Archive for the 'Real Estate Philosophy' Category

TO SELLERS OF HOMES ON THE NORTH FORK…

January 15th, 2008 category: Buyers, Real Estate Philosophy, SellersNo Comments »

AN EAST END OF THE NORTH FORK, LONG ISLAND NEW YORK REAL ESTATE PHENOMENON

We’ve been noticing a very interesting pattern with respect to sellers and their understanding of buyer agency. The pattern appears to convey a lack of understanding.

When you list your home for sale, one of several things may occur. This segment deals with the real estate agent that shows your home, representing the BUYER, not you, the SELLER.

The MLSLI service on Long Island shows the commission being paid by the seller to potential real estate agents with buyers. With alarming frequency, there is a “O” or reduced amount offered in the MLSLI to the agents that represent buyers. By reduced, I don’t mean that it’s “too low”. What is seen is an amount paid to a real estate agent that brings a buyer, but agrees to REPRESENT THE SELLER- this amount- is often higher than the amount offered to the agent that provides a buyer, but REPRESENTS THE BUYER. In too many cases, the amount paid is “0″.

The MLSLI, and REALTOR.COM, is viewed nationally, both by real estate agents and consumers. This is a huge tool in selling your home.

In a typical buyer agency agreement, the buyer has an understanding that is COMMON PRACTICE: the costs to sell the home are reflected when pricing the home by the seller. All sellers build in the amount of payment to the real estate contingent (as well as other potential costs) that are involved in the sale- there is no secret here. If a seller has priced the home to include real estate agents that represent the seller only, the SAME DOLLAR AMOUNT IS TYPICALLY PAID out of the seller’s pocket.

Think you’ll get offered less, when a buyer is represented by a real estate agent? THINK AGAIN. If a home is priced correctly, based on market conditions, the fiduciary required on the part of a buyers agent is not compromised by offering fair market value, for a home that buyers really want. To the contrary; despite possible haggling, the end result is often no different than dealing with a real estate agent that “represents” you, the seller. BOTTOM LINE: getting the house sold should be at the top of the agenda for your listing agent, which would include ALL avenues of marketing exposure and reach.

With much of the buying agenda focused on home BUYERS (the investors aren’t the majority anymore), the game has changed.

Buyers Agency has been in place in most parts of the country for 15 YEARS or more. While initially balked at (the reaction was “why should I, as a seller, pay for the buyer to be represented”) it became clear that in most cases, good market or bad, buyer agency better protects both the buyer AND the seller.

SHOULD BUYERS HAVE TO PAY THE REAL ESTATE AGENTS? They do- it’s in the price of the home.

PRICING COMPROMISES OCCUR IN A SLOW MARKET. IT DOESN’T MATTER WHETHER THE BUYER IS REPRESENTED BY BUYER AGENCY. AS A SELLER, YOU CONTROL THE “SOLD” PRICE. Your listing agent should be competent enough to handle all offers, regardless of the source. The key is to GET OFFERS.

Consider this: if an agent (other than your listing agent ) shows your home (representing you, the seller) and makes an error in some form, YOU, as the seller, are accepting this representation (despite not having chosen the cooperating broker ). You, as a seller, already have representation, via your listing agent, and typically, your attorney. It became evident, in most parts of the country, that sellers didn’t need the potential liability of two representatives; buyers, on the other hand, needed representation.

Additionally, buyers KNOW that the fees are included in the price of the home. Just ask anyone doing a FSBO- often, lookers expect the absent fees to be deducted, when calculating an offer.

If your real estate agent insists on representation from the cooperating broker for YOU, the SELLER, what does that say about their own competence? Frankly, I’d prefer to have a buyers agent in the equation- and counsel all sellers to include the contingent that is currently controlling the market. As a listing agent, our preference is to represent only you, and not subject you to potential errors from an agent representing you (but working with your buyer).

THINK HARD ABOUT ELIMINATING BUYERS AGENCY. THINK HARD ABOUT ANY REAL ESTATE AGENT, WITH FIDUCIARY TO YOU, THE SELLER, WHO COUNSELS AN ACTION THAT ELIMINATES BUYERS IN A MARKET BEGGING FOR BUYERS.

IN OUR OPINION, IT’S A BREACH OF FIDUCIARY TO YOU, THE SELLER, TO COMPROMISE ANY BUYER THAT MIGHT WANT YOUR HOME.

WE OFFER OPINIONS OF REAL ESTATE PRACTICES ON THE NORTH FORK THAT IMPACT SELLERS AND BUYERS.

We’d love to hear your opinions on the practice of “eliminating” some members of the home buying community by eliminating their representation. Has your listing agent explained ALL of this to you, the SELLER?

If you don’t offer compensation to buyer representation, the home can be shown- but will it be purchased in an uncomfortable (and unnecessary) circumstance? Perhaps…perhaps not.

If you have authorized your real estate agent to exclude buyers, rethink it.

Just welcome buyers and their representation in, and see what happens. Remember, YOU control the accepted offer.

IT IS OUR OPINION THAT ELIMINATING BUYERS IS A VERY POOR CHOICE. We don’t want our sellers missing out on buyers, period. Buyer agency offers fairness to all, and less liability for you, the seller. Just our opinion, based on experience.

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Apollo Falling?

December 16th, 2007 category: Downtown Riverhead, North Fork Neighborhoods, Real Estate Philosophy, Riverhead Real Estate1 Comment »

Condemnation possibilities were announced this past week in Riverhead.

The previous post on this topic has developed into an extended situation that can only now become more stagnant than ever. The Supervisor of Riverhead, Phil Cardinale, received a request from Apollo’s Vice President to begin condemnation procedures.

With this news the continuation of a long, protracted process for revitalization, in this authors opinion, is likely. The lawsuit that Riverhead Enterprises would file could take years to settle. Those types of stops in the condemnation process place the advancement for a reborn downtown into a holding pattern.

John Stefans in his article Apollo offer is rejected, closes his article with a glimmer of hope on the horizon, the possibility of arbitration to come up with a fair price agreeable to both parties.

“Condemnation through eminent domain of seven buildings in downtown Riverhead became more of a possibility Friday when Riverhead Enterprises, owner of the properties, formally rejected an offer by Apollo Real Estate Advisors to purchase them for its sweeping urban renewal project on the south side of West Main Street…Mr. Cardinale said Tuesday he hopes condemnation can be avoided and said he plans to ask both sides to agree to a mutually acceptable third-party arbitrator to arrive at a fair price.”

Was there anything unfair about the Apollo offer that was on the table? More information is needed. I wouldn’t be surprised if Sheldon Gordon and Riverhead Enterprises have an agenda that I do not yet have information on. “Going away” is not something that should be expected of this contingent.

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Another North Fork, Long Island Real Estate Rant…

November 28th, 2007 category: Real Estate Philosophy6 Comments »

It’s time for another North Fork, Long Island, New York real estate RANT.

Having recently worked with several buyers seeking property in the area, we were asked what “EXCLUSIVE” meant on the signs that are present here.

To those REALTORS who put the “exclusive” riders up, please do not tell me that it’s to differentiate yourself from an “open” listing- that’s RIDICULOUS, and a game abandoned by New York real estate companies YEARS AGO. Hence, the confusion facing agents from outside the eastern end of Long Island.

We have to explain it to the buyer looking at your listing. Know what? It’s ANNOYING.

Prospective buyer: ” I’ve noticed that many of the signs have EXCLUSIVE on them. What does that mean?”

Real estate agent: “Yes, it’s a practice done out here to offer the listing company the opportunity to pick up both ends, meaning the commission without sharing, in the event that someone happens to drive by the listing.

It’s a very bad plan for the seller, because in the “old” days, meaning thirty plus years ago in most parts of the country, real estate agents realized the importance of cooperation and full exposure- it’s detrimental to any seller to eliminate any buyer by making things confusing. Clearly, some still don’t GET IT.”

When I contacted MLS (MULTIPLE LISTING) about this practice, they had NO IDEA what I was talking about, because exclusive riders disappeared a long time ago elsewhere on Long Island, and everywhere else. They agreed that it is an odd practice, and requested photos- if an agent is a member of theMLS, cooperation with other agents is AGREED TO, making exclusive signs unnecessary.

Another annoyance is the use of the MLS as a method to gain exposure, but with an unwillingness to pay a “buyers agent”. SELLERS: if you’ve agreed to this, rethink it. When we tell buyers that your house doesn’t offer buyers the ability to view the home with a buyers agent, the comment from buyers is often, “WHAT’S WRONG WITH THE HOUSE?”

Because buyer agency is common everywhere, it seems, but on the North Fork, that’s tough to answer. If they want to view the property despite concerns brought about by the decision to eliminate smart buyers that want their own representation, we’ll show it. Most times, though, the buyer will take a pass. The decision to eliminate buyer agency with your property eliminates good buyers. Was this explained to you?

The real estate system has needed a balance on the North Fork, as buyers for YEARS have received the questionable status of being represented by the selling agent. This hasn’t prevented offers from being submitted; in fact, that aspect hasn’t changed.

The difference is that, when one real estate agent represents the seller, and the other the buyer, the transaction has a much better shot at concluding with fairness- to BOTH the seller and the buyer. When a buyer is represented by the SELLING agent, it makes accepting offers imbalanced, and puts the seller in a position that might create compromise: two interested parties; one represented, one not (there is no representation for the buyer whatsoever if they do not have a buyers agency agreement. You’ll never see the offer from the represented buyer. YOUR SELLING AGENT CLEARLY DOES NOT COMPREHEND FIDUCIARY if you have been encouraged to eliminate buyers represented by real estate agents. If it was solely your decision, as a seller, it might be worth re-considering.

And really, aren’t buyers correct to assume that there might be a problem with the property? Why SHOULDN’T buyers have the same ability to choose to be represented by a real estate agent, so that their interests are handled with the same diligence that the sellers interests are?

A buyers agent will establish that the value is in line before showing the property; a buyers agent will accompany the buyer for the inspection in order to determine a reasonable outcome (remember: at this point, the buyer wants the house); a buyers agent will make certain that the buyer is ABLE to make the purchase.

Why eliminate BUYERS IN A BUYERS MARKET, either by playing weird exclusive sign rider games, or insisting that all parties to the transaction represent the seller only? Buyers today are simply too smart for that.

These shenanigans have been present both here, and in the Hamptons, forever…but times are changing.

Put your home on the market, including all possible buyers and their representation, and don’t create doubt by permitting an “exclusive” rider on the house. It causes issues that YOU don’t see, BUT WE DO.

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Choose Your Real Estate Attorney Wisely on The North Fork

September 14th, 2007 category: Buyers, Real Estate Philosophy, SellersNo Comments »

Choosing an attorney for your real estate needs would seem to be a simple task. IS IT?

With an ever changing real estate market, simplicity is no longer…SIMPLE. As basic as real estate contracts are, the arena has changed. Foreclosures, short sales, credit issues, buyer rebates…all relatively new to most home sellers and buyers. And, some attorneys.

You would likely pass on a dentist that offers teeth cleaning and maintenance if you have an issue with your gums; you would likely pass on a doctor that specializes in feet if you have an issue with your heart. And so it goes, with attorneys who offer “real estate services” in addition to a myriad of other services. Jack of all lawsuits; master of none.

OBTAINING A REAL ESTATE ATTORNEY is critical in todays marketplace. If your attorney is stretched thin with other endeavors, you are risking up to the minute knowledge that could be imperative to your situation. A case in point (true story):

A buyer purchased a condominium that was to be built. Delays created life changes; two years and two weeks into the purchase, the buyer had a life change that resulted in the decision to cancel the contract. Told by employees of the builder that the earnest money was non-refundable in the event of a cancellation, the buyer conferred with their attorney, who reviewed the terms of the agreement. The buyer, not wanting to lose the 10% down payment, continued with the purchase.

HAD THE ATTORNEY BEEN A REAL ESTATE SPECIALIST, it would have been determined that in fact, the contract permitted full cancellation, with earnest money returned, in the event that the construction process exceeded two years.

As long as New York insists on the presence of lawyers for your real estate closings, choosing a specialist in real estate is imperative. There is far too much to lose in the event that your attorney is not “on the ball”- and with the current huge changes in the marketplace, gambling that you have someone competent without the assurance that their primary (if not only) focus is real estate is comparable to seeking an ear specialist when you have a broken toe.

Your REAL ESTATE TEAM, due to New York’s antiquated system, demands an attorney. Make it the right one- as real estate professionals, at Options Realty we want everyone on your team watching out for YOU.

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Laugh Out Loud

August 30th, 2007 category: Buyers, Real Estate News, Real Estate PhilosophyNo Comments »

I had a “laugh out loud” moment this morning, when perusing NYC and
Long Island, NY blog posts.

I happened upon a Corcoran blog, presented by a NYC agent, that offered
suggestions to buyers of real estate in New York (my amusement would have remained the same regardless of the source).
While this is a noble subject, it was rather like reading the solution for red
wine stains in the absence of red wine- with all due respect, there is only
way to provide integrity to the buying public, and words and advice just
DON’T CUT IT.
I am happy to enjoy ANY articles related to buyers in our state of New York, provided that it is offered by a buyer’s agent. In the absence of such a fiduciary, the rest is just an empty bottle, with an agenda that reeks of old time content.

The true measure of any commitment to a home buyer in the state of New York requires that the real estate community, whether it is on the East End of Long Island or in our fair city of New York, jump to the call of the consumer by offering FULL FIDUCIARY to the buying public.
It’s been appallingly absent, and shows little progress- while a few companies are jumping on board, the time that it has taken speaks volumes about the lack of real commitment to this consumer- the lifeblood of our tottering industry, and the heroes when the market is “hot”.
Perhaps my sensitivity chip is too vulnerable- the ongoing agency performed for the seller (except- oops- no mls, either in SOME areas) by both real estate parties involved is…overly sensitive? Insulting a buying public who has been tossed (as a second class citizen) into the cellar of real estate by offering “tips” is ludicrous. You didn’t care that their interests had been largely ignored last week; you don’t care now, or you’d be offering up some FIDUCIARY to this critical contingent.
The “stain” of your reluctance is going to be acknowledged by the public in increasing numbers, and there will be no quick-fix solution for you at that point- more empty blogs, perhaps?

This is not new. This “buyer agency” thing has been around for YEARS. If you represent the seller while working with a buyer of property in New York City or areas without buyer agency, there is absolutely NO CREDIBILITY. NONE.

Laughable, but not surprising- with a general misunderstanding across the board with respect to fiduciary, what’s one more empty bottle?

Just another opinion of Options Realty, REPRESENTING BUYERS ON THE NORTH FORK OF LONG ISLAND, with a full comprehension of FIDUCIARY. The North Fork of Long Island- a paradise!

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For Sale By Owner Alternative

August 24th, 2007 category: Real Estate Philosophy, Sellers4 Comments »

There are some consumers in the current real estate market that make the decision to go it alone, using the FSBO alternative (For Sale By Owner). Coming from the mouth of a real estate salesperson, my suggestion is: GO FOR IT.

I would much prefer that you call me to list your home. But, choices are available for those that would prefer to experience the process themselves. If you make this decision, especially in New York, you have the opportunity to wade through the less interesting (but critically important aspects) of your transaction with the assistance of your lawyer- the contract itself, various addendums that form additional caveats to the agreement, etc.

IN NEW YORK, REALTORS HAVE DECIDED, FOR THE MOST PART, NOT TO INVOLVE THEMSELVES IN THESE IMPORTANT ASPECTS from a fill in the blanks form. They CAN; they DON’T.

In observing attempts of homeowners to expose their properties, PRESENTATION is often lacking. This is very easily overcome by ordering PROFESSIONAL signage. Hit real estate signs on the internet, and any and all manner of signage for a FSBO will appear. Get consistent colors, with quality that will sustain weather.

A FSBO sign that looks…unprofessional makes a house appear less than urgent. Order signs that can be placed in the form of directionals- a small lead in on a busy corner (arrow) will increase interest. Be sure to obtain the permission of the property owner that will permit your small directional- while it’s true that the town owns a piece of our front yards, it’s courtesy that counts.

Obtain a web address for your property, i.e., GoDaddy. GET PROFESSIONAL, AND ABUNDANT, PHOTOGRAPHS. The more that your audience can understand the property, the better. Lousy photos negate the benefit of the Internet.
Utilize the available Internet opportunities: Zillow, Trulia, and CraigsList offer exposure. While the FSBO sites are also in abundance, my concern with these sites involve personal opinion- to expose your home only in this forum will bring you individuals that may be looking for a great buy via FSBO. You want individuals that want YOUR house, irrespective of real estate company involvement, at a price that is MARKET VALUE.

Here’s the kink with the process, which has nothing whatsoever to do with the real estate contingent: very often, FSBO buyers want a “steal”, and are very aware that you are not paying commission to an outside source. For this reason, if you find yourself with an offer, accept it only with an understanding of why the purchaser has arrived at their price. Have the buyers provide you with the comparables that compelled their offer, so that you can determine if you have a “real” buyer, or someone seeking to “steal” a property.

Get an inspectionperformed on your property BEFORE you list it. When arriving at an asking price, it’s imperative that you have a grip on the items that may well come your way when an inspection occurs- this should be taken into consideration when pricing your home.

Make sure that any offers have a pre-qualification letter from a bank. While often not worth the paper that they’re written on, you need assurance that your buyer has undertaken the lending process. Get permission, in writing, from the purchaser to speak directly with their loan officer. Your attorney will likely require a date for loan approval (as your real estate agent would)- don’t take it lightly.

Paying a real estate commission to a broker is an expected expense in the market. For that reason, if your property doesn’t sell after your efforts, or you determine that going it without the back up of a real estate company is just…not your thing, we’d love to hear from you- call us with any of your real estate needs or questions!

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Plant Ice…Harvest Wind. Here on The North Fork?

August 17th, 2007 category: Real Estate News, Real Estate Philosophy5 Comments »

Like you, I’ve been watching the sub prime debacle. The result of my observations (a laypersons view) is that the current mortgage company collapse involves a whole lot more than the issuance of mortgage loans to borrowers with shaky credit. I know how to assist consumers when they try to GET a mortgage; I know NOT the inner machinations of the banks in their current state.

Evidence: the recent collapse of American Home Mortgage. This is not a company that made its money on sub prime mortgages- this is a company that more often than not, carried “A” paper (good borrowers).The feeding frenzy of home buying for ANY home buyer, good credit or not, offered a myriad of “creative financing” options.

Those with good credit sometimes submitted no doc paperwork; they were able to borrow beyond a capacity that now permits escape from increased loan payments due to a rate that is adjusting (enjoined with the property value that has declined) and there is NO WAY OUT for those that need to sell, short of, well, a short sale or foreclosure.

While the world watches to see the outcome of Countrywide Mortgage (who is currently intimating some pretty hefty financial burden), those that are in the process of obtaining loans are holding their collective breath- is my company next? And what of the zero down programs; the limited doc programs; the teaser interest rate that captured our attention to purchase above our established price range?

The good news is, 100% financing is NOT GONE. The bad news is: limited or no doc loans, regardless of your financial ability, have seen (for the moment) their glory days. Remember: I’m viewing this as most do; perhaps your study of the current problem is well beyond my view. Because, to me, the problem was NEVER in lending money to less than stellar credit. Fraudulent practices are not unknown in the mortgage industry to accomplish a closing, and borrowers with “issues” have borrowed for YEARS. The problem fell to consumers and lenders engaging in a mutual decision to borrow more than they could afford in a market that would CHANGE.

Knowing this, we will all (real estate agents and consumers alike) write this off as history, in time. In the meantime, the mess has additional “ISSUES”.
Banks that are dealing with ONE foreclosing customer are challenged; the current assault has them swamped. Unprepared, calls are left hanging; customer service is out the window; and frankly, they can be MEAN to deal with. Add to that out of state lenders operating on faith with an appraisal that is skewed, due to fewer sales and older pricing- what a mess.

What will (in my view) happen is that creative financing will take a temporary leave in favor of more traditional standards- ratios will matter (ratios obtained from pay stubs and tax returns); rates of a permanent nature will be more interesting to most than adjustable rates (which are attacking
their owners now), and buyers will understand with clarity the amount that will be acceptable- buying “within their means”.

We can now surmise with caution that our government, seeing a return to traditional, will lower interest rates and offer some incentive for a decreased buying public. The month of October in my earlier years of selling real estate often offered a break when rates were on the way down- I’m very curious to see what this year brings as rates edge upward.

MONEY DOWN WILL STILL BE MONEY DOWN- down payments “talk”. Latitude will be afforded those that offer the banks a possibility of equity
should the property foreclose- 20% being the minimum. Not a bad idea, to cover yourself with an equity loss through the form of a down payment for a home that you plan to keep for several years.

In the meantime, strong borrowers will likely borrow what is, on paper, affordable- no more, no less.

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SELLERS ON THE NORTH FORK, LONG ISLAND: I WAS LOOKING AT YOUR HOUSE

August 15th, 2007 category: Buyers, Real Estate News, Real Estate Philosophy, Riverhead Real Estate, Sellers, Southold Real EstateNo Comments »

You’ve no doubt heard much about the ACTIONS recommended to appeal to a home buyer- staging, new paint as needed, handyman work, clutter gone. Very important to the process. Remember, though- that is often the SECOND (albeit most important) person to consider.

Sometimes, the prospective buyer is my client. The result of
this is an initial narrowing down via MLSLI (the Multiple Listing Service of Long Island). As it is a preliminary search initially to get a “feel” for what the buyer might desire, it is incumbent upon me to provide nice homes so that the buyers trust my judgement.

Tonight, I searched the mlsli, and have selected a few properties to add to a list that is being emailed to the client. The properties have been viewed only in pictures, so let’s start there. In the interest of time, properties without multiple photos generally get a cursory glance, but are revisited after seeing homes of interest that have multiple photos. Because there is a fair amount of inventory, if my list is complete before the revisit, it will be reconsidered after we’ve seen houses that have shown me MORE- it’s much easier to narrow down with photos.



Another consideration is the exterior photo. You’ve heard it
before, but it really does MATTER in the initial stages of a search. It again provides me with the opportunity to take an initial meeting with someone and complement it with properties that, at least from the outside, offer some kind of charm. When I’m in a certain price range, with only photos to go by, the limitations are obvious. Unfortunately, looking at all of the houses on an initial visit with a buyer is not realistic (or wise). As a result, anything with less than an average street appearance may fall off the
list; a house with a cared-for look will be at the top.



The next step is setting up a “preview” of the selected homes, to determine if I missed something important. This comes from having once, early in my career, brought people that desired a lush yard to a perfect home that had nothing but rocks, little pebbles, landscaping both front and back. Not good.

The preview part involves taking a look at showing restrictions. If I have a few extra houses on the list, the first tossed from the initial appointment with the buyer will be those that have stringent and limited showing ability. Remember, we have (at this initial meeting) limited time to develop a mutual decision about whether we will be comfortable with one another, the buyer and I. Hassles with showings create an issue that often doesn’t need to be present- I value their time, with limited opportunity to prove
it.

The initial preview will be short and painless- just a quick look around, making mental notes about what to talk about with the buyer. Knowing the property to the extent of having seen it is a huge help. There is also a real effort, always, to value the time of the seller and be prompt- this could be the seller that will provide the house for my buyer.

While most sellers have a good feel for what a buyer is looking for, know that
there are additional considerations when you are selling a home on the North Fork of Long Island. Hopefully, this provides some information on what goes through the head of a buyer’s agent- and assists you in understanding the process just a little bit better.

When a good fit between the buyers, the market, and ourselves occurs, additional properties will be presented as needed. Rather than offer any limiting factors, after our initial meeting I will have a good indication of what to
search for, should the buyer not make a decision during our initial visit. The criteria may be adjusted, and at that point…THE SEARCH IS ON!

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WELCOMED CHANGE IS HERE…DO YOU “GET IT”, NORTH FORK REALTORS

August 10th, 2007 category: Buyers, Real Estate News, Real Estate Philosophy, Riverhead Real Estate, Sellers, Southold Real Estate1 Comment »

A Note To North Fork, Long Island Realtors…

On Behalf Of The Home Buying and Selling Consumer: fiduciary duty: a trustee’s responsibility to act solely in the best interests of the owner or beneficiary of the trust.*

As a professional Realtor, this definition is a large part (in our opinion, the core) of your willingness to partake in the the advantages of being a part of a larger network of real estate professionals that choose to utilize the MLSLI, and separate yourselves from being a “real estate agent.”

When joining the Long Island Board of Realtors, one of the advantages is the ability to share your listings with all other Realtors, hugely increasing the possibility of locating a buyer for the property. In the interest of the buying and selling consumer, this is an advantage that cannot be ignored- it is in THEIR best interest, and as a result, provides the security for them that you are, indeed, up to the task of fiduciary.

ARE YOU, REALLY? This question is not posed to insult; rather, it is posed to provoke thought on the part of those Realtors that find themselves new to the MLSLI/Long Island Board of Realtors, and brand new to the expectations that are GREATER than the expectations that have been acceptable in the North Fork for too many years by local brokers of real estate companies.<

The challenge is larger than most can imagine for the North Fork Realtor. You likely work for a broker that eschewed the practical reasons to utilize the MLSLI service for YEARS, creating a disadvantage for the home selling consumer, in direct opposition to the new direction and requirement to put YOUR FIDUCIARY responsibility with your clients at the forefront. You’ve learned that “getting both ends” of the commission is better, somehow- a very poor bit of advice for a Realtor in our opinion, but common practice for a real estate agent in the North Fork.
If you’ve found the MLSLI to be an advantage for your consumers, PLAY STRAIGHT. It’s simple: LEARN ABOUT THE RULES, AND FOLLOW THEM TO THE LETTER. Use your own common sense, get all houses in the MLSLI immediately (as soon as the house is ready) and look FORWARD to the calls for showings. FORGET ABOUT COLLECTING BOTH SIDES OF THE COMMISSION. If it happens, it’s (opinion) problematic. Here’s WHY:

BUYER REPRESENTATION IS UPON US. IT’S ABOUT TIME, NEW YORK. Homebuyers in New York, unlike the majority of the country, have essentially been “on their own.” Your participation in their purchase has been merely a conduit- nothing more, as long as your allegiance was with the seller. THIS IS NOT THE CASE IN MOST STATES. In fact, it is the case in only a tiny handful- the rest of the country jumped on board with enthusiasm YEARS AGO, recognizing that allegiance to the consumer, regardless of which side of the fence their needs fell on, required specialized attention to the details of the transaction from the consumer perspective. FIDUCIARY- it’s now your JOB. Disclosure requirements came about for a very good reason- learn about this here.

As representatives in the real estate community serving the consumer, embracing changes (rather than the ongoing battle on the east end to do things “our way”) has no place in today’s real estate venue. It is the opinion of Options Realty, and innumerable entities outside of New York, that real estate is a CONSUMER AGENDA. It’s not about commission. It’s about doing a job well, providing fairness at all times, and cooperating with others in our field to accomplish a goal: SELLING A HOUSE.

Incredibly, it’s FUN to sell houses in most areas. Because the Realtor contingent takes the outcome of consumer experience with a cooperative understanding of the fiduciary spirit, guess who ISN’T present in most areas? YUP- the attorney contingent. There’s no need, with Realtors that put FIDUCIARY first on both sides. Explain that to a NY attorney, and you’ll get a litany of reasons that their presence is ESSENTIAL, but folks, it’s NOT. FOR NOW, a necessary component in New York. But who knows, with the advent of full understanding of FIDUCIARY on both sides of the transaction, it may reach the point, where it has in the majority of the country, that consumers may opt NOT TO INVOLVE an attorney, because the representation that they are receiving from the agents on both sides is stellar. Now, wouldn’t THAT be nice…

At Options Realty, WE LOOK FORWARD TO WORKING WITH YOU, AND WITH YOUR BUYERS AND SELLERS. Try hard to put FIDUCIARY first, because as participants in your transaction (buying or selling side) we understand and respect your position with your clients. Once it becomes habit to be “in your client’s shoes”, everything falls into place. Those that just “don’t get it” will be reported often enough to be GONE. JUST OUR OPINION at Options Realty…

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Understanding Real Estate Terms

July 31st, 2007 category: Real Estate News, Real Estate Philosophy1 Comment »

Terms in real estate are widely misunderstood. While often the result isn’t clear, the best approach in the current market is to make decisions based on a complete comprehension of the verbiage.

OFTEN USED REAL ESTATE TERMS:

Agency: this is the legal relationship established when one party (seller or buyer), called the principal, authorizes another (the real estate broker/agent) called the agent, to act in the principals behalf. Exclusive agency: A listing in which the seller gives one broker authority to procure a buyer for the property, but also retains the right to sell the property without the broker’s services.

Exclusive right-to-sell: A listing in which the seller gives one broker authority to procure a buyer for a property, but the broker is entitled to a commission if the seller procures the buyer.

In the above agency agreements with the seller, the listing broker will either be a Realtor, with access to the mls system and an open door policy to Realtors that bring buyers, or the broker will sign up your house as an exclusive to the listing company, in which case only the agents in the office are able to show and sell the property. While efforts may be made to provide exposure, the commission to you, the seller, typically remains the same in either agreement. In the first scenario, you are reaching hundreds of Realtors with buyers; in the other, a handful by comparison.

FIDUCIARY RELATIONSHIP:

If you have signed on with a broker that displays the Realtor logo, your agent has agreed to operate in a fiduciary relationship with you, per the National Association of Realtors requirement for membership.

The fiduciary relationship is very simple: the agent has agreed to operate solely in the best interests of, and on behalf of, you, the seller (principal). Simply put, the only agenda that matters financially is YOURS, the seller. This includes exposure for your home; marketing of your home; negotiating that occurs with your home.

Why Do Real Estate Signs Often Have The Words “Exclusive” On A Sign Rider? An Exclusive sign rider is cause for confusion. The sign that you have in your yard has nothing to do with the agreement that you’ve signed with your broker, short of providing a conduit for interested parties. Prior to the Multi List Service coming to the North Fork, many listings were “exclusive listings.” Consumers realized that being denied full internet access, such as the MLS and Realtor.com provide, was NOT in their best interests. As a result, the North Fork recently jumped on board with acceptable marketing. The result was an effective end to “exclusive” listings. Unless you have signed up with one company doing the listing and selling, you should not have an “exclusive” sign rider. An “exclusive” sign rider could also confuse potential buyers and other Realtors, who may wonder, is this an “exclusive” (no outside participation). The listing agent that you’ve chosen to sell your home has a fiduciary relationship to you, the seller, to determine the best possible listing agreement for you. What Is Buyer Agency?

The buyer of your home has no representation (becoming a customer of your listing company) or has signed a buyer agency agreement with a Realtor. A Buyer Agency means that the broker for the buyer has a responsibility to the buyer to act as his principal, in much the same way that your listing agency represents you, the seller. Either way, the commission that you, as a seller, pay remains the same. If you want your home sold, think hard about excluding the important contingent of “buyer agents”.

In the interest of maintaining integrity in the industry for BOTH sides, BUYER AGENCY is becoming an accepted method of providing a buyer for your home. That their own real estate agent represents them does not harm you, the seller. As it stands in New York, both sides have attorney representation. The buyer compensates their own Realtor through the commission that you have offered the real estate community via your listing company. It is typically split between the two brokers.

Deciding how to list is entirely up to you, the seller. If you believe that the more prospects that visit your home, the more likely an offer, sign up for an Exclusive Right To Sell with a Realtor that participates in the MLS service. If you have been talking with people about your home, write into the listing people that are yours (if they buy, you pay no commission).

What Is A Pocket Listing?

One last real estate term: “Pocket Listing”. If you expect that your home will be in the MLS, request a copy of the id # within three days. A pocket listing is a listing by which the selling agent holds off on exposing your property to other Realtors by not entering it in the MLS in hopes of locating a buyer that will provide them with both “sides” of the commission.

definitions provided above are courtesy of Real Estate Law, authored by James Karp and Elliot Klayman.

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