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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”

#121

Post by poulsbohemian »

evancox100 wrote: post #117
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.)

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

I work in two states, one of which now has a mixed commission model and the other soon going there... we aren't seeing a lot of properties without a buyer's agent commission, but in those cases (mostly FSBOs) I've simply negotiated a reasonable fee to represent the buyer and we've baked it into the cost of their financing. They get representation but don't have to come up with more out-of-pocket.

I would encourage people to ask their agents about commissions and have open conversation. I have a closing tomorrow and another next week and I couldn't even tell you the commission amount other than that yes I'll get paid something. If an agent is paying excessive attention to the commission or trying to strong-arm you into a house, find a different agent. Real estate is seldom about traditional sales - I don't sell you the property, I match-make you to it, IE: I'm here to find you the right property for you, and if I do a good job on your behalf the money will come. Again - if that's not the experience you are having, go find a different agent.

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

#122

Post by gnicholas »

poulsbohemian wrote: post #118
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 st…

What is it you anticipate happening that will trigger the change you describe in coming years? We were grossed out by our agent a decade ago, and when we went with a different agent (who came highly recommended by a neighbor whose house she sold) in a more recent transaction we were met with even more dishonesty than before.

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

#123

Post by Panzer04 »

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…

Negative gearing is made out to sound much worse than it is. If anything, it's a benefit to wage earners by allowing them to pay a business expense from their pay. It's just a standard deduction afforded to investors for business expenses.

IIRC it's actually quite difficult for foreign buyers to get into the market, and expensive as well.

The housing vacancy rate is lower than ever. There definitely aren't millions of empty houses.

Largely the issue is just going to be too many people and not enough houses where they are needed. The more liberal we are with permitting apartment and unit construction, the better things will be in the long term. I'm not sure restricting migration is the solution - but you can definitely argue that the rate is too high.

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

#124

Post by mercurialuser »

andrewstuart wrote: post #46
labster wrote: post #44

Earlier quoted context omitted.

[flagged]

Mass homelessness is new to Australia. It's used to be a small number of people here and there. The obsession with owning real estate has turned our society into landlords and renters, with renters paying the mortgages on their landlords investments - mortgages which are spiraling up due to interest rate rises. Nearly all the members of parliament have extensive housing portfolios so they have disincentive to fix it.…

I spent 1 month in Australia and my daughter 6. Hiring ads are on almost every shops or business activities, so - probably - those 715.000 workers are necessary.

Giving them a decent house for living is another problem

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

#125

Post by crooked-v »

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.

It's mostly just that the US is really big geographically, and there are a lot of places where very few people actually want to live.

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

#126

Post by seattle_spring »

chasil wrote: post #106
pkphilip wrote: post #96

Earlier quoted context omitted.

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.

Rock Island, Illinois was listed on Salary.com several times as one of the five least expensive places to live in the U.S. Our winters are not very pleasant, but if you like to ski, there is plenty to indulge within a two hour drive.

If you like to ski, Illinois is close to the last place you should be living.

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

#127

Post by logicchains »

Nursie wrote: post #81
refurb wrote: post #80

Earlier quoted context omitted.

Not sure why you’re downvoted because it’s true. People desperate enough to use payday lenders have no other options. And the high interest rates reflect the risk. Take that option away and the need doesn’t magically disappear, they just go to black market lenders where there really is no backstop at all. Far better to regulate.

> People desperate enough to use payday lenders have no other options. Not always true, some folks misuse them for a variety of reasons. Take the option away in the UK and a friend’s boyfriend wouldn’t have been able to use an app to take out a bunch of short term loans in her name for Xbox games… So I think sometimes these facilities are used frivolously. You’re right that a portion of users in real hardship would t…

>Take the option away in the UK and a friend’s boyfriend wouldn’t have been able to use an app to take out a bunch of short term loans in her name for Xbox games…

There's already a solution there, she could take him to court to recover the money. Your argument is basically "ban X because X can be used in an illegal way".

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

#128

Post by conductr »

poulsbohemian wrote: post #118
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 st…

Also would add, RE just isn’t that complex. It’s mostly standardized contracts in use. The contract to rent an apartment is usually more complex than the average RE sales contract. Read them ahead. Study the market to form your own opinions. Learn about what’s actually happening (agent can be helpful here) and what negotiating techniques you can deploy in the process. For most people, it’s worth your time.

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

#129

Post by crooked-v »

Panzer04 wrote: post #123
andrewstuart wrote: post #62

Earlier quoted context omitted.

>> 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…

Negative gearing is made out to sound much worse than it is. If anything, it's a benefit to wage earners by allowing them to pay a business expense from their pay. It's just a standard deduction afforded to investors for business expenses. IIRC it's actually quite difficult for foreign buyers to get into the market, and expensive as well. The housing vacancy rate is lower than ever. There definitely aren't millions o…

On this note, I find it increasingly infuriating to keep coming across people who blame all housing shortage issues on eeeeeevil investors and landlords, and spout a lot of bullshit about massive vacancy rates that don't exist, when the blatant root supply-and-demand cause is that there's just not enough physical housing in the places that people want to live.

You see exactly the same kind of stuff endlessly parroted in the US by people who somehow think that confiscating property from all landlords will make the millions [1] of needed housing units just manifest out of thin air.

[1]: https://www.cnn.com/2023/03/08/homes/housing-shortage/index....

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

#130

Post by poulsbohemian »

tmm84 wrote: post #33

I wish more older Americans understood how these people really work. My parents live in a neighborhood that has gone down hill through the years. They called up a company who did this kind of home buying. Usual visual inspections and the like went on with a quote being issued. They saw the amount was a little over the remaining mortgage which was less than the market value of the house. They decided to ahead of time…

>I wish more older Americans understood how these people really work.

I wish more Americans overall understood how real estate works. I see people get screwed all the time because of bad information. Here's an example: several times a year I will talk with a member of the public who will say something like "we want to work with the listing agent because then we won't have to pay as much commission" not understanding that in fact they are (assuming a traditional two sided commission offered by the seller) actually just giving that listing agent both sides of the deal.

Or, similarly, they will say things like "we want to work with the listing agent because it's their listing so they will know the most about the property" again, not realizing that depending on your state, the rules for dual agency may not give you as a buyer the same representation as getting your own separate buyer's agent. In fact in some states, you may not actually be getting any representation at all, IE: they fill out the paperwork on your behalf but actually represent the seller.

Those are just some trivial examples, but it's dumbfounding how many bad ideas the public has about real estate. So much of my job is hours of educating my clients apart from anything related to the actual transaction.

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