Saturday, January 16, 2016

Crooked Realtors in Nevada

There are those who will say that the Pimpernel they know can be down right mean when forced to deal with liars and cheats. I don't see it that way, I just think that when someone is trying to steal from you it is okay to address the issue directly and in public, call them out on their deceit. That is basically what I do on this blog and I don't even get paid for this.

Well, a relative asked me to go out to Nevada where he is selling his house and help him make sure he was treated properly. What I found was utter corruption in one small community by the realtors of that community. I want you to know what I found in case you find the same thing in your community. Firstly, the realtors in this town got together and agreed to fix the price of realtor services. A realtor usually gets 5% of the sales price of a house when sold and often splits it with the buyers agent. In this place the majority of realtors have colluded to make the price 6% that is automatically split between both realtors. Price fixing is illegal nationally, it is a federal law that prohibits it.

The next thing I found was that the property listings have a whole lot of mistakes in the MLS, this is basically the official advertised selling price of a property. The MLS showed my relatives property having half the size that it does and as a result the value at half of what it is. Some realtors even brought "comps" to prove to him he was getting a good price. The only problem was that the comp sales were not comp sales at all and they knew it. It gets better.

A little Pimpernel background. I first started following real estate when I was about 16. I followed it because it sure seemed important to my parents and all the smart adults I knew. After graduating law school I went to work at a Title Insurance company and became a title examiner and quite a good one because I studied up on how to draw out legal descriptions and I recorded many deeds. I also investigated the permits for properties and eventually was offered a job as a Vice President at one company, I took a job in the government instead at one third the pay. When a friend of mine decided to become a realtor, she used to ask me for advice and help in understanding the market, she later became a mortgage broker and I had an interest in the company acting as an advisor. Eventually I was asked to give a two day seminar to people involved in real estate in Nevada. The seminar occurred before the market crash which I told the people was coming and when it was coming, both ended up being true. I know how to appraise a property and have been responsible for completing leases of commercial property as large as 65,000 square feet. I should probably also point out that for the purposes of lawsuits I have been found qualified to be an expert regarding public easements and have actually been asked to write a book on the subject. The realtors that my relative and I met with did not know anything about me other than I was a relative and advising my relative. They were dumb and answered my questions mostly, after a bit, they got more guarded.

So lets look at the game that they were playing. They assumed that the Zillow quote would impress us; but, I had to point out that it underestimated the property by half as it was based on a MLS (that is where Zillow gets most of it's information) that showed the property at half the size it is. One of them attempted to tell me that it is real hard to fill out the MLS because it has drop down selection menus. The mistake in the MLS was not a mistake, it was intentional. The person who placed the property in the MLS, prior to my relative buying it, was a relator representing a large bank and my guess is that the loan was actually owned by Fannie Mae or Freddie Mac as are just about all mortgages in the United States. The banks merely act as processing agents for the fed. By the way, the MLS did not reflect the property tax records, the title and deed or even the view of the Insurance company. The realtors we met with did not seem bothered by this and recognized that it was twice the size. They tried to tell me that the MLS listing was probably just a mistake by some fool. It was more than that.

I haven't even mentioned half of the corruption in that town regarding property sales. The realtors we met with wanted to give their "investors" a chance to look at the property prior to correcting it and putting it in the MLS. Hmmm, they said it like it was a good thing; but, they didn't know that I knew what pocket listing are and how they disadvantage the seller and benefit the buyer by limiting competition. I should probably mention that the realtors I met with also worked for companies that were property management companies. Hmmm, isn't that a conflict of interest? If you hire a realtor to sell your property they are supposed to represent your interests and not the interest of the buyer or their own company which will act as the property manager for the buyer if they sell your house?

I don't know exactly how I will deal with these people in the future; but, a change in their actions is not negotiable. What is the old saying, "Change or die", that is too merciful to those who conspire to steal from their neighbor. What if I just see them all go to jail and lose their licenses? Isn't that nicer? Have a great weekend, I will thinking and strategizing.

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