mig174
Active Member
CG:
You are doing something very smart but have a distinct advantage; not just you but all realtors.
1) You are investing in something you know very well. You live and breathe it.
2) If this was a stock, you would be a kin to an insider with advantages not available to the rest of the public. By this
I mean that you can buy with 3-4% off; earlier than other investors. As well by bringing in your clients; you can purchase say 4 units and if you accept that you don't make the commissions; effectively buy your unit for 20% off. Either way, you have down
side protection which other investors do not have.
3) You are connected to "unload" the investment should it go sour. Other investors have to pay a real estate commission to sell; you would save your side of the commission affording you further downside protection; can undercut other investors with resultant less loss even in a bad market.
Please note: I am not saying there is anything improper/illegal with this. However, I don't really feel this a level playing field.
In the stock market; this is "insider trading" but it is not illegal or not allowed in real estate. Whether it should or should not be allowed is a matter of debate with I am sure those benefiting from this advantage saying it is fair and others looking in saying it is not.
In fact, if I were a successful realtor which you are; I too would be an investor in real estate almost exclusively because you have(along with all realtors) a competitive edge with early access to the developer; discounted fees and abillity to favour your own sales over your other clients should the market sour. It is a bit of a rigged game.
The reality is in my view, and it is just my view; that the real estate brokers/agents have been "bought" by the developers and have added a level of bureaucracy (and expense) to all end users of real estate.
It should be illegal because it is a fucking blatant conflict of interest. In every profession, there are rules to handle this. Granted, they are not perfect and broken, but those that are caught bending them are usually punished. Consider doctors - they must disclose all of their affiliations with pharmaceutical companies before giving lectures, publishing papers, etc. Same thing for scientists, all competing financial interests must be disclosed. Insider trading, as you mentioned, is illegal in the stock market.
And I would question whether people like CG are doing something "smart". They are not. In fact, most realtors are idiots. It is not hard to become one, so one can't weed out the idiots from the profession. They are just getting lucky. They are:
a) given a competitive advantage in the ability to undercut other buyers
b) given a MONOPOLY over MLS. It does not take brains to snap a few pictures and put up a listing, sit on your ass, then collect your money.
c) are enjoying a market which is FLOODED with easy credit and foreign capital. They don't have to do shit to make the money most people take tons of schooling and training to make.
I have trouble seeing a positive thing to come from realtors. In a time where housing listings should be available online and freely, they are simply monopolisitic parasitic middlemen. They should be heavily regulated.
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