One less reason to hate real estate agents.

Give the haters one less reason to hate and they’ll just hate you for it.

Parting shot to an agent hurled over the shoulder of a disgruntled “homebuyer” as he stalks out the door of an open house: “My income has only doubled in ten years. Yours has gone up eight times.”

No, I wasn’t the agent, so I don’t know the context in which this stern rebuke was delivered, and we’re pretty sure it’s a stern rebuke. However, I can read between the lines, and I have a feeling that the agent who reported this at the next office meeting had gotten a little, shall we say, edgy by this point in the open house. What tips me off? Maybe it was his comments about “people who go out looking at houses without even knowing what they can afford” and “buyers who say they’re working with an agent and then can’t remember ‘their agent’s’ name”.

But his most telling comment was that many of those at the open house were there because of the signs. You non-agents, I want you look away while I give the agents out there this red-hot tip: if you want to guarantee that a large percentage of the people going through your open house are unlikely, for any number of good solid reasons (like lack of money and motivation) to be actual homebuyers, then put out plenty of A-frames and stand back. Way back. Maybe watch from next door.

I report this latest indecisive skirmish in the ongoing war between agents and tire-kickers for several reasons.

First, I know exactly what went through the mind of each and every agent at that office meeting who’d been in the business ten years or more: “Am I making eight times more money than I was ten years ago? Should I be making eight times more money than I was ten years ago?” I’m probably the only agent there who could honestly answer “yes”, simply because ten years ago I was a brand new agent making less money selling real estate than if I’d spent my time looking for dropped pennies.

I should mention that if by his remark disgruntled “homebuyer” meant that home prices have gone up 800 percent in the past ten years, he’d be dead wrong. The median sales price of a home in that neighborhood was $380k in Q1 1999. In Q1 2008 it was $710k. I don’t have a strong math background (and I’ll bet disgruntled “homebuyer” does) but I think that’s 87 percent appreciation. Let’s just round up and say that home prices have doubled in ten years. Hey! Just like disgruntled “homebuyer’s” income!

I wonder if disgruntled “homebuyer” wants and even needs home prices to have gone up 800 percent in ten years because that kind of appreciation gets him off the hook. “Sure I’d like to buy a house. Gosh, everyone would. But I can’t, because those #*^)! agents jacked up prices so they could make a ton of money. So I’m a victim. So it’s not my fault. So I don’t have to scrimp and save and sacrifice to buy a house.”

I also wonder where disgruntled “homebuyer” got his information. At the office? On the Internet? Under a rock? Who knows? The sources of real estate misinformation are varied and endless.

But that’s not the point. The point is that agents are the profiteers of the real estate boom, earning (no, “earning” implies that they work for it) making far more money than is fair. “Fair”, of course, as determined by that impartial arbiter of fairness, disgruntled “homebuyer” and his fellow right thinkers. Never mind:

that industry figures show the average earnings of agents declining during the boom, as hordes of new agents got in just in time to compete with established agents for a dwindling supply of business
that according to the local Board of Realtors, 40 percent of its membership didn’t have a transaction in 2007
that there were 44 sales in the neighborhood Q1 1999 and just 17 Q1 2008
that total dollar volume in the neighborhood was up just 34 percent from Q1 ’99 to Q1 ’08, from $12,419,000 to $16,652,467
that when sales are down this much in this and many other neighborhoods, just about every agent tightens his or her belt (or looks for another job) even if prices haven’t gone down significantly over the past few years

But maybe you’re not inclined to feel sorry for real estate agents. Okay, fair enough. So how about feeling sorry for disgruntled “homebuyer”? Because somehow I think he might appreciate it. Because disgruntled “homebuyer” knows it isn’t fair that he can’t afford—or can’t easily afford—or thinks he can’t afford, because he hasn’t bothered to check—or doesn’t want to afford—the home from which he departed so dramatically. And he has lots of company in an area where for years fewer than 20 percent of residents have been able to afford the median-priced home. Many of them could afford a home almost anywhere else. But they don’t want to live anywhere else. They want to live here. Like lots of people. Lots of people who somehow don’t see the connection between the demand they create for a limited supply of homes and the rising price of those homes. People, often highly educated, who presumably took Economics.

People who presumably sat through a few history classes too, even if their degree ends in an “S” instead of an “A”. And what history tells those who have ears to hear is that in times of stress disgruntled Everyman needs a scapegoat and a simple answer. And that the simple answer turns out to be a comforting illusion and that the scapegoat turns out not to be the culprit. And that often the culprit turns out to be disgruntled Everyman himself.

Who’s always the last to know. If he ever does.

copyright © John Fyten 2008

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