Guess Who Is Propping Up The US Housing Market

Tyler Durden's picture




 

A month ago we showed a chart that, in our humble opinion, summarized all that is wrong with the US housing market. The chart in question showed the April breakdown of existing home sales on a Y/Y basis by pricing bucket.

 

Needless to say, what the chart showed was the symptomatic, and schizophrenic, breakdown of US housing into two camps: the housing market for the 1%, those costing $750K and above, where the bulk of transactions are mostly between non-first time buyers, and typically take place as all cash transactions, and the market for "everyone else" which continues to deteriorate.

Moments ago the NAR released its May data, which on first blush was widely lauded as bullish: the topline print came at a 4.9% increase, rising from 4.65MM to 4.89MM, above the 4.74MM expected. Great news... if only on the surface. So what happens when one drills down into the detail? As usual, we focused on the last slide of the NAR breakdown, located at the very end of the supplementary pdf for good reason, because what it shows is hardly as bullish.

So how does this "housing recovery" in which the NAR has proclaimed the "sales decline is over" look on a granular basis.

The answer is below, and it is even worse than the April data. It also explains why first time buyers have dropped to even further cycle lows of just 27%, down from 29% both a month and year ago.

This is bad because while in April there was a modest increase sales in house buckets from $250 all the way up to $1MM +, in May the only bucket that had an increase in sales from a year ago was that exclusively reserve for the ultra-richest, i.e., those who benefit the most from the Fed's non-trickle downing wealth effect policies. In fact, on a price bucket basis, the May data was unformly worse than April!

The logical follow up question: what is the total percentage of sales by given price bucket? The answer, once again, below.

Housing recovery? Maybe for the richest, and even they are far less exuberant about purchasing $1MM+ mansions. For everyone else, enjoy "plunging" hedonically-adjusted LCD TV prices. Everything else is, well, noise.

Source: NAR

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Mon, 06/23/2014 - 10:28 | 4885432 Cognitive Dissonance
Cognitive Dissonance's picture

What's good for the 1% goose is good for the gander?

Mon, 06/23/2014 - 10:39 | 4885460 sunaJ
sunaJ's picture

There is no housing for the unwashed masses?  Why, then let them live in chateaus. 

 

Mon, 06/23/2014 - 10:43 | 4885496 Winston Churchill
Winston Churchill's picture

Bullish for adverse possesion.

Mon, 06/23/2014 - 11:21 | 4885629 RevRex
RevRex's picture

George Bush is propping up the housing market?

 

DAMN HIM!

 

If it happened on Bush's watch it was Bush's fault, and if it happens on Obama's watch, it's Bush's fault......proof that the Socalist Semite Democrat Media is NOT biased!

Mon, 06/23/2014 - 11:26 | 4885644 zeroheckler
zeroheckler's picture

Belgium propping it up

Mon, 06/23/2014 - 22:18 | 4887996 philipat
philipat's picture

looking at MOM data in a market with such pronounced seasonality (Weather, School schedules etc) is grossly misleading and is an old trick of the NAR propoganda machine that it is. Only YOY data has any meaning when looking at housing. And YOY May is DOWN.

Mon, 06/23/2014 - 23:08 | 4888124 Handful of Dust
Handful of Dust's picture

So I'm going to take a wild guess here and go out on a limb and say these numbers are....

 

BULLISH ?!

... and ...

 

"There's never been a better time then now to buy a house."

 

Whew! Got that off my chest.

Tue, 06/24/2014 - 00:42 | 4888306 dubbleoj
dubbleoj's picture

its a shame the drudge readers dont look at the articles on ZH that arent posted to drudge

Mon, 06/23/2014 - 11:34 | 4885669 firstdivision
firstdivision's picture

How do Bush's balls taste? Is the flavor complimented with Red or Blue whine? 

 

Mon, 06/23/2014 - 19:42 | 4887471 swmnguy
swmnguy's picture

Could you give the RedTeam rah-rah shit a rest, please? And the "Socialist Semite Democrat Media" meme you're trying so hard to establish is bullshit too.

Those of us who have been active on this site since before, say, this past Feb. 21 understand that it's all about the merger of corporate and State power; the media, the government, the rigged markets, the war machine; the whole shittin' shebang.  Bush II was as much a part of it as Obama. Same goes for Clinton, Bush I, and Reagan, for that matter.

The way you keep finding stark differences between Obama and Bush II suggests you're holding your binoculars backwards.  You're obsessed with minutiae and you've missed the whole point.  And it's gotten really fucking boring.  If you get greenies here it's because nobody else likes Obama or the media either.  Don't flatter yourself it's respect for your insight.

Tue, 06/24/2014 - 01:11 | 4888340 sylviasays
sylviasays's picture

"Could you give the RedTeam rah-rah shit a rest, please?"

Just 7 percent of journalists are Republicans. That’s far fewer than even a decade ago according to a new study of the media conducted by two Indiana University professors. 

Could the BlueTeam news media give the rah-rah propaganda shit a rest, please? 

http://www.washingtonpost.com/blogs/the-fix/wp/2014/05/06/just-7-percent...

Tue, 06/24/2014 - 09:55 | 4889034 swmnguy
swmnguy's picture

I'm not talking to paid partisan shill professional journalists. I'm talking to "RevRex."  If I wanted to read partisan talking points masquerading as analysis, I have a plethora of options, and I wouldn't be hanging out on ZH.  Though perhaps 93% of "journalists" favor "Tastes Great," I don't see how understanding is improved by getting more exposure for "Less Filling."  Bullshit is bullshit.  The act of "balancing" bullshit is supremely pointless.  My opinions and interests are not represented on the spectrum presented to me by the corporate agenda-driven media in the US.  If 50% of journalists were Republicans, then we'd have slightly different completely irrelevant bullshit to read in the corporate media.  And that would improve anything...how?

I'm not arguing that the two parties are the same.  I'm saying they're both worthless to everyone except their primary sponsors at the moment, who tend to switch sides pretty regularly.

Tue, 06/24/2014 - 03:17 | 4888442 Serenity Now
Serenity Now's picture

I like RevRex.  It's about time some conservatives showed up around here.  The only time you guys give your Red-Team-Blue-Team-Are-The-Same argument is when a conservative makes a good comment.  You never, ever, EVER say that when a blue team member shows up to make a leftist comment.

You think you're clever with your ridicule, but you aren't.  We've read Rules For Radicals. You aren't persuading anyone.

Tue, 06/24/2014 - 06:14 | 4888543 Tall Tom
Tall Tom's picture

Perhpas you are correct that swimguy is not persuading anyone.

 

But you and RevRex (if you are not redundant accounts...) are not persuading anyone either.

 

Anarchocapitalism is the way forward as the Nationalist Fascism (Corporatism) which you support just leads to destruction.

 

Take your Red Team/Blue Team bullshit elsewhere as it is both lame and shallow.

 

Go Gold Bitchez. Vote your pocketbook, opt out of the Statism, and BUY GOLD. AVOID CORPORATIONS LIKE THE PLAGUE.

 

Fight Club lives. Liberty and Freedom reign supreme. I will NEVER vote for any Democrat or Republican again....EVER!!!  (And there is not one damned thing that you STATE LOVING PSYCHOPATHS can do about it.)

Wed, 06/25/2014 - 07:03 | 4892413 Serenity Now
Serenity Now's picture

Tall Tom,

I might not persuade many people here.  It would be hard to do so, with 99% of the posters interested only in what they have to say.  I have never in my life encountered more jerks that "know" everything about everything.  It's pretty pathetic.

I stick to a mantra of tell the truth, then give your opinion.  I don't post on every thread, or even every day.

Now, that being said, who the hell are you to tell me that I support nationalism or fascism?  Fuck you.  I support economic freedom.  And no, I'm not against corporations or rich people.  The vast majority of corporations are small businesses.  And the majority of rich people have honestly earned their money.

You are the one with the team bullshit.  You are as leftist as any leftist I've ever come across.  You are intellectually dishonest.

Tue, 06/24/2014 - 09:43 | 4888973 swmnguy
swmnguy's picture

SN, I like RevRex too, when he makes a good Conservative comment.  And he does.  What I'm sick of is "O'BowelMovement," "Socalist Semite Democrat Media," and the relentless promotion of the false duopoly of US politics.

I've worked in and around advertising, PR, and corporate-speak my whole career.  I know how the game is played and I recognize the techniques and their applications.  The purpose is not only to avoid communication, but to prevent it.  We see it applied to our political system on a moment-to-moment basis, and it's part of the destruction of America.

I think most of us, at least those of us who try to analyze the facts we see around us, have come to recognize that Republican does not equal Conservative.  If it did, we wouldn't understand the term "RINO," and we wouldn't have a Tea Party candidate defeating Rep. Cantor, etc.

I attack President Obama with venom, when the facts I observe warrant it.  Which is, actually, most of the time.  Interestingly, the reasons for which I attack President Obama are very often the same as the reasons for which I used to attack President Bush.  And, thinking back, the same reasons I used to attack President Clinton.  My realization that I was attacking these supposedly different politicians for the exact same reasons was eye-opening for me.  Just on Healthcare Finance, I can attack Presidents and parties on the exact same grounds going back to Nixon.

The more I look, the less I see that correlates to the Red/Blue, media-marketed false dichotomy of US partisan domestic electoral politics.  When I wonder what that means, it becomes increasingly clear that there's no accident about that.  Sure, there are differences between the parties.  Whose back gets scratched is modestly different.  The parties cater to different factions among the elites.  My problem is with what the elites themselves, overall, are doing to us.  In May of 2008 I read the Sen. Obama was getting more in contributions from Finance than either Sens. Clinton or McCain.  In 2012, Gov. Romney got more from Finance than Pres. Obama, after 4 years of Obama sluicing the wealth of the nation through Wall Street's vaults and exempting them from any semblance of the rule of law.

The examples of the utter corruption of both parties go on and on.  I'm not arguing that the two are equivalent or the same.  I'm saying that they are both a diversion.  This is basic stuff for most ZH'ers.  It's a non-partisan opinion.  I haven't voted for a major-party candidate for a significant office in years, because neither party advocates for, or even acknowledges, my needs.  And how obscure and individual are my needs?  I'm a 47 year-old white man, self-employed, married with 2 teen-aged kids, own a home and 2 cars, have modest retirement investments, etc.etc.  I am, in a word, the very picture of what used to be called the middle class.  I understand that bills need to be paid, and that gratification must at times be deferred for greater eventual satisfaction.

Parrot-like repetition of focus-grouped partisan catchphrases actually harms my interests by substituting cliches for actual thought and analysis.  "RevRex" makes some pretty incisive posts when he doesn't spew the doltish cliches.  Take that crap to HuffPo or FreeRepublic depending on your taste.  Bring your brain to Fight Club, please.  That's all I'm saying.

 

Wed, 06/25/2014 - 07:19 | 4892428 Serenity Now
Serenity Now's picture

swmnguy,

I don't have time for a lengthy response, but I do try to respond to people who take the time to reply to me:

Republican does not equal conservative.  True.  (And that's a huge problem.)

Red team / blue team is the same.  A lie.  (And that's a huge problem.)

People bringing their brain to Fight Club.  Wishful thinking.  95% of the comments these days are emotional, nothing more.  (And, yes, that's a huge problem.)

Tue, 06/24/2014 - 10:00 | 4889059 swmnguy
swmnguy's picture

SN:  If you've read "Rules For Radicals" you've wasted your time completely.  The only people who've read that stuff in the past 3 decades are Glenn Beck and those who enjoy that sort of entertainment.  Same goes for the "Cloward-Piven Strategy."  I have to hand it to Beck.  He, or one of his Producers, is willing to undergo a lot of tedium to find catchphrases and fodder for hours of fulminating and pontificating.  I'm sure irrelevant, effete intellectuals owe Beck enormous gratitude for the royalties they've collected in recent years.  If Beck and those like him could do some analysis on their own without offending their corporate sponsors, the Saul Alinsky's of the world wouldn't have collected a thin dime since Reagan's first term.

Wed, 06/25/2014 - 07:25 | 4892442 Serenity Now
Serenity Now's picture

Thank you for your absolutely unsolicited opinion.  It's valuable, however, as you have completely outed yourself as a leftist.  

No worries, I prefer clarity over agreement.  

Mon, 06/23/2014 - 19:48 | 4887495 Seer
Seer's picture

Go the fuck away you Party Pussy!

Mon, 06/23/2014 - 22:01 | 4887963 fledermaus
fledermaus's picture

YOU are part of the problem! Simpleton FuckTard.

RED/BLUE team cheerleaders / fighters, playing into the divide and conquered -while the middle class and 99% is destroyed.

You idiot, troll, fuck-  WHEN WILL YOU 'party' TROLLS wake up and see the forest through your trees?

Tue, 06/24/2014 - 01:09 | 4888343 sylviasays
sylviasays's picture

New Survey of 1,000 Journalists: Four Times More Identify as Democrats Than Republicans...

Those who dispense propaganda to the low information crowd are the 'party' trolls

Read more: http://newsbusters.org/blogs/brent-baker/2014/05/06/new-survey-1000-journalists-four-times-more-identify-democrats-republic#ixzz35WvxBNVV

Tue, 06/24/2014 - 01:52 | 4888390 Richardk888
Richardk888's picture

If you pick your news based on the reporters party affiliation you are already beyond help anyways.

Tue, 06/24/2014 - 06:18 | 4888547 Tall Tom
Tall Tom's picture

Who cares what party affiliation is reported as they both serve the same corporate interests?

 

It is so moot. You are beyond help. Enjoy your enslavement.

Tue, 06/24/2014 - 03:24 | 4888446 Serenity Now
Serenity Now's picture

You're the simpleton for buying into that nonsense.  Name me one Republican congressman who is even remotely as stupid as Hank "Guam will tip over" Johnson.  

Republicans are being corrupted by leftist ideology; there is no doubt about that.  But that does not mean that there are no differences between the two sides.  THAT is idiotic.

Tue, 06/24/2014 - 06:29 | 4888557 Tall Tom
Tall Tom's picture

Both factions are Tax and Spend.

 

Hell the Republicans SUPPORT OBAMACARE.

 

The Republican Congress voted to FUND OBAMACARE in October, 2013. They FINANCIALLY SUPPORT IT. Financial support is the BIGGEST SUPPORT that anyone can give.

 

(All funding ORIGINATES IN THE HOUSE. The House of Representatives can VETO any law through REFUSAL TO FUND. That is one of the supposed "Checks and Balances".)

 

So tell me all about these "fundamental differences" because when it comes to the cream, which raises to the top, the God Damned Republicans are just as fucking SOCIALIST as the Heathen Democrats.

 

Oh...By the way...You can thank John Bohener (Republican) and Senator Mitch McConnell (Republican) for drafting that "compromise" as they were demonstrative of the point.

 

NOW BOTH OF THEM ARE FUCKING STUPID...FUCK CONGRESS AND FUCK YOUR RED TEAM/BLUE TEAM BULLSHIT.

Tue, 06/24/2014 - 07:21 | 4888605 Jlasoon
Jlasoon's picture

I find it quite hillarious that some assholes actually believe that an electronic voting machine connected to the intranet would not be manipulated, by let's say, "the powers that be" for the sole purpose of advancing and fucking over those same assholes who regularly vote for "change".

As though one peon fron Iowa is going to make a difference in a world run by goons, banksters and the NSA.

But look on the brightside, woman do have a right to vote.   

Wed, 06/25/2014 - 06:49 | 4892398 Serenity Now
Serenity Now's picture

Tall Tom,

I believe in the mantra, "First be honest, then give your opinion."

Not one Republican voted for Obamacare.  Not one.  It's true that spending originates in the House, but it only ORIGINATES there.  The Senate has to vote on the spending bills as well, and Harry Reid REFUSED to put any of the House's bills up for a vote.  So the government shut down last October.  I was happy about that, frankly (the shutdown).  

But the Republicans were scared of the shutdown and caved.  I didn't support that at all.  But to suggest that the R's and D's are EXACTLY THE SAME is lazy and intellectually dishonest.

And let me tell you something else:  The only time anyone says that R's and D's are the same is when they are blaming R's for something.  How on earth can you intellectually blame R's for Obamacare when not one of them voted for it?  You need to blame D's for the mess that is Obamacare.  

I will join you in the disappointment that Obamacare didn't get de-funded, but I will not join in on your emotional and disingenuous assessment that R's are responsible for Obamacare. 

Tue, 06/24/2014 - 04:42 | 4888492 Eirik Magnus Larssen
Eirik Magnus Larssen's picture

Right-wing nuts like yourself make me laugh. =)

Mon, 06/23/2014 - 10:49 | 4885504 nope-1004
nope-1004's picture

I find it so strange that the place that I sleep, crap, relax, argue with the wife, raise my kids, enjoy having friends over, and keep warm and dry is an "economic" indicator.  Makes me wanna puke the way this shitshow of an economy has morphed into clear class slavery over simple human needs.

 Realtors, like the FED, add NOTHING to the economy.  Good thing they aren't an educated bunch... they may make their data believable then.

Mon, 06/23/2014 - 10:59 | 4885552 Ghordius
Ghordius's picture

agree with the sentiment, but disagree on realtors. they are entrepreneurs in the very French meaning of the word, "go-between". they bring buyers and sellers together, which then generates a deal which otherwise would not have happened

ok, I understand that realtors are quite hated in the US. yet... when did America's gov start to support the housing market? before or after WWII? Freddy and Fanny? Are realtors behind them?

Mon, 06/23/2014 - 11:08 | 4885588 greatbeard
greatbeard's picture

>> are quite hated in the US. yet..

They are only hated because they are lying, conniving shitbags.  Otherwise they are pretty decent people. 

Mon, 06/23/2014 - 11:14 | 4885605 viahj
viahj's picture

in a world with internet, FISBO should be gaining momentum but the realtors have such a tight grip on housing, from MLS listing to holding the mortgage company by the short and curlies.  most realtors are morons who make serious mistakes in writing the sales contract and they make 3-6% right off the top. 

Mon, 06/23/2014 - 12:21 | 4885866 Almost Solvent
Almost Solvent's picture

Why the USED HOUSE SALESPERSON hate?

See: Used Car Salesperson

Mon, 06/23/2014 - 20:03 | 4887572 Oldwood
Oldwood's picture

As a small business person I have had to struggle with my retarded salemanship. I spend more time trying to talk people out of buying, but that's a personal problem.

On the other side, my wife is a realtor. I see how hard she works, almost endlessly, trying to sell houses that sellers believe to be worth substantially more than the market will bear while lying or omitting important relevant facts about the property. Then she has to deal with lying scumbag buyers who lie about loan qualifications for loans, make ridiculous demands at the last moment prior to closing and can be just generally shits. Then she has to deal with the banks, title companies and governments. Trust me. It isn't an easy job, especially if you do it well. Granted there are tons of supposed realtors who simply try to get listings and then do as little as possible from there on out. If you hire someone to represent you, as a realtor does, you should demand what you are paying for, not excuses. Like hiring a plumber, its not easy to find a good one, and you sure as hell won't find them in the yellow pages (do they still have those?).

Other than that, find anyone who won't lie to you to sell something and you have got a winner!

Mon, 06/23/2014 - 22:08 | 4887983 in4mayshun
in4mayshun's picture

Realtor are like Politicians, Wood...I know there are a few good ones, I just don't know any.

Mon, 06/23/2014 - 23:04 | 4888114 Handful of Dust
Handful of Dust's picture

Despite zero-down mortgages and/or very little down mortgages, very lax job verification, and incredibly low rates, the house market barely budges.

 

Why?

 

People are beginning to realize house prices are still about 300% overpriced. Besides, they are broke and in serious debt with stagnant wages in an inflationary environment where food, gas and other essentials are rapidly rising. AND, as Tyler [and NPR] pointed out today, a huge number of Merikans have less then $100 in their savings account!

 

Tue, 06/24/2014 - 04:44 | 4888494 Eirik Magnus Larssen
Eirik Magnus Larssen's picture

It's another form of financial engineering really. The fundamentals, meanwhile, seem to continue to either remain sluggish or slowly deteriorate.

Mon, 06/23/2014 - 21:53 | 4887947 Escrava Isaura
Escrava Isaura's picture

viahj.... If I may ask...

What do you do for a living?

Mon, 06/23/2014 - 11:16 | 4885608 NoDebt
NoDebt's picture

Fanny Mae was set up in '38 as part of the "New Deal".  (Freddie Mac was set up as a competitor to it in 1970, but it does pretty much exactly the same thing).

In reality, the whole housing thing went gangbusters after WWII.  The real estate lobby in DC has CONSIDERABLE influence and throws a lot of lobbyist money around.  

It's why you can deduct the interest payments on your mortgage against your taxes (with some limitations).  You can also do it with your beach house.  And your house in the mountains.  And on as many properties as you have mortgages.  

It's why the mortgage interest deduction will probably still be around long after the government has confiscated all the private retirement plan money.  They want you to "Buy, Buy Buy!" not "Save, Save, Save!"

Mon, 06/23/2014 - 22:08 | 4887980 Christophe2
Christophe2's picture

The real winners from the real estate tax breaks are the BANKS.  They know that prices will go as high as people can bear (ex: 1/3 to 1/2 of income), so by giving a tax break on the INCOME paid to the banks, people can afford to pay a lot more to these banks than they could otherwise.

Prices going up and creating bubbles is more of a secondary benefit, IMO, and the real estate lobby is basically a front for the banks, who peddle mortgages and need lots of shitty, manipulative salesmen to con people into bad deals.

Tue, 06/24/2014 - 00:59 | 4888265 NickVegas
NickVegas's picture

Those "tax breaks" are converted to price on the front end, and you pay usury the whole way. Fuck the banks. The have captured the whole economy.

Mon, 06/23/2014 - 22:12 | 4887992 disabledvet
disabledvet's picture

What you have to measure is house SIZE too.

This is what made the housing bubble under "W" so truly massive.

"As with the 90's square footage was exploding."
In short "housing is very expensive" making Alan Greenspan a total dipshit.

In short "where will the incomes come from to support that housing stock?" And of course his answer was "phuck you!!!!!"

That strikes me as bad math.

So now we have a housing implosion...but not just any housing implosion...but the type of which "anything more than 500 sq feet and more than ten grand is uneconomic."

And we're gonna solve his problem by building more roads and bridges whilst taking on trillions of dollars in debt? "And pushing energy prices to the moon"?

BwhahahahahabahahhhBah.

"Say hello to Holy Shiite."

This is no longer the "free money Fed."

The bill came due over a year ago.
I'm no expert in State and Municipal finance...but I sure don't think I have to be either. Where is the demand for the debt going to come from with interest rates this low? That's VERY expensive debt.

Where is your small business creation? Your jobs recovery? Your "recovery period"?

HIGHER ENERGY PRICES ARE A TAX!
AT THE MARGIN THEY LEAD TO DEFAULT.

Tue, 06/24/2014 - 03:38 | 4888459 Serenity Now
Serenity Now's picture

NoDebt,

If I recall my research correctly, that's when (1930s) the 30-year mortgage was invented as well.  It did not exist in the nation's history prior to the 1930s.  It's part of the inflation (increase in the money supply) that I talk about so often on ZH.  

And of course, inflation = increase in demand = increase in price.  That's why people can't afford to buy a house with cash.  

Mon, 06/23/2014 - 11:40 | 4885695 QQQBall
QQQBall's picture

My buddy is a Realtor and told his clients to wait to buy in 2006 and 2007. Very few of his competitors can afford to give that kind of advice and quite frankly they didn't and don't.

Mon, 06/23/2014 - 17:28 | 4887090 CH1
CH1's picture

Glad there are a few that still have souls.

The rest......

Mon, 06/23/2014 - 14:29 | 4886357 daveO
daveO's picture

Realtors are parasites(flea is too nice a term) on the back of the world's greatest credit bubble. The last one I dealt with intentionally tried to get me in trouble with the building inspectors. She thought I is was hard up for money and would sell, to her relative, at a discount. I told her exactly where to go. Then, I sold the house for $9000 more w/o a commission at all. Never ever again!

Mon, 06/23/2014 - 20:09 | 4887596 johnconnor
johnconnor's picture

"they bring buyers and sellers together, which then generates a deal which otherwise would not have happened?"
It would have happened but without the cut they get for pretty much opening the door lock and tell you how pretty is the house in question. Realtors add no value whatsover, just subtract it, and employe an army of middle age uneducated women that couldn't work on anything else

Mon, 06/23/2014 - 23:40 | 4888195 cynicalskeptic
cynicalskeptic's picture

Realtors perform a very important function - at least in their minds (which may be why so many are the wives of local politicians).

They see themselves as the 'gate-keepers' for a community - keeping out the undesirable and steering people towards  'appropriate houses in 'appropriate' neighborhoods.  All blatantly illegal but they manage anyway.

New buyers will be steered towards 'starter' houses - those that are problematic and would not be bought by anyone with experience or common sense.  Truly great bargains are saved for the insiders - unless you stumble across one by accident.  Those with money to spent will be milked of as much of it as possible - if they allow so and some will be encouaged to spend more than they can afford.  The best houses seem to sell via word of mouth - excluding realtors entirely.

Very much an insider business with realtors referring you to home inspectors that will say what's desired, appraisors that will do as told, etc....That's why the market got so overblown in the first place.   Nobody actually doing their job - all working to keep the merry go round turning.

Tue, 06/24/2014 - 03:45 | 4888464 Serenity Now
Serenity Now's picture

Yep, there's no reason for a real estate agent in a free market, unless you WANT to pay one.  In a free market, buyers and sellers come to agreements.  In real estate transactions, you might need to pay a lawyer $500 to do the paperwork, but that's a hell of a lot less than paying a real estate agent 6% for doing absolutely nothing.

Let's see......a flat fee that has no bearing whatsoever on the price of the house.....

OR

Paying 6% commission that entirely depends on the sale price of the house????

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