The grifting at the San Diego Association of Realtors continues to unwind, and as a result, I have switched back to being a member at the North San Diego County Association of Realtors.
Rob wrote a blog post about the original swindler, Mike Mercurio, who embezzled over a million dollars while being CEO of the SDAR. His article caused insiders to respond to him with even more details, including the involvement of Mercurio’s replacement Cory Sheppard, who used to be the general manager of Coldwell Banker West.
And then when you think it couldn’t get any more slimy, it turns out that Cory still feels for CB. Rob asks:
Furthermore, in the video, you say to Peter Mendiola, President of Coldwell Banker West, that you want to do everything you need to do to support him and CBW and its agents over an “extended period of time.” To which Peter adds, “Like forever?” And you both laugh… seemingly in agreement… then you add, “For as long as you want.” Would you clarify to your members who are not with Coldwell Banker West how they should understand that statement? How can they be assured that there will be no favoritism shown to your former company and former agents since you agreed to do everything you can to support them “for as long as you want” which might in fact be “forever”? And how can your members trust you given the fact that this video was sent to CBW agents on May 2nd, while the rest of the membership didn’t know jack diddly until August?
The situation reeks of favoritism and outright theft, and you would think that criminal charges should be forthcoming. In the meantime, I’m not going to have anything to do with them.
If you have any insider information, contact Rob. Here is his latest blog post on the subject with one bombshell after another:
It makes it sound like we know something you don’t – that our price is the right price.
Realistically, you can only say you priced it right if a house sells during its first week on the market. The frenzy made every listing agent look like a rockstar when most of the time it was due to the demand being so high that many listings were selling in spite of its agent and price.
How good are agents about price?
In the first half of 2023, there were 1,377 detached-home listings between La Jolla and Carlsbad. Of those, there are 896 that have sold or are now pending, which is 65%. Hmmm.
Let’s just price them attractively, which isn’t as specific as ‘right’. Put a price on it that causes people to want to come take a look, and then when they arrive, be a good enough salesperson to handle the rest.
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One way an agent can stay sharp about pricing is to see homes in person. The frenzy prevented us from doing the broker previews on Tuesdays and Wednesdays, and those were the best way to easily view the new listings.
Buyers go to open houses on the weekends, and shouldn’t we know as much as them?
It’s easy to shrug off the broker previews if you don’t have any waiting buyers for the homes on the list. But seeing homes every week also helps to keep an agent sharper about pricing in general – and also build better relationships among the agents who are on the tour.
I’ll have my Aviara Drive listing on broker preview tomorrow from 10:00am to 1:00pm with food. I told the sellers that my over/under on agent attendance is 15, which doesn’t sound like many when there are 1,000+ agents working in the area.
Anyone who attends tomorrow and mentions the blog will get a bubbleinfo t-shirt – non-agents included!
It’s good to see that last month had more sales (159 vs 147) than in June – which also had two more business days! Let’s combine the two months to soften the July drop median sales price and compare to previous years.
The plunge in sales has to be discouraging to potential buyers who can now only expect 2-3 chances per year to buy a desirable home in their preferred area of choice – and you can count on being beat out by a crazier buyer on at least one of those, and be victim to realtor shenanigans on at least one other. It happened again this week when the listing agent grabbed the first offer within 24 hours even while allowing other showings to motivated buyers, but then denied them a chance to submit an offer.
With that much frustration in the air, the pricing will likely stay elevated.
Collecting hundreds of thousands of dollars in unearned vacation pay, and tens of thousands in purchases on association credit cards which were then posted on eBay and deposited into a personal bank account; these are only a few accusations lobbed at the former CEO for the San Diego Association of Realtors, Mike Mercurio.
In a newly filed 110-page lawsuit, four former high-level executives at the San Diego Association of Realtors (SDAR) say they were fired after investigating what they claim was a long-running scheme by Mr. Mercurio to funnel SDAR funds into his personal account.
The San Diego Association of Realtors is a large and powerful lobbying group that is funded by annual dues from its 20,000 or so members.
However, more than a million dollars in those member dues were diverted from lobbying efforts into the pocket of former CEO Mercurio, says the lawsuit.
The plaintiffs, which include the association’s former Chief Operating Officer, Director of Human Resources, Controller, and Marketing Chief, claim Mr. Mercurio, “engaged in massive embezzlement, stealing over $1 million from SDAR, and further directed, and participated in, the falsification of financial documents, extensive personal use of company credit cards, payroll fraud, and tax evasion.”
Another phrase you regularly see in the MLS descriptions is, “NO BUYER LOVE LETTERS”.
What is the underlying meaning?
Listing agents are perfectly capable of discriminating on their own, and they don’t need your help.
As long as the buyers’ names are on the contract, discrimination is probably happening. It might be so blatant that sellers make decisions just based on their names, but the more common practice is for sellers to google the buyers’ names and learn everything they can about them from the internet.
It may seem subtle, but make no mistake – homeowners want to sell their house to someone they like. They will decide their favorites early on, especially when the listing agent is a contributing factor.
Here’s an example.
My buyer and I attended an open house on Sunday that appeared to be an ideal match. As we entered, the seller was just leaving and she had the look on her face – and I knew something big was happening.
I already knew that the listing agent had not sold anything in a long time – no sales in the last 12 months. Within the first minute, she mentioned that an all-cash offer had already been received and she said it with the usual agent tone that ‘this deal is done so you are just wasting your time’. She also said she was going to shut down the open house early.
I walked my client out to the car, and then went back in to discuss. I told the agent that we were going to make an offer, and asked, “will that make your afternoon more exciting?”, to which she blurted out, “NO”.
Exactly what I expected.
Knowing that we would need to make a powerful offer just to get her attention, two hours later I sent her an all-cash offer that was 8% over the list price with an 11-day close and free rentback.
Everything that happened after that made it obvious that she had already built up the first offer in the mind of the seller – heck, she even told ME about those buyers!
Once an agent has gushed all over their seller about an offer, it means any other offers don’t have a chance. When a listing agent describes a set of buyers in great detail, it is subtle discrimination because those buyers get favored status – and it’s mostly because the agent is inexperienced or just plain lazy and doesn’t want to field any more offers.
The only hope for any other buyers is to submit a love letter! Give everyone a chance to win!
It is common to see the same words or phrases in the MLS descriptions.
A few years ago, the fancy new buzz word was ‘boasts’; a word realtors would use to describe the home’s best features. The word got overused, and eventually we would read that a home “boasts three bedrooms, and two baths”, as if that was something special.
There are two buzz-phrases you hear regularly these days.
Watch how many times you see, ‘this one checks all the boxes’ and ‘this is the one you’ve been waiting for’.
For those who have access to the confidential remarks, you will see a third phrase currently that is very curious: “Reviewing Offers As Received”
Isn’t that what you are supposed to do? Isn’t that required by law? I think so!
The phrase is probably a response to inquiries from buyer-agents wondering about their full-price offer they just sent in. Sometimes the listing agent will tell you that they have a specific date in mind to review offers with the sellers, or they are reviewing them as received, one by one.
What the buyer-agents really want to know is….when are you going to respond? How long will my buyers and I have to sit on pins and needles while you dink around with no strategy or game plan and instead just play around with the process?
The reason buyer-agents don’t like asking that question is because they cringe at the thought of having to hear one more time the same answer given by listing agents in almost all cases: ‘I don’t know’.
You get a very specific answer from me: “Should we have multiple offers, everyone will receive a highest-and-best counter-offer from us on Monday, and we hope to select a winner by Tuesday night”. It gives buyers and agents alike a specific idea of what to expect, and they can start planning their response.
It’s part of the slow-motion auction – full transparency includes an clear outline of the process, and how to win the game. Our counter-offer will level the playing field by balancing out the other terms, and ensure that everyone knows the winner will be determined by price.
It may sound simple and obvious, but I haven’t seen any other agents embracing full transparency.
I have another example happening now. The listing agent said they have already received one offer and expect a couple of more. When I asked how they will handle it, I got the usual uncomfortable laugh and a vague, joking response of doing something about it next week.
Here are comments left by listing agents in the MLS confidential remarks over the last month – some are scoldings!
No Showings until Open House, Then use showing time. Seller will only show WED/ SAT MUST USE SHOWING TIME!!! Must have a Pre qual To Enter Per seller Instructions.
Directions to property: 33.149132252579626, -117.31781391389755
All other showings after the open house to be requested via docusign.
Text agent, wait for conformation, then go. Sentri only. If you do not have Supra, agent to accompany. No one-day codes.
No shoes allowed in the home NO EXCEPTIONS., I will provide house slippers. This home has many ” breakable items” Please hold the children’s hands, this is not a place for children to play.
Credit toward garbage disposal.
Back on market as buyer past away.
Multiple offers well over asking. No more showings.
**MULTIPLE OFFERS NO MORE SHOWINGS AT THIS TIME**
NO MORE OFFERS WILL BE ACCEPTED **NO EXCEPTIONS**
Will show in till April 28 (published on May 4).
Call agent if buyer is interested.
Motorcycle helmet and jacket rack does NOT convey.
DO NOT DISTURB OCCUPANTS! DO NOT GO TO FRONT DOOR! House will not be shown until it is Active on the MLS.
AGENTS PLEASE READ!! NO MORE SHOWINGS AT THIS TIME.
Please do not call. Vacant lock box. Do Not use Showing Time. I do not support Zillow and will not take their call. ***AGENTS*** We are in deep negotiation with offers from investors.
Booties/Shoe coverings mandatory.
DO NOT ADD ME AS A RECEIVER OF THE DOCUSIGN FILE. Offer submission instructions must be followed.
Please use GPS or you might get lost.
PLEASE DO NOT CONTACT ME FOR OPEN HOUSES.
Sold before going into computer.
SELLER RESERVES THE RIGHT TO REFUSE ANY AND ALL OFFERS.
BUYER AGENT FORFEITED COMMISSION OF 2.5%
WELCOME to your Home!
Do not contact listing agent for appointments.
NOTE: SALE WENT PENDING PRIOR TO INPUT ON MLS. *CALL LISTING AGENTS FOR MORE INFO. THIS IS A STANDARD REGULAR SALE.
A constant flow of 3-6 groups at a time all to see our hot new PQ listing off the 56 and only one exit down from CCHS. Talk about a convenient location – within five minutes you can get to top-rated K-12 schools, shopping, grocery, and freeway on-ramps without hearing any road noise. Perfect!
For homes in this location, the demand is overwhelming the supply. We’ve already received two offers over list, and we’re just getting started. The way it sounds, I think there will be 8-10 offers.
How do I handle it?
I am as upfront and forthright as possible, and I discuss how the process works with everyone:
Between the lawsuits that will decouple commissions and homes.com that funnels all inquiries back to the listing agent, the buyer-agents are cooked. It’s just a matter of time.
Florance also detailed his vision for Homes.com, which he believes can serve the interests of consumers and agents in ways that other residential listings sites do not.
“I’ve used some of these competing sites myself and submitted leads on properties I’m interested in. The experience is remarkably awful,” Florance said. “The moment you submit a lead and for months afterwards, you’re bombarded with cold calls from countless agents who have questionable qualifications.”
He said the agent experience is also lacking. “The competing models use all the agents’ listings in a market to funnel monetize leads to just a very small percentage of agents.”
Florance also made the case that there is plenty of opportunity to provide a more seamless online set of tools for agents while cultivating a residential real estate space for consumers serious about buying and selling homes. “While other sites are injecting their agents into the homebuyers’ search experience somewhat awkwardly, we offer a friction-free environment connecting buyers directly to the listing agents,” he told investors.
Consumers can collaborate with their agent directly using the Homes.com platform. “Our agent collaboration tools are up and running. We’ve had tremendous feedback from both agents and consumers,” Florance said.
“We’re presenting consumers with hundreds of thousands of highly qualified potential buyer agents for free based upon those buyer agent skills and experiences rather based on how much the buyer agent is willing to give up in commission to the portal,” Florance said. He predicted that the company will start monetizing the site later this year.
“Not only do we believe we offer a superior consumer experience for buyers, we also believe we are much better aligned with real estate agents,” Florance said.
