Club Chaos Agents - All Things Hollish, Wacked, and Jacked

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BTW, my husband's photo is this one.

Currently there is an agent with three properties for sale in my neighborhood.  These three properties are killing the resale values in my area.  The interesting thing about these properties is they are neither bank owned nor are they short sales.  Property values in my city as a whole are staying roughly the same.  However, if I were to sell my home today I would have to accept approximately ten percent less than a few months ago simply because this agent is a moron.

All of the homes are below market value and I'm not entirely sure why they are not selling.  All of them are in poor shape.  Two of them were not fixed up or staged at all and are literally pigsties.  I recently took a buyer to one and he walked straight out after seeing the mess.  The houses themselves are not that bad.  They just need a good cleaning.  The third house was remodeled but poorly.  The kitchen island is about two feet tall.

Even more interesting, I have noticed that most of this agents listings are sold through dual agency.  You would think that given the low prices other agents would offer, wouldn't you?  I toured all three properties - one of them twice - and never received a call or e-mail about any of them.  While I cannot say for sure, things certainly look suspicious.

I do not mind that other agents have listings right next to my own house.  This is just how it happens in the business.  What I cannot stand is when - due to a combination of greed and stupidity - an agent causes my house price to fall.  If you're going to sell in my neighborhood, then please do that - sell!

Recently while driving down my street I saw something interesting.  A house that had been for sale for some time at $425,000 had a "sold" sign on it.  That was moderately interesting, but what I found far more interesting was that it had a new sign advertising the price now as $475,000!

I was quite stunned at this.  After all, when the property was first listed it started out at $450,000 and slowly made it to $425,000 during several months on the market.  I looked up the property on the MLS and it was pending inspection.  Who the heck puts up a sold sign when the house still hasn't gone through the inspection!

Sure enough, the home failed inspection and went back on the market.  The sign now states $425,000.

While there exists the chance that there were multiple offers on the property, the more likely case (especially given this agent has a poor reputation) is that the agent deliberately misrepresented the sold price in order to attract more listings.

I considered taking a picture of the sign and send it to the MLS, but did not have the chance before the home went on the market.  However, what would have really happened here?  From looking at the list of MLS fines, at the most he would have received a fine for $100 or $200.  More likely he would have just received a warning.

It is no wonder people distrust agents when this is all that can happen to you for deliberately trying to mislead people!  Going through the list of MLS fines is quite comical, because in many cases these fines are for completely unethical and in some cases illegal behavior.  While I can see someone accidentally including a disallowed phrase such as "walking distance to Microsoft" (assumes the buyer can walk), I cannot see someone accidentally listing a home as twice the size that it actually is.

If an agent repeatedly does these things, he or she should no longer be allowed to practice real estate.  Even with lawyers this is the case.  If a lawyer is found to have practiced unethically, he or she can be barred from practicing law in that state.  While technically this is possible with real estate, in practice it is rarely carried out.

Until we start weeding out the bad apples, public trust in real estate agents will continue to be at an all time low.

Staircases are funny.  They look rather simple but contain a lot of interesting parts with interesting names.  My two favorites are "balusters" and "newels".  Newels are the fancy posts that one can find at the end of the staircases, while balusters are thinner and comprise most of the staircase.  Typically you'll have ten or more balusters in between a newel.

Now that you know what a newel is, we are currently redoing our staircase.  We found a contractor who specializes in staircases and he worked with us to come up with a parts list for Stairwarehouse.com.  They have some beautiful pieces on their web site and I highly recommend them despite the mishap - which was entirely our fault.

We decided to do red oak for the treads (to match our flooring) and Brazilian cherry for the railing and newels.  The balusters are iron.  For the newels, we went all out and purchased gorgeous intricately carved box newels.

The newels are hand crafted by an Amish craftsman in Ohio and when they arrived were as gorgeous as we expected.  We couldn't wait to install them.  When our contractor arrived, he took one look at them and exclaimed

They're too big.

Huh!  Weren't you right there when we measured all of this!  Unfortunately, because they are hand crafted and custom to order we cannot return them.  Stairwarehouse did give us a great discount on replacement newels, but we are now stuck with $3,000 in newels we cannot use.

I am of course trying to sell them through numerous channels.  My hopes are that one of the builders we work with can use them.  The reality is they are too big for most homes.

When we started this remodel, the goal was to make our home nice enough that we will not want to leave it for some time.  However, we now have these newels to remind us that there are just some things about our home that will never work.

Therefore, the true price of these newels is not $3,000.  They are two million dollar newels.  It will take approximately two million dollars to buy a home large enough that we can redo the staircase with these newels.  So we'd better start saving!

 After a home has been foreclosed, I work with banks to sell them.  Typically, I am the one who informs the previous homeowner that he/she no longer owns the property and must vacate.  Different people respond to this in different ways of course.

What I am seeing though, is a very dangerous trend.  It is a trend that must be stopped in its tracks, or it will have very serious complications for us all.  This trend is the previous homeowner destroying the property.

One recent case really boils my blood.  All the more so since I went out of my way to work with the guy.  While the bank was rekeying his home, he called me crying that his stuff was still in the house.  I spoke to the vendor who was changing the locks and told him to stop so the previous owner could reclaim his things.  Instead of retrieving the few belongings left at the house, he trashed it.

The electrical panel was ripped out and the water heater was torn out of its place and left in the front yard.  When I stepped inside the house I could hear the buzzing of live wires and thank god I did not step into the flooded utility room which due to the live wires could have been a death trap.

He even left the door wide open and I shudder at thinking what could have happened had a neighborhood child happened to walk in.  The neighbors were so dismayed at seeing the carnage that they called the police.  When the police officer arrived he called for backup and upon finding the owner - who admitted to doing all of this damage - they told him to leave and never come back.

 Why was he upset?  He was upset because he could no longer pay back money he had borrowed because his store had less business.  He had also stretched himself too thin by buying more properties than he could afford.  And this is the bank's fault?!

What we don't realize is when these people do these things to houses, it affects not just the bank.  The bank will obviously sell the house for less, which affects the property values of the neighbors.  This in turn affects taxes and the economy in general.  The money lost when the house is damaged does not come out of thin air - it is paid for by the rest of us.

There are also the safety aspects.  Someone could have been killed fixing the electrical issues in this home.  The home could have caught fire and spread to neighbors' homes.  This is an extremely dangerous issue.

Sadly, I only see this trend increasing.  The sympathy out there right now is for the homeowners - who find nothing wrong with the fact that many of them chose not to make house payments for a year or more and the bank had the 'nerve' to take the house back.

Recently I have seen a large upsurge in the number of buyers approaching me about purchasing REO properties.  Until recently, I preferred to not work with buyers.  Most of my sales come from listing REO homes for banks and that keeps me quite busy.  However, I came to realize that with my specialized knowledge I could help buyers navigate this tricky market as well.

What many buyers do not realize though is that not every buyer is ideal for an REO property.  If you match any of the following criteria, REO properties are probably not for you.

1) You are not exactly sure of what you want.  Given a nice home, you are not sure whether it is your ideal home or not.  You want to see a great number of homes before making your decision.  You figure that when you find the right house, it will stay on the market for awhile so you can see a lot of other houses.  After seeing those houses, you may go back to this house to make an offer.

2) You are not financially and mentally prepared to buy now.

3) You are not prepared to do some work on the home - for instance install appliances that are missing.

4) You are afraid that the bank does not disclose any defects about the home (because it does not know about them) and therefore you may buy a home that has problems.

There are two types of REO properties - overpriced ones and well priced ones.  Most people tend to shy away from the overpriced ones.  Well priced REO properties, on the other hand, do not stick around for long.  They often receive many offers and buyers need to be prepared to move quickly on them.

If you are not prepared to jump when the right property comes up, then my recommendation is to clear your mind of getting a great deal of an REO property.  By the time you make your decision to purchase it, the property will already have closed.

Some time ago a house came on the market not far from my own house.  I drove by it almost every day as it continued to sit on the market through numerous price decreases.  One day I looked the property up on the MLS and noted that it had fallen so far in price that it became a short sale.

The listing stayed active for months, but eventually sold for around $410,000.  The original price of the home before price reductions was around $490,000.  From my estimates, the home was probably worth somewhere in the middle.  This wasn't overly shocking, but what did startle me was what occurred next.

The first peculiar thing was that the sign never went down.  The agent works for a small brokerage with flashy signs and has a habit of not removing his signs after the property sold.  I didn't think much of it until I noticed that the "sold" sign was removed.  Huh?  Did the property go back on the market?  I thought I remembered looking up the property and seeing that it had closed?

It turns out that the new owners did some minor remodeling and the house is back on the market with the same listing agent as before - but at $495,000!

This strikes me as a bit odd and suspicious.  Wouldn't the original sellers - who had their credit histories severely damaged by the short sale - be rather upset at this?  Isn't it a conflict of interest for the listing agent to know that the buyers intend to relist the property with him?

What do you think?