Andrew Wetzel, Long & Foster Havertown Real Estate

Only time will tell if this "disruption" helped or hurt consumers. As an ethical and honest REALTOR, let me offer some thoughts.

(1) posting coop fees in the MLS made it easy to show sellers what their "competition" was doing to help them attract buyers. It also allowed buyer agents to readily know whether their buyer was a viable candidate for specific properties that would essentially cover or greatly offset the fee(s) they agreed to pay their own agent.

On the downside, unscrupulous agents were able to "hide" property listings that did not financially appeal to them. These agents NEVER belonged in this business and appeared to be a VERY small percentage of those working in Real Estate. Was this process worth trying to neutralize them?

We live in the age of the Internet. A typical buyer was as familiar if not more familiar with the active market than many agents who work with a variety of buyers "shopping" in different areas.

How many asked why their agent did not "present" specific listings for them to see? Were they "under contract" or did their offers of compensation not appeal to the buyer agent???

(2) Our rules ALREADY REQUIRE that agents have formal, written contracts with their clients that spell out our "duties", our compensation and how we earn our fees. PERIOD! Some agents fail to use our contracts and their clients may NOT have understood our fees. Was this process worth trying to neutralize them?

(3) Commissions have ALWAYS been negotiable. However, commissions, specifically offering a "coop fee" to a buyer broker, is a marketing expense intended to maximize exposure and competition which should help sellers achieve their highest selling price.

In theory, a seller could say they would pay their own listing broker but NOT offer a penny for the purpose of their listing broker paying the buyer broker. That is legal but makes little sense if prospective buyers for those houses are not financially capable of paying their own agent. Many are NOT!

Admittedly, the typical practice of sellers paying listing brokers and listing brokers paying buyer brokers "appeared" to create a conflict. So does "dual agency" but many states allow that!

In most cases it made for an effective and efficient way for many to become home owners without breaking their bank accounts (they call that "house poor"). After all, many buyers buy homes with NO DOWN PAYMENT or 3.5 of the purchase price down. Should we require that buyers pay cash? Again I ask, was this process worth neutralizing the "mis-perceptions"?

Someone wiser than me once said "be careful what you wish for". I hope that is not the case here!

While many details remain to be worked out, I hope that low-income buyers or those who have had trouble saving for a down payment won't face a "disparate impact" from what may be nothing more than micro-managing what has been a largely beneficial arrangement.

Are we throwing the baby out with the bath water? Let's remove bad actors from this industry.

PERIOD!

How the recent Realtor settlement could change the way Americans buy and sell homes | CNN Business A settlement announced by the National Association of Realtors on Friday, which ended its litigation with some homesellers, is expected to fundamentally change the rules around how Americans buy and sell their homes.

This is a timely article given that another one I posted a few days ago discussed that some consumers believe that their Real Estate did not do enough to prepare them about potential scams.

Today's article is scary and mistakes can be costly, especially if a bogus "wire" occurs. Money can literally disappear!

As I mentioned in my earlier post, consumers have to be vigilant and stay aware of what is going on. New scams pop up all the time and often only receive attention AFTER someone has suffered. Many scams, including what is discussed in today's article, may well be above the understanding of a typical Real Estate agent. We are not technology experts!

Instead of blaming others or assuming it is "their" responsibility to educate you, PLEASE work with your agent and stay engaged in the whole process. When in doubt, ask questions and meet in person if that makes you more comfortable.

Scammers Use Agent Deepfakes to Fool Buyers, Sellers High-tech criminals are using artificial intelligence to impersonate real estate pros and infiltrate transactions. Would your clients know the difference?

I have heard many, many times during my 27+ year career as a REALTOR that many consumers felt that their agents did NOT do as they expected or as they promised to do when trying to get a representation contract signed. In some cases, the expectations were too high but some of that was the fault of the agent. It is OUR job to set expectations.

That being said, a Real Estate consumer has to have a REALISTIC expectation about their relationship with the agent. Know what you are signing; get copies; ask questions!

Big picture, the "public" has a responsibility to pay attention to current events as well. There have been ample reports about various scams involving Real Estate and new scams are constantly evolving. We can't advise you about all of them and we are NOT lawyers. Most scams rely on people not paying attention!

One quick example. I forget the specifics but I once had a conversation with a client who had a legal question about the property he owned. The issue had nothing to do with our relationship but he said that, if he could not get an answer on his own, that he would contact my company's attorney. I was a little stunned and asked why he thought that our "relationship" might include his getting free legal advice from our attorney.

Some people expect too much but, sadly, too many are impacted by poor service.

And this is why I like to add the following to my blogs, podcasts and miscellaneous Real Estate posts:

Remember, when it comes to selling or buying what is likely your biggest asset and largest overall investment of money, time and effort ...

There is no time for inexperience, empty promises OR false expectations!

HIRE WISELY: We are not "all the same".

Consumers: Agents Aren’t Warning Us Enough About Scams Amid the rapid rise in real estate fraud, a new report reveals what consumers expect from their agents when it comes to protection.

Hmmm.

No matter what your training (for example, are you a lawyer?) or how how smart you are, selling Real Estate should NOT be viewed as a challenge to your ego. It is too important! Be engaged and involved but do not try it alone.

Visit http://AndrewWetzel.com to learn more about selling Real Estate and why you should use an experienced, trained and educated professional.

All that aside, let's look at the money. Everyone wants to make more/ save more money. FSBOs often think they are saving money. However, there is typically a VAST difference in selling prices/ proceeds between sales with and without an agent and the difference is far higher than the real estate fees that may be involved.

Frankly, if we can't get you more than enough to pay our fee, why hire us? Even then, can you get your sale to closing? Most of us only get paid when we succeed.

Remember, when it comes to selling (or buying) what is likely your biggest asset and largest overall investment of money, time and effort ...

There is no time for inexperience, empty promises OR false expectations!

HIRE WISELY: We are not "all the same"

Why FSBOs Say They Regret Not Using a Real Estate Agent Home sellers reveal why they decided to bypass professional representation—and the mistakes they made without a trusted adviser.

All due respect, sometimes you have to laugh! It sounds like some people feel ENTITLED to me. I wish life were that simple.

Will children demand that their parents update their homes before they die so that they won't have to deal with repairs/ updates? There goes the NEST EGG! OMG!!!

Will younger buyers stay out of the Real Estate market because the inventory is dated? How will staying renters help their situations?

Typically property values will be impacted if a house needs updates but that requires proper valuations and, even if purchased at a lower cost, the new owner would have to handle any updates. That requires funding! Again I say OMG!

The inventory is what it is. If a buyer is capable of buying a home, they have to determine their "needs and wants" and see how they match what is available. It is sad when buyers buy an outdated home, get overwhelmed with updating and are compelled to sell a house with several projects started but not completed. Whose fault is that?

Respectfully, paraphrasing a Clint Eastwood line, a buyer needs to know their limitations and that is a PERFECT reason to hire a professional! Don't expect your HGTV watching to get you through!

Remember, when it comes to buying (or selling) what is likely your biggest asset and largest overall investment of money, time and effort ...

There is no time for inexperience, empty promises OR false expectations!

HIRE WISELY: We are not "all the same".

Younger Buyers Want Baby Boomers to Update Their Homes Millennials are worried they’ll inherit properties in need of major renovations and repairs, which could further hamper affordability, a new survey shows.

Here is my latest Blog post.

The statistics compare 2023 to 2022.

Remember, when it comes to selling or buying what is likely your biggest asset and largest overall investment of money, time and effort ...

There is no time for inexperience, empty promises OR false expectations!

HIRE WISELY: We are not "all the same".

Bright MLS December 2023 Delaware County PA Residential Housing Report Showing Time, using Bright MLS statistics, has released its Local Market Insight report for single-family homes in Delaware County, Pennsylvania through December 2023. This report allows us to comp…

Well done but I would add three points.

(1) When I meet with prospective sellers I ALWAYS show them the buyer-broker compensation being offered by owners whose properties may "compete" with their property. What they decide to offer MUST be competitive or agents and their buyers may decide NOT to visit their house.

(2) Here is why: when buyers sign contracts with their agent, they agree to pay them a specified fee. If the owner of a house the buyer likes is not offering what the buyer agreed to pay their agent, the buyer may have agreed to make up the "difference". I have never had a buyer be willing to do that.

There are ways to address that but the real question is why would a seller expect a buyer to pay "market value" for their home and have to compensate their agent? It may happen but it is risky. Price is NOT always the reason for houses sitting on the market unsold.

(3) Year after year statistics show that agent-assisted sales results far exceed the results achieved by "private sellers" (aka FSBOs). The difference is well above the fees paid in agent-assisted sales or agents would continue to be involved in 90% of all sales.

Remember, when it comes to selling or buying what is likely your biggest asset and largest overall investment of money, time and effort ...

There is no time for inexperience, empty promises OR false expectations!

HIRE WISELY: We are not "all the same".

Compensation in Real Estate Ever wonder how real estate agents are paid for their services? We explain the process. Here are some takeaways: Compensation is always negotiable. At the st...

Interesting!

Family and friends may "help" you with other pieces of "advice". Some may be helpful while others may do more harm than good!

As with buying a house in the first place, many may "know" things that just aren't so!

It's YOUR house: YOU decide.

Best wishes in your new home!

7 Myths All New Homeowners Fall For How short should I cut my grass? Can I cut it really short and mow less often? The answer is no. Get more answers about home stuff like water mains and roof vents.

Visit AndrewWetzel.com and look at the articles I wrote under the "Expired" Listing tab. Feel free to look at other articles and links as well. Contact me for a "no-obligation" discussion.

Remember, when it comes to selling or buying what is likely your biggest asset and largest overall investment of money, time and effort ...

There is no time for inexperience, empty promises OR false expectations!

HIRE WISELY: We are not "all the same".

Things To Consider If Your House Didn’t Sell If your listing has expired and your house didn’t sell, it's completely normal to feel a mix of frustration and disappointment.

If you don't talk to a lender, you may never realize how close you are!

Programs have requirements and some have budgets so they may run out of money.

Hiring a REALTOR is a great first step and we can recommend lenders to you.

Remember, when it comes to selling or buying what is likely your biggest asset and largest overall investment of money, time and effort ...

There is no time for inexperience, empty promises OR false expectations!

HIRE WISELY: We are not "all the same".

Down Payment Assistance Programs Can Help Pave the Way to Homeownership If you’re looking to buy a home, your down payment doesn’t have to be a big hurdle.

Home inspections and financing issues are typically the top two deal killers.

As far as inspections, no house is PERFECT and the quality of inspectors varies. The buyer may have the right to terminate a sale even if the seller is willing to negotiate. However, MOST buyers (and their agents) are NOT capable of assessing a home without an inspection, making the waiving of inspections potentially costly and even dangerous.

HOT markets make many buyers do things to compete that they would not "normally" do.

THINK ABOUT THE RISK!

Remember, when it comes to buying (OR selling) what is likely your biggest asset and largest overall investment of money, time and effort ...

There is no time for inexperience, empty promises OR false expectations!

HIRE WISELY: We are not "all the same".

8 Common Home Inspection Issues: Fix Now or Later? Buyers may balk at lengthy inspection reports, but not every item is an emergency. Know what may—and may not—be cause for alarm.

I recently posted blogs and podcasts on Facebook about NAR's annual survey of sellers and buyers where I covered this issue.

While some FSBOs know their buyer and may be willing to take less than "fair market value" (making their paying an agent less likely), many want as much as they can get, especially if their "equity" is going towards purchasing "next home".

Frankly, if I can't get you more than enough to cover my fee, why would you "hire" me?

On the other hand, to think that a seller will get "full market value" without "hiring" a professional AND get to closing with no regrets is unlikely. We have done this before.

Talk to a professional, "know thyself" and act accordingly. It is YOUR choice.

Remember, when it comes to selling (or buying) what is likely your biggest asset and largest overall investment of money, time and effort ...

There is no time for inexperience, empty promises OR false expectations!

HIRE WISELY: We are not "all the same".

Why FSBOs Say They Regret Not Using a Real Estate Agent Home sellers reveal why they decided to bypass professional representation—and the mistakes they made without a trusted adviser.

It is important to plan and prepare for such a large purchase. Mistakes are costly and difficult to overcome. Don't make assumptions (the past is history!) or rely on questionable sources. Be engaged and stay informed. Talk to professionals.

Two "connected" questions I hear often: when will prices and mortgage rates drop? There is no guarantee that either will happen in the "near-term". Real Estate is cyclical but the time frame can vary. There are reasons why prices remain high (low inventory is one; seller willingness to give up low interest rates are another). There are factors causing mortgage rates to remain high as well.

These are odd times: high mortgage rates have not influenced prices. Is there a direct connection? No BUT sellers with urgency may need to lower their prices to sell in tough markets. Others can wait especially if they have a low-interest mortgage and are looking to buy their "next home".

What is in YOUR best interests? What will you think one year from now if you do nothing? Do you expect to regret if you buy now? Buying and selling are emotional decisions justified with logic!

Remember, when it comes to buying or selling what is likely your biggest asset and largest overall investment of money, time and effort ...

There is no time for inexperience, empty promises OR false expectations!

HIRE WISELY: We are not "all the same".

4 Mortgage-Refinancing Mistakes Homeowners Must Avoid With mortgage rates recently starting to retreat from their highs of close to 8%, homeowners may start to consider refinancing

If you are planning to sell or buy Real Estate, this information may be very helpful.

Remember, when it comes to selling or buying what is likely your biggest asset and largest overall investment of money, time and effort ...

There is no time for inexperience, empty promises OR false expectations!

HIRE WISELY: We are not "all the same".

2023 Profile of Home Buyers and Sellers: The Seller “The NATIONAL ASSOCIATION OF REALTORS (NAR) Profile of Home Buyers and Sellers is an annual survey of recent home buyers and sellers who completed a transaction between July 2022 and June 2023. The…

If you are planning to buy or sell Real Estate, this information may be very helpful.

Remember, when it comes to buying or selling what is likely your biggest asset and largest overall investment of money, time and effort ...

There is no time for inexperience, empty promises OR false expectations!

HIRE WISELY: We are not "all the same".

2023 Profile of Home Buyers and Sellers: The Buyer. “The NATIONAL ASSOCIATION OF REALTORS (NAR) Profile of Home Buyers and Sellers is an annual survey of recent home buyers and sellers who completed a transaction between July 2022 and June 2023. The…

One of the many examples of what REALTORS do to further "protect and promote" the PRIVATE ownership of land and housing, an opportunity denied many in other countries.

NAR Weighs in With Supreme Court To Protect Private Property Rights NAR filed amicus briefs with the Supreme Court of the United States in two different cases in support of property owners facing unconstitutional violations of the Takings Clause under the Fifth Amendment.

Amen!

Unfortunately, while owning their own home may be unrealistic for some in "the present", too many make assumptions that undermine reality.

How many could own their own home but believe otherwise? How many could reach that goal with planning and preparation but assume it is impossible?

Talk to professionals and then decide!

Remember, when it comes to buying or selling what is likely your biggest asset and largest overall investment of money, time and effort ...

There is NO TIME for inexperience, empty promises OR false expectations!

HIRE WISELY: We are not "all the same".

Why Homeowners Are Thankful They Own Countless people have set out on the exciting journey of homeownership.

The Inquirer asked me to edit my submission down to their 200-word maximum. I had to do a lot of editing but think I made my points. They published my article on buyers compensating their own agents today.

Here it is:

System works

I am a Realtor and found recent articles on a court decision that found real estate companies conspired to artificially inflate brokerage commissions misleading.

One: No rules set agent commissions; our fees are negotiable by law. “Collusion” is illegal.

Two: Most multiple listing services do not require listing brokers to compensate buyer brokers for showing, selling, and settling their property listings.

Three: Most buyer brokers accept compensation from listing brokers with buyers making up any difference between what they agreed to pay them and what listing brokers offer.

Four: Having buyers compensate their agent ignores the fact that commissions are “built into” loans and pricing. Many buyers struggle to save for a down payment and other costs, including inspections, and do not have the funds to pay their agent.

Given concerns about disparities in home ownership, why consider doing anything that might exclude more people from owning their own home?

Five: Some studies have shown that “noncompetitive” buyer broker compensation may result in houses taking longer to sell and their achieving lower selling prices, likely offsetting any “perceived commission savings.”

I am against anticompetitive practices such as collusion. I think, respectfully, that changing a system that has worked well for many years may do more harm than any perceived or intended good.

Andrew Wetzel, Havertown, [email protected]

Here is an interesting statistic from the National Association of REALTORS (NAR) 2023 Profile of Home Buyers and Sellers based on their "annual survey of recent home buyers and sellers who completed a transaction between July 2022 and June 2023.... The survey contained 129 questions."

While this may not be an "apples to apples" comparison of housing and 57% of FSBOs ("private sellers") already knew their buyer, the fact is that an experienced, educated and trained professional should achieve a final selling price that more than justifies their fee.

Add to this the efforts to force buyers to pay their own agents rather than continue what has worked for years!

In most scenarios, buyers pay sellers who pay their listing broker a commission/ fee who offers compensation (MONEY!) to buyer brokers to show, sell and settle their Real Estate listings!

The price of the house, which includes money the seller/ owner will pay their listing broker, is BAKED INTO the loan and the appraisal, meaning "market prices".

Many buyers struggle to save for a down payment and other home-buying expenses like inspections and simply DO NOT HAVE THE FUNDS TO DIRECTLY PAY THEIR OWN AGENTS! What will happen to them?

There is already concern about the disparity in home ownership among different demographic groups. Forcing buyers to compensate their own agent, as logical as that may sound, will likely exclude many from owning their own home and increase the disparity, despite the intended "good" that some are seeking.

BE CAREFUL WHAT YOU WISH FOR!

https://www.wsj.com/economy/housing/while-all-inflation-feels-bad-housing-inflation-is-the-worst-f12f518d?fbclid=IwAR2CWgRFbmnr9uI7LqCgyMZhR04HAdZDT_VfWImYa5Id-1zgqP9rcWUIVbo

While All Inflation Feels Bad, Housing Inflation Is the Worst For some, unaffordable homes undercut the American dream even more than high gasoline and food prices.

A deep dive into a topic that always seems to generate opinions and is misunderstood by many.

While "negotiable" by law, our commission/ fee is a "marketing expense" and a cost of doing business. Real Estate is NOT retail: "hiring" the lowest price is a choice that may backfire.

Sellers need to know their competition or risk missing an opportunity to attract interest and sell so they can move on.

Remember, when it comes to buying or selling what is likely your biggest asset and largest overall investment of money, time and effort,

There is NO TIME for inexperience, empty promises OR false expectations!

HIRE WISELY: We are NOT "all the same".

Compensation in Real Estate Suppose you contacted me to discuss my helping you sell your home or any piece of Real Estate. What would you think if I told you that I could greatly increase your proceeds by reducing what you ex…

This article specifically discusses buying a "co-op" but it has relevance to ALL Real Estate transactions.

I EMPHASIZE with all of my seller and buyer clients that a Real Estate transaction is a BUSINESS DECISION: will the parties do their best to get the deal, a sale or a rental, DONE?

That being said, this is NOT retail: gratification is delayed and success typically requires and depends on several steps. Unfortunately, some decisions involve issues they should NOT, meaning discrimination.

I prefer NOT to have sellers and buyers meet until settlement to avoid ANY suggestion that a decision was based on something other than objective criteria. This includes having sellers leave their property during showings and buyers NOT sharing information they think may influence behavior such as "lover letters", pictures or video.

I know that selling and buying are emotional decisions based on logic. The circumstances are not always pleasant and that can add to the emotions already present.

No one should EVER wonder if they "lost" for indefensible reasons. Agents MUST also properly advise their clients about their prospects for success so that people do NOT assume they "deserved" to succeed when there was stronger competition.

Remember, when it comes to selling or buying what is likely your biggest asset and largest overall investment of money, time and effort ...

There is no time for inexperience, empty promises OR false expectations!

HIRE WISELY: We are not "all the same".

Co-op Transactions: Unmasking Hidden Discrimination REALTORS® have had some successes in the fight for transparency.

I recently recorded Podcasts and published Blogs on two relevant topics. One does a deep dive into Compensation in Real Estate; the other asks Should Sellers and Buyers Compensate Their Own Agents?

Be careful what you wish for!

Remember, when it comes to selling or buying what is likely your biggest asset and largest overall investment of money, time and effort ...

There is no time for inexperience, empty promises OR false expectations!

HIRE WISELY: We are not "all the same".

Op-Ed: Agent Commissions’ Possible New World: A Step Backward for Fair Housing The United States real estate market is actually the envy of the world. The U.S. boasts the world’s most orderly,

After 26+ years working in Real Estate, I finally got to experience first-hand some of what sellers have to deal with!

Remember, when it comes to selling or buying what is typically your biggest asset and largest overall investment of money, time and effort ....

There is NO TIME for inexperience, empty promises OR false expectations!

HIRE WISELY: We are NOT "all the same".

I Finally Felt Like a Seller It took more than 26 years working in Real Estate and meeting with and working for hundreds of homeowners but I finally got to experience some of what many sellers have to deal with when trying to …

Excellent overview of how compensation typically works. Our fee/ commission is a "marketing expense" and a cost of doing business. Negotiating is fine but sellers and buyers need to understand the pluses and minuses.

In my recent Blogs and Podcasts I point out one additional thought: the compensation offered buyer agents MUST be competitive within the local market or showings and interest may suffer.

The contracts that buyers and their agents have typically allow buyer agents to be compensated by listing brokers/ agents BUT often state that ANY difference between what the buyer contract states and what the listing broker/ agent is offering must be paid by the buyer.

In my experience, buyers do NOT want to pay "fair market value" for a house and still have to compensate their own agents.
There is NO TIME for inexperience, empty promises OR false expectations.

HIRE WISELY: We are NOT "all the same".

Video: How to Explain Real Estate Compensation to Clients Share how you get paid and where the money comes from, step by step.

What may be true for "patience" is NOT universal. "Hard to find" items may be appealing and attract competition BUT, for Real Estate, lack of exposure/ being "hard to find" is NOT GOOD! In fact, if someone stumbles upon such a property, the seller may be desperate and accept less than they should.

Even in crazy markets, some houses sit UNSOLD for a long time. Some have their listing contracts EXPIRE while other sellers CANCEL theirs (that, of course, requires agreement with a listing broker).

By "hard to find", I simply mean that buyers looking for houses that fit their "needs and wants" MUST BE ABLE TO FIND THEM IN THE MLS AND ONLINE SEARCH RESULTS. Some of these owners are a little luckier, being located on a well-traveled street with a "FOR SALE" sign.

I have been working for owners of EXPIRED and CANCELED property listings for my entire 27+ year career. Many of their houses were priced higher than prospective buyers were willing or able to spend so they generated little to no activity. Why they did not adjust their price to the market is a good question and NOT my point here.

Most of these properties had ERRORS in their "write ups" which, worst case, made them unable to be found in search results. I can't tell you how many houses had "central air" set to "NO" but had a "remarks" section that bragged about newer or brand new central air. That simple, easy to catch, DATA ENTRY error kept those properties from being in ANY search results where an agent or a buyer indicated that they wanted to see houses with "central air". There are many other examples that should have been corrected or not made in the first place.

Is having your property listing contract EXPIRE or get CANCELED a terminal situation? No but it can impact a seller's plans, especially if they have identified and perhaps even gone "under contract" for their "next" home and were unable to move without a sale. In addition, the property history may deter some interest as people may think something wrong with the house. That assumes that those houses come back on the market properly described. Some don't even after changing agents!

Sadly, when a typical house does not sell or attract serious interest, the typical response is a price reduction. That lowers the owner's proceeds, perhaps resulting in a change to where they look to move. However, that does NOT change the real problem. A price reduction under these circumstances may be a waste of equity!

When it comes to selling (or buying) what is likely your biggest asset and largest overall investment in money, time and effort ...

There is NO TIME for inexperience, empty promises OR false expectations.

HIRE WISELY: We are NOT "all the same"!

Patience It’s worth the most when it’s the most difficult to find.