Tuesday, November 27, 2012

How to Survive a Sleazy Real Estate Market

Despite the fact that there is a lot of sleazy stuff going on in the housing market you can be successful in purchasing a home.
The crucial thing is finding a real estate agent who's both a good person and incredibly smart and savvy.
Let me give an example. I started out using a cut rate real estate buying service where they kick back half the commission. The franchise owner was really smart and knew his business. But he never came to the property; other employees were responsible for showing up at the property and guiding us through the process. I never once questioned the ability of the real estate agent who owned a the franchise, or his ethics, but there were too many other people involved in the process to prevent my driving a good bargain.
So I switched to an agent who was one of the nicest people I've ever met. He's the guy you'd want to live next door to and make your best friend. But when I realized I was in a situation in which the Flipper hadn't paid off the property he was selling to me, because he was waiting for his lender to give him my money, I'd realized I'd gotten into a big mess. None of the requested repairs were made on the property, they were just waiting on my money to pay off the former owner who was underwater and needed to get out. The Flipper was connected to a large property title company (an entity you may never have heard of if you don't live in California); had the lender in his back pocket and was doing incredible volume. He didn't need to sell to me because there was always another sucker looking for a deal. When I realized what was going on and that my agent didn't have a clue, I decided to look for another agent. I really felt bad since I really liked the agent I was with, but he should have caught the scam. (This trick is actually legal in California if the flipper tells you he's doing this from the start)
My new agents were fine people and also were incredibly savvy. Since they work the Westside of Los Angeles they had seen every scam that came down the Turnpike. They found me a bargain and we did business with the seller's real estate agent, who had high ethical standards. He came back to help us after the deal had closed to provide assistance.
This whole experience took over a year, but we rented for seven years after selling our condo until a decent deal opened up. I never thought of patience as one of my virtues, but somehow this paid off.

No comments:

Post a Comment