Thursday, November 15, 2007

Under-Reported Concerns Of Buyers Exposed

by Broderick Perkins
© 2007 DeadlineNews.Com

Deadline Newsroom – A real estate industry trade group that serves only buyers says their constituency isn't getting the straight scoop about housing market conditions and they want to set the record straight.

From delayed agency disclosures and "fake" buyer agents to poor home inspections and shoddy new home construction -- with the media making matters worse -- the National Association of Exclusive Buyer Agents (NAEBA) says it has the full story.

Too often, says the group, media attention is focused on sellers when buyers are besieged by just as many new challenges in the boom-gone-bust housing market.

"When you’re shopping for a new home, you face many challenges. Picking a location, deciding how much you can afford, and securing the right financing are some of the most commonly discussed issues that you must solve," according to "Under-Reported Home Buying Issues" a survey of NAEBA members who were asked to identify the most under-reported issues facing home buyers.

The members also offered solutions for buyers facing those issues.

The report continues, "However, you should also be aware that there are many new and challenging issues which are not as often discussed, but which can be just as important."

While NAEBA claims obviously don't apply to every media outlet, especially those that cover real estate full time, here are some of the issues the group would like to see addressed more often.

Fake buyer agents. Operating under a strict code of ethics and pledging undivided loyalty, NAEBA members represent buyers exclusively.

Without the dual role as a seller's agent, according to NAEBA, buyers agents are able to address only buyers' needs and concerns without being distracted by the business of managing sellers and their listings.

There's also the potential for a conflict of interest should a single brokerage represent both buyer and seller in the same transaction, something called "dual agency," a practice that's outlawed in some states.

However, according to the NAEBA report, some non-members feign NAEBA affiliation or misrepresent themselves as buyers agents.

Buyers who want exclusive representation should seek NAEBA certification, a written representation service contract and a track record of satisfied customers.

One-stop shopping. One-stop shopping (a bundle of realty, finance and related services offered by a real estate brokerage) is marketed as a convenience to housing consumers. The bundle may offer the best deal, but consumers won't know that if they don't first shop around individually for all the services they need. Shopping around and comparison shopping is the hallmark of savvy consumerism.

Poor local news coverage. NAEBA says local news outlets too often don't abide by journalism's code of ethics if much of their ad revenues stem from the real estate community. Unbiased or broad based news coverage can difficult for media outlets that don't want to alienate advertisers, says NAEBA.

Consumers are advised to look for advertisements disguised as news stories and see them for what they are, be aware of the limitations of smaller, local media outlets supported by real estate ad revenues and take time, over time to examine a media outlet's editorial content.

DeadlineNews.Com recently raised related issues in "Finding News That Really Hits Home".

Buying foreclosed properties. Foreclosures sound like a good deal. Below market prices can be alluring, a cottage industry of infomercials say they are a steal and they are flooding the market right now. However, a foreclosure acquisition doesn't follow the more structured path of a conventional listing purchase. Without a real estate agent or other expert to provide some specialized hand-holding, a novice could lose his or her shirt -- and the 'deal.'

Websites not providing the full inventory of available property. Not all realty Web sites provide all available listings in a given area, but opt to provide only their agents' listings. Other companies don't manage their Web sites well, causing listings to fall out of date.

Larger Web sites, dedicated to listings and smaller ones that link to the larger pools of listings do a better job at scouring the market. A savvy real estate agent can also root out all listings available in a given area and, in some cases, even find properties that are for sale, but not listed.

Inadequate home inspections. Pre-inspections offered buyers as a convenience from sellers, says NAEBA, can be quickie inspections rather than a thorough once over.

Even if a seller provides what appears to be an expert inspection that comes with a guarantee, buyers making what's likely to be the largest purchase ever, should always hire their own inspector.

The inspector should be licensed locally or certified by a national trade group like the American Society of Home Inspectors. Local certification offers another layer of protection.

Like choosing any professional, get referrals from family, friends, co-workers, professional associates or others you trust.

Poor quality in new construction. Professional studies and grassroots action groups repeatedly reveal new homes are always defect-free for a variety of reasons, including the fact they are built by imperfect humans.

Consumers should make every effort to have a new home inspected while it is under construction during several phases, foundation, framing, wiring and plumbing and upon completion. Builders may not make this an easy task, but consumers can have new homes inspected by a professional during or before your final walk through.

Editor's Note: DeadlineNews.Com frequently covers all the issues mentioned in this report. A few recent and timely examples are below. Check out the DeadlineNews.Com Index Page for our complete archives of full coverage of the residential real estate market.

DeadlineNews.Com's founder, publisher and editor, Broderick Perkins has been covering the real estate market for nearly a quarter century.

Check us out for news that really hits home.

Finding News That Really Hits Home
It's a Good Time For A Home Inspection
Many Left Behind In Real Estate School
Buying Foreclosures Not For The Novice
Timely Defect Litigation Guide Book Published

© 2007 DeadlineNews.Com

Broderick Perkins, an award-winning consumer journalist of 30 years, is publisher and executive editor of San Jose, CA-based DeadlineNews.Com, a real estate news and consulting service, and the new Deadline Newsroom, DeadlineNews.Com's new backshop. In both cases, it's where all the news really hits home.

DeadlineNews.Com's Editorial Content Is Intellectual Property • Unauthorized Use Is A Federal Crime


Judith Clausen said...

Thanks for the very good article about the concerns we face as Exclusive
Buyers Agents. I'm a member of NAEBA and participated in the report. It
helps to have media light on the issues that face buyer consumers.

Michael said...

Wow, that is one great article for home buyers and the general public. I am a member of NAEBA and I've been a "true" Buyer Agent, not a Fake Buyer Agent since 1996. It's really nice when unbiased article gets the information right for the consumer and is not "tilted" toward the Seller or traditional real estate agent. Thanks for the good info.
Home Buyer Advocate Mike