60 MINUTES - PUBLIC PUFF PIECE BY PURVEYORS OF PUBLICITY FOR THE PERCENTAGE POSSESSED

MORE PATHETIC PUBLIC RELATIONS, MORE BAD PRESS for REALTORS. 

OUR BUSINESS IS NOT ABOUT THE COMMISSION PERCENTAGE.  IT'S ABOUT THE VALUE TO THE CONSUMER OF SUCCESSFUL REAL ESTATE TRANSACTIONS.

I would like to know where they dug up that pathetic excuse for a "spokesperson" for real estate listing agents.  She was a clear dupe of the moderator.  I wonder if her broker approved the piece.  Of course, it wasn't advertising, that's for sure, so no reason for the broker to review anything.  When is an objective journalist going to do an expose' of a few discount brokerage companies?  It would appear from the media slant that all customers of discount or Internet listing companies are happy campers. 

I just did a search for one of the major Internet listing companies in my market area and for all of 2006, the stats are 160 Expired, 311 Withdrawn and 336 SOLD.  Of the 336 Sold, a large number, about 65, were listed a "0" DOM with listing/contract/settled date all the same.  That stat leads to more questions than answers. 

I believe that a home owner has every right to do anything they wish with their property, including selling it themselves, selling through Internet listing service or using low fee listing companies.  However, it's patently ridiculous for the media to continue to focus on the fee that, in the eyes of the media, are higher than they should be, ACCORDING TO THE MEDIA.  Since the media focus on only the fee, they apparently believe that all transactions are the same and all agents provide the same service and ALL HOMES ARE ALIKE. 

The 60 Minutes slant was just too obvious to be considered fair, but it will surely make the Redfin web site click rate jump dramatically.

It's just a good thing that all sellers who use the services of discount brokers have homes that are:

  • priced right
  • have no material defects
  • comply with state and local laws
  • always appraise for the contract price
  • never have disputes over price, terms or condition
  • don't discriminate against protected classes
  • close timely
  • never have a dispute following settlement

If all of the above were true, I'd agree that traditional listing agents are overpaid.  But, all sellers do not have

  • perfect properties
  • properties priced right for the market
  • properties free of material defects
  • properties that appraise for the contract price
  • sell at or close to the asking price
  • sell at all for any price

But, these anti-REALTOR pieces will continue to air as long as we continue to ignore that we are paid for WHAT WE KNOW, NOT WHAT WE DO.

ADDENDUM TO ABOVE AT 8:57 EDT;  It just occurred to me that one of the reason we are getting such bad press lately is that the Internet companies like Redfin have THEIR public relations folks out there inspiring the 60 Minutes, Fox Sunday news and others to broadcase these pieces.  The NAR, on the other hand, really has their hands tied by the DOJ litigation. 

More from the Drive By Media

 
Posted by Lenn Harley on 05/14/2007 07:39 AM   Comments (26)    

26 Comments on 60 MINUTES - PUBLIC PUFF PIECE BY PURVEYORS OF PUBLICITY FOR THE PERCENTAGE POSSESSED

Lenn

Amen!  Professionals are paid for what they know ... not what they do.  The editorial staff at 60 minutes missed that point completely. 

05/14/2007 07:46 AM by E Rybczynski (Rybczynski Consulting)

Yeah I think CBS is just a bunch of liberal weenies. They can't stand big business. The view real esatat as big business because NAR is so big. Who atches CBS anyway.

05/14/2007 07:50 AM by T.U.P. Realty

THANKS for commenting folks.

ED - The 60 minutes editorial staff did precisely what they intended, portray REALTORS in a negative light.  It was the job of the "spokesperson" REALTOR to give some information about what we really get paid for.  She failed miserably.

JEFF - Who indeed???  A former agent called me when the piece started or I'd have missed it.

05/14/2007 07:57 AM by Lenn Harley, Homefinders.com, MD & VA Real Estate

Lenn,

Do you think we will get OUR say???

Let see to it we do! Sign me up!

05/14/2007 08:00 AM by Dave Sulvetta - Camden County NJ Realtor (Century 21 Hearst)

It is ridiculous what they are trying to do to the industry.  The reality is that most people do not want to sell their houses on their own, they admittedly know nothing about real estate or real estate transactions.  Everyone is intilted to sell their house on thier own but, when you are trying to sell the single largest investment that you will make dont you think you would consult a professional? I sure do and im a mortgage broker.

05/14/2007 08:02 AM by Matt Royston (KC Mortgage Services)

I purposely did not watch it because there is never any good news about anything on the TV. The viewing public has become jaded and doesn't pay much mind to this stuff. I believe that the viewing public will forget about it right about this time tomorrow.

05/14/2007 08:06 AM by Greg Cremia (Shore Realty of the Outer Banks)

I must have missed most of the segment... I had the TV on and thought I was paying attention but there was a mishap with the blender and green slime in the kitchen so I missed most of it.

What I saw looked like a commercial for Redfin.  I read the transcript that Rich S. in PA posted though.

05/14/2007 08:08 AM by Maureen McCabe - Central Ohio real estate (Real Living HER)

Lenn, I used to work for an oil company, and during the 1970s Arab oil embargos the news coverage was just as biased, generally looking to some corner gas station operator for "insight" on the global situation.

There has been a populist, anti-big-business slant to the news media for 40 years, and NAR, along with its members, are generally viewed as the establishment aligned against the little guy.

05/14/2007 08:12 AM by Brian Schulman - Your Lancaster County, PA Real Estate Professional (Coldwell Banker Select Professionals)

Lenn--Not too many in MN buy homes sight unseen as it sounded like these people did. Also they only spoke of Seattle WA which is not as affected by the buyers market and high inventory hitting other parts of the nation...Looking at one local market and implying that this will work nationwide is not right.

05/14/2007 08:15 AM by Teri Eckholm, Realtor® Anoka County MN (Keller Williams Premier Realty)

I found the segment really lacking in terms of information. For instance the $3000 listing fee that is paid covers what?  or nothing and the seller still has to pay their own advertising?  Misleading.  Not thorough and I got the impression that Lesley Stahl wouldn't use Redfin if buying or selling, her heart wasn't into it.  There are always companies coming along trying to change the industry but so far and i believe this includes Redfin the way we do business still works, albeit not perfect and will continue for a long time.  Even the wife of the young couple they interviewed in the piece said she was nervous and uncomfortable using Redfin during the process.  With Redfin and all these other companies why is it the DOJ is still after NAR?

05/14/2007 08:20 AM by Miriam Bernstein, CRS, Westchester County, NY (RE/MAX Prime Properties)


Dave Sulvetta - NO DAVE.  We do not get a "say" because it doesn't fit the media agenda.

Matt - I sold a $700,000 property in Bethesda with a full service 6% commission broker.  I haven't lost my mind.  She was worth every penny.  (She did reduce the fee to 5.5% for "professional courtesy", but I never asked.  I know that a good real estate broker or agent is worth what they do to protect us. 
Greg - I was alerted to it by an agent friend.  She asked me to watch and I'm glad I did.  Just gives us insight.  When someone says to me "But, 60 Minutes says", I'll know how to respond.
I must have missed most of the segment... I had the TV on and thought I was paying attention but there was a mishap with the blender and green slime in the kitchen so I missed most of it.
Maureen   HA! !   There was slime on the TV too.
Brian You are 100% correct.  The industry bias is palpable. 
Teri - Agreed.  But, the 60 minute piece was clearly promoting online listing services.  It was a 15 minute commercial for Redfin.

05/14/2007 08:28 AM by Lenn Harley, Homefinders.com, MD & VA Real Estate

Lenn - Every time the media ventures into the real estate arena, they make Realtors look like greedy vultures whose only concern is the paycheck. Of course, they wouldn't entertain a seasoned professional as a spokesperson for the Realtors.

It is absurd the only ammunition they have is commission......as if that were the only consideration when hiring a professional. While we, the professionals, always say commissions are negotiable. Since they are negotiable, people are free to choose the model they want. They have always been free to do so.

When my clients start to buy homes sight unseen and do all the paperwork online, as they suggest, maybe I will buy their crap. BIG MAYBE. I wonder how much Redfin paid for this hour long commercial?

05/14/2007 08:37 AM by Indianapolis Real Estate | Paula Henry (ReMax Excel)

Lenn ~ People do tend to focus on the cost and not the results.  Your research of the discount company's lack of success is a good example of that.  Guess it is OK to list with a cheapie if you just want to "test the waters."  If a seller is serious about getting his home sold he should probably list with someone who has a better track record and doesn't need to "practice!"

kk 

05/14/2007 10:56 AM by Kristal Kraft ~ Denver Real Estate (The Berkshire Group Realtors)

Hey Lenn, LOVE the title by the way. That's a tongue twister:) You know there are many folks that can benefit from using a discounter or a commission rebater. If they have the knowledge and the know how then more power to them. There's room for all biz models in out industry.

I did watch the show last night and have to say that the ReMax agent's rebuttal was just plain pitiful. But to give her the benefit of the doubt let's just say she was probably edited. Maybe she really didn't justify her commission by an increase in postage:)

When will REALTORS(R) learn to create value NOT try to justify what we get paid. My average commission in my market is about $6,000. My Sellers are getting a steal at that price. I bring years of experience, knowledge and a calming influence to the transaction. MY ability to get the job done while at the same time guiding my sellers through a very emotional time is why I get paid. Not to mention the $25.00 I spent on postage:)

05/14/2007 12:24 PM by Bryant Tutas-Tutas Towne Realty, Inc

As always, Lenn, you've hit the nail on the head!

05/14/2007 01:17 PM by Gregory D. Maley - Metropolitan Washington, DC REALTOR (Coldwell Banker Residential Brokerage - Chevy Chase)

Lenn, Great post. People tend to use these discount brokers because they are so money oriented. But what I wonder is once they have seen the service would they ever go back?

05/14/2007 04:44 PM by Camarillo CA Real Estate Agent/ Mana Tulberg (Beach View Real Estate)

I find it interesting that the media thinks we charge too much when one of our biggest expenses is advertising.

I think the story should be about how much of an impact the media has on the cost of selling real estate.

05/14/2007 05:56 PM by Randy L. Prothero - Hawaii REALTOR® (Century 21 Liberty Homes)


When my clients start to buy homes sight unseen and do all the paperwork online,
Paula Henry  Thanks Paula.  I do know a few people who have purchased homes sight unseen.  I've helped several over the years, but they are few and far between.
60 Minutes implied that it was routine.  It isn't routine.  Most folks have better sense, but shows like this put so much pressure on agents to donate their time to perform agency duties with fiduciary for the same price as a web site.

  Your research of the discount company's lack of success is a good example of that.  Kristal Kraft - Agreed.  If a full service broker had a less than 50% success rate, they'd soon lose agents and market share. 
Hey Lenn, LOVE the title by the way. That's a tongue twister:) You know there are many folks that can benefit from using a discounter or a commission rebater. Bryant Tutas  - I agree.  I don't care what consumers do.  They make decisions to suit their comfort level and pocketbook.  But, the 60 Minutes show was very misleading.  The make buying or selling a home like buying or selling a pair of shoes. 
As always, Lenn, you've hit the nail on the head!
Gregory Maley Thaks Gregory.  Nice to hear from you. 
Lenn, Great post. People tend to use these discount brokers because they are so money oriented. But what I wonder is once they have seen the service would they ever go back?
Mana Tulberg Thanks Mana.  My dispute is not with the consumer.  They don't know the difference.  My dispute is with 60 Minutes who produced an infomercial for Redfin.
I think the story should be about how much of an impact the media has on the cost of selling real estate.
Randy L. Prothero - Hey, there's a topic for a show.  How much money does the real estate industry spend on advertising for their clients??

05/14/2007 07:21 PM by Lenn Harley, Homefinders.com, MD & VA Real Estate

Lenn, great post. I would say it is one of the best blogs I have ever read. Having said that, i want to take my comment in a different direction and that is to poo poo on RE/MAX. Fifteen years ago, when I got into the business the RE/MAX agents were usually just a desk and phone in a one room office or storefront and they were there because they did not do a lot of production so the desk fee was fine - and usually not what they are today, or also broker-associates getting ready to open a traditional split office. In the metro-Orlando market the franchise has had serious growth - mostly by people who feel they deserve 100% and are willing to pay 5% franchise fees and desk fees to use the overused and abused RE?MAX name - after being in the business just a little it of time. 100% shops have sprung everywhere and have recruited extensively - but they seem to attract an underclass of agent - one that does discount, rebates, and has little or no experience. I have never had to discount a listing below 6%. I still tke some 7's with tougher properties. That lady exemplified what I think of most RE/MAX agents. I have met very very very few I would rally like to do business with.  

05/14/2007 07:26 PM by Baldwin-Fairchild Cemeteries & Funeral Homes

Paul.  Thanks for commenting. 

I have found over the years, that RE/MAX agents in my area are usually very experienced and easy to work with good listing agents.  Desk fees were, for many years, about $1500 or more and the RE/MAX offices attracted only experienced high producing agents. 

In later years, with competition from other brokers with low fees and little supervision, often not even NAR membership, I believe that the standards of the RE/MAX offices dropped some. 

Of course, with the glut of licensees we have, it was bound to happen.  There is only so much business to go around and agents have a hard time getting experience.

05/14/2007 08:05 PM by Lenn Harley, Homefinders.com, MD & VA Real Estate

Excellent post, Lenn.  Unfortunately, as Broker Bryant and others have pointed out, there are far too many Realtors who don't know much, and who still are getting paid just as much as the rest of us.  This is where the Realtor horror stories begin, and only lends credence to the notion that Realtors are overpaid.

05/14/2007 10:48 PM by Buyer's Broker of Northern Michigan, LLC

Lenn- I think that aside from NAR's problems with DOJ they are just Weenies.. if we want to have better press then we need to have better standards and no one at NAR wants to go there..Until we respect ourselves enough to demand higher standards we can hardly blame the public for our poor image

05/15/2007 12:05 AM by Manhattan Beach CA/ e-PRO..... Kaye Thomas... (Real Estate West)

 I think NAR is now going about it all wrong, by trying to defend itself.  YES there are many, numerous agents that are overpaid for what they do, and by showing consumers "we are not going to take this lying down" just throws fuel on the fire.  It is unfortunate that we have such a poor reputation, however, I think the majority of the consumers will still continue to appreciate what a GOOD Realtor brings to the table.  For scores of years we have made buying and selling real estate a pleasurable experience for consumers, if not we would not be around now.   Awesome article Lenn!

Dick Beals

05/15/2007 02:29 PM by Realty Executives of Wilmington

This is where the Realtor horror stories begin, and only lends credence to the notion that Realtors are overpaid.
Stefan Scholl, Could be Stefan, but the whining is NOT coming from our satisfied clients.  It's coming from our competition.

Lenn- I think that aside from NAR's problems with DOJ they are just Weenies..
Kaye Thomas  Thanks Kaye.  Agreed, agreed, agreed.  But, funny thing, none of the NAR advertising campaigns really
get into the nitty-gritty of what we do for consumers. 
 I think NAR is now going about it all wrong, by trying to defend itself. 
Dick & Sandy Beals Agreed Dick.  I don't believe that the NAR needs to defend itself.  It needs to simply tout our services and
the fact that we help our clients protect their largest financial investment.

05/15/2007 04:34 PM by Lenn Harley, Homefinders.com, MD & VA Real Estate

Hi Lenn,

I did not see this program, I was out of town and I don't watch TV. 

I mentioned on the Broker Bryant blog:

I am seeing a lot of defensive reactions to this and I believe that was one of the program's desired outcomes. 

I hope we can take all of this 'energy' and funnel it toward changing the REALTOR image to who we truely are, and the focus to what we really do. 

Thanks for this post.

Doreen

05/16/2007 12:03 AM by Phoenix Arizona Real Estate ~ Doreen McPherson (Keller Williams Arizona Realty ~ Scottsdale ~ Tempe)

Thanks for commenting Doreen. 

Of course there are defensive reactions.  Faced with unfair and unwarranted denigration of your daily work, you either defend what you do or accept the criticism as accurate. 

If 60 Minutes did that piece to get real estate practitioners to react, fine.  We have a voice and we need to use it.  Redfin got about $20,000,000 worth of free publicity from that piece.  Our collective voices can produce positive results if consumers see that we are dedicated and passionate about what we do.

I just hope that 60 minutes doesn't accept any rebuttal statements from the NAR for their broadcast because such a statement would be only seconds long, have no passion and probably just repeat how many REALTORS there are. 

05/16/2007 06:35 AM by Lenn Harley, Homefinders.com, MD & VA Real Estate

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