Q: For real estate pros (agents, appraisers, etc.) re. Trulia/Zillow/etc.

[CoastRange57]

I'm a Realestate broker and investor. Zillow et al can easily be 20% or more off. High and low. Nothing beats a COMPITENT Competitve Market Analysis.
I would be happy to do one for you, except I'm in WA and don't have access to OR MLS data.
The more unique the property, many times the harder to set a price. That's where the art comes into valuation and automated programs just can't do it.
Right now I have a listing priced at $839k. If it was a few miles away, I guarantee it would be closer to a million and sold in less than 2 weeks. We got "trapped" into a price because a neighboring house was on market @$835k and our property was superior in several way (land, sq ft, upgrades etc) and owner did not want to sell for less. Other house has been on market for almost 90 days.
Where Zillow gets ppl in trouble is the Zestimate. Another new listing I recommended a $299k -$309k price point. $299k would have created bidding war and easily gone 10-20k over asking. No matter how much real life data I presented, owner insisted Zillow and Redfin said his house is worth $319-$340k. It's not, even in this crazy market. Seller will have to learn the unfortunate fate of Days on Market and price reductions. This also kills negotiating power. I pray I'm wrong and Zillow is right, but you are paying me a good percentage of the sale price on my expertise, why fight it?

I believe, bar a catastrophic event like a new war, this market run has a year or so left to the very top. Prices are higher than before the 08 crash and inventory is crazy low. It is scary. If you seriously want to sell in the next 1-5 years, now is the time. These things run on ~10 year cycles. Yes, next year you may get 5% more, or 10-15% in two years, but is that worth it vs a possible 30% drop and being unable to sell for another 8-10? That choice is very personal. With values as is, another option is refi at these rates, take cash out and sit back.
Feel free to contact me if I can assist anyone privately.

No taking a shot at realtors personally here, as what you wrote is 100% spot on, and you indicate you are an investor as well, which means you have done well. I don't have a real estate license, don't need one and have done a lot of deals over the years and much more so here in the last 5 years.

I saw a realtor leave a deal hanging at closing on somebody I know this last week, and the deal crashed because of lack of attention to simple details. Of course the owner should have paid more attention too.

Your comments about the market peaks and adjustments are exactly what I see happening as well.

 

[NCW_Robert]

The Freakonomics of Real Estate

Zillows estimates are just averages for your area. They do not take reality into account. That means they don't know if your house is a dump or totally remodeled and in super perfect ready to sell condition. That is where you come in.

If you know about real estate and how it is valued you can figure out where you stand pretty easy.

I would consider calling a few real estate sales agencies and getting market analysis or estimates done, just make darn sure you do not believe everything these people tell you.

There are real estate firms that suck arse and ones that are OK or at least suck less. Read on and you will find out why I say "suck less" and not some are great, because none are great.

One guy [real estate sales agency owner/agent] in my area really is a total scumbag huckster, he advertises on the only radio station in town constantly with weekly hr long infomercials where he brags himself up as the ultimate expert and mover and shaker in town for buying and selling homes.

In reality he is an equity thief and scam artist who will hammer on you to list your house well under market value so he can then sell it super fast and his cost end up being super low. Then he brags about this, selling homes super fast with bidding wars like he is the single greatest thing to ever hit the real estate sales world.

Had him do a market analysis 5 yrs ago and he was almost 50k lower then every other firm out there. House a few doors down sold for 40k more a month before and he left it out of his market analysis. I asked him why he left out a home with exact same features, lot size and state of condition and that just sold a short time ago for 40k more then his estimate and his eyes got big as saucers and he began mumbling.

SCUMBAG... Guy was trying to steal equity from me by convincing me to list my home at "fire sale price" so he could sell it quick, steeling 20% of my equity all so this so called "real estate professional" could make a quick and easy commission. I told him I know exactly WTF he was doing and he could F' OFF.

How do you make sure this crap does not happen to you? Ask around but still be careful as many people taken in by my local scumbag fast sale BS artist real estate sales agency would haplessly tell you how fast this D-BAG sold their home all the while never realizing how they were really scammed out of 20+ percent of their homes equity because this scumbag convinced them to "call him first" and believed in his scam so much they never got any other market analyses done so they never realized he under valued there home so he could sell it instantly.

Make sure you have all the top local real estate sales agencies do market analysis for you and then do your own. Make sure they do not leave out important recent sales [last 6 months or more] that have taken place right in your neighborhood like my local scumbag real estate sales agency owner likes to do so he can artificially support his undervalue stats for your house. Pay attention to this trick, almost all sales should be right in your local area or neighborhood. If there are comparable sales listed in your market analysis from other areas or far from your home such as across town, find out why and question everything you are told.

If this happens, your so called real estate professional list many out of area sales when he could have used in area local sales it mean he is manipulating statistics in order to deflate his estimate of your homes true market value. This is done in order to convince you to list for say, 350k when statistics if accurately depicted could support a true expected sales price of 380 to 400k as an example.

If this so called real estate professional successfully used this scheme to convince you to list for less then true market value, he has in effect stolen a percentage of your equity and taken money right from your pocket just as if he was going through your home and stole 20k or more of cash from your stash in your sock drawer. This sh-it is becoming a lot more common in the real estate world. My local scam artist real estate sales agency owner has developed this to a fine art and has been extremely successful in convincing local home owners to "trust him" by calling him first and not even bothering to have any other real estate sales agencies/agents do a competitive market analysis because he has many people in this area convinced he is the last word in the real estate world and calling any other real estate sales agency is simply a waste of time.

This is where Zillow will come in as you can easily find recent local sales and compare them to your own home. Zillow even has a way to do this automatically and it works well. Take this all into account and judge the suggested selling price your local real estate sales agency come up with against what your own research tells you.

If you get lazy and trust the real estate sales agency D-BAGS they just might do like this local D-BAG agent/owner tries to do.

Trust me on this, statistically real estate agencies/agents take much longer to sell their own homes then it takes them to sell clients homes AND, on average they get 3% more for their own homes. WTF is up with that?

Simple, they want to sell your home fast for a lower price so they have low listing and selling cost involved and then sell it themselves having the buyers and sellers go through them without having the buyers come through another real estate sales agency so there is no split commission. It takes them longer to sell their own homes because they list for true upper market value then work hard for themselves so they get max sales price.

Here is another D-BAG real estate sales agency trick many of them will pull on you. They will take your listing on say, Saturday or sunday and not place your home in the multiple listing or MLS service until the following week, Monday, 7 days later. Why? because if they represent you the seller, then bring in the buyer themselves, they keep 100% of any commissions. If they place your home in the MLS right then, and they can do that if they want, though, every scam artist real estate sales agency out there will show themselves to be exactly that when they refuse to get your home in the MLS for 5 to 7 days all the while making excuses for, we don't know why it is not showing up, I submitted it myself, it must be the MLS system having a problem etc.

Tell any agent you list with you want your home listed in the MLS within 24 hrs and check if you can find it on his website and other agencies websites as verification. If the agent balks at this walk away because he/she knows the game and you are being lied to starting right then, recognize it for what it is and walk away. I would also write in an escape clause allowing you out of the contract if your home is not find-able online in 24 hrs. make them perform and if they balk at this it should tell you something and you should walk away right then as this is a sign you are not dealing with an up and up agent/agency. If they say we are busy it might take longer, tell them to step it up and perform or you will walk out and find some one who will.

I had one real estate sales agency/agent/owner take 10 days to get my listing in the MLS and he only finally got it in the MLS after my lawyer called him and told him we would file suite the next day if the D-BAG failed to get it in the MLS. Like F'n magic it finally popped up in the MLS that very same evening, god that guy was such a lying clown.

This jerkwad cost me big, made me lose a huge score on a house with home and garden magazine perfect yard and 40x60 shop on a lake because he took an offer without making sure the buyers were pre-approved, so it held me up for 30 days - other buyers showed up and took my dream house because I was fighting with buyers who had no $$ and could not finish the deal. it was in another town/area as we were relocating due to employment etc. The deal was friggin done my sellers had accepted my offer but it all came apart due to incompetence on my real estate sales agency's part as I finally figured out later and I found out what really happened, though the real estate sales agent/owner did his best to try and hide the details and evade questions.

I should have sued him. These people are lower then used car salesmen as far as I am concerned because they can cost you so much $$. The bad thing is many people trust them and never even figure out they are being scammed or defrauded or just being lied to by these "professionals".

If your place has potential but has been let go with work needing to be done You will attract scumbag flippers who will lowball you mercilessly so they can move in, fix it up and blow it out for a 100k profit in 2 yrs. How do you know your offer is from a flipper? It will be almost exactly 100k less then your house is actually worth. House flippers have this figure, 100k stuck in their heads and base everything they do on being able to "make 100k" flipping a house.

Craigslist, odds are if you look on your local Craigslist you will see local real estate sales agencies listing homes on there. WHF? Yes, and why do they do that? because buyers "are" trolling your local CL looking for homes because it is so much more simple then a real estate sales agency web site that is slow and most often will demand the customer "log in" so they can be called and locked in to deal with that real estate sales agency.

So if CL is good enough for your local real estate sales agency, why not just cut him out of the picture and list it yourself? OMG selling a home is so complicated... BULL CRA-P.

What does a real estate sales agency/agent do that is magic? He takes the potential buyer out to your home in his car, walks them around your home and says really earth shattering sales talk such as, "here is the kitchen".... "here is the living room" and look, "down here is the master bath and master bedroom".

So you think you could never handle that? I bet you could. In most states the real work of the sale is done by the title company, not the real estate sales agency.

The key to selling a home yourself is to not say too much, but not to little ether. Answer questions, tell a few stories about how much fun you had raising a family and the features you love, never ever mention any problems or anything that does not work or would be viewed in a negative way and always show the house when it is clean and tidy. About the story telling and BS, you can pretty much tell if a buyer is swallowing your stuff and is in tune with you and is into it, that is when you can expand into a few stories that can help endear the home to the buyer. Beware though, if your buyer and you are not hitting it off and the buyers are not really into talking with you and they are being more business like, do not tell them stories, keep it all business.

Last and one of most important rules, never lie about anything and you do that by never going overboard with the BS. If the buyer notices something and ask, and is has been an issue, tell the truth such as, yes the roof leaked, we had a roof fixed professionally it and it has not leaked for the last 5 yrs. I have the receipt for the roofing company available that will corroborate the dates and length of time I stated. The buyer will accept this but not if tell it like a scammer would with lots of BS or with an attempt at hiding anything. You can smell BS a mile away right? so can a buyer so just don't lay down a line of BS.

The real estate sales agency will use a pre-configured contract that has every place you need to sign marked so even a monkey in a suite can point and tell you sign here and initial here etc.

AND now for the most important part of any contract the real estate sales agency will be certain you sign, it is the part stating the real estate sales agency is not a lawyer and does not represent your legal interest and you thus agree to not hold the real estate sales agency liable for ANYTHING.

WAIT.. WHAT? WTF are you paying these real estate sales agency people for? well it is not for legal representation and not for legal protection, that much is for sure. Read the entire contract before you sign it next time, you will be shocked. I read every friggin word and it drives them crazy waiting, I don't care.

So why not go down, get a friggin lawyer, get legal protection and a legal sales contract from the lawyer for a HECK OF A LOT LESS then the 5000.00 plus you will pay the real estate sales agency and sell the friggin place yourself? a lawyer is not going to charge you 5k for a contract and a few hrs of his time. If he tries walk down the street and find another friggin lawyer. Even small towns have a bunch of them.

You can write a home sales contract on a napkin, I am not kidding.

Sold one home, as is, no warranty expressed or implied of any kind.
Line 1: Home address here [____]
Line 2. sales price [_____].
Line 3. Buyers name [___]
Line 4. sellers name [____].
Line 5. List all applicable home defects according to your states laws here [_____].

Then you take it to the title company and they take over. WTF do you need that real estate sales agency/agent/owner for again? Oh ya, so he can make easy $$ for working a few hrs doing your deal. Then buy a huge house and car and boat off his profits from his really smart customers haha....

I seen clerks at radio shack work harder and spend more time on a cell phone sale.

Want to sell fast and for top $$, make sure your home has all the easy stuff done, spruce it up, paint, mow, trim trees and pull brush and out of control bushes etc. Even if you got to hire local labor to help, your return will be many thousands above what the price would be if you just blow it out with peeling paint, rough lawn, out of control weeds and junk every where.

Well you probably figured out I hate real estate sales agencies by now. I kinda do and kinda don't but I am the kind of person who want to get his monies worth. Every time I have ever sold a house I watch the entire process very closely and I have had some really nice sales agents, mostly women, who did there jobs OK and I have had some clowns who I wanted to shoot because all they did from the time I signed was lie and then lie some more until I had to have a lawyer intercede to get them to perform and do their jobs as I hired them to do.

I wrote all this with the thought that if I can save one of you a fraction of the aggravation and expense I have experienced at the hands of these so called "real estate professionals" then I will be happy.

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[CoastRange57]

Craigslist, odds are if you look on your local Craigslist you will see local real estate sales agencies listing homes on there. WHF? Yes, and why do they do that? because buyers "are" trolling your local CL looking for homes because it is so much more simple then a real estate sales agency web site that is slow and most often will demand the customer "log in" so they can be called and locked in to deal with that real estate sales agency.

So if CL is good enough for your local real estate sales agency, why not just cut him out of the picture and list it yourself? OMG selling a home is so complicated... BULL CRA-P.

What does a real estate sales agency/agent do that is magic? He takes the potential buyer out to your home in his car, walks them around your home and says really earth shattering sales talk such as, "here is the kitchen".... "here is the living room" and look, "down here is the master bath and master bedroom".

So you think you could never handle that? I bet you could. In most states the real work of the sale is done by the title company, not the real estate sales agency.

You can write a home sales contract on a napkin, I am not kidding.

Sold one home, as is, no warranty expressed or implied of any kind.
Line 1: Home address here [____]
Line 2. sales price [_____].
Line 3. Buyers name [___]
Line 4. sellers name [____].
Line 5. List all applicable home defects according to your states laws here [_____].

Then you take it to the title company and they take over. WTF do you need that real estate sales agency/agent/owner for again? Oh ya, so he can make easy $$ for working a few hrs doing your deal. Then buy a huge house and car and boat off his profits from his really smart customers haha....

Awesome post Robert and thanks for your take on it. I picked up a few things and 100% agree with everything you said. I am fortunate that my career background includes about 10 years of direct large capital sales experience in heavy equipment sales and golf course development, plus professional level training in that kind of high dollar sales. That helps. We also were flipping houses for a while, but ours were all distressed properties, and we got out of that almost 3 years ago when the raw product became too expensive. There again 20 some years of general contracting helped out at well.

I cut out what I feel are the most important of your quotes, and what it all comes down to. A real estate agent only needs a computer, cell phone and car to sell a house. Which in reality is a good business model. I have purchased 2 pieces of property in the last 6 months. The seller on one did not realize the property had an existing permitted septic system and existing water connection. This would have added about $ 18,000 to the selling price. The realtor did not bother checking with the county either. On comparable properties it was always clearly noted about those two items, We offered 10% under the list price because it had been on market 210 days. They accepted, the seller paid a $ 2,000 commission to their realtor plus 3 years worth of taxes and back HOA fees. We then purchased the adjoining property on a tax foreclosure sale, and have our 2 acre retirement place locked down at 50% less than market value. Unless of course I find a better property in the same area and can sell mine and pay for that one. I need a couple more pieces right now so that I always am holding 2 to 3 pieces more than I want, all in the same area of course. Understanding your local markets are very important here as well.

This brings up the point when looking at a property, always call the county or look online for recorded permits for work done to the property. If the realtor / seller says they upgraded the electrical panel but there is no permit, then that is a problem and negotiable point for sure. Even if the seller did the work themselves it has to be inspected and permitted otherwise insurance companies have this tendency to deny coverage if there is a problem. If you find even one problem like this, it immediately puts the realtor and seller on the explanatory defense and you just gained a sales advantage as well as a cost reduction potential or at least force them to correct the problem so it does not become your problem.

I have been keying in on bare dirt properties in affordable areas in the state. I am not interested in dwellings, I can make a decent profit by doing good and complete due diligence and moving quickly with cash money on properties that the realtors have done piss poor sales jobs on and I can put a bit of pressure on the buyers. The buyer gets screwed, but I get a decent deal and I make money on them. I can turn them in 12 to 24 months for 30% profit. Realtors are bored with bare dirt properties because the pay day is low. So they tend to discount them, not do due diligence because they are only going to make a $ 2,000 commission on it.

Sucks for them.

 

[The Heretic]

I've got a few years to go before I sell, so I am just trying to be generally informed as to the value of my property so I can kind of make a general plan for when I am ready to sell.

When I am ready then I will do more due diligence. I may retire later if I think my finances require any kind of mortgage on the next property, and/or I decide I want to buy first and then sell my current property. Having a job makes mortgages, especially a second mortgage on undeveloped land (and possibly construction too), easier. I can always retire a year or two later after I get things sorted out and some kind of living quarters built on the land.

As for an agent - I certainly won't be going with my previous agent, but I don't have time or patience to deal with the selling myself either. I really liked the PO's agent, he saved me some hassle with a suggestion on financing because of the manufactured home - which my agent seemed clueless about (she made a minimal effort to help me - a first time buyer) - and he has a very good reputation in rural properties. So I am thinking of using him for selling, possibly for buying my next property too.

 

[bgdawgrr]

Funny, I became a realtor because of the bad experiences I've had with realestate agents. There are a fair amount of bad ones out there.
Wanted to address a few issues. (Sorry if I give away some trade secretes) Being an investor, I've easily talk my clients OUT of buying properties 3 to 1. I'm not a home inspector, but I have a ton of experience rehabbing. You would be surprised at the things ppl don't see and I point out that would impact a deal. It would probably show in an official inspection, but why go that far when I can save them a few hundred $ up front? Also, home flip/rehab shows have skewed real life timelines and costs.

Not posting a listing is a BIG no no. A listing should be live in the MLS by 5pm on the date you agree it to go live. Personally, I set my listings to go live ideally on Thursdays (Fridays if pictures can't be scheduled to be ready) and there are marketing reasons for this.
If my listing wasn't live within a day, fire your realtor. What else might not happen on time?

A good realtor should give you a price range YOU want to list at. I usually give a low, mid and crazy number recommendation. They should be based on facts. I also recommend we hold replies to offers at least a few days just so we can get multiple offers. Yes, full price/no closing sounds great day 1, but if we wait the weekend, maybe I can work it for you and get YOU another $5-20k for your pocket. Remember, I only make about $2500 per $100k of your money. That $10k is nothing for me, but could be life changing for you. IMHO, that why you hired me to sell your property. Get YOU top dollar. I also don't overprice properties to get the listing, then come back for price reductions. Watch out for that tactic as well.

Craigslist is a major marketing tool, but not for the reasons you may think. 1. Newspapers are dead. 2. Homes for sale type magazines are ineffective 3. It gives your property exposure on the international market. Foreign investors scour Craigslist for listings. They would not see them on the MLS only.

Lastly, if your agent isn't bringing in a pro photographer, a stager if vacant and putting up 20-25 pics of your property when listed, walk away real fast. I never understood cell phone pics on a listing. It's the price of doing business.

 

[The Heretic]

I mostly used CL and Redfin to find the properties I was interested in. I rarely used MLS listings on individual real estate sites - they were hard to find, could not be searched in one place, and generally did not have the rural listings I wanted.

The photos most of the time sucked - did not show what I wanted to see. Floorplans were extremely rare (how hard is to sketch out a floorplan? ). Some listings had all of the rooms, many did not. Just not a lot of info in listings. I wasted a LOT of time going out to look at listings on my own because my agent rarely sent me anything - she just mostly "phone it in", making no real effort to find what I wanted.

A lot of that time was wasted because the listings themselves did not show what I wanted to know about the property or the house. Do the sellers/agents/photographers think that buyers are going to buy only based on the photos? What buyer would do that? No way I would. So only showing the good in the photos is just going to make me mad when I get out there and see the crap they didn't show in the photos.

I intend to take many of the pics of my property myself. I may not be a pro photographer, but I can do a LOT better than most of the pics I have seen in listings. I also intend to put together a aerial vid of the property and some aerial photos and a plot map - these are the kinds of things many rural buyers want - I spent more time walking around the acreage than I did inside the house (once I did a single walkthrough I knew the floorplan was satisfactory).

As for staging - it helps sometimes - but I really don't care - I personally prefer to see a bare house - with floorplan and measurements - so I can know if it works for me - I don't care about the furniture someone else places in their home, it just obscures things I want to know (like how many outlets there are).

 

[notazombie]

So I mentioned earlier in the thread that Zillow had me way low and I set my price where I thought I might get some action. House listed last Friday and its been shown several times. Checked the listing for something in the write up and happened to notice that Zillow had magically increased their "zestimate" price to within $4k of my asking. Really? The value magically went up $140,000 in the last 30 days? Maybe I should hold out for a couple more months.

 

[NCW_Robert]

So I mentioned earlier in the thread that Zillow had me way low and I set my price where I thought I might get some action. House listed last Friday and its been shown several times. Checked the listing for something in the write up and happened to notice that Zillow had magically increased their "zestimate" price to within $4k of my asking. Really? The value magically went up $140,000 in the last 30 days? Maybe I should hold out for a couple more months.

Zillow has a comparable sales function that will show houses in your area and what they sold for, try to use it to see if other similar houses in your area show the same price increase. If they do then act accordingly.

Look at how many days on the market they had until sold, shorter number of days equals higher demand and higher sales prices.

Do your homework on this stuff and it will pay off.

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