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The EXTINCTION of the Realtor?

By Sidney Jimenez

Real Estate Agent with Keller Williams

September 17, 2009 07:38 AM

It seems to me that the extinction of the Realtor is at hand. The abundance of Short Sales and the new hard line tactics employed by the Lenders is causing more and more agents to leave the industry or just avoid Short Sales altogether.

Already there are agents that pronounced their unwillingness to get involved with Bank of America Short Sales...that is quickly being expanded to Wells Fargo, Chase and the once shining star in Short Sale negotiations, IndyMac (now OneWest). How much further into the future will it be until the majority of agents stay away or find another career or niche?

Can the extinction of the Realtor be too far off?

I've been going back and forth with Wells Fargo, who holds both mortgages. The First agreed and the Junior Lien is playing Hard Ball...we offered them $5,000, they said NO!..at least $10,000, they countered...We said OK, they then came back with a Promissory Note for the balance of the amount owed ($85,000). We then tried to find out what it would take to get rid of that Note...they said $38,000 cash, we countered with $28,000. They told us it would be submitted to the Approval Team...Well, the Team said that wasn't enough and countered with $47,000! What happened to the $38,000? But wait! We were told that was no longer available...OH! and the homeowners would still need to sign a note for the balance.

WHAT ?!?!?!??!??!?!??!?!

This property will go into Foreclosure and with negotiations like this, who can see a viable future for Realtors dealing with these Lenders?

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Marte Cliff

Marte Cliff Copywriting - Priest River, ID

Your real estate writer

Realtors will not become extinct. There have always been people entering the business and leaving because it's just too much HARD WORK. They didn't expect to have to work, for heaven's sake!

Sep 18, 2009 05:34 AM

Home Loan Search.Online

Home Loan Search Online - Newnan, GA

I was just speaking with a rep from a local big bank and they said that when they took over a failed bank the fdic took the loss. I don't know if they took all of it or not, but the new big bank hasn't had to worry about the short sale / foreclosure mess because the fdic took care of it. Their words not mine.

Sep 18, 2009 05:39 AM

Michael J. Perry

KW Elite - Lancaster, PA

Lancaster, PA Relo Specialist

So in other words REO's are gonna be hotter than ever !!!!!!!!!!!!!!!!!!!!!!!!!!

Sep 18, 2009 05:57 AM

Carol Fox

Allen Tate Company 704-905-3935 - Matthews, NC

Helping You Discover Charlotte's Best Small Towns

I agree that the ranks of agents must be thinned simply because there aren't enough transactions to go around. In my market, the number of closed units is down 30 to 50% over last year. This means that there are a lot of agents who will not have enough transactions to make a living. The discounters seemed to have thinned out the most here, probably because they don't have enough volume to make up for the small commissions earned on each transaction.

Like Katerina, I'm ready to hold the door open for the part-timers and unprofessionals to leave the business. We agents won't go extinct but it will definitely be survival of the fittest. I was surprised recently to see a chart showing the average age of realtors going up over the last five years. To me that indicated that the old-timers have built a business over the years that enables them to survive the downturn.

Sep 18, 2009 06:22 AM

Shellie Alicia Carter

REAL. | Realtyka, LLC - Maplewood, NJ

It is awful what your clients are going through. I have been working with an attorney here in New Jersey on Loan Modification and My experiences have been very much like yours.

I am one of the ones that actually has an aggressive and involved attorney to work for. Regardless of working directly for an attorney with the modification... I find myself in these tennis matches. Wells has been the worst offender. I just found out on Wednesday that Wells after turning us down three times is finally helping my client. Through this entire process my client and I took turns wanting to give up but we had to push through.

From my perspective we can't afford for agents to go extinct. Real estate is a team sport and without realtors I believe that clients will begin to suffer. I remain hopeful and prayerful that all will turn around over time. My business plan revolves around me building recriprocal relationships with my real estate partners. I pray every day for our mutual success.

Sep 18, 2009 10:11 AM

Daniel J. Hunter

REALTOR® - New Port Richey, FL

I harken back to my days on Wall ST (actually Broad St.) in the 90's

Stock brokers are going extinct. The future is online Discount brokerage houses

I laughed than, I laugh now. All this will do is weed out the dead wood

Wealthy are too busy being experts in the field they specialize in and make their money in. The rest of america, for the most part are not sophisticated enough to handle the Real Estate Transaction. While the weak may fall by the wayside, the strong will thrive

Sep 18, 2009 11:35 AM

Michael J. Gallo

Florida Luxury Realty - New Port Richey, FL

Florida Luxury Realty - Gulf Home Sales Team

There have been many comments on this Post which is Excellent by the way. I dont see an extinction of Realtors. However we were sitting around the office right after the melt down started. You know, the day everything stopped. Anyway we were discussing the market and economy and truth be told WE ALL SAW THIS COMING!!! The bubble had to burst, the arms had to hit. This current climate has caused the "shister" mortgage people and the "used car salespeople" of Real Estate to bow out. The true, honest and passionate members of the Industry Will prevail.

Im no Realtor(R) yet :-) but I would think that the short sale thing has got to be a bit trying. REO's are the new Shift from what I am seeing. I graduated RE School in May and we had a class of 30 in that course. No extinction here. The Heard Will Thin and The Nourishment Will Be Abundant.

I know how it can be dealing with the lenders......take a deep breath and re-boot. You cant fix stupid

Sep 18, 2009 12:28 PM

Joe Pryor

The Virtual Real Estate Team - Oklahoma City, OK

REALTOR® - Oklahoma Investment Properties

As a short sale specialist with a team, what might drive me out of the business is not Countrywide although that is a close call. It is the owners who have so little appreciation and gratitude at the work you have to do on theie behalf. As they say, no good deed goes unpunished.

Sep 18, 2009 12:38 PM

Katerina Gasset

The Gasset Group & Get It Done For Me Virtual Services - Provo, UT

Amplify Your Real Estate & Life Dreams!

Sidney- That is me, Katerina who made that comment. Believe me, my kids know more about short sales than most of the agents in our market. I do have a lot of patience and that is why I train them for free so they can keep their buyers in the deal. This is not just about short sales. It is about basic contract understanding, knowing what is confidential and what is not. If you are running a business you should be staying on top of your game. If not, then you may not be cut out to be an entrerpreneur. My biggest pet peeve is agents who treat this as a job not a business. I may be sounding harsh, but sometimes tough love works better than enabling incompetance. Katerina

Sep 18, 2009 12:48 PM

Anonymous

no more dumb blogs

an example of blogging just to blog

Sep 18, 2009 12:54 PM

#72

John Elwell

CENTURY 21 Bill Nye Realty, Inc. - Zephyrhills, FL

You Deserve a Full-Time Agent, Not Reduced Results

Just like a virus that is 100% deadly will cause its own extinction if it does not mutate to a form that does not kill its hosts, so will short sales either get modified to work better or they will become extinct as fewer buyers and their agents will tolerate them. They have the power in the end.

There are still a lot of other sales out there that are REO's or conventional. As the market recovers, and it will (Remember the late 70's?) short sales will either become easier to close or they will fall to the wayside.

I suggest that those who think that real estate agents are a dying breed get out of the business now. Only an insane person would stay in a business that will cause them ruin. However, the rest of us that know that this cycle will also start to move more into the positive range will be happy to pick up those customers that you will no longer be serving.

This is still going to be a person-to-person business. People may want to search from home on the internet, but when it comes down to seeing those homes and writing contracts they will still want a trained and experienced professional working with them. Regardless of how many ads we see on tv about how "I saved $16,000 selling my own home" there are many many more sellers out there who are complaining about doing it that way. Of course, those will not be on the ads.

Sep 18, 2009 02:41 PM

Mike Henderson

Your complete source for buying HUD homes - Littleton, CO

HUD Home Hub - 303-949-5848

Nope Realtors will always be here. Banks will always be here. Mortgage brokers ... that is a different story.

Sep 18, 2009 04:28 PM

Mark Velasco

West Shores Realty - Whittier, CA

Top Producing Broker Associate

Sidney, the banks are like children: if you offer them one candy...they want two and so on. Don't feed the monster. Wait it out and you may come out ahead

Sep 18, 2009 05:44 PM

Joy Carter & Jeff Booker Brother and Sister Team

Keller Williams Parkland/Coral Springs Realty-GreatFloridaHomes Team - Coral Springs, FL

Trust Your Family's Move To Our Expertise!

Amazing isn't is that we hear all of this rhetoric about how THE BANKS...Want to Work with the PEOPLE! Did I say Rhetoric??????? I'm sorry I meant BS! Joy

Sep 20, 2009 01:50 PM

Sidney Jimenez

Keller Williams - Miramar, FL

CDPE, Short Sale Expert, 954-665-9449,

GENE--You can be sure that if they are handling these things the same way they have for the last 3 years that they are making money, we just don't see it. I have thoughts on how they are doing it and I have several other posts explaining how. They are not losing as bad as we may think.

MARTE--There are plenty of agents working hard but the closing are far apart because of the Lenders control of the outcome. There are many more leaving than coming in, and the ones coming in will leave much quicker than in the past.

INTEGRITY--Are you speaking of OneWest...that is a good example. When they were IndyMac everything went well and working their files was almost a pleasure. Now that they are OneWest it has become the same nightmare it is with the other Lenders. To me, that means that Short Sales is not their priority.

MICHAEL--There might not be an explosion of REO's. The Lenders are trying to find ways to control the amount of inventory in order to stabalize prices. They are behind the big push to lease the property back to the homeoners AFTER they have been Foreclosed. That helps keep the property off the market until the Lender decides when to sell.

CAROL--You're right, the average age of Realtors is 54. That means that the younger agents are leaving and there are few that enter and stay. What happens if that trend continues? There has always been peaks and valleys in real estate. The difference is that today the sales are being dictated by the Lenders and their approval of Short Sales. That is not a natural swing..it is an outside force that can gain control of the market and manipulate it to their advantage.

DANIEL--Business Week has an interesting article on the death of the Stock Broker and their evolution of becoming "Financial Advisors." No longer are their calling to seel you stock but are now getting involved in insurance, will, and any other vehicle that will give their clients a financial plan that is not based solely on Stocks....the stockbroker, as you remember is dead. As a matter of fact, even the brokerages have changed their titles and no longer have stockbrokers but Financial Advisors, Financial Associates...ect.

Sep 21, 2009 06:53 AM

Anonymous

Carol Fox

Sidney,

I would not characterize my market here in Charlotte NC as dominated by short sales. In fact, I haven't listed or sold a short sale in the last two years. Prices have declined, yes, but we didn't have the huge run-up in prices that you did in Florida so we still have many/most sellers with equity in their homes.

The reason that I see agents leaving the business is the severe decline in number of units/transactions. There simply aren't enough transactions for every licensee to make a living.

Sep 21, 2009 07:03 AM

#79

Sidney Jimenez

Keller Williams - Miramar, FL

CDPE, Short Sale Expert, 954-665-9449,

SHERRIE--I agree with your thoughts, but I think Short Sales are giving real estate agents an even worse name than we had in the past. Agents submitting multiple offers, leaving sellers high and dry and into foreclosure, telling their potential clients they can't do anything to avoid a foreclosure...ect Real estate agents are not separating themselves in this mess. I think there are too many that just have eyes set on the cash. I hear many clients avoiding short sales depending on the Lender. What do you think that says to the public? If I can't make money I won't help. I have done Short Sales and not made a dime because my commissions might have to go and pay for something no one else is willing to pay. My goal is for that homeowner to avoid a foreclosure...and sometimes that means a sacrifice on my end. How many will do that? How many can do that?

JOE--Unfortunately, most don't see what we do. They have the frustration of nothing happening but they don't have the insight of all the frustration and fight most of us do on their behalf. After the deal closes, I see a much better grasp as to the situation and more appreciation for reaching the goal.

KATERINA--I spoken to you on a couple of occasions and you come across as if you know everything and everyone else is dumb is not the way to go. You need to use your knowledge as a base of helping other reach the level you think you have reached. I know something for sure...if you didn't have the people you have working for you..you'd be lost...How's that for tough love.

NO MORE...--So I guess you are posting just to post?

JOHN--You may be right, however...this country is fast becoming a country of bad credit scores. The Lenders are not willing to turn this around quickly, they are more decided to stretch this out and make a larger profit from the carcass of what was once a healthy market. The turnaround in the 80's was driven by a healthier economy....this time around the turnaround will be dictated by the Lenders and the unscrupulous quest of profits. There was a time when we all thought that Appraisers were going to be here forever..they have a highly specialized vocation....but the Lenders are going to do away with their independence now that the HVCC is going to take hold. They will be employees getting a set fee for their services, instead of running their businesses.

JOY--You have the best post! Amen.

Sep 21, 2009 07:13 AM

Sidney Jimenez

Keller Williams - Miramar, FL

CDPE, Short Sale Expert, 954-665-9449,

CAROL,

That is a contributing factor. It is not just the Short Sale infested areas that will thin out the ranks...the economy, job losses, cuts in pay, credit score deterioration, affordability, there may be more homes standing that there are buyers in the country. I won't be shocked when the brokerage model comes about that will turn everyone for a loop. In the hey day it was the discount brokerages that created headaches for many...who knows what tomorrow may bring...but one thing seems to be true, most agents are to comfortable in their belief that nothing will change. To me, that is a huge mistake.

Sep 21, 2009 07:18 AM

Joy Caldwell

Coventry Glen Realty - College Station, TX

I was successful in closing a short sale 1st lien and 2nd lien with CitiBank recently. It was frustrating because of never being able to speak to the same person. You had to stay on them everyday. The only major concern is that the sellers understand their consequences, there will be some. That is why E & O claims for short sales are soaring.

Sep 22, 2009 09:57 AM

Alix Pinzon

Open Mortgage, LLC NMLS # 2975 - Downey, CA

(562)743-6086

This business was DOA when the boards starting putting listings on the internet. With the internet, and an escrow officer, who really needs a real estate professional anymore? Not to knock the advantages to having a true professional, not a newby, or a wanna-bee, but really, the access to the listings was the hinge on the door.

Nov 24, 2009 10:21 PM