Westchester Real Estate Talk

In 2000 a company by the name of Foxton's spent millions, hired Jason Sehorn and advertised like there was no tomorrow.  They charged a 2% commission total.  They took exclusives and tried to sell in house.  They had salaried agents.  They didn't assign agents to individual listings.  Everything was centralized.  You called an 800 number to make an appointment, to present an offer, to discuss contingencies, to negotiate price - it was truly awful.  Whoever answered the phone handled whatever you were calling about.  No one represented the seller so there was no discussion.  At the beginning of this year we read that they closed their upstate office and now we hear that Foxton's is closing down in the United States.  They are gone, gone, gone. Recently they haven't been very prominent at least in New York.  They are based in New Jersey and originate in England.

They announced that they are closing because of the downturn in the market.  The lesson is that it is expensive to sell real estate.

Bye, Bye.

In a study published today done by the National Association of Exclusive Buyer's Agents some problems have been pointed out with staging properties.  The first is that staging benefits a seller.  Under the heading "Don't Be Fooled by Staged Homes" the article goes to explain some of the problems according to this study for buyer's with houses being staged.  An agent could not talk a young couple out of buying a home that was staged even though it was overpriced by $50,000 because of the following:

 "But the one that takes the cake, at least in Fields' experience, was the back-yard doghouse custom-painted to match the house itself. It had an address, just like the house, shutters, a carpeted floor, a resting mat at the front and flowers in the back.

"It was an oversized doghouse, like the kind you can buy at Lowe's or Home Depot," she recalls. "It was presented very well, but it added no real value. However, my clients were dog lovers and felt if the owners took that much care of the doghouse, their house must be stellar."

NAEBA advices buyer's to look beyond the staging and admit that most buyer's can't. 

"A survey of the group's 500 members, who represent buyers and only buyers -- they take no listings -- found that more than four out of five house hunters are likely to be distracted from important issues when they tour a staged home. Worse, though, is that more than half of the respondents said that staged homes often cover up defects, including structural damage"

I suppose I never thought about it, but staging is purely marketing for the seller, where does the buyer fit in?
Yes, they get a house "done" but is it really. 

From the Wall Street Journal, "What Sellers are Doing to Attract Buyers", read more.

From the Herald Tribune in Southern Florda, "Don't Be Fooled by a Staged Home", read more.

One of the things agent's are now doing is advertising their listings all over the internet.  Through my website I am downloading my listings from my site to about 20 other sites.  One site that seemed to be working and attracting buyer's was Craig's list.  Appearing in the papers this morning is an article about Craig's list and how it is now the electronic version of 42nd Street.  The oldest profession is apparently on Craig's list.  Some words are clues, like snow for cocaine and who knows what else.  I wonder if we place an ad for property if one of the descriptive words we use really means something else, oh, oh.  Please read more, here

I recently rented a house to a very nice young couple.  As I went through the process with the listing agent one thing after another happened  that in my expereince raised all sorts of red flags...As we went through the negotiation of the price, the lease, etc. I was rather surprised by the suggestions that this agent came up with.  This agent is a complete gentleman who has been in the business for under five years successfully. So I began to wonder if there is a right way to do things, or were my reactions to his suggestions just my way of doing things.  Were his suggestions ok in terms of the process, were his suggestions wrong, was he too new in the business, were his suggestions based on a lack of experience?  So here are some of things that came up and what I thought.

1.  The first problem that came up was that my buyer was uncomfortable exposing his SS'#'s and financial information to someone he doesn't know.  His credit report would be pulled and then what happens to it, it ends up in a file in an office.  In a few years thrown out in the garbage.  We are all hearing about identity theft and he was concerned.  The listing agent on this property was adament and finally I had to speak to the owner of the property to overcome the agents rather rigid requirements.  The owner of the property understood my clients objections and we cam up with an acceptable solution.  On to the next step.

2.  In New York State Real Estate Agents are not permitted to draw up legal documents and a lease is a legal document.  We are allowed to fill in the blanks, name, address, start date, end date but we are not supposed to write up addendums.  So, instead of using a Bloomberg lease which is standard, tested and used in all of the rentals I have done this agent decides not to use a Bloomberg lease because it is too difficult to convert it to a PDF and fill it in when necessary.  So he writes his own lease in a Word Document, yes he write the entire lease himself.  It is missing loads of wording and is missing a load of stuff that both the buyer and seller should ahve in the lease.  Does anyone else in New York see this as a problem?  He writes the entire lease which I give to my tenant to review.  They get back to me and say that they won't sign it, it only protects the owner of the property.

One of the items he puts in the lease is that the owner can place a for rent sign on the property for the term of the lease.  My client and I say no that isn't fair.  They are paying a fair price to rent the house and shouldn't have to live with a for rent sign on the property for the entire year they are renting. I suggest that if a sign is necessary perhaps one or two months off the end of the lease is fair so the owner can find a new tenant.  of course, this sign is for the agent not the owner because you can't find a tenant ten or eleven months before the end of a lease.  He put a lot of other stuff in the lease but I won't go point to point but it was a document that could not have signed.

 3. After the lease is signed,  I call the listing agent for payment.  He tells me that he sent a bill to the current tenant who is living in the house and he has requested that the tenant write a check to RE/MAX to pay my commission and he is waiting for his check from the owner. A week later I call him again and he says that he sent a bill to the tenant and hasn't heard back yet.  The listing agent doesn't know where the tenant is and tells me that as soon as he hears from the tenant he will pay me.  Does anyone else have a problem with something like this?  He tells me that the owners funds are not available to pay me and I need to wait!!!!  Finally two weeks after the lease is signed I explain that he needs to pay me.  That the check he is waiting for from the owner should be used to pay me and when the tenant returns he can accept a check from the tenant in payment.  I was not willing to accept a check for my commission from the tenant.

Honestly in 15 years having done numerous leases I have never come across this type of approach.  Inexperience?  Not knowing the law? No oversight?