Did you know we can all get rich because of the down market? Today I probably passed the thousand per week mark in email solicitations for websites I have never heard of, who will immediately

• Send me short sale leads
• Send me loan modification leads
• Get me REO business
• Send me fully qualified, “ready to buy now” buyers

and about 30 other bullet points. All I need to do is give them anything from 40 bucks to over $1,000 and I’m in. One pitch was so well done I actually registered on their website for $40 per year (although for a little more I could have had a “lifetime” membership). The same parent company sent me another solicitation, and it prompted me to go to their website and attempt to log in. I was unsuccessful, so I emailed them about the mistake. No mistake, was the reply. Same company, different family of websites. So they aren’t in the business of generating business, I replied, they are in the business of registering agents on their websites for future spam. No reply.

That outfit is getting fat on registrations for utterly nothing. They send a first class letter to bank asset managers asking them to use their directory for BPO and REO agents. Yeah, like that will happen. Can you imagine an asset manager acting like my 6-year old son and saying “Oh! I got a letter!” insead of tossing the junk mail?

Here’s the lesson: Some scheisters out there know that agents are often struggling. So they cyber panhandle these agents, promising to get them out of the doldrums for $50 or $20 per month, or in some cases (such as the now infamous REExperts, who are reduced to a Facebook page after scamming over 1000 agents out of $3500 each), lots more. These are sirens on the rocks. Don’t bite, or you’ll get bitten.

If something were truly worthwhile, as I have told some of the phone scammers, I’d be willing to pay a referral fee from the closed business. That’s far better than $80 per month, I told the guy. But they wouldn’t go for that, because they know it won’t work on their end.

Truly worthwhile endeavors don’t need to solicit you. Be suspicious and keep your money.

Some buyers are reticent to work with one agent exclusively. They think it wise to use more than one agent, perhaps because they think it helps them shop around. Maybe they distrust agents. But that philosophy is tough to manage and it backfires. 

We got a call from one such buyer who turned out to be writing simultaneous offers with different agents. One offer was with our agent on another firm’s listing, and another was with an agent from another company on one of my listings. It took 4 days to piece it all together.

It also got, as you might imagine, very messy. I have a heartbroken agent who jumped through hoops all week with a buyer who ended up not buying the home they found together, and several other headaches, the details of which are too lurid even for a “members only” posting.

I know full well that most people are reticent to sign an exclusive buyer agency agreement with a licensee whom they have known for only a few days. However, it is getting so that some people need to be flushed out early, as regretable as that terminology sounds. We should be more open about the need for that agreement, even for a very short term if need be. I think that most people have more scruples than this buyer, but it all goes back to the importance of the following statement: If you want me to work on your behalf, you need to hire me.

There continues to be a series of article at Inman News about the compensation of real estate agents. The latest article, entitled “6 Percent is Dead,” the owner of a web-based company chimes in with his view. A version of my response is below:

I have not read every article in this series, but the two I have read were written by an agent whose blog paints a picture of frustration who is muses for a salary; and a web-based firm which doesn’t do traditional brokerage in a market where local listing agents have to accompany every single showing (no easy feat).

Inman may get alot of chatter and mileage from these articles, but in light of the failure of Foxtons and Iggy’s House, Real Estate never had the massive Internet-fueled sea change we saw in travel, insurance and stock brokerage, which revolutionized entire industries almost overnight.

I’m also a little tired of people poo-pooing the role agents play in the home buying process. The “I saw it first on the ‘Net so I don’t need a broker” game is tired, inaccurate and obtuse. You saw it on the net first because you were on a broker’s website and they figured out how to make it play into their model. The rest of the process is so clunky, complicated and drawn out that the best brokers who do the most business drive the traffic while working at companies where they can earn the most for their expertise.

In the meantime, non-traditional brokerage remains virtually the same percentage of the market as FSBO was before the advent of the Internet. My own observation is that commissions have risen in my marketplace since 2005, when there was a legitimate question as to how much work it was to sell a listing.

Having an interest in two companies, one “traditional” and the other “non-traditional,” I can see it better than most. Brokerage is needed because of the landscape, the best brokers will work where they can earn the most, and that is why the talk of changing business models has only yielded failed companies and more talk.

Somewhere between the anti-trust cabal of “standardized” commissions and the wildly inaccurate predictions that agents are unneeded because people will add homes to their Internet shopping carts, the market has already spoken. It remains a percentage commission based system. Water falls to it’s own level and cream rises to the top. It is no mistake. Examples to the contrary are anecdotal and less and less common.

Agents are utterly crucial in the transaction of real estate. The best agents who do the most business will work where they can earn the most. Moreover, the agents who are surviving (and some are actually thriving) in the current depressed market are forces to be reckoned with.  Rumors of our demise are premature.

Debbie Clifton wrote a thoughtful piece on how friends listed their house with someone else. I can relate. About two months ago I got an email from a dear family friend. She was my 82 year old mother’s college roommate, her life-long friend, and my oldest brother’s Godmother. She sat with us when we said our last goodbye to my dad and then again with my older brother’s passing. I think you get the picture.

The email said that she had listed her co op apartment for sale and to please keep it in mind if I had a buyer. Now obviously, this friend knows I am a broker. She knows I am a good broker. She didn’t forget about me, because she wrote the email. But she chose another agent without even interviewing me. Am I hurt? No, but I am curious. I certainly could have used the listing (I’d view it as a fairly salable property) and I think I could have sold it by now. It hasn’t sold yet.

I’m not going to ask her why she listed it with another agent. She had her reasons, and talking about them might make her uncomfortable. Maybe she meant to interview me but the first agent she spoke with talked her out of it. This much I know- my mother’s friend owes me nothing. The thing to do is see if I can bring a buyer, and if it expires, make a note to gently convince her that I am a viable option. If she tells me it is uncomfortable to do business with the son of a close friend or something else, I’ll have my answer.

The Universe doesn’t owe me a piece of the action. I have snatched my share of listings from the more obvious or expected agent my whole career. Sometimes the ones that might seem natural for me don’t go that way. On the whole, I win far more than I lose. In the meantime, I’ll try and bring her a buyer. If I am successful, I’ll make some money, feel vindicated, and help a woman who has known my mom for twice my lifetime to get to the next chapter of her life.

Why can’t the hundreds of thousands of NAR members who have to pay for our health insurance as individuals pool our buying power together and get group coverage? I pay $1200 per month for my family’s coverage. We are on our 5th or so insurance company since were were married in 2001 and this is our 2nd go-round with Blue Cross. What an odyssey.

Most if not all real estate licensees are self employed independent contractors. Some of us are married to teachers, union members, and corporate types who have health insurance with their jobs. For those us us who aren’t, we have to pay for health insurance as a small independent business. And we pay through the nose for that health insurance. The NAR has about one million members. Many in our ranks have married our health insurance, so they are fine. What about the rest of us?

My question, isn’t original or new but it isn’t asked enough. Why can’t the hundreds of thousands of NAR members who have to pay for our health insurance as individuals pool our buying power together and get group coverage?

I appreciate what the NAR PAC does on the legislative level. I do benefit from the affinity program discounts and benefits. They offer help with auto and E & O insurance. Good stuff all. But isn’t something wrong with this picture when I pay 1200 clams every month, Joe Blow Realty down the street pays the same, and all the others in town buy the same product and we can’t get a dime’s leverage from our collective buying power? We DO have buying power, do we not? Hell the Long Island Board of REALTORS have their own CREDIT UNION. NYSAR has an endorsed health insurer but every time we’ve looked into it their premium has been the same for REALTORS as for anyone else in the public (we wouldn’t save a dime with them- we’d lose, actually). And when we had GHI ( a prior incarnation of the endorsed) they stunk. 

At the risk of sounding like Dr. Evil, we have ONE MILLION members. That is gigantic buying power, even if parsed down to the state level. I’m all for rent a car discounts, but we can do better.

I want my trade association to do more about this crucial necessity. I pay dues, Lord knows they hold me to high standards, and not enough of us are making noise about this.

I’ll repeat that. Not enough NAR members are making noise about this.  Health insurance is a big deal.

I am home tonight, alone & playing Mr. Mom with the Little Begotten, while Mommy is in Queens cleaning the in-law’s apartment to prepare it for the market. Her parents have been in Seoul, Korea for the past year and unfortunately my father in law’s health precludes him from returning to the States. Sad. Given our busy schedule, Valentine’s day was the perfect day for Ann to spend the day at the apartment.

I’ll miss the place. My wife grew up there. It is the root of all her childhood memories. I remember the first time I was there, in December of 2000, for my first-ever dinner with my future in-laws. I also remember the time we spent there after we were married, sharing a great deal of time together with her parents. My fondest memory of the place was the night Ann told me that we were expecting a baby, all of 2 months after we were wed. It was one of the few times in my life I was speechless.

That baby is now in the next room with his 3 siblings. He’s no baby anymore. Luke is an ebulant 6-year old who loves reading, chess, and building things. He’s also not at all happy that he won’t see his mother until tomorrow, after she crashes at Grandma and Grandpa’s place and takes the train up tomorrow morning.

As much as he feels out of place, I feel out of place too, not just because I am wearing an apron, but because my wife and I will start wearing the hat of home sellers again. Don’t get me wrong; I love the broker we’re hiring. He finishes my sentences. But we too will undergo the process of sweating out showings, feedback, offers, negotiation, mortgage, co op board approval, moving 30 years of life out before closing. It isn’t easy. It will make us better agents, as empathy usually does, but it will be another hat to wear.

And that is why I am wearing an extra hat tonight. Not the most romantic Valentines day, but like John Lennon said, life is what happens when you are making other plans.   

Luke in his hanbok on his Tol (1st birthday) with Grandpa and Grandma

My BA is in English. I am far more of a man of letters than of numbers.  I’ve always sort of disliked math, unless it was related to money or baseball stats.  But there are times when numbers are clearly more imprtant than letters. Take for example a recent conversation I had with an agent on one of my listings:

Me: This is a short sale. It is contingent on price approval from the seller’s lender.

Her: Has the short sale been approved yet?

Me: No, we haven’t had an offer yet. But when we do, I can assure you that we’ll get it done as smoothly as possible. I have done dozens of short sales.

Her: Oh, I am a short sale expert too. I’m a certified pre-foreclosure(or whatever) property expert.

Me: (scratching head, going through metal rolo-dex because I never heard of the person): Oh? How many short sales have you closed?

Her: Well, none yet.

So here we have a person who has paid her money, gone to a class, and gets to put some initials after her name. And the first time she’s on hold for 40 minutes with a loss mitigation department she may well decide she’ll never do a short sale again. And she’ll be cutting her teeth on the file of some poor slob who thinks he’s in good (expert) hands.

I don’t see how it can possibly be anything other than MISLEADING to bill oneself as an “expert” or “certified”  at something one has never done. I think classes are just fine, but many professions require an apprenticeship before giving someone their wings. This is so for appraisers,  electricians, plumbers, physicians and many other fields.

Everyone has to start somewhere, but there are right and wrong ways of getting into short sales. And, believe me, the WRONG way is to fly solo on the back of an unsuspecting public. If you want to earn commission in short sales, there are two good ways of doing so if you are a neophyte:

• Work for a broker who does a high volume of short sales
• Find short sales and refer them to someone who does lots of them in exchange for a referral fee.

I wouldn’t want a neophyte performing open heart surgery on me, defending my life in court, or caring for my autistic son. I want the BEST, no matter what the initials after their name are. It should be the same with real estate transactions that must close to avoid a foreclosure. Sadly, the direction our profession is going is to obfuscate who is truly qualified for short sales, to the detriment of our clientele. It also does a disservice to the GRIs, ABRs and CRSs of the world, whose initials DO mean something of value.

To the consumer: Don’t count the letters after their name, count the number of successful short sales they’ve closed.