Charlotte Real Estate: An Issue of Trust

Charlotte Real Estate: An Issue of Trust

Finance in America has a long history of criminals—men and women who use deception to turn profits. Today that seems especially apparent, with headlines routinely announcing one swindle after another. Paranoia and distrust from this news is sewn into the public's mindset. Couple that with an unstable economy and a grim financial situation emerges.

The real estate market in the past 10 years had had an important role in developing these trends. The current state of the economy is largely due to the subprime mortgage crisis. It's understandable then if homebuyers want to know more about realtors.

Transparency is a positive thing in business. It allows involved parties to understand and accept another's motivation and goals. It fosters stronger relationships and develops lasting success. But business also employs cloak and dagger tactics. Nobody wants to give away too much information. Nor do they want to appear vulnerable, greedy, naïve or overzealous. In this regard, transparency is anathema to business.

Real estate, for most part, involves a buyer and a seller. Let's focus on residential property. A buyer contacts a realtor and expresses interest in a home. The realtor describes the home, shows it, and works with the buyer. Easy, right?

The buyer understands the realtor is trying to sell him something. It is a conditional agreement that when a realtor shows a home he is trying to sell it. The buyer knows this, listens to the realtor, looks at the home, and then decides.

The realtor makes money from a sale. It's no surprise, then, that realtors work hard to sell property. The trouble starts when bonuses and financial incentives motivate realtors to distort the facts. If a realtor has an incentive to sell a home for a price that he knows the homes is not worth, chances are, especially in a difficult market, that he'll do it. This makes potential buyers suspicious. And it spurs action.

In Charlotte, realtors were recently pressed to allow buyers access to their financial interests in selling a home.

The Charlotte Observer ran an article.

"We want to go over and look at it again," said commission member Marsha Jordan, owner of Apple Realty in Lincolnton, speaking of the rule.

Jordan said colleagues around the state had expressed concern about having to reveal to clients what they make beyond the standard commission that's recorded on a buyer's agency agreement.

She and commission chairman Skip Alston, owner of a Greensboro real estate company, denied that the nine-member commission, which is made up mostly of real estate professionals, was putting their colleagues interests' ahead of consumers.

It's plain to see people are wary. The best way to promote better relationships between realtors and buyers is transparency. When a buyer understands where a seller's motivations are, he feels more comfortable with the experience. But at the end of the day, buyers and sellers need to recognize that real estate is a business, and people are trying to make money.

American history is full of financial criminals. It is also full of trustworthy business people. It's time to flush out the criminals and focus on developing a healthy economy through hard work and trust.