Steve Moffitt- Multi-Million Dollar Seller

In the much touted book, Freakanomics, by Stephen Dubner and Steven Levitt, the authors make the case that there are similarities between the way the KKK operates and the way we Real Estate Agents operate. I don't know about you but I take umbrage at this.

All remarks about nitwit media people and out of touch wonky econ professors aside, I'd like to discuss the authors remarks about Realtors.

First of all, I agree with the authors' opinions regarding the KKK. I also, agree with the historical perspective of the KKK presented in the book. Suffice it to say that the KKK is a loathsome black mark on our culture and our history. In my opinion, the KKK is basically a racially charged, small minded, fearful group of men and women caught up in a ponzi scheme perpetuated by and for the benefit of its small group of leaders. I also agree with the authors view that the KKK's secretiveness and control of information about themselves is what contributed largely to its growth, in decades past. However, the authors go on then to paint Real Estate Agents with this same dark brush. Their opinion is that Realtors are the same, in that Realtors also control information, and also make that information seem secretive.

What a bunch of hooey.

It seems to me that the authors have a built in bias towards Realtors. This bias, which is typical of the media today, has crept into their story. They manipulate their "data", which in this case is purely anecdotal, to fit their biased view and report it as conclusive. The facts tell a different story, if you care to look.

Realtors do have access to information that allows them to "know" what is for sale in the housing market. This information is collected by Realtors and deposited in most, but not all cases, into their local MLS. We Realtors have been doing this for decades, and it has worked well - both for Realtors, making our jobs easier, and for the public. It is important to remember that this information is given to Realtors by the public we serve. Furthermore, it is important to remember that the maintenance of this information system is NOT FREE. Realtors have to pay for it!

Because Realtors have built and control access to these MLS systems does not mean that they have the sole method of "knowing" the market. Anyone can get in their car and drive around an area to find a home for sale if they choose to. It's just easier to use the system built by Realtors to serve the public, namely the local MLS. Realtors don't control the flow of information now, and they never have. We do control the flow of information from our MLS systems, but the public is free to get the same information if they choose. They just prefer to hire someone to do that for them and we prefer to do that job for them the easiest and most efficient way possible. Which is why we created the MLS system.

We also don't mystify the information regarding our industry, as the KKK does about itself. Go into any bookstore and you can find any number of books on the "Business" of buying and selling homes. Entry into our business is not controlled by Realtors. It is controlled by State, County, or City governments.

It is obvious to me the authors saw an opportunity to sell books by making Realtors an easy target. Their criteria for their negative opinions of us - that we control information, that we're secretive, and that we have evil intent, could be easily applied to almost any line of profession - say Journalism for instance.

Recently I received a call off of one of my listings. A buyer's fiance. She wanted to know about the listing and I offered to drive over and show it to her and her fiance right then. My coach advises me to go ahead and show one property to unknown buyers, but then show them nothing else until I've qualified them and gotten a buyer's agreement signed. So, I drive over and show them the house. They tell me that her credit is no good, divorce, husband in jail, etc. Her fiance, I'll call him Ted, has a good credit, a job he's been in for 12 years, a 401k, and he's pre-approved for up $130,000. On top of that they have no agent, and Ted seems nice. His fiance, wasn't the buyer so I didn't pay her much attention.

Needless to say, I thought Ted was safe as a client and I felt akward, so I didn't insist on a buyer's agreement. I began sending Ted listing information, and to my delight Ted kept urging me to move quickly. He wanted to get a home purchased before school started. Great, I thought, a motivated client. I ignored the annoying problem that the Fiance represented - she kept calling me and not Ted - and kept on working on Ted's behalf.

A few days after our initial meeting the girlfriend called me again and asked me to prepare an offer for Ted on a listing that I had sent "them" but that I had not seen. It was a short sale in the area they wanted and within reach of their budget, but neither I not Ted had seen the interior. I mentioned that we hadn't seen the interior and that I don't recommend making offers on property sight unseen. She said Ted had been to the property and looked in all the windows and thought it was worth an offer, that he would rely on a home inspection anyway, and he wanted to make an offer before the house was taken by another buyer. I insisted that we at least drive over and look at the outside together since we couldn't get an appointment to see the interior for 24 hours. This we did. They liked the house, even though I couldn't get them inside. I agreed to write an offer for them on the understanding that we would look at the interior together as soon as possible. I wrote the offer. I contacted the listing agent, a high volume, short sale "Specialist" who informed me that the house had one offer on it already. The house had been on the market 3 days. I informed my clients and we presented Ted's highest and best offer. 3 days later I was informed by the "specialist" that Ted's offer wasn't even considered and that we'd would not be receiving back any written acknowledgement of Ted's offer or a written rejection. [Wow, what professionalism.]

So, back to square one for Ted. Meanwhile, the Fiance/girlfriend was making a nuisance of herself. I began to notice that Ted did whatever she told him to do. So, while Ted was going to be financing the purchase, the Fiance/Girlfriend was the Real buyer.

Well, I found them another house. We wrote a good offer and it was accepted in second position. [That's another story] I informed my client of the failure of the other agent - another short sale "specialist" - to perform their due diligence presenting my client's offer in a timely manner, and of the other agent's failure to inform us of other offers coming in as the other agent had promised to do. So, my client withdrew his offer. Then they found another house, well outside the area they told me they wanted to be in. So, I drove over during the week, and reviewed the house alone. It looked good the client's had gone through the previous day during an open house so I felt comfortable writing an offer for them that day. This too was accepted. This too was a short sale.

A week went by and we had received no response from the seller regarding the bank's acceptance, when I got a voice mail message on a Saturday evening about 9PM from my client's fiance/girlfriend. The message asked if I could call them back which I did and left a message. Sunday they left another message for me saying they had found another house that they like even more than the one we had an accepted offer on and could I call them back to talk about getting out of their current offer and writing an offer on the second (house number 4). By this time, I had had it with them. I called them back first thing Monday morning and got no answer. I left a message. Then I got a call from their lender asking if I was still representing Ted?

To sum up. Fiance/Girlfriend had convinced Ted to kick me to the curb. They got a new agent to write an offer on the house they'd found - house number 4. The story doesn't end there, I got a call from Ted a week later apologizing up and down, professing his loyalty, and Oh yeah the "other deal" on house #4 had blown up. Goodbye Ted. Goodbye Fiance.

I hope this is instructive to you and that you learn the lesson I had to learn the hard way. Always meet with buyers in the office and discuss in detail the services you provide. Then...get a buyer's agreement!