Are Real Estate Agents Becoming Obsolete?

Whether your buying and/or selling a property, hiring a Realtor is the absolute best way to protect yourself.  Realtors are mandated by law to protect your interests. 

Realtors know the law, in fact, they have to attend up to six hours every year on real estate topics such as Code of Ethics, Mortgage & Financing programs and Real Estate Law. 

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Yet many consumers falsely believe they can just read a book and navigate all the in’s and out’s of real estate. Using that same analogy, try reading a book on how to fly a plane and them jump into the cockpit and let me know how that goes.

The following is a true story was shared by a Steve Burton, a Veteran and real estate agent.

True Story…

Client A. (Let’s call her slick girl) wants to buy a house she has picked out searching Zillow. She can’t figure out why the house hasn’t sold as it is beautiful and very reasonably priced.

The guy that is selling the house is doing it as a For Sale By Owner. This guy even wrote a book on how to do this.

She calls me first bragging about how she bought her current home on Craigslist but this time she is a bit more cautious because of sellers book writing history. She meets with the owner and determines that he is a “nice guy”.

I drive out to the house and poke around. It is indeed nice and priced well below what I thought it was worth. Thinking something isn’t right I decided to research the house but she wants a contract “just to see what it looks like” while I am gathering information.

READ: He Lost The Bid But Won The House

You can probably guess what happened. Slick Girl just wanted a contract she could copy to continue the deal without me.

A contract in hand (minus me representing her) she contacts the “nice guy” and does the sale all on her own. Proud that she bypassed me, she ignores my phone calls until after the sale, only then does she answer to crow to me about how she did it all herself.

Yes, she was quite pleased with herself thinking that she “negotiated” a deal with the seller on her own and secured the purchase of the property. Until she finally decided to return my calls, that is.

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Ignorance Can Be Dangerous To Your Health

Come to find out that she also chose to wave the home inspection because the seller assured her all was in order. What Slicky Girl didn’t know was:

  • The septic system was years past its useful life.
  • The septic system was installed at a time when regulations were a lot different and as the new homeowner she was not grandfathered in. The county made her purchase a new septic system.
  • The original number of bedrooms was different then what Mr nice guy listed it as. The septic system even if it wasn’t old an outdated didn’t have the capacity for the house.
  • The house was big and beautiful because the original owner had additions built on. The additions were built prior to most of the regulations and codes we have now and the ground beneath the house is shifting causing separation.
  • The ground is shifting, the house is sinking. Not noticeably yet unless you know what to look for and are aware that this is a problem in this neighborhood. The foundation needs to be stabilized costing thousands.
  • Another big expense was that lot of the electric in the house was knob and tube. Not used since 1930, knob and is considered to be a potential fire hazard today. In fact, a lot of insurance companies won’t touch a house with knob and tube.

Zillow, Trulia, and other internet sites didn’t tell her any of that. Her attorney didn’t go out to the house and find those things out.  I could have saved her thousands and directed her to a much better investment, but she decided I was obsolete.

Who Came Out On Top?

The seller, on the other hand, went without a Realtor because he knew about those things and didn’t want to disclose them. His big beautiful house wasn’t sold for a long time because other people interested in it had Realtors that discovered these things.

He moved out of state right after the sale 230K richer probably laughing his a** off. Oh, and his book was self-published through Amazon.

Read: Armed & Ready: 5 Winning Home Buying Strategies

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Speaking Of Disclosures

Client B: For Sale By Owner person sells a house to an unrepresented buyer, Craigslist again. The buyer referred to the seller as a “sweet older guy” before this happened.

About a year later, new owners toddler became sick. 2 years later child suffers from neurological problems. Two more years go by until they were able to identify the likely cause…Turns out the house is full of asbestos and lead-based paint.

Now the owners are suing the seller for fraud, negligence and violating federal law.…… 4 years after the sale.

Imagine selling your home and 4 years later being sued. Better yet, imagine knowing you are the reason that child will never live a normal life.

That is the civil side. As it turns out, the seller was aware of the lead-based paint & asbestos he just didn’t disclose it as is required by law. Criminal charges have now been filed.

A Property Disclosure statement and Lead-Based Paint Disclosure for properties built before 1978 are required by law. These are just two of the many documents in a real estate transaction. Failure to complete and have these and other documents with your listing or part of the contract with a buyer could expose you to liability in the future.

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Selling A House On Your Own Can Land You In Jail

Selling A Property is not like selling a car. Sell a clunker car to someone you don’t know and you will have someone a little peeved at you.

Sell a home without the proper documentation and full disclosures could cost you hundreds of thousands of dollars years later and you could wind up in jail.

Read: Who Pays Buyer Agent?

There’s no statute of limitations in many states across the U.S. Which means, even five years after the sale, you could still be sued by the buyer if they can prove you willfully withheld information that posed a health hazard. In light of this fact, do you still think it’s worth it?

So, are real estate agents becoming obsolete?  Nope.

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