All Forum Posts by: Trevor Richardson

Testing

Quote from @Brian Kloft:

Am I missing something? I see the chart but it doesn't have Reno on it and you don't mention any numbers for Reno to compare with that chart.

This is National macro data comparing regions. Reno’s vacancy is 3-4% which is consistent with how the West is preforming.

That 3-4% local data is from a separate source than this. 

Exploring multifamily investments in Reno? Here's a comforting fact: Reno's got a handle on occupancy rates, keeping things smooth and steady for investors who like predictable cash flow. We see it all the time analyzing deals in the market.

Lots of investors are lured to areas like the Midwest, which might look tempting with its high returns, but don't overlook the ups and downs in occupancy. Reno, on the other hand in the heart of the West, offers a more consistent track record-just what you want for peace of mind in your investments.

Key Points:

1) Reno is holding its own with solid occupancy rates for multifamily properties.

2) Across the West, occupancy is more consistent, and Reno fits right into this pattern.

3) For a balanced approach to investment, Reno’s stability is worth considering.

For those San Francisco, Sacramento, San Jose, Los Angeles investors looking at the big picture, Reno is a smart choice.

Source: Freddie Mac Multifamily 

Reno's median home sales data speaks volumes – up by a remarkable 7.4% from last year! If you've been eyeing the market for the "bottom," it was last year at this time. And here's why:

Key Takeaways:

1) The market is following the original year-over-year appreciation trendline from 2014 upwards, indicating sustained growth and stability.

2) Supply issues in Reno's housing market are once again in focus,

emphasizing the need for strategic solutions to address housing shortages.

3) Exciting developments, like Tesla's massive expansion to manufacture electric semi-trucks in Northern Nevada, will further strain housing availability, signaling continued demand.

4) With increased home prices, we anticipate a ripple effect on rental markets in both single-family and multifamily sectors, driving up rents due to housing unaffordability.

For California investors in San Francisco, Oakland, San Jose, Sacramento the proximity of Reno and stability of investments are attractive. 

Quote from @Calvin Thomas:

Quote from @Scott Schnabel:

Quote from @Calvin Thomas:

Quote from @Scott Schnabel:

Quote from @Calvin Thomas:

I am curious though.  What's going to happen to the tire kickers? Buyer agents prob. won't entertain them for more than two or three showings.

You’ll have to get a buyer’s agency agreement now. That will weed out the tire kickers a bit

Good luck enforcing it if they use a different agent and you find out later.

Something I’ve been thinking about since I learned of the ruling. How will it be enforced?

 Can't enforce it now..  How would an agent enforce it then?

 It’s not the agent that’s enforcing it, it’s likely the state’s real estate division. For example if a licensed brokerage is audited by the state and they cannot furnish buyer broker agreements for active clients the division could fine heavily the brokerage or remove their license. It’s not me coming up with this haha. Read the settlement, part of the agreement is to mandate buyer-broker agreements industry wide. That means if licensees don’t have them they will probably be fined or worse.

Quote from @Chris Seveney:

@Trevor Richardson

I agree with Russell

You will see a la carte services from agents to write up offers and possibly even charge for showings. It’s going to go away from a commission based model (which to me never really made sense but not complaining about it).

25 years ago when there really wasn’t online listings and you would check the newspaper or call agents for listings times have changed and commissions made sense. Today Buyers will need to be more savvy which they should be making the biggest investment in their life.

They can source online information but realize now when they go shopping they are gonna have to pay for it out of pocket.

This will 100% reduce the number of agents out there which is not a bad thing, and it will be very good for those agents who are good at what they do.

Agreed on reducing agents, I think everyone likes that. I think good buyers agent fees will go up. 

I don’t think having a buyer,  have the sellers agent whip up an offer for a fee is going to be adopted in mass. The fraud and collusion with that… talk about forcing buyers and sellers into duel rep. I’m assuming you have seen seller agents with multiple offers. Now they will just write up extra buyers offers…. I could see in slow markets where there is time. But yea not adopted in mass. If that was adopted wait for the seller agent collusion lawsuits where the listing agent boosted the buyer’s offer to get a higher price. That’s what you are left with without buyer representation. Just sayin.

This post was about listings that don’t have BB commissions losing value for unrepresented buyers because they no longer have that card to play “hey seller I’m unrepresented my offer doesn’t include commissions” won’t be there on those listings. Interesting.

I could see fees for like $300 per showing, then that amount is applied to a 2.5% BB fee at closing. Something like that where you are paying a la cart fees that are applied at close under the buyer-broker agreement and commission agreement.

Its going to be fun to figure out this year and next, I’m building basically a subscription based brokerage right now anyways where they sign up for the “plan” that suits them which will require the mandated buyer-broker agreement and commission schedule.

Quote from @Scott Schnabel:

Quote from @Trevor Richardson:

Quote from @Scott Schnabel:

Quote from @Calvin Thomas:

Quote from @Scott Schnabel:

Quote from @Calvin Thomas:

I am curious though.  What's going to happen to the tire kickers? Buyer agents prob. won't entertain them for more than two or three showings.

You’ll have to get a buyer’s agency agreement now. That will weed out the tire kickers a bit

Good luck enforcing it if they use a different agent and you find out later.

Something I’ve been thinking about since I learned of the ruling. How will it be enforced?

It’s easy you can sue the buyer if you are the brokerage. If a buyer signs the buyer/broker agreement that’s a binding and enforceable contract. It’s going to take a year at least for the real estate industry to figure out exactly how to write it. 

The language will be similar to listing agreements. I plan on making ours where the buyer has the ability to terminate it (no worries with me) but any properties they purchase that were shown by us will be enforceable for like 30 days. These are the details that will have to be ironed out.

Buyers got a lot of no cost service with nothing attached. I don’t know to what extent but that’s going to change. 

I was thinking more in the terms of buying agents not getting an agreement in advance v this who are doing it correctly.  There is a large percentage of buyers who balk at signing one. They’ll gravitate to the agent that doesn’t make them sign. 

I don't think that's going to be an option legally. That's part of the settlement, buyer brokers agreement will be mandated. This whole lawsuit is about NAR and the industry not disclosing or talking about commissions, compensation and how that's paid.

A licensed agent will be held by law to have any buyers they are working with under a buyer/broker agreement, it's not going to be an option, that's the past. The NAR and licensed agents in any state would be liable (again) and prone to lawsuits if buyers don't sign and agree to representation. They will at that point be signing that the agent and the industry has informed them of who gets paid and why.

The lawsuits hit a weak point in the industry, made realtors look ill prepared. The news is running wild, speculation is wild, but I don’t think a lot of people are really understanding the fine points and how this will actually go down. Like buyers not having an option to not sign a buyers broker’s agreement if they are working with a licensed agent.

Quote from @Scott Schnabel:

Quote from @Calvin Thomas:

Quote from @Scott Schnabel:

Quote from @Calvin Thomas:

I am curious though.  What's going to happen to the tire kickers? Buyer agents prob. won't entertain them for more than two or three showings.

You’ll have to get a buyer’s agency agreement now. That will weed out the tire kickers a bit

Good luck enforcing it if they use a different agent and you find out later.

Something I’ve been thinking about since I learned of the ruling. How will it be enforced?

It’s easy you can sue the buyer if you are the brokerage. If a buyer signs the buyer/broker agreement that’s a binding and enforceable contract. It’s going to take a year at least for the real estate industry to figure out exactly how to write it. 

The language will be similar to listing agreements. I plan on making ours where the buyer has the ability to terminate it (no worries with me) but any properties they purchase that were shown by us will be enforceable for like 30 days. These are the details that will have to be ironed out.

Buyers got a lot of no cost service with nothing attached. I don’t know to what extent but that’s going to change. 

Quote from @V.G Jason:

Quote from @Trevor Richardson:

Quote from @V.G Jason:

Quote from @Trevor Richardson:

Unrepresented buyers have lost power, here is something to consider.

Before the settlement there was nothing preventing a buyer from approaching the listing agent with an offer. Buyers have had this power the entire time. In that regard nothing has changed.

NOW that 2.5% that COULD have been coming to the buyer side (unrepped buyer) may not be there. 

Unrepresented buyers, how has this increased your unique leverage approaching without an agent? That 2.5% could no longer be a negotiation token that you used to have to make your offer stronger or put it in your pocket as a credit.

I can argue that the pre-settlement was incentivized buyers to self represent because the industry had commissions available to the buy side. 

 If the seller's agent gets my official offer as an unrepresented buyer they still have to legally show the buyer right? It doesn't change that. The states where I went to the listing agent to get done, now I'll just submit on my own accord and I'll carefully craft it to where the seller gets more, I get the price I paid and the agent gets what's necessary to execute it. If the seller agents, in their power, refuses to show my offer or play defensively against it that's fine-- but there's legal recourse. Or am I off?

Agents will still have to present all offers. The point I’m making, and highlighting is if the seller is not offering buyer broker commissions (like pre-settlement) your carefully crafted “seller gets more” won’t mean anything. It just comes down to price just like every other offer. 

Say before there is a $500k house and the seller is not offering BB commissions. Remember that’s the whole settlement issue. That’s $12,500 that the seller was paying to the buy side. You could have wrote your offer to not include that effectively making your offer $12,500 more net compared to other offers.

Now if that seller is no longer offering that, as a unrepresented buyer what’s your pitch to the seller? That $12,500 is no longer on the table. So if you offer $500k it’s the same as any other $500k offer even if the other buyers have agents. Because now that buyer is paying their own agent. The price is all that matters to the seller.

 I see what you're saying, I don't think that'll be common at all. I think the buyer either a)will  pay a fee to a buyers agent making their offer weaker due to net out of pocket costs or b) the buyer will wrap the mortgage in with the seller subsidizing the buyers agent fee. 

My unrepresented offer with more in the pocket to the seller will still yield the best if it's presented properly. 

In this scenario the only way you get more to the seller is offer more. To the seller that’s the only thing that matters. 

It will be as common as there are properties without buyer broker commissions. On every one of those you can’t get more in the pocket to the seller with non-representation because they aren’t offering commissions to the buyer side. It levels the playing field with other offers.

Just think of it like this. On listed homes where there is no buyer broker commission you offering to “not include commissions so the seller pockets more” won’t be an option. Now you may be able to offer more than a buyer paying an agent. 

Quote from @Russell Brazil:

I think there will be a lot of unrepresented buyers approaching me on my listings now. Due to the expected influx, which will be primarily people wasting my time wanting me to write up their weak offers, we will be charging fees to unrepresented buyers for services they want us to perform. Write offer: $695 is the first one. Ive got a fee schedule with about a half dozen services unrepresented buyers might ask for. 

One of my many questions are. What has been preventing buyers from approaching listing agents like you said? There was no law or anything stopping that so why are buyers now going to write offers themselves? Personally I don’t think decoupling commissions makes it easier for a buyer, I think a side effect could be it makes (some) buyers agents more necessary. I own a brokerage, we do a lot of buyer broker and I’m really excited for these changes. It’s perfect timing for us. 

If the seller is not offering buyer broker commissions isn't there less incentive for a buyer to write their own offer? They could have gotten paid for that pre-settlement or figured that into their approach. That’s gone if the seller isn't offering commissions to the buy side.