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The Ugly Truth Behind “We Buy Ugly Houses”

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Re: The Ugly Truth Behind “We Buy Ugly Houses”

#111

Post by [deleted] »

stanleydrew wrote: post #98
danielmarkbruce wrote: post #87

Earlier quoted context omitted.

In the cases mentioned specifically, the buyer has broken a law already (at least two are fraud) or the contract is invalid (lack of mental capacity). This isn't really a story per se. People are doing illegal stuff or stuff that won't hold up in court if challenged. We have a system for it - it works ok, not fantastically. We don't need new regulation for cases like this, we just need better execution on the existin…

This is a reasonable take, but I think it's also reasonable to suggest that if current system execution is too expensive then perhaps a new regulation could make it cheaper. Of course there are perhaps unintended side effects from new regulation, but "this is already a crime, we don't need anything new" isn't prima facie a sufficient argument. If a lot of a similar type of crime is going unpunished, there may be a re…

[deleted]

Re: The Ugly Truth Behind “We Buy Ugly Houses”

#112

Post by gnicholas »

> Real estate agents have a fiduciary responsibility to represent a homeowner’s best interests in negotiations, which is defined in state laws, licensing requirements and an industry code of ethics.

Our experience with real estate agents has been far from this ideal. We had to fire one after she lied to a counterparty and then lied to us in an attempt to cover it up. Other agents weren't much better, and none of them seemed to take their fiduciary responsibility seriously. They seemed to be looking out for themselves 100% of the time, and their client only when interests were aligned.

The relationship epitomizes the principle-agent problem.

Re: The Ugly Truth Behind “We Buy Ugly Houses”

#113

Post by WirelessGigabit »

> Real estate agents have a fiduciary responsibility to represent a homeowner’s best interests in negotiations, which is defined in state laws, licensing requirements and an industry code of ethics.

How is this possible when looking at 2 houses, one $700,000 and one $850,000. The realtor makes more money on the latter.

How is that not a breach of fiduciary duty?

Re: The Ugly Truth Behind “We Buy Ugly Houses”

#114

Post by toast0 »

Clubber wrote: post #91
nekitamo wrote: post #76

Earlier quoted context omitted.

Legislating away discount buyers would be like legislating away payday lenders. The only thing accomplished would be to leave a hole in the market which will be filled by shady loan sharks.

Each state has usury laws, but there are of course loopholes and exclusions. https://www.upcounsel.com/lectl-state-interest-rates-and-usu... In 1980, due to high inflation, the federal government passed a special law that allowed national banks to ignore state usury limits and pegged the rate of interest at a certain number of points above the federal reserve discount rate. In addition, specially chartered organizati…

That doesn't seem unreasonable. Really, the usury laws should be linked to the federal discount rate anyway.

If 20% is usury when the law was written and prevailing rates were 10-15%, 19% shouldn't be allowed when prevailing rates are 0-5%

Re: The Ugly Truth Behind “We Buy Ugly Houses”

#115

Post by sacrosancty »

pkphilip wrote: post #96
chasil wrote: post #90

I bought a local house in 2004 that suffered a failed furnace in deep winter (with great damage) for $17k. I put another $10k into it for repairs, and rented it. I started getting postcards around 2012: "I/we want to buy your house." I have a pile of them. None of them offered more than $20k. The home in question is very near Augustana College in Rock Island, Illinois. I do a two mile walk through campus every day, s…

I can't imagine property being so cheap - that too in the US. Here in India where I reside, you wouldn't be able to get even a 100sq.ft of open land for that price.

America is blessed with a low population density (10% of India's) and lots of rich people who recently decided to live crammed together in cities. So there's more than enough spare property for everyone.

Re: The Ugly Truth Behind “We Buy Ugly Houses”

#116

Post by brigandish »

andrewstuart wrote: post #62
Andaith wrote: post #53

Earlier quoted context omitted.

I don't even know how we got here. Population growth has been below average for the last 3 years(no immigration). Housing/Apartment construction didn't slow down. I just don't understand it. Mortgages are insane. If you're buying a rental property with a mortgage, you can't afford to not rent it out. But home costs are up, rental costs are up, and properties are vacant. Do we really have so many people able to afford…

>> I don't even know how we got here. I presume you mean Australia. Here is how we got here: The government pays money to property investors/landlords via negative gearing. The government gives tax incentives to property investors/landlords. Australia excludes real estate from money laundering - making it a prime destination for proceeds of crime from China, Russia and many other places, driving up prices. https://ww…

Much of that resembles the UK situation. I wish MPs received more scrutiny for their property purchases, the best we've had so far is when the open corruption of their expenses came out.

Re: The Ugly Truth Behind “We Buy Ugly Houses”

#117

Post by evancox100 »

WirelessGigabit wrote: post #113

> Real estate agents have a fiduciary responsibility to represent a homeowner’s best interests in negotiations, which is defined in state laws, licensing requirements and an industry code of ethics. How is this possible when looking at 2 houses, one $700,000 and one $850,000. The realtor makes more money on the latter. How is that not a breach of fiduciary duty?

People focus on this but the far bigger lever is simply time. If it takes 2/3 the effort to get you into the $700k home then the agent comes out ahead on a revenue/hour basis, and can move on to the next customer.

(And the much bigger conflict is for properties with a no or reduced buyer’s agent commission.)

Re: The Ugly Truth Behind “We Buy Ugly Houses”

#118

Post by poulsbohemian »

gnicholas wrote: post #112

> Real estate agents have a fiduciary responsibility to represent a homeowner’s best interests in negotiations, which is defined in state laws, licensing requirements and an industry code of ethics. Our experience with real estate agents has been far from this ideal. We had to fire one after she lied to a counterparty and then lied to us in an attempt to cover it up. Other agents weren't much better, and none of them…

Real estate agent here...While there are many agents that hold themselves to the standard that the National Association of Realtors has documented in their code, one of the root problems is that state agencies are negligent in enforcing rules and investigating fraud. For example, I know a fellow agent who had documented proof of another agent committing a fraud that did approx $400K in damage to a client - and the state didn't even bother to investigate. For that matter, local Realtor associations are often complicit as well - mostly out of laziness rather than deliberate ill-intent.

My best advise is to treat a real estate agent the same way you might your accountant / lawyer / financial planner / private banker: don't just pick one off Zillow or at random, but carefully cultivate a relationship before you need their services and take steps to discern for yourself whether they are acting as a fiduciary. I agree completely - there are a lot of bad actors in this space, but over the next decade I expect market forces to drive a lot of people out of the business and improve the professional standard.

Re: The Ugly Truth Behind “We Buy Ugly Houses”

#119

Post by bigger_cheese »

Andaith wrote: post #53
andrewstuart wrote: post #41

>> Home ownership is the American dream: In Australia, for many people the (new) Australian dream is: "One day I hope to have the income to be able to afford to pass the grueling real estate agent's suitability test to rent a house and move out of the tent/car."

I don't even know how we got here. Population growth has been below average for the last 3 years(no immigration). Housing/Apartment construction didn't slow down. I just don't understand it. Mortgages are insane. If you're buying a rental property with a mortgage, you can't afford to not rent it out. But home costs are up, rental costs are up, and properties are vacant. Do we really have so many people able to afford…

Negative Gearing and AirBnB are the big culprits people get tax incentives to buy properties and then make more off of short term leases through AirBnB then renting to long term tenants.

South Coast of NSW is particularly bad.

Re: The Ugly Truth Behind “We Buy Ugly Houses”

#120

Post by toast0 »

morkalork wrote: post #38

>One whistleblower tells of how the company uses the surveillance advertising industry to locate elderly people who've broken a hip: "a 60-day countdown to death — and, possibly, a deal." This statement right here is truly disgusting and real. It doesn't just apply exploitive contracts either. In the case where the victim is deemed incompetent by the government, this is how families have them die. You want to talk ab…

Surgery for a broken hip in an elderly patient may not do much to aid survival, depending on the patient's situation. Managing pain may be more humane than a surgery; especially if the patient is not of sound mind and may be unable to participate in rehabilitation to make use of their repaired or replaced hip. Of course, you're not allowed to request euthenasia for your relatives like you are for your pets, so it's harder to show the same type of mercy.
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