ve never been a “Suzanne”, but there is a funny RE/MAX commercial that sounds a lot like me, even though it’s a guy talking.

    I thought the stereotypes of male – female were quite offensive in that as to the considerations of the wife vs the husband. As if the guy only cares about his garage. Clearly not the case for most of my clients.

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  16. 16
    ARDELL says:

    RE: Ethan @ 3

    That brings up the issue in the post saying the appraisal “went through”. Given there are many sold properties nearby at half the price, I’m wondering how much attention was given to the detail of the appraisal vs the mere fact that “it appraised”.

    Perhaps Tim could give us some insight on how closely he reviewed the actual appraisal vs merely noting that it “passed” for the lender’s purposes.

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  17. 17

    RE: ARDELL @ 16 – I would find the selection of comps interesting, so if Tim could post them that would be great.

    Rate this comment: Thumb up 0

  18. 18
    cotomwed says:

    I’m interested in hearing more about the short-sale process in general and how you made it work for you (your last “era”). They sound appealing to someone who went the traditional route, but I’ve heard enough RE agents comment that they really are a bad idea….

    Thanks!

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  19. 19
    jesse says:

    Out of interest, let’s say you bought your house in 2005 25% down at 2005 prices with VRM. How different are the situations financially (owning 6 years vs renting 6 years), and what could you have done with your time over those 6 years if not bear blogging? :)

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  20. 20
    The Tim says:

    RE: jesse @ 19 – Well, we didn’t have the 20% down to buy at 2005 values, so it would be a pretty unrealistic hypothetical. However, I can compare to the previous owner’s situation. They bought it in 2006 with a zero-down 80/20 (according to public records). By my rough calculations based on rates at the time, their all-up PITI payments would have been nearly $3k a month (slightly lower if it was interest only). We paid no more than $850 a month in rent before we bought, and our PITI payment on the home is $1,250 a month.

    I’m quite comfortable in saying that we are in a far, far better financial situation today than we would have been had we bought any time 2005 – 2009.

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  21. 21
    Eastsider says:

    On short sales, I have seen many questionable (fraudulent) listings in the past 3 years. Some properties cannot be viewed/toured. Some listings go straight into pending status immediately. Some sellers demand side deals. Some “approved” price is higher than market. Even for an above board transaction, you have to deal with so many parties that a final deal is not a sure thing. You may still wait for months or a year before you hear back from the lenders. (By that time, you offer might have been too high.) Of course in many cases, you end up with a house without a fridge, a stove, a washer/dryer, or even hot water tank! Maybe you can provide some statistics on short sales, e.g. percent closed/foreclosed, days pending, closed/listing prices.

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  22. 22
    jffj says:

    I second Kary’s request to see the comps.

    Also, I find it interesting that you made an offer the day after seeing your house. Did you feel pressure from multiple offer sudden death? And how much did it influence your decision to offer quickly, if at all?

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  23. 23
    LocalYokel says:

    Tim,
    Did you make offers on “MLS” listed homes from the bank or did you approach
    the bank directly when you found out a house foreclosed? Looking forward to your
    thoughts on using an agent versus an attorney for shorts.

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  24. 24
    ray pepper says:

    I just wanna know about:A) The 500 you paid up front to Wa Law ( would they take cash or check )
    B) How did it feel cutting the check for 3495.00 when you didn’t buy at 6 months.
    C) No Agents appear to work for their Brokerage so who gave the tours? Were you cognizant of the 75.00 an hour clock that was running on you if you exceeded 10 hours in searching?
    D) At what point did they start the clock on you? When you both arrived at the residence or when THEY left their homes or place of work? Did you ever feel if you used about 30+ hours in touring you would end up owing them money at close based on the commission paid?
    E) Were you cognizant of the clock and did you keep track of your time?
    F) Did you pay the extra 250.00 in fees because it was a short sale?
    G) Were you given the customary school ratings and crime profile of the neighborhoods prior to tours?
    H) What did they advise you in/re to the high kitten kicker rating of the area? School rating?

    ahh so many questions I have…..http://walawrealty.com/fees/

    If it sounds like I’m a jilted lover I hope not. I know they will change their business model pricing soon if they desire to exist but I’m shocked at the property you bought.

    Its completely different then what you described to me that you wanted.

    Lastly, did you get a WALAW mug, t shirt, hat, bandana, sweatshirt, or at least a pack of Swisher Sweets, or Wa Law pen?

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  25. 25
    The Tim says:

    RE: ray pepper @ 24 – When we signed up with WaLaw, their fee structure and rules were slightly different than it is today, so some of your questions don’t really apply to my experience (marked with N/A).

    A) Yes we paid this, in check, before we toured the first home in early 2010.
    B) N/A
    C) Marc & Craig are both licensed real estate brokers and NWMLS members. They were the ones who toured homes with us.
    D) The clock starts when they leave the office. No, I was never concerned that my tour costs would result in fronting more money at closing.
    E) Yes I was aware of the clock.
    F) N/A
    G) I’m fully capable of doing my own neighborhood research, and they were quite aware of that.
    H) See above.

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  26. 26
    Terence says:

    Could you elaborate on this:
    “Realized that the market insanity was being driven not by sound underlying economic fundamentals, but essentially by mass hysteria.”

    What are the details in terms of underlying economic fundamentals?

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  27. 27
    Linux Fool says:

    RE: Ethan @ 3 – I disagree. We are in the middle of buying a home in North Everett using a Streamlined 203k and The Tim’s price is very reasonable. It all comes down to what you can afford, what you will put into the home. The home he got seems to have a lot of work done on it. It is very surprising what people want for homes, even if they have major problems such as structural, mold, electrical, and HVAC issues. There are plenty of scary houses out there. BTW The Tim..if you want to upgrade from ramen..I highly recommend Jade Garden. North Everett Rocks!

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  28. 28
    David Losh says:

    I’m also interested in the WA Law choice. In your case it appears to have been a good choice, and an appropriate role for them. You do your own searches, and keep your own counsel. In my opinion short sales have become complex. Attorney review would always be my recommendation to any buyer, or seller, of a short sale.

    The fee schedule also bothers me. In my opinion WA Law has a market niche as an attorney. It seems strange to me that they are projecting an image of a discount, rather than a boutique Brokerage.

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  29. 29
    ray pepper says:

    RE: The Tim @ 25

    “D) The clock starts when they leave the office. No, I was never concerned that my tour costs would result in fronting more money at closing.”

    Thanks Tim for the response, I was adding items as you responded..

    When THEY leave the office? hmmm? Traffic??

    If their current pricing structure existed when you engaged their assistance initially would you still have chosen Wa Law?

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  30. 30
    The Tim says:

    By ray pepper @ 29:

    When THEY leave the office? hmmm? Traffic??

    Is it not time that they are spending to provide a service to me? Seems completely fair to me that they be paid for it. Traffic considerations did inform our decisions about when to schedule tours.

    If their current pricing structure existed when you engaged their assistance initially would you still have chosen Wa Law?

    Certainly. It’s not that different from when I signed up. Just some minor changes. I fully support the concept of connecting what I pay directly to the service I am being provided. Commission as a percentage of the sale price makes no sense, and neither does a completely flat fee that is the same whether the agent spends 10 hours or 100 hours with a buyer. IMO, a direct fee structure makes perfect sense.

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  31. 31
    ray pepper says:

    RE: David Losh @ 28

    David, don’t you find it interesting that Attorney’s are giving home tours? Or Attorney’s sit through 3 hour inspections (which they are required to do as we know) because we cannot pop open the door and leave.

    I give it 12 months or less and we will see a radical change in Wa Law.

    There is NOBODY and I REPEAT NOBODY that will cut a check for 3495 if they haven’t bought their home for whatever reason.

    The 500 (up front) apparently is for their gas consumption no doubt…..Hope they have a Prius…….

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  32. 32
    The Tim says:

    RE: ray pepper @ 31 – I’d prefer we not get off into the weeds here, turning this entire comment thread into a debate about WaLaw. Let’s save that conversation for the future post where I’ll discuss how I analyzed my options for representation and made my decision.

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  33. 33
    ray pepper says:

    RE: The Tim @ 30

    Tim, if you hadn’t bought at 6 months would you have cut a check for 3495.00 or would you have walked to another Brokerage?

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  34. 34
    ray pepper says:

    RE: The Tim @ 32

    ok ok..I can go on for hours on that business model . I will wait and pounce later…..

    Rate this comment: Thumb up 0

  35. 35
    Marc says:

    RE: ray pepper @ 31

    Ray,

    Actually our clients routinely pay the balance due at 6 months even if they haven’t closed on a home yet. That’s the reason our model works. If they didn’t then we’d be essentially the same as any other agent whose compensation is dependent upon a successful closing except that we’d be earning a pittance for taking on so much risk. There’s a reason why the 6% model has endured substantially unchanged for so long, it compensates agents for accepting significant risk by having successful buyers and sellers subsidize all those sellers with ridiculous pricing expectations and fickle buyers who can’t decide on a house.

    Our model is ideal for people who are confident they’re going to buy or sell a home in the near future (although to be clear, there is no time limit on how long they have – 30 days, 6 months, nearly a year and a half like Tim, or longer is fine by us). People who only want to test the waters for a “make me move” price are better served with a more traditional agent.

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  36. 36
    David Losh says:

    RE: ray pepper @ 31

    Those are excellent points that concern me. At the same time, after reading some of the exchanges between Craig, and Ardell I really wonder who would be better, an attorney or a Real Estate agent.

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  37. 37
    David Losh says:

    RE: Marc @ 35

    I also agree that a flat fee, or 6% makes no sense in today’s market. There needs to be, there has always needed to be, a more fair compensation for Real Estate services.

    In today’s market I am seeing a growing need for attorneys in Real Estate. It will be interesting to see how your practice grows.

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  38. 38
    ray pepper says:

    Sorry Mark..I don’t buy it…

    People (in masses) will never pay 3495 UP FRONT on a home they have not bought yet!Good Luck on that one!Many things can delay closing of a property that will end up killing a deal. Especially short sales where the waiting time for a reponse can be 30+ days. Thereby eating up precious time.
    I also do NOT ever see people paying 75.00 an hour for home tours. They will terminate the relationship at 10 hours or when the 3500 is due and then WE, Red Fin, Findwell, Shop Prop, or other alternative brokerage will get the call because the buyer is already ahead of the curve and educated.

    You maybe able to get the 500 to cover gas over the series of months your showing but the GOLDEN CARROT of 3495 will NOT be paid at 6 months if they have not bought!

    Enough of all that. Off to Mediterranean Kitchen in Bellevue tonight then Spielbergs Super 8…Sitter is in place and I’m rollin!

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  39. 39
    Voight-kampff says:

    RE: ray pepper @ 38
    Jilted indeed! :-)
    Your previous posting jousts with Marc made me giddy with excitement to see how you would respond to the Tims choice of representation.
    I have thought about using either 500 or walaw for my next purchase as you both seem to offer a nice alternative to someone who does there own legwork.
    I think It’s great that that you guys offer alternatives…kudos!
    Oh yeah, I have To point out that my wife found it hilarious that $500 realty actually costs about $4000.00

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  40. 40
    Scotsman says:

    “JPMorgan Chase is forecasting another 4 to 5 percent drop in home values over the next 12 months. ”

    http://www.cnbc.com/id/43354054

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  41. 41
    David Losh says:

    RE: Voight-kampff @ 39

    What? $4K? Lucky I got my form fitting T-Shirt before it became a part of the service package.

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  42. 42
    David Losh says:

    OK, fun’s fun, but there is a chance that housing prices may stabalize this year. As much as I think they are over priced there are arguments to be made that we do, or will, have inflation in the coming year that would off set any decline in prices.

    $225K on Wetmore seems high to me. I’d like the reasoning for Everett, at that price.

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  43. 43
    Cascadian says:

    By Voight-kampff @ 39:

    RE: ray pepper @ 38
    Jilted indeed! :-)
    Your previous posting jousts with Marc made me giddy with excitement to see how you would respond to the Tims choice of representation.
    I have thought about using either 500 or walaw for my next purchase as you both seem to offer a nice alternative to someone who does there own legwork.
    I think It’s great that that you guys offer alternatives…kudos!
    Oh yeah, I have To point out that my wife found it hilarious that $500 realty actually costs about $4000.00

    In Ray’s defense the $500 is referring to a seller’s cost if using $500 realty, which as far as I understand is $500.

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  44. 44

    By Scotsman @ 40:

    “JPMorgan Chase is forecasting another 4 to 5 percent drop in home values over the next 12 months. ”

    http://www.cnbc.com/id/43354054

    And Ira Sacharoff is forecasting that JPMorgan Chase will be wrong, but it won’t matter. The CEO will still get a bonus of a few extra million dollars, and depositors will still get a quarter of a percent in interest.

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  45. 45
    Jonness says:

    By The Tim @ 20:

    I’m quite comfortable in saying that we are in a far, far better financial situation today than we would have been had we bought any time 2005 – 2009.

    Although I haven’t bought yet, I’m in a very similar situation as you. I started looking in 2005 and had very little down payment saved. The sticker shock sent me in search of answers on what the heck was going on. In the meantime, I’ve been saving a nice down payment and then some in anticipation of lower and lower prices. IMO, the last six years or so have represented an unprecedented opportunity to save a down payment and free one’s self and family from a lifetime of debt slavery and indentured servitude.

    For those who think they missed the boat, don’t worry. The opportunity for saving will most likely remain alive and well for several more years. During these times, doing things the old fashioned way will reward savers handsomely.

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  46. 46
    LocalYokel says:

    By David Losh @ 42:

    OK, fun’s fun, but there is a chance that housing prices may stabalize this year. As much as I think they are over priced there are arguments to be made that we do, or will, have inflation in the coming year that would off set any decline in prices.

    $225K on Wetmore seems high to me. I’d like the reasoning for Everett, at that price.

    Unless someone is planting non-services, job creating beans, the forecast is cloudy
    with chance of severe thunderstorms.

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  47. 47
    Jonness says:

    By ray pepper @ 34:

    RE: The Tim @ 32

    ok ok..I can go on for hours on that business model . I will wait and pounce later…..

    Face it Ray, you are a jilted lover. WA Law took down the big score when they landed Tim as a client. But don’t fret, you still have me as your consolation prize. :)

    Your agency has already saved me a fortune, because every time I get emotional about a house and start to pull the trigger, your agent brings me back to earth with his savvy RE investor mindset. He and I have become pretty good friends over the course of the last couple of years. I’m going to be sad when I finally pull the trigger and buy a house, because I really enjoy discussing buying houses with him.

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  48. 48
    David North says:

    Tim, I’m a big fan of your approach. And as long as the weeds have been trampled just a bit here, I’m also a big fan of diverse business models to match the differing needs of various real estate buyers, sellers, dreamers, etc. I find the notion that there is any right or wrong model, to be silly.

    I’m interested in what things if any, trivial or otherwise, that you discovered along the way were not as black and white as you thought.

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  49. 49
    Leanne says:

    I’d be interested in your experience looking for, at and bidding on REOs.

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  50. 50
    ray pepper says:

    RE: Voight-kampff @ 39 -Glad you like Nik, Joness…Hes a good guy! And yes 100, 500, 3900, 4500, or 4900…You will be charged one of those by 500 Realty…100 or 500 to SELL! and a 3900 minimum to Buy with us….

    As I like to say…………If you can find a better deal with the same customer service TAKE IT and run!

    Also Buyers do NOT forget about Skyline…Those independents will cut you 50% + of YOUR commission and all you must do is ask…Hundreds if not thousands of Agents will give you 50% back now, but when you desire the 75-80% rebate you gotta start digging!

    Maybe I am jilted but he was outta my service area anyway and Tim would have been assigned to Eric or Chris…They never read Bubble or even know about Tims celebrity status. They would have gotten an email from me saying we got a WHALE here…Take care of him…Hes the King of the Bubbleheads….

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  51. 51
    sallybuttons says:

    RE: ray pepper @ 50 – Thank God for yer input Ray…Redfin-guy is mush.

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  52. 52

    By David Losh @ 36:

    Those are excellent points that concern me. At the same time, after reading some of the exchanges between Craig, and Ardell I really wonder who would be better, an attorney or a Real Estate agent.

    If you want an opinion on what the contract means, or how the contract operates, clearly you’re better off with an attorney. Ardell has demonstrated that over and over again with her inability to understand even basic terms in our standard NWMLS forms. And generally attorneys are underutilized in this state in real estate transactions, but it does seem to work because both sides typically want the same thing: A closed transaction. Where things get off track though, there’s a potential for a huge mess.

    I think WaLaw has an interesting business model. It’s not right for everyone, but it is right for some, and I’ve referred some buyers to them in the past where I thought the fit was better than what I could offer. Alternatively, I’ve also given one reader here the name of multiple real estate attorneys where that was the better fit.

    It’s somewhat interesting that Ray is so opposed to the 6% model, but is also opposed to other alternatives that aren’t his model.

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  53. 53

    By Voight-kampff @ 39:

    Oh yeah, I have To point out that my wife found it hilarious that $500 realty actually costs about $4000.00

    She probably hasn’t been to a Motel 6 for quite some time. ;-)

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  54. 54
    Lurker says:

    RE: David North @ 48

    Fantatic question

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  55. 55

    By Leanne @ 49:

    I’d be interested in your experience looking for, at and bidding on REOs.

    Isn’t that already covered above? He bid on three, was out bid on two of those and one already had an offer the bank had accepted.

    Unless you’re going for fixers, that can be rather typical of bank owned because they do tend to get listed at a discount. Although again, if circumstances allow the buyer’s agent should call the bank’s agent prior to drafting an offer so that time is not wasted making an offer on what is in effect a pending offer. So the making an offer on a house not really on the market isn’t necessarily what I would call “typical.”

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  56. 56
    Lurker says:

    RE: Lurker @ 54

    Fantastic even!

    Rate this comment: Thumb up 0

  57. 57
    ray pepper says:

    RE: Kary L. Krismer @ 52

    “I think WaLaw has an interesting business model”

    Kary what do you find interesting about Wa Law? I mean TRULY interesting…They are just two guys over there with a 4000 minimum per transaction. 500 Up Front, 3500 due in 6 months ( which nobody will pay) . 75.00 an hour to tour homes ( which nobody will pay) They charge ALOT to list. I can go on and on..

    “It’s not right for everyone” –I AGREE with that…BIG TIME!

    “It’s somewhat interesting that Ray is so opposed to the 6% model, but is also opposed to other alternatives that aren’t his model.” TRUE! BINGO!!

    6% is a SHAM…The ERA of 6% (the buffet-golden carrot) is in a death spiral anyway. Soon we will be under 20k agents at the NWMLS and as the numbers continue to dwindle and the collapse of the MLS data base becomes evident, what emerges it what we ALL have been waiting for…………

    History will dictate Red Fin was a game changer and so was MLS4Owners. 500 Realty and all these other small alternative Brokerages will have adapated to the new data base and pricing will be completely different.

    It took a Bubble in real estate to trigger this change and left ALOT of carnage along the way but our society truly does need more workers in alternative employment other then paying members of a database that bring NOTHING to the table.

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  58. 58

    By ray pepper @ 57:

    RE: Kary L. Krismer @ 52

    “I think WaLaw has an interesting business model”

    Kary what do you find interesting about Wa Law? I mean TRULY interesting…They are just two guys over there with a 4000 minimum per transaction. .

    Assume a $1,000 value for attorney representation, and that gets them to $3,000 minimum. Just because most people don’t opt for attorney representation, don’t think it’s not valuable. It could be particularly valuable on an REO transaction, where attorney representation is even more advised.

    But to answer your question, when I have someone call me up out of the blue and say they want to make an offer on a certain listed property, I’ll most often refer them to Craig. They don’t need my services in finding a property, and he’s set up to do it for them cheaper. More to the point though, I’m uncomfortable with that type of transaction, because in my opinion putting that transaction together is more in the line of practicing law, not being a real estate agent. While I am both, I am not actively practicing law (although I am actively licensed), and never was a real estate attorney (although I did do some transactional work).

    Change the hypothetical a bit, and make the call from a buyer who has reached a deal with an unlisted property owner. There I would probably give them Craig’s name and one or two other real estate attorneys (after getting some idea that the price reached was reasonable). There is no SOC to capture in that situation.

    You seem to be like pfft analyzing health care, where he judges the quality of health care solely by the percentage of people which are insured. You seem to judge a real estate model solely by how closely it fits your own. The thing you both also have in common is that you’re supporting systems that are unstable. You act like discount brokerages are something new and the waive of the future. They aren’t either. Craig, on the other hand has developed a system that sets him apart both from full service and discount brokers, and I find that interesting.

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  59. 59

    By Lurker @ 56:

    RE: Lurker @ 54

    Fantastic even!

    So it’s not merely “fantastic” as you declared in post 54, it’s actually “fantastic?” ;-)

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  60. 60
    ray pepper says:

    “But to answer your question, when I have someone call me up out of the blue and say they want to make an offer on a certain listed property, I’ll most often refer them to Craig. They don’t need my services in finding a property”

    Do you actually get calls from people asking you to search for a property for them? Does ANYBODY EVER make this call anymore? Your grasping at VERY SMALL numbers of people who need assistance “searching” for a home. Please do NOT tell me you put them in your car too?

    If you REVERT your calls to ANYONE who has already found their home and keep only those who need assistance searching or the biggest SCAM of them all **LISTING** then Kary……………. YOU ARE RETIRED!

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  61. 61
    David Losh says:

    RE: Kary L. Krismer @ 58

    I agree.

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  62. 62

    By ray pepper @ 60:


    Do you actually get calls from people asking you to search for a property for them? Does ANYBODY EVER make this call anymore? Your grasping at VERY SMALL numbers of people who need assistance “searching” for a home. Please do NOT tell me you put them in your car too?

    Are you that out of touch with reality? Maybe there’s a reason you charge less? ;-)

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  63. 63
    David Losh says:

    RE: ray pepper @ 57RE: ray pepper @ 60

    Good Morning Ray!

    Your business model is John P.Nagle. He was the original game changer who was flat fee, and hated the Multiple Listing Service. When the business sold to the agents John was disappointed when they made the choice to join the Multiple.

    I can’t speak for John, but I also know that one of the top producing agents in California also doesn’t belong to the Multiple there. In his case he was asked to relinquish his membership.

    In both cases the belief is that buyers, and sellers should have an open forum to exchange property as they choose without the interference of a bunch of weasels. If you put the gimmickry aside you are talking about a price for the property.

    The game changer today is the internet, even craigslist to a lesser extent. In terms of a business model John L. Scott, Microsoft, and Zillow brought much more to the table. Online presence, and promotion of property is complex. Online presence is more of an art than it is a given. In my opinion it’s why this year Crate, and Barrel looking listings are selling readily, with multiple offers. Buyer’s are choosing online presence over, in some cases, substance.

    Alright, I’m getting off track there.

    Craig, and WA Law, are providing a unique service. It’s an attorney service that has a very well established place in Real Estate, at a fee structure that is defined. That’s hard to beat. I agree that I doubt it is sustainable, but it does make sense. It makes more sense than other brokerages that only promise that if you pay them less they will do less for you.

    As far as the Multiple Listing Service goes it is a great resource. It’s cheap, and efficient. If you’re claiming people can get specialized knowledge of real estate on line, then they never need to call you. They would just do transactions themselves, probably with the help of an attorney.

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  64. 64
    ray pepper says:

    RE: Kary L. Krismer @ 62

    Again, you actually get calls to help people Search? Seriously? Listing maybe? But, search?

    Yes, I must be WAYYY out of touch…From everywhere I go and everyone I talk to nobody wants needs assistance searching.

    Can you please tell me the last time you placed someone in your car for a tour? Is this still happening out there?

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  65. 65

    By David Losh @ 63:

    As far as the Multiple Listing Service goes it is a great resource. It’s cheap, and efficient. If you’re claiming people can get specialized knowledge of real estate on line, then they never need to call you. They would just do transactions themselves, probably with the help of an attorney.

    That’s the problem with Ray’s thinking. He’s critical of the MLS system, but fails to realize that virtually the only reason people would come to him is because of the SOC offered by the listing. Remove the MLS from the equation and there if you have a buyer who has found a property they would be much better off in all regards to deal with an attorney only. The attorney could have a list of inspectors, or the buyer would find one on their own. Without the MLS rules, the attorney would not need to be there during the inspection (which raises other issues though). The main problem would be the attorney probably wouldn’t have as good of tools to determine whether the price was reasonable, but Craig and Marc do have access to those tools.

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  66. 66
    ray pepper says:

    RE: David Losh @ 63

    No David Wrong!

    People need assistance getting INTO the homes and guidance through the transaction and close.

    They need facilitators. Agents who believe they are anything more then a facilitator to assist Buyer and Seller through a transaction are dinosaurs.

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  67. 67
    ray pepper says:

    ” but fails to realize that virtually the only reason people would come to him is because of the SOC offered by the listing”

    We realize this 100% and we are OK with it. But, remember in turn, we decide who we represent. If they do not fit our criteria they go off to Red Fin, Findwell, ShopProp etc.

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  68. 68
    ray pepper says:

    gotta go Coach Final BBall game and Soccer game of season..Wish I could engage with you guys for hours just for the comedic value………….

    enjoy the day.

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  69. 69

    By ray pepper @ 67:

    ” but fails to realize that virtually the only reason people would come to him is because of the SOC offered by the listing”We realize this 100% and we are OK with it. But, remember in turn, we decide who we represent. If they do not fit our criteria they go off to Red Fin, Findwell, ShopProp etc.

    Which also only exist because of the SOC. I’m not so sure you do realize it at any percent.

    If you go to a model where the information is somehow magically provided on Craigslist, you go to a system with attorneys, not agents.

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  70. 70
    David North says:

    By ray pepper @ 66:

    RE: David Losh @ 63

    Agents who believe they are anything more then a facilitator to assist Buyer and Seller through a transaction are dinosaurs.

    I will respectfully disagree with you on this point. While it is true that there are plenty of dinasaurs, there are also brokers who bring far more value to the transaction and their client than facilitation.

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  71. 71
    David North says:

    By ray pepper @ 50:

    They never read Bubble or even know about Tims celebrity status. They would have gotten an email from me saying we got a WHALE here…Take care of him…Hes the King of the Bubbleheads….

    Why does celebrity (and pretty minor celebrity at that – meaning no disrespect toward Tim or the value of what he does) warrant any different treatment than a typical client would get?

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  72. 72

    By David North @ 71:

    By ray pepper @ 50:
    They never read Bubble or even know about Tims celebrity status. They would have gotten an email from me saying we got a WHALE here…Take care of him…Hes the King of the Bubbleheads….

    Why does celebrity (and pretty minor celebrity at that – meaning no disrespect toward Tim or the value of what he does) warrant any different treatment than a typical client would get?

    It shouldn’t, and it probably didn’t in Marc and Craig’s case, but…Over the years The Tim has done his share of making fun of agents ( justifiably so), and there are some regular posters here who view real estate agents as some kind of sub human filth, so if the brains behind the Seattle Bubble decides to have you represent them, wouldn’t you view that as a feather in your cap and do everything possible to ensure that he was pleased with your service?

    For that matter, do you think most real estate agents work harder for clients looking at million dollar homes as opposed to two hundred thousand dollar homes? I think most of them do, and it’s because of the commission.
    Me, I’m crazy. I work at least as hard for the clients looking for 200,000 dollar houses. It’s that deeply ingrained sense of fairness that doesn’t help the bottom line.
    If I’d been brought up conservative instead of liberal, maybe I’d have gotten rich:)

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  73. 73
    David Losh says:

    RE: ray pepper @ 66

    You are so right, people are making very bad mistakes every day.

    Ardell said in a comment that she sees people after the transaction, so do I. People pay way too much for crumby houses. I went to look at one yesterday.

    The buyer is another really, really smart guy who hired a discount broker to “write it up.” I know the broker to be one of those that waits for other agents to do all the work of preparing the buyer, then “writing it up, for less.”

    The house is bank owned and needs an immediate $20K worth of work to make it safe. The inside is all dolled up with new paint, kitchen, and bath remodels from the sale in 2004.

    The problem is that as the house was built, and where it sits on the lot, it has mildew, and in my opinion, potential rot issues that are clearly visible on the back of the house. The lot is a little swampy.The visible rot has been disclosed. The new paint inside, I think, by the smell, is covering some issues with a continuing mildew problem.

    You may say an inspection would disclose everything, but it doesn’t, especially what is covered. The second issue is the property placement on the lot.

    The smart guy is paying 10% less than was paid in 2004. Before that the house was owned by what looks like the original owner.

    I have conversations with people all the time about what can be done with a property, what makes sense, and what needs to be sold, so you can purchase something better suited to your needs. In my opinion people need those people who deal with property.

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  74. 74
    toad37 says:

    Cool post Tim. That shows a lot of patience and smarts on your behalf. Your house looks awesome too!

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  75. 75
    D. in Ballard says:

    RE: ray pepper @ 64 – I have to agree with Ray on this one. I don’t need an agent to find me houses. I need an agent to take me to the house and then make the deal happen.

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  76. 76
    P J says:

    I would be interested in knowing more.

    We recently made an offer on a short sale. BoA holds 2 reverse mortgages on the house. It was a multiple offer situation, and our offer which was at list price was accepted.

    After appraisal, BoA sent us a counter offer at 10% above our offer. Not sure why they think they have a negotiating position since we already know our offer was the best:D We re-countered back at list, and are currently waiting.

    Would be great to know more details of how your transaction went.

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  77. 77
    Scotsman says:

    RE: Ira Sacharoff @ 72

    “If I’d been brought up conservative instead of liberal, maybe I’d have gotten rich:)”

    Well I knew you couldn’t reason your way into a liberal mindset, so it’s good to have it confirmed- you’re just running on habit and momentum.

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  78. 78

    By D. in Ballard @ 75:

    RE: ray pepper @ 64 – I have to agree with Ray on this one. I don’t need an agent to find me houses. I need an agent to take me to the house and then make the deal happen.

    So just out of curiosity, how’s that going for you? Found it yet? If not, maybe you’re not as good as you think you are. ;-)

    Not to say some people aren’t good at finding ones on their own. I had one client who was excellent at it. They were the exception, not the rule.

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  79. 79

    By P J @ 76:

    After appraisal, BoA sent us a counter offer at 10% above our offer. Not sure why they think they have a negotiating position since we already know our offer was the best:D

    Doesn’t matter. They don’t have to approve any short sale, so they have all the negotiating power. That could be a good decision or a bad decision, but it’s a common decision (especially if you consider no action as being a “no.”) And the person making the decision for the bank probably doesn’t care either way.

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  80. 80
    D. in Ballard says:

    RE: Kary L. Krismer @ 78 – As a matter of fact, I closed within days of Tim’s purchase.

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  81. 81
    Pegasus says:

    Hahaha. What a bunch of self-serving real estate wimps. Attack and attack back. Shame on the bunch of you for being unprofessional here. You are giving real estate “brokers” a worse name(if that is possible) by bad mouthing the competition and manufacturing reasons as to why the 6 percent is justified when clearly the market has changed forever. Here is a little something to put it all into perspective as to what is at work here…..

    A dark Cave. In the middle, a Caldron boiling. Thunder.

    Enter the three Witches.

    1 WITCH. Thrice the brinded cat hath mew’d.
    2 WITCH. Thrice and once, the hedge-pig whin’d.
    3 WITCH. Harpier cries:—’tis time! ’tis time!
    1 WITCH. Round about the caldron go;
    In the poison’d entrails throw.—
    Toad, that under cold stone,
    Days and nights has thirty-one;
    Swelter’d venom sleeping got,
    Boil thou first i’ the charmed pot!
    ALL. Double, double toil and trouble;
    Fire burn, and caldron bubble.
    2 WITCH. Fillet of a fenny snake,
    In the caldron boil and bake;
    Eye of newt, and toe of frog,
    Wool of bat, and tongue of dog,
    Adder’s fork, and blind-worm’s sting,
    Lizard’s leg, and owlet’s wing,—
    For a charm of powerful trouble,
    Like a hell-broth boil and bubble.
    ALL. Double, double toil and trouble;
    Fire burn, and caldron bubble.
    3 WITCH. Scale of dragon; tooth of wolf;
    Witches’ mummy; maw and gulf
    Of the ravin’d salt-sea shark;
    Root of hemlock digg’d i the dark;
    Liver of blaspheming Jew;
    Gall of goat, and slips of yew
    Sliver’d in the moon’s eclipse;
    Nose of Turk, and Tartar’s lips;
    Finger of birth-strangled babe
    Ditch-deliver’d by a drab,—
    Make the gruel thick and slab:
    Add thereto a tiger’s chaudron,
    For the ingrediants of our caldron.
    ALL. Double, double toil and trouble;
    Fire burn, and caldron bubble.
    2 WITCH. Cool it with a baboon’s blood,
    Then the charm is firm and good.

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  82. 82
    Jonness says:

    By Kary L. Krismer @ 78:

    So just out of curiosity, how’s that going for you? Found it yet? If not, maybe you’re not as good as you think you are. ;-)Not to say some people aren’t good at finding ones on their own. I had one client who was excellent at it. They were the exception, not the rule.

    Anybody who sucks at finding homes and has been out looking for any portion of the last 7 years should thank their lucky stars. Pity the fools who hired agents who were good at finding homes (or conning people into purchasing homes they should have never bought). These expert home finders should consider giving free scuba diving lessons with each purchase in order to prepare their clients for a decade of being underwater on their mortgages. I mean, at a minimum they should throw in a complimentary set of mask, snorkel, and fins into the deal. The more high-end firms should include a free wet suit and a set of freshly filled oxygen tanks.

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  83. 83
    Jonness says:

    By David North @ 71:

    By ray pepper @ 50:
    They never read Bubble or even know about Tims celebrity status. They would have gotten an email from me saying we got a WHALE here…Take care of him…Hes the King of the Bubbleheads….

    Why does celebrity (and pretty minor celebrity at that – meaning no disrespect toward Tim or the value of what he does) warrant any different treatment than a typical client would get?

    Because he out forecast 99.9% of professional RE agents at a time when most were leveraging their life savings into a soon to be depreciating asset class. Then he built a website and warned people of the dangers in believing in the RE industry propaganda and taught people the importance of reading charts when making the most important financial decisions of their lifetimes. In the process lives were saved.

    For that, Tim deserves the absolute highest quality red carpet treatment. For instance, if Ray had landed him as a client, he would have treated him to numerous free meals at the Claim Jumper and provided 500 Realty T-shirts for all. I mean, to heck with the 75% refund on the commission, I want a free meal at Claim Jumper and a complimentary six pack of Gas-X.

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  84. 84
    Voight-kampff says:

    Ray you also have a $4000 dollar minimum?

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  85. 85

    By Jonness @ 82:

    By Kary L. Krismer @ 78:
    So just out of curiosity, how’s that going for you? Found it yet? If not, maybe you’re not as good as you think you are. ;-)Not to say some people aren’t good at finding ones on their own. I had one client who was excellent at it. They were the exception, not the rule.

    Anybody who sucks at finding homes and has been out looking for any portion of the last 7 years should thank their lucky stars. Pity the fools who hired agents who were good at finding homes (or conning people into purchasing homes they should have never bought). These expert home finders should consider giving free scuba diving lessons with each purchase in order to prepare their clients for a decade of being underwater on their mortgages. I mean, at a minimum they should throw in a complimentary set of mask, snorkel, and fins into the deal. The more high-end firms should include a free wet suit and a set of freshly filled oxygen tanks.

    You make the same mistake as Ardell, thinking agents are somehow responsible for predicting the future and telling their clients when to buy or sell.

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  86. 86
    Scotsman says:

    RE: Kary L. Krismer @ 78

    “So just out of curiosity, how’s that going for you? Found it yet? If not, maybe you’re not as good as you think you are. ;-)”

    Wow. That’s the way to win clients. Are you really that blind, Kary? Or does the smiley make it all OK?

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  87. 87
    Voight-kampff says:

    Ive been drinking, but The WA law and $500 realty models seem very similiar to me
    So as a buyer maybe it’s just a choice of if you want a lawyer or an agent,
    Or maybe…
    THE FUTURE OF REALESTATE WILL BE DECIDED HERE!!!
    SEATTLE BUBBLE SMACKDOWN 2011!!! BE THERE!!!!
    Marc “the esquire” Holmes
    V.S.
    “Reno” Ray Pepper

    Sorry I broke the golden rule of posting on blogs after several beers.

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  88. 88

    By Scotsman @ 86:

    Wow. That’s the way to win clients. Are you really that blind, Kary? Or does the smiley make it all OK?

    Do you really think my goal was to get someone like D. in Ballard as a client? I don’t have a problem with people having choices in brokerage services (unlike say Ray), but I also don’t try to convert those who want a different choice to pick me. To me that makes about as much sense as trying to convince someone to buy a house.

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  89. 89
    David Losh says:

    RE: Kary L. Krismer @ 85

    Let me introduce you the Neale, and Harry Obedin http://www.nealeobedin.com/

    Neale told me last week that you just know when a property is right. You just know. It’s not something they teach in schools, it comes from practice, mistakes, sleepless nights, and being wrong enough times to get it right. She also said that the numbers never work.

    Neale is the Real Estate agent, and Harry is a property manager. Harry actually has the capacity to manage property so that it gave a return on those investments.

    This is what Real Estate is about. Real Estate is about knowing. It’s nothing fancy, it’s just hard work, and repetition. It’s making being stupid look smart.

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  90. 90
    David North says:

    By Jonness @ 83:

    Because he out forecast 99.9% of professional RE agents at a time when most were leveraging their life savings into a soon to be depreciating asset class. Then he built a website and warned people of the dangers in believing in the RE industry propaganda and taught people the importance of reading charts when making the most important financial decisions of their lifetimes. In the process lives were saved.

    With all of the above I completely agree, except I don’t know whether the percentage cited should really be 99.8%, 99.99%, or some other percentage very, very close to that range.

    For that, Tim deserves the absolute highest quality red carpet treatment.

    For that, Tim deserves exactly the same quality of treatment that every other real estate client or prospect deserves. Nothing more, and nothing less.

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  91. 91
    ARDELL says:

    RE: Kary L. Krismer @ 85 -“You make the same mistake as Ardell, thinking agents are somehow responsible for predicting the future and telling their clients when to buy or sell.”

    Kary,I don’t know how much of your time you spend with actual buyers and sellers, but if no one ever asks you, as the professional in the room, whether they should sell now or later or whether they should buy now or later, it can’t be many.

    Every day someone asks if they should rent their house or sell it. Sell it now or sell it later. Had a call like that this morning. Every day someone asks if they should buy now or wait until…

    What do you answer? “Beats Me! I haven’t a clue.”?

    Not sure why you have to drag me into your fights. Are you lonely tonight?

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  92. 92
    ray pepper says:

    Wow, what a comedt thread..Just a few random thoughts:

    1. David real estate is not hard..Working back to back on 6 North at Madigan was hard.

    2. Pegasus, I think you missed a dose tonight.

    3. Yes, we have a 3900 minimum if your a Buyer. if you can find better then 75% take it. Just please do NOT pay for tours or allow yourself to be on a time line to buy.

    4. Craig and Marc will surely change their model or abandon it altogether in the coming slow grinding years ahead. Red Fin will not make it either in their present state however, they can remain viable if they focus more on Lead Generation then sales commissions.

    5. Nobody needs help searching for a home. They need guidance throughout the transaction and a facilitator to assist along the way. Anyone who tells you they have superior search techniques then you is lying.

    6. If you pay more then 500 to list your home I hope you get an itemized print out of what exactly the LA is going to do for you. After getting that info compare to MLS4Owners or a comparable 500 fee service. I could careless if you list with us. Just don’t GIVE your money away thinking you are getting more by paying more.

    7. Confused? Read 5 and 6 over and over until you understand it.

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  93. 93
    ray pepper says:

    RE: David North @ 90

    David, in all due respect, your new here so I will be easy on you.

    You bring nothing to the table that the other 20k Agents slowly dying on the MLS bring. If you do have something new to offer PLEASE tell us!! PLEASE!! I want to see something FASCINATING and something that will be a GAME CHANGER! NO BS PLEASE! You will get crushed here.

    At least that one agent that got scared off RCG brought a book or something about the best places to visit in Seattle, or dine, or make out.. It was something like that. 100 places to do something. She blasted me and stated well its better then “jammin a 500 Realty Movin Van with president Bush on the side” down our throats. I liked that!

    But, you will soon realize how much of a WHALE Tim is and you MUST respect him, buy food for him, and offer to change his oil during property tours if he requests it. I had 5 cans ready and the funnel but still lost out. golly Marc and Craig who I will forever BASH because of my lost whale.

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  94. 94
    ARDELL says:

    RE: Kary L. Krismer @ 52

    “Ardell has demonstrated that over and over again with her inability to understand even basic terms in our standard NWMLS forms.”

    LOL! Is that what you call it when someone disagrees with you?

    Seriously Kary, you’re like the kid in grade school who liked to pull on my pony tails. Calling me out twice in one comment stream. Be careful, you may start calling my name out in your sleep, and that might get you into a lot of hot water at home.

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  95. 95
    David North says:

    By ray pepper @ 93:

    RE: David North @ 90 -David, in all due respect, your new here so I will be easy on you.

    No need. I’ve got a thick enough skin.

    You bring nothing to the table that the other 20k Agents slowly dying on the MLS bring.

    You’re wrong.

    If you do have something new to offer PLEASE tell us!! PLEASE!! I want to see something FASCINATING and something that will be a GAME CHANGER! NO BS PLEASE! You will get crushed here.

    I could say anything I want to say here, and you wouldn’t know whether it was true or not. My clients know what I offer and whether or not it’s valuable. That’s what matters, not whether it’s new, fascinating, or a game changer. I’m not here to show off, I’m here because I fundamentally agree with the content and purpose of the site, and I’m not worried about being crushed.

    But, you will soon realize how much of a WHALE Tim is and you MUST respect him,….

    Celebrity does not impress me in the least. Tim does impress me. A small portion of his analysis is flawed, and most of it is excellent, orders of magnitude more credible and meaningful than most of what the industry’s spokes-spindoctors spew. I have a great deal of respect for that. And if he were my client he would get exactly the same level of service and respect that all of my celebrity and non-celebrity clients get. If I understand how Tim thinks, I seriously doubt that he would expect to be treated any differently than anyone else.

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  96. 96
    Scotsman says:

    RE: Kary L. Krismer @ 88

    Wow. It’s not about D in Ballard, it’s about the other 2-300 (or so) people a day who read this site but never comment, some of whom might be looking for a traditional realtor. It’s basic marketing sense. You are in marketing, aren’t you?

    It must be getting tough out there. I agree the traditional 6% model is done, perhaps dying a slow death, but it’s done, along with the concept of real estate as anything but shelter. By the end of this year it will be clear to even the most obtuse that real estate is no more of an investment than buying a car.

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  97. 97
    BillE says:

    June 5th.
    By ARDELL @ 3:

    When does all of this “Great time to buy!” talk enter the conversation?

    Is it in response to a question from the client?

    June 11th.
    By ARDELL @ 91:

    Every day someone asks if they should buy now or wait until…

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  98. 98
    Real World Express says:

    Not that I don’t think you’re a real person and all…but your sudden purchase reminds me of the other famous real estate market hound…Patrick (of patrick.net). After years of lambasting housing, a few months ago he suddenly “called bottom” and pulled out all his chips. Everyone was stunned…but then it occurred to me…was the whole thing an elaborate setup….take a group of people and use Pavlovian conditioning to get them to listen to a “regular guy…fighting the market”…then, when the iron is hot, slice through ‘em, grill ‘em and roast ‘em by making them think it’s time to buy. I mean let’s face it, “Tim” as he likes to call himself even has his own personal Ed McMahon-slash-Godfather in the form of Krismer who could probably sell an igloo in Ballard to a Aleut.

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  99. 99
    Pegasus says:

    Real estate agents spotted migrating from Seattle to Spokane

    http://apnews.myway.com/article/20110610/D9NOPLUG0.html

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  100. 100

    By ARDELL @ 94:

    RE: Kary L. Krismer @ 52

    “Ardell has demonstrated that over and over again with her inability to understand even basic terms in our standard NWMLS forms.”

    LOL! Is that what you call it when someone disagrees with you? .

    I’m not sure what your “that” is referencing, but if “100% wrong” what you were thinking, then yes.

    You single-handedly are the best example of why agents are not allowed to give legal advice. You’re horrible at interpreting the language used in contracts, statutes or just about anything else that communicates using the English language. You are to interpreting language as Cramer is to picking stocks.

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  101. 101

    By Scotsman @ 96:

    Wow. It’s not about D in Ballard, it’s about the other 2-300 (or so) people a day who read this site but never comment, some of whom might be looking for a traditional realtor. It’s basic marketing sense. You are in marketing, aren’t you?.

    I don’t post here to try to get clients. And I get at least one call a week where I have to sell a sales person (for a marketing company) that I don’t want to try to get clients off the Internet because they tend to be somewhat flaky.

    Don’t get me wrong, I have had some good clients come from my postings, including one I describe as my most interesting client. But most of the contacts I get off the Internet I don’t even respond to or I refer to someone else (without a referral fee).

    So, no. What I write here is not written with the design of trying to attract clients.

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  102. 102
    ray pepper says:

    RE: Real World Express @ 98

    I’m happy I checked back………….This is funny as heck:

    “even has his own personal Ed McMahon-slash-Godfather in the form of Krismer who could probably sell an igloo in Ballard to a Aleut.”

    This is what the blog needs…………more spirit, constructive bashing, and comedic flavor!

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  103. 103
    Frank says:

    My family is moving to Seattle this summer and will be buying a home. I’d be very interested in why you went with WaLaw. I’m not sure if it’s the right fit for a family unfamiliar with Seattle neighborhoods or not, but their web site is more helpful than many others I’ve been looking at.

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  104. 104
    Macro Investor says:

    By Scotsman @ 96:

    RE: Kary L. Krismer @ 88

    …real estate is no more of an investment than buying a car.

    Should I sell or rent out my car? I need some advice.

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  105. 105
    The Tim says:

    RE: Real World Express @ 98 – Patrick bought? I missed that. His daily email updates seem to be as bearish as ever.

    Rate this comment: Thumb up 0

  106. 106

    By Macro Investor @ 4:

    By Scotsman @ 96:
    RE: Kary L. Krismer @ 88

    …real estate is no more of an investment than buying a car.

    Should I sell or rent out my car? I need some advice.

    I won’t get into the difference between buying a car and buying a house, but the difference between real estate agents and car salesmen? Hmmm… Maybe the car salesman’s suit is shinier?

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  107. 107
    ARDELL says:

    RE: BillE @ 97

    Good point! It’s interesting how those scenarios play out and why “It’s a GREAT TIME to buy!” or even a GREAT TIME to sell is rarely “the” answer. Comments #19 and #20 highlight to what extent current market conditions weigh in as the deciding factor. 10% to 20% is often the case.

    Comment 19:

    Jesse “Out of interest, let’s say you bought your house in 2005 25% down at 2005 prices with VRM. How different are the situations financially (owning 6 years vs renting 6 years), and what could you have done with your time over those 6 years if not bear blogging? :)”

    and 20:

    Tim: “Well, we didn’t have the 20% down to buy at 2005 values, so it would be a pretty unrealistic hypothetical.”

    If you can’t swim, the decision of whether or not to jump into an 8′ pool is not about the temperature of the water. In the grand scheme of great time to buy or great time to sell, are market conditions ever more than 20% to 30% of the decision process?

    If there were a poll asking:

    1) Do you think The Tim bought now because of the change in market conditions from 2005 vs now?

    2) Do you think The Tim bought now because he didn’t have a job he liked in 2005, but as a result of good blogging for 5 years was able to secure a job better suited to his talents, making it more practical to purchase now vs in 2005?

    3) Do you think The Tim bought now because his current and future life plans are better suited now to owning than they were in 2005?

    How many would answer that the primary decision factor was the change in market conditions in early to mid 2005 vs present market conditions?

    When people ask if it is a good time to buy or sell, it usually comes at the end of their other reasons to buy or sell, which are most often more compelling.

    What The Tim ultimately answered is that right time for him all but negated the market considerations, which is often the case. In 2005 the prices were slightly higher and positioned to go up in the near term. Today prices are slightly lower and positioned to go down in the near term. But neither of those facts represented the compelling reason to buy or not to buy.

    When someone is 80% to 90% sure they want to buy or sell for other reasons, market conditions are often not a strong enough factor to sway them from the decision made on factors based outside of market conditions.

    I would say the exception was from August of 2007 to February of 2009. During that time market factors were compelling and often more compelling than other factors. But 2005 vs now?

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  108. 108

    RE: ARDELL @ 107
    Interesting comments, Ardell.
    In 2005, it struck me that market conditions should have played a huge part in the decision to buy a home. Prices had gone up for a long time, but sales were slowing and inventory was high. I misread the market at that time, convinced that the market was about to crash. Crash it did, but I was a couple of years too early. I was sure we were going to see a big decline in home prices, and it seemed that waiting to buy a house was a prudent thing to do.
    Right now, I’m confused about the direction of the market. I’m pretty sure it’s continuing down, but the crystal ball is more blurry than it was six years ago.

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  109. 109
    David Losh says:

    RE: ray pepper @ 92

    If you’re confused read 5 and 6.

    You don’t care. You have a Brokerage based on you don’t care, and that is what you are selling. You want people to give you $500 to fill out paper work to submit to the Multiple. If it were that easy a lot of properties would be selling today. People would simply make offers for what they think a property is worth.

    As far as buying I would like to know what you bring to the table. $3900 seems like a lot for an oil change. Is that what’s included?

    I’m beginning to think that you don’t work in Real Estate so I’m suspicious of what you are promoting. Oil Changes? I have 5 quarts, and a funnel?

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  110. 110
    ray pepper says:

    RE: David Losh @ 109

    Remember this David…………I encourage everyone to use MLS 4 Owners for selling. I can careless who people give their 500 to. We provide the 100 or 500 Listing as a courtesy. Yes, I said a courtesy. But, we will not take a short sale and unfortunately refund so many listings from PayPal because people are upside down. We were not started to suck up 100 and 500 from sellers.

    We want the Buyers as does Red Fin. However, we keep turning so many away for a variety of factors. #1……………No Current Pre Approval in the last 30 days you get sent right to Red Fin. There are so many factors that get clients sent right to Red Fin that I cannot list them now..Yes, red Fin is our “penalty pit” and from there we never know what happens to the client!

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  111. 111

    By Frank @ 103:

    My family is moving to Seattle this summer and will be buying a home. I’d be very interested in why you went with WaLaw. I’m not sure if it’s the right fit for a family unfamiliar with Seattle neighborhoods or not, but their web site is more helpful than many others I’ve been looking at.

    It’s probably a good idea to talk to a few real estate brokers before you decide on one.
    A website might look nice and provide good information, but it’s not all that different than a pair of running shoes. They need to feel comfortable. It doesn’t matter if they have a slick website or receive great reviews, other people aren’t you.
    The big difference is that a nice pair of running shoes might cost 100 dollars, and a nice house might cost 400,000. If the shoes don’t fit, bring them back to the store or throw them away. If you don’t like the house? It’ll cost you a little more to get out of:)
    If saving money is part of the equation, ask the real estate broker if he or she will rebate back to you some of the commission. Many will, including full service brokerages.
    Just about every real estate agent and attorney brokering real estate here on Seattle Bubble will tell you that their model is the only one worth following, but we’re all different and your mileage may vary.
    If you do all your own research and know the neighborhoods and require only a door opener, it makes no sense to use a big name full service broker who will not rebate you commission.
    If you do need a little more guidance, going with someone who only provides the bare minimum of that also might not be a good choice.

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  112. 112
    Jonness says:

    By The Tim @ 5:

    Patrick bought? I missed that. His daily email updates seem to be as bearish as ever.

    You better check your cowboy boots Tim. By the smell things, it appears we are wading through a field of BS!

    However, another well-known housing bear called the bottom months back, and prices have been falling ever since.

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  113. 113
    David Losh says:

    RE: ray pepper @ 110

    Your comment says it all. You don’t care, you don’t follow, you don’t know.

    This is what has always bothered me about Real Estate brokerage. Anyone can get a license, do some deals, become a Broker, and start hiring agents.

    There is no rhyme or reason for the system that’s in place other than John Jacobi made the observation that Real Estate agents should be more “professional” and actually did something about making that happen. RE Max, and Coldwell Banker had proposed business models based on a corporate culture, but Windermere was an excellent example of an expandable boutique brokerage.

    I’m saying you can’t compare being a nurse to a life time obsession with Real Property.

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  114. 114
    David North says:

    By Ira Sacharoff @ 111:

    By Frank @ 103:
    My family is moving to Seattle this summer and will be buying a home. I’d be very interested in why you went with WaLaw. I’m not sure if it’s the right fit for a family unfamiliar with Seattle neighborhoods or not, but their web site is more helpful than many others I’ve been looking at.

    It’s probably a good idea to talk to a few real estate brokers before you decide on one.

    Just about every real estate agent and attorney brokering real estate here on Seattle Bubble will tell you that their model is the only one worth following, but we’re all different and your mileage may vary.

    Let me be the exception. I haven’t seen any business model represented here that’s either good for everyone or bad for everyone. I see some misrepresentations sometimes, which is unfortunate. I like the diversity of available business models. It can make choosing more difficult, but that’s a small price for the big advantage of having choices, one of which is likely to fit very well.

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  115. 115
    Marc says:

    By Voight-kampff @ 87:

    THE FUTURE OF REALESTATE WILL BE DECIDED HERE
    SEATTLE BUBBLE SMACKDOWN 2011!!! BE THERE!!!!

    Marc “the esquire” Holmes
    V.S.
    “Reno” Ray Pepper .

    LOL. If that’s the case Ray has got a big advantage in the nickname department. Seriously, Reno Ray sounds like somebody who beat Roberto Duran back in the 80’s. I need something better than esquire. How about “Hanging Judge” Holmes.

    In all seriousness, we didn’t start WaLaw to change the world. We saw an underserved niche and thought we could fill it. We have no misconceptions that ReMax, Windermere, and the other big boys are shaking in their boots. Sure, we hope to grow the business and maybe make them sweat a little but we won’t be planning any victory parties any time soon.

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  116. 116

    RE: Marc @ 115
    ” Hangin’ Judge Holmes won’t work.
    Maybe Mark ” The Executioner” Holmes. Left unsaid is that paperwork is his weapon of choice.
    Or initials. JD?

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  117. 117
    Marc says:

    How about “Judge & Jury”?

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  118. 118
    ARDELL says:

    RE: Ira Sacharoff @ 108

    I had an odd situation, Ira. A very young man, 19, was convinced by his parents to buy a condo in early 2005. He paid $104,500 including all costs. By the time he closed escrow, the prices were already up another $15,000 or so.

    I called him in January of 2008 when the prices hit $175,000 and told him to sell. Rent in the same building was only $650 a month. He owned it more than two years. I thought a tax free gain of $60,000 or so for a young man would be awesome! I practically begged him and his parents to take the profit. What are the odds he’s going to live there 10 years? A 30% per year gain…or just about.

    He liked his place. Didn’t want to leave even to move in the same complex. Now they are back down to what he paid. So how much does timing really impact residential real estate? Rarely does someone buy or sell a place to live in based on “right time” as to market conditions.

    So even though they like the agent to have an opinion on that topic, it doesn’t mean they act accordingly. 2005 was not a bad time to buy. For that young man it could have been a great time to buy. But he wouldn’t take the profit. What are you gonna do? :)

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  119. 119

    Ardell said” What are you gonna do? :)”

    I don’t know. They frown upon it when we hit clients with sticks.

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  120. 120
    ARDELL says:

    RE: Ira Sacharoff @ 119

    On the East Coast I was allowed to grab them by the face, and they listened up better. :)

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  121. 121
    jrc says:

    I am a potential buyer. And cat fights have reinforced my distrust of RE agents and mortgage brokers. I can search websites just as well as an agent and don’t need an agent to send me listings. I would like to have an agent help with negotiating and have some advice on pricing. But I know what I want, where I want it and how much I am pre-approved…. Tim, does this fit the WALaw model or will I need to go with a discount broker like RedFin? Thanks!

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  122. 122
    ChrisM says:

    Wow, fascinating thread. I, for one, view the different models to RE sales with excitement, after having suffered through prior purchases the traditional way.

    Ray – it sounds like you are looking for buyers who are committed to buying in a short time-frame? Is that a fair assessment?

    I was a bit surprised about your numerous comments about WA-Law. As a buyer, I have no issue dropping $3k when I know I will be buying a house (as long as I have ample time to locate a good property). As you pointed out, I’m able to do the searching on my own. I also feel comfortable locating and hiring the various inspectors. However, I’m *not* comfortable reviewing the legal contracts – IMO only a lawyer is competent. Do you disagree?

    So… if we believe a lawyer is needed to review the contract, then what other service does a real estate agent provide?

    Again, as a buyer I’m comfortable finding a mortgage broker (or two!). Heck, I may even go with my local credit union. And we already have a pretty cool escrow guy posting here.

    So… what service does the real estate agent provide to an experienced house buyer who is able to do most everything on their own?

    As far as I can tell, there are two things as a buyer I cannot do:
    1. review the contract
    2. access the lockbox

    What am I missing???

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  123. 123
    Voight-kampff says:

    RE: Marc @ 15
    I’ll admit “the esquire” was a little weak, maybe Marc “the loophole” Holmes.
    We had a great experience working with you guys on another condo matter and were VERY pleased with your services, we will most likely use you for our next purchase…
    This does NOT mean I don’t want you to throw down with Reno Ray! :-)

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  124. 124
    Pegasus says:

    RE: ARDELL @ 118 – Did you really think your job was to convince everyone to sell their abode to take a profit while listing the sale through you? You must have been very busy trying to contact every home and condo owner in the PNW to liquidate their residence…..all in the name of taking a profit. You must be refusing to list any homes for sale now as you have seen the bottom according to you every year or so. The comments in this thread from real estate “brokers” has demonstrated what we the public have generally known. You are all a bunch of back-stabbing loons who will say anything to justify your unprofessional behaviors.

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  125. 125

    By Pegasus @ 124:

    RE: ARDELL @ 118 – Did you really think your job was to convince everyone to sell their abode to take a profit while listing the sale through you? You must have been very busy trying to contact every home and condo owner in the PNW to liquidate their residence…..all in the name of taking a profit. You must be refusing to list any homes for sale now as you have seen the bottom according to you every year or so. The comments in this thread from real estate “brokers” has demonstrated what we the public have generally known. You are all a bunch of back-stabbing loons who will say anything to justify your unprofessional behaviors.

    We are ALL a bunch of back-stabbing loons? Have I said anything to earn that?
    Loon, sure, but back-stabbing?

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  126. 126

    By David North @ 14:

    By Ira Sacharoff @ 111:
    By Frank @ 103:
    My family is moving to Seattle this summer and will be buying a home. I’d be very interested in why you went with WaLaw. I’m not sure if it’s the right fit for a family unfamiliar with Seattle neighborhoods or not, but their web site is more helpful than many others I’ve been looking at.

    It’s probably a good idea to talk to a few real estate brokers before you decide on one.

    Just about every real estate agent and attorney brokering real estate here on Seattle Bubble will tell you that their model is the only one worth following, but we’re all different and your mileage may vary.

    Let me be the exception. I haven’t seen any business model represented here that’s either good for everyone or bad for everyone. I see some misrepresentations sometimes, which is unfortunate. I like the diversity of available business models. It can make choosing more difficult, but that’s a small price for the big advantage of having choices, one of which is likely to fit very well.

    Actually, I think Ray is the only exception. He thinks only his model is right for everyone. I’ve indicated above that I have actually referred people to Craig, which goes a bit beyond just admitting my model isn’t the only model someone should use.

    It probably goes back to my bankruptcy attorney days, when probably close to 80% of the people who would call me didn’t need my services, at least at that point in time, and probably 10-20% of the people were referred out to other attorneys. If something is not a good fit, it’s not a good idea to make a fit.

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  127. 127
    David Losh says:

    RE: Pegasus @ 124

    Yes, I did think it was my duty to tell past buyers to take a profit if that was in their best interest. Yes, it was a daily grind of dialing he telephone.

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  128. 128

    By jrc @ 21:

    I am a potential buyer. And cat fights have reinforced my distrust of RE agents and mortgage brokers. I can search websites just as well as an agent and don’t need an agent to send me listings. I would like to have an agent help with negotiating and have some advice on pricing. But I know what I want, where I want it and how much I am pre-approved…. Tim, does this fit the WALaw model or will I need to go with a discount broker like RedFin? Thanks!

    I don’t know how you can say you can search just as well as an agent when you don’t know how an agent searches. Simply put, you don’t know what you don’t know. The consumer search tools, while much better than in the past, are still deficient in many ways, although it does depend somewhat on what you’re looking for. For some searches one or more (but not probably more than two) consumer sites would be adequate. For others even the best would be a complete joke.

    Then of course there’s the issue of how much your time is worth. Looking at everything you find on the Internet takes time (again depending on your search), and having someone go though them before hand can save a lot of time. To some people that is worth a lot, so some it’s worth very little.

    As to the last question, realize Tim works for Redfin. In the past I’ve said one of the big benefits of Redfin is that you are likely to get an agent who at the very least can properly draft a contract (which was a huge problem in the past, but not as bad now that a lot of agents are out of the business). Between Redfin and Craig, I’d give Craig the nod in that regard without having ever seen one of his contracts, because he can legally explain the terms to you, which is something the Redfin agent cannot do, and he’s also very likely to understand the terms, which is seemingly what you’re looking for.

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  129. 129

    By ChrisM @ 22:

    However, I’m *not* comfortable reviewing the legal contracts – IMO only a lawyer is competent. Do you disagree?

    So… if we believe a lawyer is needed to review the contract, then what other service does a real estate agent provide?

    As I noted above, Ardell has proven over an over again that she cannot interpret contracts, and is a good example of why agents shouldn’t try to interpret or explain contracts. Doing so is not only illegal, but also likely a Consumer Protection Act violation.

    On the other hand, what Ardell can do as a result of her experience is give advice about a particular piece of property. For example, that property X might be difficult to sell because of Y. Back during the peak those types of things tended to be overlooked due to the rush atmosphere. Those most underwater now are those that simply bought the wrong house near the peak.

    The typical buyer, in my experience, often isn’t even familiar with the types of siding. I once saw a property that had both LP siding and a Papco roof, the latter apparently of the type that was recalled. An experienced agent should be able to point that out to you before you spend time drafting an offer and money on an inspection. Most attorneys would be no help in that regard.

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  130. 130
    David North says:

    RE: Kary L. Krismer @ 126 – Kary, like you, I also refer business out (without any referral fees) to other brokerages and business models on a regular basis. I do ask both the referred prospect/client and the referred to broker/attorney/etc to provide feedback once their engagement together has run its course, so I can measure the quality of my referral process and recommendations.

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  131. 131

    By David Losh @ 27:

    Yes, I did think it was my duty to tell past buyers to take a profit if that was in their best interest. Yes, it was a daily grind of dialing he telephone.

    You should have gone into the mortgage business. Far more people want to refinance because rates are lower than want to sell and move because prices are higher.

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  132. 132

    RE: Kary L. Krismer @ 129 – Here’s a link on how to identify LP siding:

    http://activerain.com/blogsview/640749/how-to-identify-lp-siding-and-related-issues

    And here’s one on Pabco roofing:

    http://ho25settlement.com/product.php3

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  133. 133
    David Losh says:

    RE: Kary L. Krismer @ 128

    Geez, that was a great comment. Remember Tim had access to both redfin, and WA Law with an inside track. He works for redfin, and WA Law advertises here. Tim had professional search, and advice resources.

    The search for property may seem pretty easy, but it takes time. It also takes resources. Your home inspector is limited, and your mortgage broker is looking at you as a one time opportunity.

    I think Real Estate agents, good agents, are over worked, and under paid. There are times when the business is easy, but you need to save during those times for when it’s lean. You also have the ebb, and flow of agents who enter, and exit the “business” when times are good, and leave when times are bad.

    6% isn’t enough to keep the over head paid. Commission sales are a very limited way to make a buck. So, in my opinion Real Estate agents, good agents, are a bargain.

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  134. 134
    jrc says:

    RE: Kary L. Krismer @ 129 – Thanks, those are some good points. I would not know about the sidings or roof, but I am not so sure most agents would either.

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  135. 135
    mukoh says:

    Tim,
    North Everett? Are you serious? Right down the street from where a guy was shot a few weeks ago?

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  136. 136
    jrc says:

    David, I understand the problem as you explained it, but it still does not answer the question from the buyers side. For example, some friends of mine, closed on a Seattle house last month. They were buying from someone they knew. They had a morgage broker. So they contacted a RE agent who did a great job of getting them through the closing. They were very happy with the RE agent and mortage broker. But honestly, did the RE agent really deserve the 3% of a 600K price? RE: David Losh @ 33 -

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  137. 137
    ray pepper says:

    RE: ChrisM @ 122 -A few comments:Between Wa Law and Red Fin there is no comparison. At Wa Law you have up-front fees and a time clock which I would never agree to. There is also only 2 guys at Wa Law and if you like what they are pitching take it! I would choose Wa Law before a conventional Brokerage but only if up-front fees are waived and no time clock

    .However, before choosing any of those I would make a call out to Skyline as well. They are independents and if you are searching on your own you maybe a good fit. At 500 Realty if we know you are serious and HAVE YOUR 30 day Pre Approval then you maybe a good fit for us. We would show you all the homes you wanted and never on a clock.

    BTW, thinking an Attorney will not make errors on contracts or can decipher your interests better then Investors who put THEIR money on the line each and everyday is a huge miscalculation. We have 4 Attorneys for 500 Realty that are the best in the biz but, yes, they are investors as well and grinding it out with us at The Trustee Sales each and every week. .

    I will say it again we are all investors here and the 16 of us (8 visible- 8 silent) started 500 Realty because we believe Real Estate, as its conducted today, remains a SHAM. 500 Realty is the best parts of MLS4 Owners, Congress Realty, and Red Fin. The model was formed from analyzing these 3 years ago.

    In re to Marc and Craig I will say it again : We hate up-front fees and time clocks so until that gets changed they remain in our Sham Department of real estate Brokerages. However, I assure everyone they will analyze this in the coming years and it will change if they desire to continue.

    We are prepared for change as well and hopefully be able to give 100% of the commission back but until Lead Generation can be implemented on a wider scale (like Red Fin) we must continue to nibble on the 3900 minimum.

    Good Luck Chris!

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  138. 138

    By jrc @ 134:

    RE: Kary L. Krismer @ 129 – Thanks, those are some good points. I would not know about the sidings or roof, but I am not so sure most agents would either.

    I think most agents know about LP siding, but maybe not Pabco roofs. As to siding though, I wasn’t just referring to not knowing about defective siding, I was also referring to many people know being at all familiar with the different types of siding (metal, vinyl, cedar, cement, etc.).

    There are also Zinsco/Sylvania electrical panels:

    http://www.youtube.com/watch?v=uMV1jmDn3o4

    I’m not so sure about that test setup, but that video does show the concern. Personally I think the concern is probably a bit overblown, but if you see one of those you’re either looking at spending $1,000+ before you move in or possibly when you sell. Knowing that before you make an offer is a good thing.

    Agents get to know a lot of different conditions, and that comes with experience.

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  139. 139
    jrc says:

    David, just to be clear, I am not picking at you. If I do decide to go with a traditional RE agent you will most likely be my first call. Having class, unlike some agents on this sight goes a long way with me.RE: David Losh @ 33 -

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  140. 140

    RE: jrc @ 36 – That’s the type of situation that just screams for getting only a real estate attorney, and one that charges hourly. That’s the type of situation I avoid because to me it is too close to just practicing law (and again, I can legally do that, but if someone else can do the same thing cheaper . . . .)

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  141. 141
    The Tim says:

    By mukoh @ 135:

    Tim,
    North Everett? Are you serious? Right down the street from where a guy was shot a few weeks ago?

    I assume you’re referring to this story, which took place over 4 miles away from my house, in South Everett. That’s like saying that Safeco Field is “right down the street” from the Fremont bridge. Are you seriously that ignorant of Everett?

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  142. 142
    ray pepper says:

    RE: jrc @ 139

    JRC, if David is your first call (from what you learned here) you OBVIOUSLY learned nothing here.

    I think you need to stick around and learn more.

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  143. 143
    ray pepper says:

    RE: The Tim @ 41

    4 miles? Holy Crap Tim…Did you know I can do a 5k? I could almost make it from your home to the crime scene….

    too Close for comfort!

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  144. 144
    jrc says:

    Hey Marc,
    Hope you are still following this thread. When you go on a home tour with a client, what do you add besides opening the door? From the comments of Ray, Kary and others, they make it sound like you don’t do anything except check your watch to make sure you don’t miss any billable hours. When I get closer to buying time, Oct 2011, I will give you and a couple other agents a call. But would be nice for everyone on here to give us a little more info. Especially since many on here are taking you to task. Thanks!RE: Marc @ 17 -

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  145. 145

    By jrc @ 144:

    Hey Marc,
    Hope you are still following this thread. When you go on a home tour with a client, what do you add besides opening the door? From the comments of Ray, Kary and others, they make it sound like you don’t do anything except check your watch to make sure you don’t miss any billable hours -

    I’ve said no such thing.

    To be clear when I say a real estate attorney cannot do something (e.g. determine value), I’m not talking about attorneys that have the tools available to agents. That said, my positive comments about WaLaw are based on the model. It’s a good discount brokerage model. I don’t have any experience working with either Craig or Marc as agents (as opposed to as attorneys), so I’ve made no comments about the quality of their services one way or another.

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  146. 146

    RE: jrc @ 136
    The RE agent in the case you mentioned likely didn’t deserve the 3% commission. But a lot of agents will refund some of the commission back to buyers, just like Redfin does. If I’m not mistaken, some of the franchise brokerages like Windermere and John L Scott don’t allow that, but most of the independents don’t have those restrictions, and many agents are happy to rebate back some commission. When I worked for Skyline, the rules stated that we couldn’t advertise that we offered commission rebates, but they were allowed, up to 50%. My current brokerage does not have those rules. It’s probably a good idea to ask a broker/agent if he would be willing to rebate back to you some of the commission. The worst that can happen is that he or she will say ” No.”
    Also, going back through this thread, I can’t find anyone putting down WaLaw Realty except for Ray.
    I like their model, and I hope that in the future more agents are able to charge by the service they provide rather than a flat commission.

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  147. 147
    ray pepper says:

    RE: jrc @ 144 -agreed!!! JRC?

    When did I ever say that? Good God!

    Now I see how you came up with David as your 1st call.

    Cut a check and I’m sure Marc and Craig will serve you well and do FAR MORE then opening a door. Look into Ira, Ardell, and Kary as well. Oh , and David as well if hes licensed again. Report back what you found out and who you chose and why. I’d be VERY interested.

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  148. 148

    By The Tim @ 141:

    I assume you’re referring to this story, which took place over 4 miles away from my house, in South Everett. That’s like saying that Safeco Field is “right down the street” from the Fremont bridge. Are you seriously that ignorant of Everett?

    OMG! I just discovered I’m within about 4 miles of the Renton Bus Transit Center. I must live in a high crime neighborhood.

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  149. 149
    The Tim says:

    By Kary L. Krismer @ 148:

    OMG! I just discovered I’m within about 4 miles of the Renton Bus Transit Center. I must live in a high crime neighborhood.

    Oh wait, I just found a story about a different shooting slightly closer to my house… just over 3 miles away (also in South Everett).

    I bet all those people living on the top of Queen Anne Hill feel pretty dumb for buying homes so close to crime-ridden Pioneer Square.

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  150. 150
    mukoh says:

    RE: The Tim @ 149 – I think that story didn’t quite make the news just like most of North Everett’s issues. That school on Rucker has a pretty bad rep. I drive by there on my way to Comcast Ice Arena on Sunday’s tends to be a freekshow much like Broadway. All I am saying not exactly an upgrade from Kenmore’s North Shore Schools.

    Houses are nice though with lots of old style character and if it was with the right type of basement, a great way to get more space. :)

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  151. 151
    ARDELL says:

    RE: Pegasus @ 124RE: Pegasus @ 124

    Every client buys for a particular reason, Pegasus. In residential real estate it is a rarity for me to be a primary factor as to whether one buys or sells real estate. I visited clients yesterday who bought their home when the wife was having twins back in 2006. Their decision to purchase had nothing to do with good time to buy and neither will their eventual sale, which could be 20 years from now, be about a good time to sell.

    But in the case of the 19 year old boy, his primary reason to buy was that he was on a summer internship at Microsoft while in College at U-Dub. His cost to buy across from work was comparable to his cost to rent. That the one bedroom apartment would suit his housing needs long term was negligible. That he would even stay in the area once he graduated from college was anyone’s guess.

    Locking in a $60,000 – 60% gain, 30% per year for two years in a row, a tax free gain, clearly was at least reasonable advice in late 2007 early 2008. For a young man with uncertainty as to where he might live and work past graduation, why not take the gain once prices started their trend downward? Do you really think that was bad advice?

    IF someone’s primary reason to purchase is as investment, then yes, the agent should follow through as to good “time” to sell. The bulk of my clients do not purchase as investment, so no, I wasn’t busy on the phone calling other people. But for that particular client the recommended course of action was beyond obvious.

    Earlier this year I called a few clients who closed when interest rates were around 5.5% to tell them it was a good time to refinance. I provided them with a contact with the lowest costs to refinance. There’s an old school phrase “your real estate agent for life”. I make absolutely nothing to take the time to alert clients as to a good time to refinance based on their rate at time of purchase. Based on appraisal one was able to eliminate the mortgage insurance and get a lower rate.

    How can you possibly find fault in my recommending that a client, who bought primarily for investment purpose, take a 60% gain? A 21 year old (19 when he purchased) with no wife or children and only purpose to buy in the first place being that it was a good time to buy for investment. Compelling evidence that the 60% gain was not going to hold and prices were trending downward, and the 2+ year hold period making that gain totally tax free.

    If that is “unprofessional behavior”…then I have to assume there is just no pleasing you. Luckily pleasing you is clearly NOT “my job”.

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  152. 153
    Nic says:

    Way way to much hatred going on here. Both $500 realty and WAlaw have great busines models, but we don’t need to play the game of who’s is better because there isn’t an instance where 1 business model is the best thing for everyone in the world. The people that use these services are going to do the research and find which one is the best deal for what is offered. Anyone (mainly Ray Pepper) that thinks that putting down another business is good for them is sadly mistaken, and is only hurting their reputation. I would say that in everything Ray Pepper has written so far on this comment thread would lead me to believe that his business isn’t very customer friendly (just because he hasn’t sounded friendly thus far). Sorry, but attacking other business models really doesn’t get you that far. Maybe The Tim saw the same thing when he decided to go with WALAW….

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  153. 154
    jrc says:

    Completely agree Nic.RE: Nic @ 153 -

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  154. 155
    jrc says:

    RE: Marc @ 52 – Thanks for the reply

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  155. 156

    By Marc @ 152:

    We don’t mind how long it takes our client to find a home or how many homes they have to look at before they’re ready to make an offer. That’s the beauty of our flat fee, we have much less incentive to try and push for a fast deal.

    I think you could probably determine the incentive of the agent more by looking at their bank account than the commission they charge. ;-)

    I was once fired by a client because the client’s boyfriend wanted her to buy a place and was tired of me pointing out both advantages and disadvantages of various properties. He once said: “There is no perfect property.” I’d agree with that, but I also think it better a client find out about obvious issues before an inspection is done, or if it pertains to location, before moving in.

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  156. 157
    ARDELL says:

    RE: jrc @ 36

    There is no one best agent for all people buying in all places.

    The reason WA-Law is an interesting newcomer as an Alternative Model is not about “discount”. It’s about the client paying for the service whether they buy a home or not. It’s about paying a portion of that up front out of pocket, and the balance in six months. It’s about payment being due whether you buy a house or you don’t buy a house, in that six month time frame, or ever.

    The general commission structure, for most any other brokerage, allows for an agent and client to say at the end of the day…that maybe you shouldn’t buy a house at all. Maybe the market changes, or there just aren’t any good houses for you on market at this time or for the foreseeable future. Most every other commission model charges a potential home buyer nothing if they decide not to buy a house for whatever reason. That reason may or may not be apparent on day one when you start working with an agent.

    Historically that has been the decision of the home buying public. They do not want to pay if they do not buy a house. That is the main reason why most all commissions have been based on a closing vs a payment due regardless of outcome. If you do not want to leave your options open as to buying at all, or if you are willing to pay the commission whether you buy within 6 months or not, then WA-Law may be right for you.

    The term “discount broker” is generally a negative term, without basis. It is a term traditional brokers use to “put down” business models with a stated “lower” rate. In reality, as Ira points out, on some days a traditional broker charges more than a “discount” model, and on other days they charge equal to or less than a “discount” model. A fair price for the service rendered is determined between an agent and their client.

    The majority of my clients do not see what I see when they look at a house. Home Inspectors do not point out value weaknesses in a home. They point out “current defects”. Those are not one in the same.

    Bad siding can be good or made to look good on any given day…it’s still bad siding. It can pass inspection and many people buy the homes. The important thing is buying it with informed consent whether it is currently defective or not.

    There are different degrees of this type of siding, as it was upgraded a few times before it was replaced with the better and best product. It was made by two companies nationally and used by two of them locally (for the most part). On at least one occasion in my experience, that siding would not have been pointed out by the inspector at all, depending on which inspector, even though it was “failed siding”. It was not on the home, it was on an “out building” which may or may not be part of your inspection and agreement. to purchase.

    Relying entirely on inspection vs a thorough and knowledgeable review of the home prior to offer, can cost you money even if you cancel at inspection. There is a limit as to what can be addressed at time of inspection. Let’s say there are several defective panels that cost $1,500 to replace (often up at the chimney box or down by the ground or on one side of the structure only), but replacing the paneling in it’s entirety would cost $20,000. The inspection would more likely accommodate the former vs the latter.

    Rarely can an inspection absorb a $20,000 cost, except as to price reduction vs credit or repair, due to lender limits as to credits and seller’s limits as to repair cost. Many and most sellers and agents would be addressing the defective panels only, and many home buyers would think that was normal and reasonable and close on that basis without addressing the fact that the non-defective siding is subject to the same problems after purchase.

    Price reduction does not give my client the money to replace the siding. So for one client who has the money and is willing to replace the siding, a $20,000 or more price reduction may be appropriate. But for a client with very little cash after closing, that is not an option. It may be an acceptable remedy as to contract and close, but not a good decision for that particular client who lacks the means to correct the problem long term during their ownership of the home.

    The right agent for you depends on what and where you hope to purchase, and whether or not you want to retain the right not to purchase at all. Finding someone who you trust to represent your best interests, and negotiating a commission that you both feel is a fair price, is generally the best way to go.

    Have I referred to WA-Law? Yes. Someone called me to buy X at X price. It was a unit in a brand new downtown condo. He knew exactly what he wanted to offer and exactly which unit he wanted to buy. He did not want advice as to whether that price was a good price or that unit was a good unit to buy. He preferred not to know as his mind was made up and he didn’t want someone to muddy the waters with “advice” as to value. I told him hiring a traditional agent made zero sense for him in that case for a $500,000 condo.

    If it were a good choice and a good price, I would have matched the commission and have done that. But it was NOT a good price or choice, and so I referred him out, given he made it very clear that he did not want to know. For another client we had two prices, one if his choice was good, another if I found a better choice than the one he picked.

    Your job is to find the right service for you, and that is not a decision you can delegate. Best for your friend may not be best for you.

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  157. 158
    ARDELL says:

    RE: ARDELL @ 57

    Correction (too hard to correct a long comment using the edit feature as it negates paragraphs)

    ” It was made by two companies nationally and used by two of them locally (for the most part)”

    That should have said THREE companies nationally, and used by two locally.

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  158. 159

    By ARDELL @ 157:

    Have I referred to WA-Law? Yes. Someone called me to buy X at X price. It was a unit in a brand new downtown condo. He knew exactly what he wanted to offer and exactly which unit he wanted to buy. He did not want advice as to whether that price was a good price or that unit was a good unit to buy. He preferred not to know as his mind was made up and he didn’t want someone to muddy the waters with “advice” as to value. I told him hiring a traditional agent made zero sense for him in that case for a $500,000 condo.

    If that were a private seller on a non-listed property I would refer them to Craig (and/or other attorneys) to handle as an attorney, not as an agent. I assume Craig would be willing to do that. (And I would explain to the buyer the difference.)

    Assuming a listed property I’d be very reluctant to take that type of transaction even if I thought I was a screaming deal. The buyer would have to convince me they had a valid reason why they needed my specific services, although if they just wanted to repay a past favor that might do it. Again, to me it really screams lawyer where the buyer has selected the property and price is not an issue at all.

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  159. 160
    jrc says:

    Ardell,Thanks for your reply. It was very useful. One question please. Are you assuming or do you know WaLAw would not advise this condo buyer that this was not a good value and therefore at least encourage said buyer to: lower the price, suggest a fairer price and then help said buyer with a negotiating strategy to get that better price? Mark if you are there, what is your take on this? RE: ARDELL @ 157 -

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  160. 161
    Pegasus says:

    RE: ARDELL @ 151 – Your original statement said nothing about the fact that the buyer, a very young man, 19, bought for “investment purposes”. It appears since the buyer rejected your attempt to move him out of his condo with a 10 percent cost in fees and commissions because he did not buy it just for “investment purposes” but to actually have a place to call home and enjoy(“He liked his place. Didn’t want to leave even to move in the same complex.”). It is very easy to find fault when one changes the facts to suit one’s story when confronted. Oh my…your slip is showing…

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  161. 162
    ARDELL says:

    RE: Pegasus @ 161

    The reality is that often in a real estate transaction there is more than one decision maker. Sometimes the objective of the husband, as example, is investment. More than one builder has built a house to sell only to have his wife decide it was to be their new home, upon completion.

    When the purchase involves a student, as in the instant case, it is very common for the parents to look at buy vs rent from an investment standpoint for their “child”. The difference here was the parents decision became the student”s purchase, given the lucrative intern position and salary ander more favorable lending terms for him in a first time buyer program that the parents were not eligible for.

    The people who primarily decided to buy for investment reasons (his parents) were not the same as the person who decided not to sell for domicile reasons (the actual owner-the son).

    Still, you give the best advice. They can choose to take it or not. Your criticism was that it was not my “job” to give that advice. I do not agree, and neither do my clients.

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  162. 163
    S-Crow says:

    RE: ARDELL @ 157 – Ardell mentioned: “They do not want to pay if they do not buy a house. That is the main reason why most all commissions have been based on a closing vs a payment due regardless of outcome.”

    I would argue that THE PRIMARY REASON for the existing entrenched commission structure is more a function of Banks and financing institutions playing nice with the real estate industrial complex essentially making a commission a de facto “closing cost financed into the purchase price fully paid for by buyers.” Without playing the game this way the market would be entirely different. People value the money in their wallet and where it goes. Therefore, people would value the role and time an agent or any other service provider and they could immediately fire service providers that are doing sub par work or lousy service with no strings attached.

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  163. 164
    Voight-kampff says:

    RE: Nic @ 53
    I agree as well. I love a good blog brawl, however the way many of the agents etc conduct themselves here speaks volumes on how you could expect them to behave. In some cases it helps them( I’m talking to you Ira!) but with some I always picture “that guy” with his bluetooth headset on speaking loudly in line at the bank, or Starbucks or whatever, oblivious to the world around them to “close the deal!!!”.

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  164. 165

    RE: S-Crow @ 163 – I would note that Craig being an attorney is probably familiar with compensation systems where when the fee is contingent it is generally a higher amount than if it isn’t contingent. That it isn’t contingent allows him to offer a lower fee.

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  165. 166
    jrc says:

    Marc,
    Arden wrote:
    Have I referred to WA-Law? Yes. Someone called me to buy X at X price. It was a unit in a brand new downtown condo. He knew exactly what he wanted to offer and exactly which unit he wanted to buy. He did not want advice as to whether that price was a good price or that unit was a good unit to buy. He preferred not to know as his mind was made up and he didn’t want someone to muddy the waters with “advice” as to value. I told him hiring a traditional agent made zero sense for him in that case for a $500,000 condo.

    If it were a good choice and a good price, I would have matched the commission and have done that. But it was NOT a good price or choice, and so I referred him out, given he made it very clear that he did not want to know. For another client we had two prices, one if his choice was good, another if I found a better choice than the one he picked.

    I wrote:
    Are you assuming or do you know WaLAw would not advise this condo buyer that this was not a good value and therefore at least encourage said buyer to: lower the price, suggest a fairer price and then help said buyer with a negotiating strategy to get that better price?

    That’s fine if the answer is: ‘no we would just let the buyer do something stupid or no we don’t know anything about the market or how to value RE.’ But if that is not the answer, then once again, other RE are making you look like a paper pusher and like you add nothing of value that is not legal advice.
    RE: Marc @ 152 -

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  166. 167
    S-Crow says:

    RE: Kary L. Krismer @ 165 – With paying for some service up front my guess is that the clientele at WaLaw is probably of the cloth of really having a great collaborative relationship: one where the parties really know the obligations of the other and knowing each others strengths and limitations, if any. Putting money on the table right away changes the entire home buying process. Buyers are probably highly qualified and ready to rumble and the Attorneys and support staff can focus on serving vs. will I get paid?

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  167. 168
    David Losh says:

    RE: S-Crow @ 163

    The financing of the commission is very much the point. Rebating the commission into escrow is also something that has yet to be fully explored. The siding, or electrical box, even a roof, could all be rebated at closing. Paint, repair, or land scape can be attractive rebate items once the, “who will work for the cheapest” is settled.

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  168. 169
    ARDELL says:

    RE: jrc @ 160

    The issue was not whether they would. The issue was the buyer chose to be ignorant of that fact. I confirmed that 3 times with the buyer. For his own peace of mind, he did NOT want to know.

    I am quite certain that the models that discount for buyer performing their own duties and being fully responsible for product selection, both WA-Law and Redfin note that difference on their websites, would have no problem with that, particularly if given that directive by their client.

    That is not to say they wouldn’t attempt to venture a guess as to value, if asked the question by their client. But that is not their forte or even a primary component of the service they offer.

    I am responding on an iPad from an appointment during waiting time. When I am at a computer I will answer more fully with language quoted from those websites.

    That is not a criticism. Different models for different consumer needs is great. Redfin has referred clients to me at times, both buyer and seller clients, when that client’s needs exceeded their offered service. Often that was done after they hired redfin, and the client simply made the wrong choice for what later turned out to be their specific needs. It’s great when the one you choose refers it to someone else who is a better fit to your needs, when appropriate. Clearly very few do that.

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  169. 170
    David Losh says:

    RE: Voight-kampff @ 64

    Funny!

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  170. 171
    ray pepper says:

    RE: Marc @ 152

    hmmm…again with the blue highlight………………….Why did you think that was so insightful to deserve a blue highlight. Because he was defending his model? I have been defending for years!

    I’m sorry I must……………..Of course you do not mind “how long it takes for your client to find a home or how many tours”

    Marc you charge 75.00 an hour to tour and get paid 3995 at the end of 6 months. Why would you care? Plus you already got 500 up front.

    JRC and all the others saying I’m mean,rude, and may have poor customer service and this is why Tim didn’t choose me….Possibly……..maybe Tim thinks I’m an idiot….But, the joy is he had options to choose from that were far and away better then the 6% SHAM of conventional brokerages.

    I find compelled to reiterate though I have a HUGE disdain for fees charged to buyers for looking at homes, putting them on a clock, charging a fee to initiate a search, and a 6 month time limit before having to bring in another 3500. NO WAY !

    Wow…what was this topic again…………

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  171. 172

    RE: jrc @ 166 – I don’t think Marc was answering that question, since Ardell’s post you are referring to was after his.

    My answer would be that the duty of an agent is not to prevent the client from paying too much, but merely to let them know your opinion and to give the client data if necessary. I’ve mentioned before having a client that during a single negotiation made three offers over what we advised as being prudent. They acknowledged that advice, but wanted to make those offers. I was somewhat relieved when the deal didn’t come together, but if it had that would have been their decision to make.

    Another part of what Ardell was thinking might have been that even at a much better price she wouldn’t have recommended buying into a high priced condo at that point in time. If that’s what she was thinking, I can understand that thought, because it wouldn’t be my choice either. Again though I’d point out that an agent acts at the direction of their client, and gives them advice, not directions. So if a client wants to buy in a particular neighborhood, I’ll help them do so even if it’s the last place in the state that I’d want to live personally.

    Let’s change the scenario a bit and say I’d been showing a client a number of houses in the 500-700k range, and then after some time he finds the condo Ardell described and says he wants to buy it ASAP and not negotiate price. There I would be willing to write him up an offer due to the ongoing relationship, I would prepare a CMA prior to drafting up the contract, and discuss that CMA with him prior to filling in the amount by hand. If I felt the condo wasn’t worth $500 and told the client that, it’s still the client’s decision on what to offer. I’m their agent, not their guardian.

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  172. 173
    David Losh says:

    RE: jrc @ 36

    That is a transaction that can be done for less. 1% is kind of normal, but again, it can be done for less.

    A great thing about Real Estate today are the support services available. You can have a virtual assistant do most of the paper work for, I think $250. You still have Errors, and Ommissions Insurance, and the Brokerage fees, whatever they happen to be. It depends on the circumstances.

    Larger brokerages don’t encourage discounts, but most recognize the 1% fee for something easy. Larger companies have deeper pockets. As long as everything is fine, that’s great, but when they go sideways some people tend to blame the Brokerage.

    The way a Brokerage works is that the agents, (I know we are all Brokers now, but give me a break here), split the money coming in according to the contract they have with the Broker.

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  173. 174

    By ray pepper @ 171:

    I find compelled to reiterate though I have a HUGE disdain for fees charged to buyers for looking at homes, putting them on a clock, charging a fee to initiate a search, and a 6 month time limit before having to bring in another 3500.

    This makes me have a question for Marc or Craig. When you’re getting the clients to sign these grossly unreasonable terms, does it work better to hold a semi-automatic pistol or a revolver to their heads? I’m thinking that seeing the silver hollow points in the revolver might just be the thing that gets them to sign. ;-) :-D

    Ray, you need to realize that different people have different desires. Some will prefer Craig’s model, some yours and some mine.

    Finally, this does again remind me again of when the seller client wanted my commission to vary depending on how long it took to get an acceptable offer. When he asked my response was something like: “I’d consider that. Do you want it to go up or down?” Terms are negotiable.

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  174. 175
    ray pepper says:

    RE: Kary L. Krismer @ 174

    Kary, you know me…For god sakes you R even my FB buddy. So is Ardell, Tim, Ira, and YES David Losh.

    I wear my opinion on my sleeve. Right or wrong I stand by my beliefs. I would NEVER, EVER pay 500 up front, knowing I had 10 hours to find a home, then have 75.00 an hour thereafter. Furthermore, if I became knee deep in a short sale (which can take many months) I cannot stand the thought of having another 3500 due at a pre determined time. PURE INSANITY! There is too much pressure on Buyers anyway now buying in a depreciating asset environment.

    So when I see statements “we don’t care how long the buyer takes” “they can search as long as they want”…………WELL OF COURSE!!

    Good God! I’m in Panera Bread right now with 2 appts and I’m gonna eat more bread to pacify the acid that their model built up. Hope I can put on a “friendly face” for these builders…I doubt it!

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  175. 176
    ARDELL says:

    RE: Kary L. Krismer @ 172

    It was new construction. I will clarify that I referred them to Craig Blackmon of WA-Law. WA- Law has a lawyer only component. My guess is they utilized that lawyer services only option vs the plan and payment noted in this discussion. But that choice became an issue between them after I suggested the buyer call them. I trust Craig would have applied the appropriate service for that person.

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  176. 177
    David Losh says:

    RE: Pegasus @ 24

    I don’t know what you do for a living, but Real Estate is a great business to be in. It’s fun, and exciting.

    I was shocked when I first got my Real Estate license to find out how little money agents made. I had been around the business for over twelve years before getting a license. I worked on properties. When I was in college my economics professor asked how much I made, and I made more than him.

    Even though it all looks glamorous, or easy, it’s not. You have to dedicate your life to it. You’ll find that the top agents work the forty plus hours per week, and then some. They are on call 24 hours a day. As much as guys selling the sales package tapes say you can have a life, you don’t get one.

    There are profit potentials with property. The profit is based on risk. The risk lately is extremely high for margins that are extremely tight.

    Good agents are always busy. Your chances of getting good representation are very low. In my opinion that is the problem most people have with a Real Estate agent experience. Most people find an agent through some contrived meeting only to find that agent lacks the skills to navigate the process. Most people become disillusioned, and look for alternatives.

    A good agent is always qualifying the buyer or seller. The system is set up that way. Good agents don’t waste time, they don’t have, with people who don’t want help. Way too many people today think because they spend some time online looking at pretty pictures that they know more than an agent who has visited thousands of properties over decades.

    Then we have the charts and graphs of sales data. Let’s leave it at that.

    Real Estate agents are some of the greatest people on earth. It’s a great business that can make or break you, but it isn’t boring.

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  177. 178
    jrc says:

    I am good with your thought process and agree. My question is more for Marc and that is would he give the same or similar advice and is he qualified to do so. If the answer is yes, then I think many on this sight have been painting him with the wrong brush. I am not accusing I am just asking.RE: Kary L. Krismer @ 72 -

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  178. 179
    ARDELL says:

    RE: Kary L. Krismer @ 72

    As David stated, I and other brokers on occasion, drop to .5% per person, when the service is no opinion needed. I had one in West Seattle like that. 1% to represent both the buyer and seller who were past clients and mother and son. An attorney wouldn’t have worked in that instant case for a few reasons.

    The difference was no opinion needed vs opinion needed but not wanted. It becomes a matter of personal ethics. Can you pay an accountant $50 to file a return, once he sees errors on it? Can you pay him less and tell him to pretend he didn’t notice? I can’t do that.

    Yes, a client is absolutely free to choose with informed consent. But he can’t pay me not to tell him at all once I’ve seen something “wrong”.

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  179. 180
    ray pepper says:

    Appt 1 DONE….Kary, I’m so disappointed…U R NO LONGER my FB friend. U defriended me? You know what that means………

    I can now put you on my Pounce List.

    Be afraid…very afraid….

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  180. 181

    RE: jrc @ 178 – Again, I’d get back to the point that an agent’s motivation may be more dependent on their bank account than their commission model.

    One thing I will add though is that attorneys probably understand the agency relationship the best. That’s because a lot of what an attorney does involves being the client’s agent. They answer a complaint as an agent. They negotiate settlements as an agent. They make offers based on their clients’ authorizations. They understand that different clients have different motivations and concerns. It often doesn’t even matter if the attorney disagrees with the client’s decisions, as long as maybe they aren’t ongoing stupid things that make the situation worse.

    The point is in may ways Craig (and Marc) probably understand their roles at agents better than most agents. Now are there things that Ardell with her 20 years (or whatever) of experience does better than Craig and Marc? Undoubtedly. But overall I would say they probably do a better job at many things than your average agent, and they’ll probably get even better in the future because attorneys are smart people that do great jobs with everything they touch! :-D

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  181. 182

    By ray pepper @ 80:

    Appt 1 DONE….Kary, I’m so disappointed…U R NO LONGER my FB friend. U defriended me? You know what that means……….

    Nothing personal. I deactivated my account. If I ever sign back up again, your wall will be the first wall I post onto. ;-)

    What I want to know is why you didn’t miss me earlier!

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  182. 183

    WOW! No wonder my ears have been ringing lately… ;-)

    Both Marc and I are exceptionally busy with providing real estate broker and legal services to existing clients. That’s one of the challenges of our model: We spend more time working with current clients and less time trying to find the next ones. That said, its the RE Brokers social media world, so we gotta at least try and play by the rules.

    I’m backed up on RCG comments, hopefully Marc will return to this thread soon. But until he’s got some free time, clients of course take priority.

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  183. 184
    ARDELL says:

    RE: Kary L. Krismer @ 181

    jrc…you do know Kary is an attorney… :) His idolatry of such is apparent.

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  184. 185
    ray pepper says:

    RE: Kary L. Krismer @ 181

    quite literally everything they touch..:http://seattletimes.nwsource.com/html/localnews/2015278014_lawyer10m.html

    So many attorney’s I know are riddled with student loan debt and as we know they cannot WALKAWAY from this. I would use EXTREME caution when assuming anyone in any capacity is superior because of a degree.

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  185. 186

    RE: ARDELL @ 184 – Ardell, thanks??? My last sentence probably didn’t make a lot of sense without that piece of information.

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  186. 187

    RE: ray pepper @ 85 – Okay, now you know I’m an attorney, so the joke there should have been obvious. But just in case, I don’t really think Craig and Marc use guns to get their clients to sign.

    That keying the car thing was truly bizarre. That will probably cost him his license to practice law.

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  187. 188

    Kary said “…attorneys are smart people that do great jobs with everything they touch! :-D”

    I must have been confused. I guess the term shyster really means ” great, honest guy with brains who works hard.”

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  188. 189
    Pegasus says:

    RE: ARDELL @ 162 – Say….didn’t you call the bottom in the real estate market about a year after you pumped this kid to list his condo for sale with you? You could have turned him into a flipper with bad timing assuming you could have sold his condo in a reasonable amount of time for what you claim it was worth in 2008. Hindsight…ain’t it wonderful?

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  189. 190
    EconE says:

    All this back and forth about how much peoples services are “worth”…or not worth…reminds me of the scene in ‘Trading Places’ where Dan Akroyd is trying to pawn his watch.

    “In Philadelphia it’s worth fifty bucks”

    http://www.youtube.com/watch?v=pMz_sPs11HU

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  190. 191

    RE: Pegasus @ 189 – The condo market and SFR are different markets.

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  191. 192
    David North says:

    I am amazed at the arguing and finger pointing over business models in this thread. I think the market works reasonably effectively at sorting out which ones are valuable to enough people to be viable, and which ones are not, including which ones change too slowly, which ones are ahead of their times, et al. The range of choices is fantastic!

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  192. 193
    Pegasus says:

    By Kary L. Krismer @ 191:

    RE: Pegasus @ 189 – The condo market and SFR are different markets.

    Yup and all real estate is local(or is that loco?).

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  193. 194
    Scotsman says:

    I won’t ask what’s happened to your incomes while you’re busy arguing how much you’re worth.

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  194. 195
    jrc says:

    I am not sure any of these models make any sense. Take these hypothetical.
    hypothetical 1a: Buyer A buys a house for $450K and buyer B buys a house for $650K. Both require the same amount of time and the amount of expertise. Under the 6% model how do you justify B’s broker getting 6K more
    hypothetical 1b or even more crazy, buyer A takes up 5X the amount of work and needs much more professional help.
    And these also make no sense for the walaw or redfin… models.

    How about charging an hourly rate, based on ones abilities. Yes I know how does one know who is better or worse than the other agent. OK, time to put this to bed.

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  195. 196
    Jonness says:

    By ChrisM @ 122:

    As far as I can tell, there are two things as a buyer I cannot do:
    1. review the contract
    2. access the lockbox

    What am I missing???

    1) Convince himself now is a great time to buy when it obviously isn’t.
    2) Convince himself a house is a place to live and not an investment.
    3) Give himself that extra little push necessary to get off the fence in the middle of a collapsing housing market.
    4) Figure out a just cause to write a frivolous check to for roughly 3% of the house price.
    5) Be coached about PITI while being taught to not account for maintenance fees.
    6) Get pushed to get preapproved prior to searching for a home so you can buy on a moments notice without having to take adequate time to contemplate a more responsible decision.
    7) Have an expert coach and guide you who has his/her personal financial interests in mind while you are contemplating making the most important financial decision of your lifetime.
    8) Be constantly reminded it’s better to buy now as opposed to later because interest rates are low (even though when rates go up prices will go lower).
    9) Have somebody butter you up and make you feel important even though he looks down on you because you don’t wear a suit to work every day.
    10) Have someone reinforce NAR Chief Economist Lawrence Yun’s outlook on the future direction of house prices.

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  196. 198
    David Losh says:

    RE: jrc @ 195

    Now you’re asking the age old question of if $650K is harder than $450K to justify the difference in commission. In theory they are both the same, each should have the same pit falls.

    The difference of the $650K is the increase in liability, and may require a different skill set.

    A bigger difference is between $250K, and $650K, or $650K to $850K.

    Each agent picks a niche, of buyer pool, or potential sellers. Every body has a style that you can kind of tell from the comments here. Most agents can work in the $250K range, Some have an ability over a million, or two million, or sixteen million.

    $400K is a bread and butter range of agents.

    What people are talking about here is the over head of attracting clients, or customers. The theory is you don’t give a $250K agent an $850K listing. The over head at $850K is, in theory, higher. Many agents are now being required, by competition, to stage properties, or pay to get a property ready.

    I also say, that in Real Estate it’s not what you know, it’s who you know. You can walk into some Brokers Opens and see a hundred cards. The same house with a different agent may only get ten cards, or ten agents looking at it.

    The reverse is also true. A house that I really like took repeated price reduction from a very high end agent. She took the listing because she had sold this couple a house on Lake Washington. The house they were selling was in Lake City. It’s a great house, great price, great location, and yet it just sat there. An agent more suited to the price point, and location, attracted another agent who had a buyer.

    OK, it’s not fair, but there is a pecking order that requires a certain look, and quality. In my opinion that’s how the commission breaks down.

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  197. 199
    Jonness says:

    By ARDELL @ 51:

    How can you possibly find fault in my recommending that a client, who bought primarily for investment purpose, take a 60% gain?

    I’m thinking it would be more like a 55% gain if he could have gotten a full price offer, but wasn’t January 2008 right about the time you were adamantly blogging Seattle was special and thus immune from a downturn? Or by then had your heated arguments with Tim already convinced you he was right, and you were wrong about the future direction of the market?

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  198. 200
    Jonness says:

    I dub these 200 posts as “The Heated Real Estate Agent Wars.”

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  199. 201
    David North says:

    By Jonness @ 200:

    I dub these 200 posts as “The Heated Real Estate Agent Wars.”

    I hope Tim’s next post on his purchase decision and process leads to a big long discussion on…(drum roll)…his purchase decision and process. :)

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  200. 202
    David Losh says:

    RE: Patrick Killelea @ 97

    I now use your blog as a part of my daily news read in the morning. You have excellent links to great information.

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  201. 203
    ARDELL says:

    RE: Jonness @ 199

    I looked back to see what I was saying in Jan of 2008

    “I feel badly when I correct agents who say real estate always goes up, but really. I’ve even heard consumers say that. Nothing ALWAYS goes up. Why do people say things like that? Do they like kidding themselves?”

    Right below it Kary said this in 2008

    “I often disagree with Ardell…”

    Maybe Kary and I will soon have our Anniversary of his disagreeing with me. He seems to enjoy it.

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  202. 204

    RE: jrc @ 95 – I think you need to look at it from the seller’s point of view, since they’re the ones that dictate the starting terms. What are they willing to offer to assist in selling their place?

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  203. 205
    ray pepper says:

    who started all this fighting? Someone is to blame but its too late for me to backtrack. I will get to the bottom of this…………..

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  204. 206

    By ray pepper @ 80:

    Appt 1 DONE….Kary, I’m so disappointed…U R NO LONGER my FB friend. U defriended me? You know what that means………

    I can now put you on my Pounce List.

    Be afraid…very afraid….

    Ray, you’ve really sunk to a new low. Emailing me a contest where to win the free dinner I have to be notified by viewing your FB page. Way to rub it in! ;-)

    Seriously, I think Tim should let your contest be a guest blog piece here.

    (For others, he wants a creative idea what to do with a van, and no, he doesn’t consider another Obama/Bush wrap a creative idea.)

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  205. 207
    ray pepper says:

    RE: Kary L. Krismer @ 206

    Kary, when I was sending that out I thought the exact same thing, that I was getting people to go to a 500 Realty FB page. But, I didn’t want to email (spam) everyone again in a week with the winner…But, anyway I got one response this morning that absolutely cracked me up. Its so sad but true..Check this one out:

    “I would suggest something that would benefit all of the unemployed executives in the area.

    The van could be painted blue such as the King County Vanpool Vans.
    Former Vanpool riders and/or executives could be picked up in rush hour and sit in traffic for a couple of hours

    This would bring some routine back into their lives and allow them to become motivated to get back in the work force.

    On days that you don’t have but only a few vanpool riders you could fill the empty seats with manequins holding books or laptops.”

    terrible…so terrible…but golly it made me laugh…

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  206. 208
    Marc says:

    RE: jrc @ 66

    JRC,

    Sorry for the delayed response. I’m not sure who the condo buyer Ardell described in comment 157 is or whether they retained us or not. But, to your question on how would we advise a new client who came to us with a home picked out and a pre-determined price, this actually happens fairly frequently although the price in their mind is almost always below the current list price. They typically want to make a very aggressive or at least a fairly aggressive offer. In those cases we absolutely do a CMA and try to come up with a logical and defensible argument for why our clients offer is reasonable (or in the ball park of reasonable). We’ve found that we have much greater success if we can provide some sort of objective rationale for an offer versus an unsupported, unexplained offer far below the list price. The latter just ticks off the agent and seller and are frequently rejected out of hand.

    After completing the CMA we’ll advise the client what we think a reasonable offer would be and how we think the seller will react to the client’s pre-determined price. We might advise them to re-consider the offer if it’s really low as we think that offers that are highly likely to offend the seller are counter-productive and just set up the next buyer to come along. And that’s not because we care about offending the seller, rather it’s because the goal is to get the house under contract and not to prove that we’re smarter than the other guys. One shouldn’t forget that the seller and listing agent have egos and pride at stake and that it doesn’t do any good to trample on them. Sometimes you need to coddle them a little to make the bad taste of a low offer palatable. A spoon full of sugar, if you will.

    However, each negotiation is unique so no one approach works every time or is best in all situations. You have to be able to adapt to the circumstances and come up with a good approach.

    If someone comes to us that wants to offer full list price without any negotiation I will still encourage them to let me do a market analysis and advise them whether the list price is reasonable. Sometimes, as Ardell points out, they don’t care to negotiate and aren’t particularly interested in a CMA. This blows my mind on a personal level because I’m extremely tight and can’t fathom not pushing for a bargain. But, so long as I’ve discussed the possibilities with my client and given them the opportunity to get more thorough pricing information, if they want to move forward at full list price then I will gladly accommodate them. Our clients are adults and I am only their adviser, not their parent.

    This is not a very common scenario but I can think of one transaction that came close to it. In that case, our clients didn’t negotiate hard up front but were very thorough on the inspection and did negotiate pretty hard for repairs/credits. They were very well-to-do cash buyers who had owned many homes in the past. They knew what they wanted and for personal reasons that seemed very reasonable (under their particular circumstances), they did not want to bicker over price. Ten or twenty grand here or there just wasn’t important to them.

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  207. 209
    Jonness says:

    By ARDELL @ 3:

    Maybe Kary and I will soon have our Anniversary of his disagreeing with me. He seems to enjoy it.

    You guys should go out to dinner some time with an agreement that you won’t discuss real estate. :)

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  208. 210

    RE: Jonness @ 209 – Or use silverware! ;-)

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  209. 211

    […] 210 comments, 06/10: Knife-Catcher: The Tim’s Home Search Timeline […]

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