Matt Ratcliffe\’s Blog

DOJ Sets Up New Website of Consumers in Regards to Agents….

Here we go again, someone wants to get in our business one more time and now it is our Government.   If you do not believe me then this site should convince you that the Department of Justice is now on track to inform real estate consumers of all about the truth about our business.   Lets see, Phone Companies, Electric Companies, Farm Subsidies and not to mention trying to tax the Internet, we are now being put to the bright light.

http://www.usdoj.gov/atr/public/real_estate/index.htm

Here is a quote from Inman News:

Article can be found at:   http://www.inman.com/hstory.aspx?ID=64857

“Both the DOJ and FTC have engaged in actions targeting Realtor-backed state measures that restrict rebates or mandate minimum levels of service for real estate licensees, for example, and the FTC last year took action against a group of MLSs that placed restrictions on the online dissemination of property information based on the type of listing contract chosen by the sellers.

The estimated median commission paid by home sellers in 2006 was $11,672, and that amount has risen every year since it was $9,110 in 2001, according to the DOJ site.

“Unless broker costs were also rising sharply during this period of time, competition among brokers should also have held commissions in check even as home prices were rising,” according to the Web site. Real estate commission rates are typically a percentage of the home’s selling price.

“Over the past decade the average commission rate has remained relatively steady between 5 and 5.5 percent,” the Web site states. “As a result, the actual median commission paid by consumers rose sharply along with the run-up in home prices.”

In 2007, the median commission paid by consumers dropped to $11,302 from the 2006 level, while the median sales price of homes dropped from $230,059 in 2005 to $225,334 in 2006 and dropped to $218,184 in the first half of 2007.

According to the preliminary results of an annual profile of home buyers and sellers prepared by the National Association of Realtors, 70 percent of sellers say they negotiated their real estate commissions, Salvant said, adding that in 39 percent of cases the agent brought up the negotiability of commissions while in 31 percent of the cases the seller brought it up.

A map at the DOJ site lists 13 states that forbid buyers’ brokers from rebating a portion of the sales commission to consumers, and a separate map displays eight states that require consumers “to buy more services form sellers’ brokers than they may want, with no option to waive the extra items,” according to text at the site.

The list of states with anti-rebate measures includes: Alaska, Oregon, Montana, North Dakota, Kansas, Oklahoma, Iowa, Missouri, Louisiana, Tennessee, Mississippi, Alabama and New Jersey. The list of states with so-called minimum-service measures includes: Idaho, Utah, Texas, Iowa, Missouri, Illinois, Indiana and Alabama — Iowa, Missouri and Alabama appear on both lists.

A chart at the site compares the cost of full-service real estate companies that charge about a 5 percent commission to alternative business models that offer a buyer’s broker rebate and/or offer a fee-for-service model.

“Consumers who live in states permitting them the option to choose innovative brokerage options, such as rebates or fee-for-service MLS-only packages, can potentially save thousands of dollars on commission payments,” the Web site states.

The Web site notes that closing costs related to real estate transactions “are another area where robust competition is needed to protect consumers,” and the DOJ’s Antitrust Division “advises states to reject laws that prohibit nonlawyers from providing real estate closing services” to preserve competition between lawyers and nonlawyers.

Additional resources at the Web site include links to reports and hearings on the topic of real estate competition in the brokerage industry, as well as a list of DOJ enforcement actions.”

I guess the part the website fails to mention as our commission went up because of the sales price so did the expense of making that commission.   The last time I checked we paid the same amount at the gas pump as every other American.   They are not trying to tell the Oil business that they are making to much money or showing consumers a fancy website that shows their income.   We pay taxes just like everyone else and we get double taxed at the local level because we use our vehicles for our business.   I guess you can tell that I’m  a little  put out that the very country that cries free enterprise chooses to tell the American buyer and seller that we make to much money.   Did I mention that as independent contractors we find nearly impossible to get health Insurance and we have to pay nearly double because of it.     I could rant all night about this one, however I will just leave it where it is for now.

Matt Ratcliffe

Today was a good day in College Station Texas.   I moved here 4 months ago and started down this road to open a KWR office and be the Team Leader for Keller Williams Realty Brazos Valley market center.   I knew it would be hard and require lots of hours and I was ready for it…bring it on!   I have had lots of meetings with Mega Agents to New Agents and you know what I have discovered is an awesome thing, it is called community.   Community is just that, a group of people living in the same geographical area, sharing and working, enjoying seasons, football, baseball etc…   It is a wonderful thing to be part of that community.   I thought at first that the outsider from Lubbock would not be accepted, however I was wrong.   I want to relay a meeting I had today at a local coffee shop with an agent that represents to me community.

The time came for us to meet and the agent came in the door.   They appeared on time ready to have a cup of coffee.   We sit at a small table ready to solve the worlds problems.   The conversation started out wonderfully, you see it was a Bryan/College Station agent that I was with at the coffee shop.   This means I was sitting with a Representative of the community we call Brazos Valley.   They told me stories of life adventures, choices and decisions that where made about their life and of course how they got into real estate.   I sat there fascinated by it all, again communityshowed up.   We finished and I realized that we had been talking  for over 2 hours about careers, changes in the industry, technology and of course company differences.   I thanked the agent for allowing me to visit with them and I left the shop.   On the way back to the office I thought, wow what a community this is to have people like this agent in it.   College Station, Bryan and the Brazos Valley I hope you know how lucky you are to have such great people who represent you each and everyday, as these REALTORS do.   They are true Ambassadors to your region.

Go College Station and Bryan, I now call you my community of choice.

Matt Ratcliffe
Team Leader
KWR Brazos Valley

Land development is a fine art.   There are alot of players that well have to join your team.   Here is the short list:

1)   The City or County where you plan to put your development

2)   Who will draw you plat and site plan?

3)   What survey company will you use to establish the exsisting boundries and then the final tracts.

4)   Who will draw up you deed restrictions and do the reasearch to make sure that what you plan, can be built.

5)   Your REALTOR, who knows what lot values are in the area.  

6)   You local home builders who you will try and sell your lots too!

That is a short list but as you can see that land development is not an easy thing just to jump into.

Here is information on platting:

Platting

Platting is one tool used to implement the City’s Comprehensive Plan and encourage sound growth within the community. Platting, or the subdivision of land, ultimately becomes a public responsibility because infrastructure must be maintained and public services provided. For this reason, the City regulates platting to ensure compliance with the Thoroughfare Plan, planning policies, and adequate extension of infrastructure. Chapter 212 of the Local Government Code sets forth subdivision enabling legislation for Texas cities.
A Plat is required when any of the following occur:

• The division of land (for any purpose) into two or more parcels;
• Development of a platted property where right-of-way for an existing or future thoroughfare has been identified by the Comprehensive plan
• Development on a parcel not previously legally platted; or
• Development that involves the construction of any public improvements that are to be dedicated to the City.

For more information about the platting process please e-mail the Planner-on-Call  or call 979.764.3570.

Call the city planners if you paln to start a new area even if it is in the county.   The county has its on set of rules.

More to follow…