August 28, 2006

You can't make this up - REIC whores really starting to get desperate, while eating their young

This grotesque story from bubble-central Phoenix, where builders are trying to make nice with the realtwhores they screwed last year during the peak days (when they stopped paying full commission).

Now? Builders throwing parties, paying bonus commissions, and trying to woo the sharks back into the water. Realtwhores response - a big middle finger.

Meanwhile, doesn't the NAR espouse a code of ethics? Doesn't the buyer's interest figure in this mess somewhere? Gren Credo by the way is doing some great reporting now at the Republic - must have pushed the incompetent Catherine Reagor to the side..

Builders work to mend fences with agents

Home builders are spending big bucks and dishing out heaping helpings of hospitality during what has become the summer of love in the Phoenix new-home market. The objects of their affection? The real estate agents they spurned during last year's housing boom.

The wooing has agents sipping wine and tossing down hors d'oeuvres in Buckeye, networking to live music in Chandler, munching free sandwiches in Florence and cashing fat commission checks.

It was a different world in Phoenix housing last year at the peak of the boom. With buyers camping out at subdivisions, builders didn't need agents to bring them prospects. Builders, looking to maximize their profits, cut agents' commissions or started paying flat fees, if they paid any fees at all.

That angered a lot of agents, who felt that builders were abusing the long-standing relationship between the people who sell homes and those who build them.

But the tables have turned. Demand has evaporated, and builders are trying to get cozy with agents again, throwing parties and offering big fees - commissions of 4 to 5 percent - for selling houses fast.

Yet some agents are steering clear of new subdivisions unless clients ask to see homes there. It's payback, they say, for builders who got greedy in a runaway market in which builders raised prices with impunity and slashed commissions.


veritas_faust said...

"Yet some agents are steering clear of new subdivisions unless clients ask to see homes there. It's payback, they say, for builders who got greedy in a runaway market in which builders raised prices with impunity and slashed commissions"

I call BULLSHIT...well OK most of what RE agents have been saying all along is bullshit so its not such a stretch that they are lying now, anyway:

They are gonna go where there is dough and its just that simple. The righteous indignation of a commissioned salesperson is a joke. IF, and that is a big question mark, but if the builders are going to pay more in commissions the agents are going to steer the 2 or 3 buyers they have towards those subdivisions. Wouldn't you?

Claiming its payback time doesn't make alot of sense when you are all starving for business. But I bet the moron they quoted thinks he really "stuck it to the man!"

Anonymous said...

We had (notice the "had") a mega builder (Beazer) in town a few years ago. The builder offered a huge fee to agents. About 30% more than other builders. But, it didn't work.

Beazer builds a crappy home with sub-standard materials. They were run out of town even in a great market. The sales prices were about 10-15% more than their competion and it was an inferior product. As a result, the agents stayed away. Why sell a client a poor product and have to explain to them the faults 5-10 years later when it's time to sell?

I expect the same is happening in Phoenix.

Anonymous said...

Well this is a bad sign in the short term.Builders have so much at stake that they have to keep building period.If they stop now,they are completely ruined,even the big boys.They must keep pushing sales,which means that the low,down dirty,shyster's of the sales world will be recruited(Junk bond salesmen,car salesmen,high pressure closers,and and the dirtiest sharks from all sales fields).You will see big advertised sellathons,and tent sales with huge spotlights at night. This is no joke.Expect this to keep going because the USgov will subsididise the whole mess.And they wonder why we have an "ATTITUDE"

Anonymous said...

A good Broker would have suggested Puts and warrents be included in the sale.No really,they should have.

Anonymous said...

The skells, skanks, genetic mutants and hybrids of indeterminate heritage which populate the builder and realtor
ranks in Phoenix metro, deserve each other.
Let them eat each other out.

illegally yours in PHX said...

So a realtor was quoted as saying that they would rather take their buyer to a resale home that will close faster so that they can get their commision quicker. They also said they wouldn't take the buyer to a new home builder unless they specifically asked.

Real nice ethics play there. Funny, the heartwarming commercials never say that stuff. Way to support the buyer. I WILL NEVER EVER USE A REALTOR AGAIN. I hope they made tons of cash and have some savings, because it'll be a while before they make any real money.

BTW - I will never buy a home until I get at least 50% off. No matter how much the wife asks. Had an investor lower his home from 1.1M to 849K. He offered it to me (after some negotiation) at 700K. I told him he only paid 508K 8 months ago and I would give him 515K. He laughed and said NO and added that he wouldn't give it up for anything less than 700K.

I laughed harder and said, you may not have a choice. I let him know if it didn't sell by the holidays I would offer again. But the offer will be considerably lower.

I may not offer again but I gave him them the most sinister laugh. I can picture his nightmares....while I sleep soundly.

Anonymous said...

DUDE!!"If they quit building we will run out of houses"??????WTF-I wager that in one month from now we will have a full 1year supply-then the fireworks start-and within two months a 3 year supply.Who says this stuff?Crap who the hell in the media is stupid enouph to write it?They gotta be taking orders from some higher up slimeballs.

Dogcrap Green said...

Yet some agents are steering clear of new subdivisions unless clients ask to see homes there.


No builder needs an agent. At least not the ones pumping out 100 units developments.

An agent serves two purposes

1) interduce the seller to the buyer.
2) Create an air of trust by the preception of professionalisem.

Now what f'ing agent can create trust between the builder and the buyer? Geeezzzzzz save your money and walk into the builder's trailer with your own two feet.

Anonymous said...

A drowning man will cling to anything (e.g. 100 year loan) to save himself.

Builders are drowning and all the RE agents in the world cannot change the fact that the bubble has played out and gravity is back from vacation.

Now in addition to unsold inventory the builders are gonna have the RE Agent "entertainment" costs.

As the Titanic sank the back end of the ship looked "safer" and everyone rushed there.....but in the end it mattered not.

Anonymous said...

"As the Titanic sank the back end of the ship looked "safer" and everyone rushed there.....but in the end it mattered not."

That is both an appropriate metaphor and most likely prophetic of the upcoming sinking, underwater, financial drowning.

How does that other quote go...
Don't go gently....

Anonymous said...

Maybe a little off topic but here it is.
What my mom needs right now is a good old fashioned crash.
She was suddenly sued by a creditor for an old debt now reaching or maybe past SOL. This was probably Dad's but maybe she signed on it. She is elederly and gets Soc. Sec and nothing else.
Very likely , due to the huge out of nowhere equity she now has in her rundown stucco box in Phoenix ,the creditor knows she is past the 150,000 dollar EXEMPT PROERTY and can't be Judgment Proof. They probably expect a payday soon by trying to wait for a default Judgment and then tag a Lien on her non exempt property. I believe this is happening to a lot of people with older credit debts now. No time to sue like the present.
We will try to settle but dispute the debt based on SOL.

Anonymous said...

If the cannibals will feast to the last man I'll pay for all the pepto-bismal! Now there's a reality show for you.

Dogcrap Green said...

Kieth why did you destroy this post of yours?

OK, follow this one. The 30-year and the 10-year
6 Jul 2006 by Keith
The mortgage rate is tied to the 10 year, so the mortgage rate will go up. And it will continue to go up even after the Fed stops raising the short-term rates, because there will be less buyers of the 10 year and more buying of the 30 ...

Anonymous said...

read the article AND the responses from the realty whores at the bottom. great entertainment. kind of like poking a pissed-off cat.

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