Real Estate Reality TV

Real Estate Reality TV… It’s not Real

I don’t watch much TV. I suppose it’s because I can’t find anything to watch. Today, television is riddled with Reality TV shows.

I don’t like Reality TV. There, I said it.

I don’t care for the Real Estate Reality TV shows. They are on for their entertainment value. It gives people a false sense of what’s real when they are ready to get in the market to buy, sell or to invest in real estate. If Reality TV portrayed real world experiences, people would stop watching and the shows would quickly fade off the air.

Only on Reality TV… can you have an open house, the first day a house goes on the market with 10 different buyers getting into a bidding war. The house sells for tens of thousands over list price! Houses rarely sell at an open house. They typically sell after a scheduled appointment with a buyer. And, the house must appraise, based on comparable homes sold in the area.

Only on Reality TV… can a buyer find 3 absolutely gorgeous homes for sale, at the same time, in their desired neighborhood & school district that suit their wants, needs and price point. And, then those buyers have ample time to go home and think about which one they’d like to buy. When they decide, all 3 houses are still waiting for this buyer to come and choose the one they’re going to buy. In our current market, our inventory is low, so often it takes some time to find the right house for a buyer. The good homes typically go quickly. So today, when a buyer finds a home that suits their wants and needs we recommend they not take too long to think on it. There are other buyers out in the market, too.

Only on Reality TV…can two polished real estate agents sit down and negotiate a $5 Million real estate deal verbally, with their buyers and sellers on the telephone, over lunch. Real estate transactions can take time to negotiate, and they are typically done in writing, if even in an e mail.

Only on Reality TV… can buyers close on a house in 30 days, without home inspections, property appraisals, discussions of mortgage underwriting guidelines and discussions about securing homeowner’s insurance. There are required steps that are taken in real estate purchases, to be sure that today’s guidelines are followed.

Only on Reality TV… can you paint a house various colors of the rainbow and have buyers fall in love with the house and pay full price. Too much color can turn buyers off. Neutral colors are best. Buyers will often discount the purchase price substantially on a home with lots of color, to figure in the cost of having the home painted.

Only on Reality TV…can a buyer flip a house in a couple of months and walk away with a huge chunk of money. There are various costs to consider in a flip… the cost of the house, the cost of sweat equity (paying yourself for the hours you’ve put in), mortgage closing costs, monthly mortgage payments, taxes, insurance, holding costs, homeowners association fees, utilities and real estate commission to sell, etc.. And again, the home has to appraise. If the house is being sold too quickly after purchased, a lender can require 2 different appraisals and repair receipts from the flipper.

Only on Reality TV… do real estate agents make high 6 figure commissions, or a full 6% and 7% of the sales price on each transaction. Real estate commissions are typically split 50/50% between the listing agent and the buyer’s agent.. And, then typically that 50% is split again (broker splits can vary) with each agent’s real estate broker.

Reality TV is made for the audience’s viewing pleasure. It’s entertainment (or so they say). It has it’s loyal followers. If people didn’t watch those shows, they wouldn’t be on TV.

I don’t watch Reality TV shows. Each week when we talk to buyers, sellers and investors, someone mentions an episode they saw on Reality TV. And, I remind them, “Real Estate Reality TV… it’s not real.”

*Please note, that real estate is local in nature, Every market is different.