The I Love CVille Show With Jerry Miller! - Candice Van Der Linde And Woody Fincham Joined Keith & Jerry On "Real Talk With Keith Smith!"

Episode Date: April 12, 2024

Candice van der Linde, Owner of Buy And Sell Cville, and Woody Fincham, Owner of Fincham & Associates, Inc., joined Keith Smith & Jerry Miller on “Real Talk With Keith Smith” powered by YES Realty Partners and Yonna Smith! “Real Talk” airs every Monday, Wednesday and Friday from 10:15 am – 11 am on The I Love CVille Network! “Real Talk With Keith Smith” is presented by Charlottesville Settlement Company, LLC, El Mariachi Mexican Bar & Grill, Fincham & Associates, Inc., Free Enterprise Forum, Intrastate Service Co, Pearl Certification and YES Realty Partners.

Good Friday morning, guys. My name is Jerry Miller. Thank you kindly for joining us on Real Talk with Keith Smith. It's a pleasure to connect with you guys on a show that's presented by Yes! Realty Partners, a show that has kind partners like Fincham & Associates and its principal, Woody Fincham, in the studio and in the house today. Judah Wickhauer, our director and producer of this talk show, Keith Smith, he is the executive producer and the namesake of Real Talk with Keith Smith. Judah, if you can go to the studio camera,

and I will let the namesake, the man whose name is on the marquee, set the stage right here. So, set the stage. I'm going to do a little selfless PR, PSA plug for the stage. I'm going to do a little selfless PR, PSA plug for the moment. I just want to give a thanks out to Tiger Solar. They're sponsoring a little

event that Yona and I are putting on at Lake Monticello. We do this every year at our little neighborhood within Lake Monticello and we bring a big old 40-yard dumpster and we let our neighbors go ahead and put all their stuff in it. So, Woody, if you're out and about on Sunday and you need to get rid of some stuff, swing by the house,

dump it into the dumpster. But, you know, Tiger Fuel, Tiger Solar, excuse me, helped sponsor the dumpster, so I just wanted to give them a little bit of shout-out. So if you need to throw something in a dumpster and you live close to my house at the Acres, swing on by and go ahead and do it. I wanted to kick off today, you know, we're now four weeks into the NARS announcement of the decoupling or the settlement of the class action suit. And what I've been doing since then is I've been tracking day over day

what listing agents are offering to buyer's agents. So, Jude, if you've got time, slide number one, it's just a quick little overview, and then I'm going to kind of hand it off to our panels to kind of talk a little bit about their thoughts. Thank you, Judah. Their thoughts on this impending decoupling. So what you're looking at real quickly, this is day over day since the last four weeks, there was 334 listings that came on the market. 67% of them had three eggs. 3% of them had 2.75 parts of an egg. 25% had 2.5. 0.31 had 2.25. 15 had two. And one had zero, which is an interesting note. The zero to zero was a $1.8 million listing.

So at the moment, it seems to be tracking what it has prior to the announcement that we're kind of looking between 3% and 2.5%. I'm going to continue to track this um every month i'm going to kind of update it up until we hit the formal decoupling and see what impact it really does have on the buyer side so woody um what is your industry thinking about this it's a a topic of conversation for sure every just about every agent that i talk to anymore is asking me what we're going to do as appraisers as this is occurring and when it does finally go into effect, what in July. First and foremost, I have to say that I am on the car board, so I'm not speaking on behalf of the association. Everything I say today is on my own behalf. We're not expecting there to be much of a shift as far as the market value aspect of it goes. I mean, commissions have never been

considered in what we do because it's usually just the cost of business, to do business, to sell a piece of property. It's just a fee that's usually associated with it. Does it matter the buyer and the seller? Absolutely. But that's not something that we're looking at. A lot of folks are like, well, is it going to become a concession? No. Commissions have never been a concession. And as of right now, we're not seeing that change. Now, to caveat that, if the market starts reacting in a way that we need to address it

and what we're doing on the market value side. We will, but we're not seeing any indication that that's going to be the case. So, Candice, if you just give me a minute, I just want a quick question. So, Woody, from your perspective, let's assume, because I think this is what's going to happen, commissions, listing, and buyers

is going to end up in the contract. Yes. If that ends up in the contract, let's say right now it's in the contract, how does that impact your world and impact valuation? So you've got to look at it from the transaction point of view. That's how we look at it as appraisers. So how's the market reacting? So sellers right now have leverage because it's still a seller's market.

So if a seller decides they're not going to participate in compensation for the buy side, um, are they going to sell the property for any less? The answer is usually no. They're trying to maximize what they, their return is on it. So they're not going to just magically say,

well, and as your chart shows here, 3% is the most common thing we're seeing right now. They're not going to just magically say, well, we're selling it for a million. We're going to drop it, you know, $30,000 or whatever because, yeah, because, you know, we're not going to pay the commission. They're going to absolutely want to make every cent of that they can. So they're not discounting the sale at all. So from a market value perspective, it really has no impact at all.

So in my open letter, I wrote out, you know, there's, there's folks out there, there's not related to our industry that are actually saying that, that, you know, all of a sudden the homes are going to decrease and you're seeing, you're thinking it will not. As long as our market stays as strong as it's been and the sellers are still in control of everything. I don't see it. Well, Charlottesville is not any more affordable because of this. That's for sure. Sorry, I want to jump in real quick. So here's one of my questions just popped up and I love talking to you, Woody. I love being on the show. Thank you. We love having you on the show. So here's one of the questions though. Okay. So we're talking about decoupling. We're

talking about all this stuff and how does it change? Realistically, everything is just, how does it record on one of these and how does this go to the county or the city or the municipality and get recorded from A to B that's what it boils down to a buyers buying something and they're paying what a seller is willing to sell it for and then how does it record how how is how are things happening on paper? So currently, so here, Woody, this is my question to you. How does it change what's happening now versus what's going to happen in the future?

Because if eggs are being offered by a seller currently at 3%, 2%, 0%, whatever it is, flat fee, whatever the case may be, that's already in the equation as part of the appraisal. So how is it really going to differ when the professional realtors and people assisting their clients with buying or selling their residential or commercial properties, how is it really going to make a difference if on this piece of paper it says the end result is the end result? Well, I mean, as an appraiser, part of our diligence is to talk to the parties involved with the transaction to understand what's going on. Motivation and how buyers and sellers

interact with one another are very important because what we're trying to do is certify whether or not the sale is what we call an arm's length transaction. And usually what that means is that both parties are acting in their own best interest. There's no motivation. Like, as an example, the court has compelled someone getting divorced to liquidate their property. You know, in that case, they're probably not acting in their best interest. They're doing what the court tells them to do and how the court tells them to do it. So it does matter.

What's on paper does matter, but we also have to verify that there's actually that it is in fact an arm's length transaction but yeah you're correct I mean it really is all about you know the the actual you know the sales price and if we're convinced that it's arm's length and you know that's that's the market value indication now not saying that makes your job any easier or paperwork less by any means, but just that kind of simplistic understanding of, again, this is what we've been doing. That's why I love this area and being trained by professionals. Marjorie Adam, big shout out to her in my beginning stages of real estate here in this community and understanding how to read the contract and what is happening in the representation standpoint of, as professional

realtors, you know, we're not legal representatives. We really have to be careful and cautious of how we basically translate the documents that we see, know, understand, and live every day, and how to explain it to a server or a veterinarian or a talk show host or anybody from any walk of life that has no idea. They're busy in their life. You're doing your thing. That's what we do. So we're really working hard to understand your personal interests and needs, what your personal expectations are, and then realistically be honest and upfront with you with, hey, here's what we can do.

Wonderful things like bringing Woody in and bringing a professional appraiser in, or inspectors, or any of our affiliates. Always, you know, American Pest, shout out. But bringing people in that we know do this every day to help you as the client, consumer, seller, buyer, understand tangibly what is happening and how the process works. So I'm just going to say this, and this is me, right? NAR did a lousy job of communicating this from day one. Flat out, lousy job of communicating this from day one. Flat out, lousy job. That left the market or left other actors to go ahead and set that narrative for us.

I know this because I know you're busy, but Candice, I mean, tell me about the kitchen table conversation you're having with me as the buyer or me as the seller saying, you know, tell me about what's going on. I need to understand this. So give me a kitchen table conversation where I'm, let's say, I'm the seller. Because the sellers are very much so asking about this. What do I do? As they should. That's the beauty of it. I mean, you guys know I get really energetic and motivated by education.

You get energetic? Really? Yeah, I've been told I'm shy and quiet often in my life. Give me back that coffee. I know. Thank you, Keith. You're welcome. Yeah, no, it's really the wonderful thing.

A colleague and board member of ours, and again, same thing like Woody, I am on our local board. The conversation I have is from my professional business ownership standpoint, not from a car board membership standpoint. However, we have people that come and join and attend our membership meetings and our different realtor association affiliated events, and the camaraderie, communication, and understanding, and respect that we have. We are competitors. However, we are also colleagues, and we are here looking after, and we know that Keith is going to look after his client's best interest. That's his job.

My job is to look after my client's best interest. And we respect each other for that, and that's the beauty. I'm getting goosebumps. I like it. I'm getting goosebumps over here. Keep going. So kitchen table conversation. I've had multiples of these today. Clear communication. That was an early breakfast then. Oh yeah, always. But yeah, clear communication, understanding, and again, the beauty of being here in this area and having the opportunity to work with professionals

in and around the Charlottesville and surrounding counties, not taking away other realtors from other organizations. But we have the conversation with the client. Hey, this is how I'm representing you. I'm representing you as the seller, you said. We're at the kitchen client. Hey, this is how I'm representing you. I'm representing you as the seller, you said. We're at the kitchen table. Okay, my services to you are going to include A, B, and C. And at completion of settlement, we agree to a percentage of the price. We agree to a flat fee.

We agree you're going to buy a home and sell your home, so I may operate in a different way. Maybe you're my cousin, long lost arm from somebody I don't even know, but I'm going to help you out because you need help. There's wonderful grants and facilities, the Thomas Jefferson Area Foundation, and different opportunities where, you know, all people, all small business owners, I'll get off my soapbox, all small business owners need to look at how they operate. How do we get paid? What hours do we work? What times and days do we work?

Yeah, we're going to get into that later in the show because Jerry and I tackled that on Wednesday. He broke down what you guys net commission-wise on Wednesday. And my phone was ringing off the hook. I bet it was. Since then, yeah, yeah. So, you know, Woody, I just keep on running this through my head because maybe I'm too deep, deep into it, is what is this really going to look like on the back end when this decoupling happens, right? Because it's going to happen.

It's going to happen in July, right? You know, where we now do not have buyer agents' compensation in the MLS. It will be forbidden to be there. I'm struggling trying to figure out how we can help the first-time homebuyer, right, that may not have that cash and the seller may not have the room to go ahead and do that. You know, from your perspective, you know, how can we get to the middle ground on this? Well, the market always fixes everything. I mean, you know, the market will normalize to the situation, right?

Totally. Totally my doctor. With sellers having all the leverage that they do right now, overzealous sellers who are not going to include compensation in what they're trying to do will eventually learn that they can't sell homes in certain situations where there is no compensation. So look at the – if you have a VA buyer, VA buyers don't – they can't pay fees. So it's got to be included in there for a VA buyer. As long as we have a lot of cash buyers, which we do in Charlottesville, it won't impact the market as much. So sellers will continue to have that kind of leverage until we start seeing some property starting to sit on the market.

So let's assume the federal regulators on the loan side said you know what guys it's okay now to include commissions into the seller compensation how do you guys look at that not side of the table so if it's now allowed does that impact your valuation or or do we now have a X percentage gap that we have to fill out I want to clarify if it's allowed to be in the MLS for realtors to understand or allowed at all in the contract? Thank you. So the federal regulators who control the loans, right, say, okay, now federal regulators, VA can, I as a seller, can pay the buyer's commission, FHA, whatever it is, loans.

It's now allowed to be part of the seller compensation. Right now, it's not. It's excluded from it, right? So let's assume the regulator says it's okay, it's included. Will you then now be able to look at that or you still have to exclude that? It's still a commission as a commission. It's not changing. It's just the way the negotiation goes on and the deal are different. I mean, if it doesn't impact the market value of the property, it really isn't a consideration for us. You know, like when we're appraising a property, we don't address insurance costs or home inspection costs and things like that. Those are just things that are part of the transaction fee or transaction fees rather not just one thing this is a great

question too um so let's say we're like i don't have any um let's say you're going through the pro or someone's going through the process and we do the appraisal and prior to closing some major function mechanical system or function of the property is needing to be replaced? Let's say you have a brand new alternative septic system. This is hypothetically speaking. Do you as the appraiser, so maybe tell people about, okay, we know this is happening. The price is X. If it were failed, it would be Y. But because it's a new system, similarly with eggs, compensation, concessions, you take these things to account, right? So let's say brand new windows are coming, but they're not in place yet. How do you do your

appraisal? If there's a mechanical systems or major functions that are in process of being replaced. So that's part of the assignment conditions with the client. And you know, in this case, a lender, most of the time, if you're doing conventional financing, it's going to be as-is value. So however the property exists at the time of my observation of the property or inspection, depending on which word you want to use, that's what we're going to be appraising it as. So if there's no heat in the property and it needs to be replaced, then there's a good likelihood that we're going to be coming back at a later date before you close because most lenders are not going to close on a property

without heat. That's a health issue. So or a septic system failing or needing to be replaced. If we're aware of it. That stops the process though. Yeah, absolutely. If you're aware of it, like let's say as part of the contract, we say seller has already paid for new windows, but the window company is on delay and we want to close, but the windows will be in in two weeks. Yeah. So I mean, it'll be as is unless the lender says, hey, Mr. Frazier, can you do this as a subject to? And most of the time the answer is no. Oh, really? Yeah, because the lender.

It's a snapshot at that moment. Yeah, it's a snapshot at that time. Now, when we do like 203Ks and home styles and things like that that are renovation loans, we will appraise it as is but also as it will be once all that work has been done. But that's done post-closing. So, yeah, I mean, those types of things, if they're health and safety concerns, even conventional lenders in most cases are not going to want to close a loan if those things haven't been done. Okay. That's great to know.

I got a lot of questions coming in as I'm fighting some allergies here. This is a good one from a pretty experienced realtor, maybe perhaps in the game longer than you, Keith Smith, of Dan Pettit. He says, if the commission not in the MLS, do all your

agents have to come to you for permission to offer a certain percentage each time? We've been talking about that for a while, right? And how is the market going to do this, right? So if Candice is the listing agent and I'm the buyer's agent and Woody wants to see Candice's house, the first thing I'm going to do is pick up the phone and call Candice and say, okay, you know, now she may have a website or a page, and we talked about this, that I can look at and that references that.

The broker can. The broker can. This is not an MLS. This is your private. This is your own independent thing. And you can't say, look at my website to see it. No. And it can't even be tied.

In the MLS, it can't even do that. You cannot even refer to going to your site. And it can't even be tied to IDX on the website. No IDX. Yeah. I actually had a meeting with a couple of the homes.com executives yesterday and actually asked them that question. You have to build a landing page not tied to any third-party platforms that Realtor uses. But then what's the one-step click then?

I mean, how do we, you know, there's, so ultimately there's so much on the back end. We built one of these out about this. So we're, you know, our team. And I was about to say, I know somebody really good that can do that for you. So one of the things that excites me about this change, and I'll be honest with you, I'm kind of excited about it, is it's going to require the two of us to have a conversation. Yes. It is going to require the two of us to have a conversation. Like it or not, you've got to call me more, Keith.

You just didn't pick the phone up. Yeah, I think this is where Candace says you're going to have to text me more, Keith. No, no. Hey, y'all think I don't want to talk? Do we really want to do this live? I'll do it. A follow-up response to you. Does the broker have any oversight in their realtor

or their team members adjusting commission rate? So the broker's the broker. The broker funnels everything out, so everything runs the way the state agency laws set up. commission rate? So the broker is the broker. The broker funnels everything out. So everything runs through the way the state agency law is set up. Everybody works underneath the broker. I can say this, for as long as I've been in this business, commissions have always been negotiable, right? There's certain rules that certain brokers will do. Like, for instance, and I want to get into this a little later, we don't allow dual agency in our brokerage, right? And we'll talk about the pitfalls of that a little bit later.

I know you're a little passionate about that. A little bit. A little passionate about that. As you should be. I'd love for you to jump in from your perspective on it. Got great examples. It is extremely slippery slope. But it's the broker that actually controls that. And I can tell you, you can just take a look at all the percentage of eggs. I mean,

I'm just shocked that out of 334 new listings since this hit the news, only one was at zero. Well, and like you said, I believe I tried showing that property. And, again, that's where it's great communication. So talk about that. You actually had a client that showed that individual property? Well, they were interested, but then other factors came into place. 1.8 million. Yeah. And, you know, in any property, so I'm a note taker, so I have my notes in here. So, for example, a wholesale deal, which is, oh, I'll get into that.

So wholesale, auction, foreclosure, for sale by owner, any of these types of things, Jimmy down the road wants to sell to Betty Sue, but Betty doesn't know what she's, whatever the case may be. We have to talk about how we get paid. This is a Sesame Street show. It is, yes. Disney World, talk about how we get paid. It is. Yes. Disney World, as Andy would like to say. So we have to tell our people, okay, you're interested in doing

this. This is how I get paid, and here's what I can do for you. Do you want me to work for you or not? Yes? Great. Sign here, blah, blah, blah. Of course, it's a little bit more... Obviously, it's a little more refined and nuanced. I'm a little bit more sloth in there. But at the end of the day, that's where we're at. That's the gist of it. We have a

conversation and you say, hey, look, you're looking in this price point. And I had a second-time homebuyer, first-time homebuyer wrote me this morning, purchased a property thinking about selling and buying or renting or doesn't know what to do and asked, what do I get paid to just come and talk to her about this? Oh my gosh. No, honey, no. I'm here to help you, to give you information and let you decide with tangible things. Now this is me. Other people might want to charge to sit and talk to them. I like to talk. That's their right to do that. That's their right to do that. Absolutely. You go, oh, this is one of the things. Not sure who would want to do that, but that's a different story. Well, doctor, I love using professionals. So we're small business owners. All of us sitting here are small business owners. There's a lot of small business owners out there, cleaning companies,

you name it, retail, all restaurant owners, all that. So let's have a conversation. Do you think the general public really understands that? No, because you go to the, this is my example. I thought of this the other day on Wednesday, listening to the show. You go to the doctor, you pay to be seen. Then they pay for a diagnosis. Then you pay for a treatment. And then when that doesn't work, you go back and you pay to be seen. You pay for a diagnosis. You pay for a treatment. for treatment, ongoing, ongoing. Or you do it on your own and you're still paying for things to better your life. Same thing with any professional. So

if you're looking at buying or selling, you know, real estate, you go to a professional. And I don't know exactly where I was going in all of that. With any small business owner, how we get paid, how we work, and our time, I don't charge, and most agents I talk to in this community, don't charge to have that conversation. This is a conversation about education, and then you can take this and go on your merry way and choose what you want to do with it. If you don't want to pay me, great.

Find somebody else or do it on your own or whatever, and I'm happy to answer questions if you have them. So I think this might, you know, at some point. Different than the commercial game. Different, yeah. Commercial agents are charging for time or setting up a retainer type setup to interact with clients. Just want to highlight that for the viewers and listeners.

Residential, I'm not seeing that at all. But residential can. I know of agents in certain price points in certain areas. If you want me to go to a certain place, maybe I charge you a driving fee. Or maybe you want to do a flat fee and you say, look, here's the thing. I just want you to put it on the market for me and I'll pay you up front for whatever, blah, blah, blah. Small business owners, you can work out your way that you run your business. If I want to pro bono somebody because I want to, that's up to me and my broker. And again, everybody can operate their own way. So I want to learn here. Can, if a salesperson under a broker chooses to do a setup where it's for you to have my time, I need this amount of money,

does that need clearance with the broker beforehand? Not only does it need that, the money has to go through the broker. Right. To get paid. Yeah. Right. So you... So I got a follow-up for you.

Go ahead. No, finish your thought. Yeah. So not only does the broker need to approve that, it needs to go through the broker. So whatever dollar amount that you settle needs to go through the broker. So whatever dollar amount that you settle on to go ahead and do that, it has to go through the splits and the over, however, that's all structured and each brokerage is different before it ends up to there.

My experience is much like Jerry commented. I do a lot of commercial work. The numbers are usually big. They're very long, drawn out years of projects on that. There is a retainer I charge, an hourly rate I charge, and it gets deducted out of the back end of it. They're generally super, not generally, they're always super sophisticated. They know what they're doing. And the amount that they pay me to do that is minuscule compared to all the fees and the engineering and the legal stuff that we're going to get to that here in a minute but Jerry wants to do a follow up.

You covered it. You said that the retainer fee would have to go through the broker first and then allocated to the salesperson. The only time I've ever done that in a residential perspective. It would probably be a development project. No, I've done it residential

once or twice, but these were very big purchase numbers. Right? Multi-million dollar purchase numbers where we were all over the map trying to do something and we negotiated a fee and stuff like that and it came out of the back end. Well, and we negotiated a fee and stuff like that,

and it came out of the back end. Well, and I've had, through the years, different people reach out for, you know, who were interviewing other agents as well, and the question would come up, okay, what is your charge to meet with me? I'm like, oh, I'd be happy to meet you. So, again, everything has an asterisk, for the most part.

I always have my bunny ears. So yes, as far as like tangible way, it happens liability, insurance, umbrella coverage, all that fun stuff, the way in general, kind of, it reminds me of insurance and I might be totally inaccurate on this, but let's say you look at state farm or Allstate or Nationwide, any insurance company, right? That's the franchise brand. And then there are individual owners and operators who have teams and yada, yada underneath of them. I don't know. Woody has a bunch of agents or appraisers under him or his team.

Everybody who works for me is an employee. Right. So as a business owner or the broker. See, that's the thing to really note here. There's a few brokerage scenarios that the agents are employees, right? Right. Right. But you can, so as a business owner or the broker. See, that's the thing to really note here. There's a few brokerage scenarios that the agents are employees, right? Right. Right. But most often the agents are single owner.

Subcontractors. Individual subcontractors. But their insurance is with the brokerage. So the brokerage gets to set the rules, the regulations and and all that for the most part, and the agents comply. If you don't mind me jumping in. So we are independent contractors that have an independent contracting agreement that's signed with the brokerage that you work in. The insurances, and this is super important to get out, and, you know, maybe we ought to put up slide 11 and talk about how we get paid at this point on this. And that's on the listing side on a half-a-million-dollar transaction.

The owner and I did, and this is part of this 33%. This is post. This is what's called gross commission income. So this is after the split with the brokerage, right? The brokerage has E&O, Evers and Omissions, which is part of what we pay into that. But we pay for our auto insurance. We pay for our health insurance.

We pay for all that stuff that comes out of our pocket every month regardless of getting paid, paid or not. And that's that 33%. So at the end of the day, you know, on $11,875, because I keep track of P&Ls on every particular transaction, basically we made about $4,000 in that, which translated into roughly $50 an hour for two people, right? So this is for Yona and I. And she probably gets the lion's share of that. I don't think I'm worth much more than a few bucks on that per hour.

But it's important for us. Are you saying you're just arm candy, Keith? I thought it was eye candy. Pretty much the same thing. But it's important for us. Are you saying you're just arm candy, Keith? I thought it was eye candy. Pretty much the same thing. Is it the same thing? Yeah. Thank you. So we've been talking,

and I'd love to get your feedback in that, and I'm sure Jerry's got a couple other questions. We do have some questions. So how do you feel about this, how we get paid, and do we do a good job of explaining it? No, I mean, I'm going to make a lot of people angry. I watch what agents and brokers do oftentimes and scratch my head because as good as you all are at negotiating,

a lot of folks in the business are really bad at defining how their value comes to the table for the client. And I see it oftentimes where people are giving away their time. They're not being compensated for it because they're not assertive. They don't treat it as a professional business. They're treating it as, oftentimes, I think it's miscommunicated as we're doing you a favor up until it becomes a transaction. And, you know, I'm not saying that's good, bad, or indifferent, but as a person who owns a professional service company, I define my value up front with my clients and say, this is what my hourly rate is if I'm consulting.

This is what my fee is going to be if I'm writing a report, et cetera. And it's non-negotiable as far as that goes. I know everything is negotiable, but I know what my value is. And if my potential client doesn't want to pay me what I think I'm worth, then, you know, I wish them well. I even reaffirmed someone else. I'm going to jump in here. And since you, me and you are going to go down the slippery slope together. All right. All righty. So, um, I'm doing three new construction transactions in Richmond right now. Lovehomes.com. They're coming on the show to some of the executives to talk about the awesomeness they're doing.

I did everything through homes.com. Did everything through homes.com. I'll have a conversation on that. I'm engaged with the builder rep and the client, and they were telling me yesterday, she goes, my God, I wish all other real estate agents would do this. They just dump off the client and sit around and get weight, and that's what gives us a bad name. And she goes, look, you know, you're, you know, she was giving

me kudos. I'm also a recovering builder and developer, and I kind of love this crap stuff, but in any event, um, you know, she was giving me kudos. So when, when builders are thinking this, what does the general public think? Right. And we just, you know, we have an opportunity here. I'm going to get on my soapbox. We've got an opportunity here to go ahead and be very clear about our value proposition, be good at that, learn how to negotiate for yourself, be transparent about how we do our job, and freaking communicate with people. And we just...

Well, yeah, the example you just used, there's a correlation to commercial. You're working with a corporate entity when you're dealing with a builder, right? Yeah, that's exactly right. They understand what you're doing. The problem is that we've set the table for normal consumers that there's a lot of wiggle room here as far as how most people will work. And the expectation is that you work for free, unfortunately. Well, the problem is we have some bad actors that said we work for free.

And that's what got us into the job. But perspective is reality, and that's the reason all this stuff has been happening. Well said, Woody. That was very well said. Neil Williamson, welcome to the program. A lot of questions coming. Logan Wells, Clay Lowe, Bill McChesney, hello. Thank you for joining us. We will get to the question on what we think the future of NAR

and the exodus of members of NAR that has been reported by Legacy and Traditional Media. Before we get that, I know you had something to say about homes.com. I would imagine it has something to do with HomeSnap and an app of previous usage. Is that where you want to go? You have such a great memory. No, Keith and I will be talking about that because I am very, very interested in seeing some wonderful new things coming around the corner. So I'll leave that at that. Well, they're coming to our office.

They're joining us in our office to talk about that. I know. One of the things I did want to bring up, talking about new construction, I love our builders. I mean, goodness, too many to name right now on the show, but kudos to all of our local builders and people here. I always joke with my clients that when we go to new construction places, the sales reps hate seeing me because they know I'm there for every meeting, every selection thing, every walkthrough, everything we do. And I'm just like,

oh, they hate me. But really that's because they love me because in every industry, right? So first and foremost, I want to say, if you can't tell, I love what I do and I love helping people. That's great. And it seems like, you know, being able to explain and express, you know, there's a cost to doing any business. And the days and times that we typically work are when our families are home, when our holidays, weekends, evenings. Again, I come from the restaurant industry a long time ago. So not that that's new. And I love what I do but when you know going above and beyond is what some people do in any industry and unfortunately in any industry there are people who will take advantage or just do what you know bare

minimum bare minimum I mean I'm just going to be the one to say it at the table we as an industry we as individual members in our association. You made this bet. We did not do enough job of policing our own. Yeah. And ultimately, this is what's going to happen. I'd say on a national, so I am extremely very, very proud of. I'm speaking nationally.

Yeah, nationally, I'd say it was horrible. And that's where, you know, personally, I love being involved in our local Charlottesville area association of realtors and Neal. And, I mean, the amount of. Yeah, I know. He always is. The amount of local work that our realtor community and affiliates do, I mean, it's extraordinary. So here we are in a great well either way partners friends family colleagues awesome um yeah so Realtors and the like but yeah ultimately it is very different here and

I think that it's so much nicer in this area when the national stuff happens and then people call sitting at the dinner table buyers or sellers it's been so much nicer and agents that I you know help with it to go you know what this area the way we've been operating it's clear communicative I'm gonna do the best I can and this is how we've been operating for X number of years, and I love being able to say that confidently. So I'm sure there's some questions for Woody on there from an appraiser's perspective, but I'll get this out there.

Since 2012, it's been the law, a buyer-broker agreement in the state of Virginia. Many states still don't require that. Other states, and I want to get into Woody's dual-agency thinking on that. Other states, and I want to get into Woody's dual agency thinking on that. Many states have banned that, Florida being one on it. So unless there's a question specifically for Woody. So Elizabeth Mason on Woody's page says, as a consumer, we appreciate the transparency. It allows us to make the best choice for us. The fact that we're even having a conversation that transparency needs to get better just blows my mind. What do you think about dual agency? Well, I put a question out on the ASCII appraiser group yesterday or the day before because I'm trying to understand it more.

Dual agency is confusing to me because by law, I can't be an advocate for anyone except for my opinion of value. Well, you're a client technically to bank, right, or the lender. Sure, but I'm not advocating on their behalf. I'm trying to advocate from a public trust perspective. And like I said earlier, perspective is reality in most situations, right? So I never understood where dual agency is legal, how anyone could ever see it as being quote-unquote ethical. And I'm starting to understand it a little bit better because usually in the situation where you are doing dual agencies, you're more of a contract facilitator than you are really advocating for either party. At least that's how you're supposed to do it.

That's correct. The problem with the situation I have is that if it becomes just the perspective of the buyer or the seller that you are perhaps advocating a little bit one way or the other, you've just put yourself in the crosshairs of a lawsuit. Man, I'll tell you what. Do you think these lawsuits are bad? No. Wait till that stuff starts happening.

And they could be completely wrong, but just their perspective is, hey, on the buyer side, say, you know, you're advocating for the listing side more than you're advocating for us or you're advocating at all is a problem in that situation. Money makes people funny. When somebody starts losing a lot of money because somebody said or done something and crossed the line, which is super thin on that, you think these lawsuits are bad. Wait till the one-on-one lawsuits start happening. One of the answers to my question that I thought was very astute is that the states where you see dual agency being legal are states where the realtor associations have a tremendous amount of lobbying power, and they've been able to convince the legislators in those particular states that, you know, this is a good thing. But there are states out there where dual agency is absolutely not allowed because, you know, how do you ever change the perspective that you're somehow not advocating?

Because most of the time as a real estate agent, you are advocating for your client. You're not acting as a neutral party in the middle. Without calling out names or very specific situations. Have you seen that in your business where you've seen certain agents cross the line on your interactions? I have. Yeah. So I think this is a really good opportunity, I believe, again, for education, just to break down some of the terminology that's being utilized. So the big difference is dual agency means one licensee is doing buyer and seller, both sides of the transaction. Again, we talked about that. Designated agency is something totally different. And there's also consultants, totally different.

So designated agency is something that happens all the time, and I wanted to explain that just a little bit because what that means is, let's say in Keller Williams, there are 600 realtors in this area. Even Keith and I. Keith doesn't know my clients. He doesn't work with them on a daily basis, and he doesn't talk to them like I do, and vice versa. So other agents that are all in the same brokerage, they can operate and represent their clients fully to their best interest with no concern of crossing any violations or anything that is not favorable there. That's designated agency, and that is allowed. Dual agency, though, is what we're talking about. So I just wanted to kind of clarify that. Yeah, I mean, there's clear distinctions. And I think an easier way to explain it, Candice, is that with designated agency, it's one broker. You've got two agents working under the same broker, but the designated agent's working for a specific client, and then

the other agent on the transit, there's another agent in the same brokerage. They're working independent of one another, and so that's what designated agency is. So we're required by law, if we're going to do dual agency, to have a document signed. And I'm going to read, and I won't go through the whole thing, but I'm going to read the last sentence that talks about what the licensee cannot do. Specifically, a licensee may not tell the buyer that the seller will accept a price lower than the listing price, nor the seller that the buyer will pay a price higher than the price offered. So to your point, it's really an administrative thing. Yeah. And there's a reason why attorneys don't do this stuff.

It is so damn slippery. I mean, it's illegal for an attorney to do this. Exactly. But they allow it in this situation. I mean, real estate agency and brokerage, they've got some different ways of doing business. I mean, as an example, the way the tax situation is set up, you know, with the way that you guys do business, y'all are the only business I'm aware of that's allowed to have independent contractor status the way you do it. Because

in a lot of other businesses and industries... That's in the radar. You know that, right? Yeah. I mean, it's an employee-employ that's all your employees on doj's yeah i know radar right are you really an independent contractor and i know this because as a recovering developer and builder you know i would get looked at all the time is cand this my drywall contractor does all my work really an employee or a contractor right now i think what keeps us out of out of the the slippery slope on that is because we work for so many different people right as independent contracts i don't think it's going to have a lot of legs to it but it's being looked at and to your to what we kicked the show off, pre-production show, DOJ is now allowed to start re-looking

into investigating NAR. So this is not going away. It's not over. This is going to get deeper and deeper and deeper. Sarah Hilbuchenski, who's a realtor, says, and if dual agency is explained correctly, why would buyers and sellers agree to it? Agreed, 100%. Yeah, which is a great point. She's basically saying, who would go into a professional relationship where their consultant

is representing both sides? You can't do it and provide just service to your client if you're representing both sides of a transaction. Although you do see this, and I hate to go back to this, you do see this in commercial?

You do, but typically it's very transparent. Everybody knows exactly what they're doing. And generally the folks on either side are more sophisticated with purchasing. And in my experience, they're usually sitting at the table together. And that's where I want to just, again, with the little S for smart. So let's say Jim and Sue know each other. They want to sell a property from one to the other. Everything's all worked out, and they call me,

and they say, Candice, we want to do this. How can you help? Well, they've got it all. So every situation is different, right? But doing it as a dual agent is not the paperwork process that I would go through that transaction. So there are different ways that the broker would be paid throughout doing administrative duties for people who want to buy, sell, do whatever. But the dual agency is not the paperwork process that would go about in the representation that would be described in that transaction.

So there are a lot of different things that happen all the time, of course. And similar to commercial, if people are knowledgeable, informed, communicating, and know exactly transparently what is happening and where the funds are going, then there are papers to process that appropriately. This comment, we'll keep going, Keith. I know you had something to say. This one's off topic, this comment here. I just wanted to add something. If we go back to slide number 11, there's a 7% little piece of the pie that says

other buyer credits, right? So if this was a dual representation, we would have not been able to do this. This was a home inspection situation where the seller couldn't make the repairs. We contributed a substantial amount of money to help that, to make that transaction happen. Now all of a sudden, as I'm doing dual representation, I can't do this because one would benefit one over the other. Sarah Hill Buchanski says, and she follows up,

you're not actually representing, though, in dual agency. That's exactly right. And in a lot of ways with the dual agency you've become more of a transaction coordinator or a facilitator of the deal, just pushing the deal forward as opposed to providing honest feedback

to your client. Yeah. That was well put. We're struggling doing value proposition being transparent. That is a very slippery slope. The follow-up question on another page is, is there dual agency transpiring or happening here in the area?

Of course. I'm sure that there is, right? I can tell you most brokerages don't allow it. Back to your question about you only can do what your broker tells you you can do, from that perspective, legally. Well, how about a follow-up question then from me? What are the accountability measures to police dual agency not done properly in this area? What are any accountability measures?

There you go, yeah. What's the liability? Is it deep war? Is that the accountability? Or is there... No, I mean, there's with the local association... What kind of courts do you want to go through? Is it worth it? As a member of the association, you do have the ability to...

There's an ethics committee. So it can... Anytime there's a complaint with a realtor as a member of NAR, you can go through the ethics complaint process with a local association, but yeah, DEPOR would be the next stop after that. So the level of depth

of violation of dual agency is not just that, because now the broker's on the hook, right? And then somebody's going to get DPOR involved in it and get the state involved in it. But's just that. But I just want to talk to you. I know at your shop, though, brokerage supervision is hands-on, and you guys are involved in everything.

I know, and I'm not going to name any names, that that's not the case for all brokerages. Where a lot of salespeople are pretty much operating unsupervised. I don't want to say unsupervised, but they have a tremendous latitude. Yeah, and that's where compliance comes in on our side, right? And that's where transparency comes on. Look, I wrote in my letter, and I'll say it again, that's a bad actor, right? And if somebody at this table knows somebody's doing that, I was going to say drop a dime, but I don't think it costs a dime anymore. Whatever a phone call costs right now is you need to go do that. And I'm just going to say this out loud.

I think part of the problem with our ethics thing is some of it should be a bit anonymous. Because who's going to drop a dime on another agent, right? It should be anonymous. Right now, correct me if I'm wrong, it's set up more as like a legal process. It's very open. It's very transparent. I know we've been talking about transparency,

but if we're going to go ahead and police ourselves, there has to be a better way of dealing with bad actors. If we have agents that are doing that, that is a clear violation of law and a clear violation of our ethics, and they should be held accountable for that. Well, here's the thing. In life, in all types of scenarios, we'll use this one as the example. Like you said, Keith, so again, locally speaking, I joke that this is the Kevin Bacon of towns because everybody knows everybody in some way, fashion, within two to three people, right?

And that's the problem with not being anonymous. Yes, exactly. So I always look at it as, hey, I'm going to call in to our organization and say, hey, this is a violation. I really think this is an educational opportunity. I like to take it as this person doesn't know what they did. And I had an agent do this with one of my listings. I called her up and I said, hey, love that you're promoting it. However, there are certain things you just need to make sure you can do. Do you want to meet? Do you want to talk? Do you want to do some open houses for me? You know, what do you want to do?

How can I educate you? She was, oh my God, I had no idea. And then thank you. And then, yeah, still keep posting it. A great idea the other day, yesterday, my God, I had no idea. And then thank you. And then, yeah, still keep posting it. A great idea the other day, yesterday an agent had a new listing where the seller gave permission for other realtors to professionally and appropriately come and post social media videos and stuff. And was often like, come check it out. So there are different creative ways. I know Keith is tightening up here. But yeah. No, no, go ahead. You finish. I would just say that ultimately we need to abide by what our clients are wanting us to do within our rules and regulations. And here in our local community,

because everybody does pretty much know everybody, we have to make sure that everybody's doing things appropriately and using it as an educational opportunity to make sure that, hey, this is a violation. I'm going to call you personally and say, and I've had this happen. Back when I was a new agent, I'll even say, Lindsay Milby, thank you very much. I knew her for years before I became a realtor, and she called me and said, hey, Candace, you made a boo-boo. Don't do that again. And this was 13 years ago. And I appreciate the crap out of the world for her doing that. So we get passionate about helping our clients. Sometimes that gets the better of us. As those who watch the show know that I'm the chairperson

of the Piedmont Community Land Trust. We had an opportunity in coming soon. In coming soon. I had a half a dozen very reputable local agents call me and say, can I get in there? Just let me in. That's exactly right. Nope. And I said, are you effing kidding me?

Nope. And, you know, and I said to these agents, I would suggest you don't ask me that a second time. Your wife, Lori Fincham, Fincham & Associates, asked this question. Am I right that the complaint process for appraisers is anonymous? For the state, yes. Now, appraisers who are realtor members have to abide by the same process that real estate agents and brokers who are realtors have to. Yeah, I am. Most of the appraisers in the area are because I think at one point a car required us to be.

I think to get access, right? Yeah. There's a process they can do it without being members, but I don't know it. But, yeah, it's basically the same thing. And absolutely at the state board level you can do an anonymous complaint. I mean, it happens all the time because it's a small community as well. I mean, there's not that many real estate appraisers out there. And if one appraiser turns another appraiser in, it creates quite a bit of a conundrum within the community. And so most of the time when that happens, it's quite a bit of a conundrum within the community. And so most of

the time when that happens, it's going to be done as an anonymous complaint. This question is one from earlier in the show that I'm now getting to. There's been a pretty significant exodus of agents in the National Association of Realtors. Some media outlets reporting as much as 800 agents. This is from Dan. And he says, what do you think about this, Keith, Candice, and Woody, about such a significant exodus from NAR and how it could trickle down to VAR and CAR?

Well, being an analyst for a living, 800 out of a million and a half, I wouldn't call significant at this point. It's something to definitely watch. But I mean, it's the largest professional organization in the country, definitely one of the most powerful ones. One of the most influential lobbying groups in the country, for sure. Yeah, I mean, they, as a professional organization, I think they spend more money on lobbying dollars than anyone.

They do. But long story short, I mean, 800 I wouldn't consider significant at this point. But it's something definitely to watch. Well, I've talked about the six things of real estate. Number five is timing, right? And that's what we're talking about right now is timing, right? You, you are, you know, when the dues resets happen, right? You're going, you know, see a larger, uh, outgoing on it. Also, nobody really knows. We just don't have this

clear, concise communication about what's happening next. We just don't have it. Unless there's emails or... I read this stuff profusely. I don't see anything out there. I think once we get closer to July and people have to figure this out

and the people that can't have the conversation, hey, Woody, I got a client, or Woody doesn't want to pick the phone up or whatever, there is, you know, I think at one point in time I thought we were going to hit about 30%. I think we're going to get closer to 60%. Well, that's what a lot of, I mean, Wall Street Journal was reporting that number. That's nationally. I had about a half a dozen real estate agents say, I shouldn't be saying those numbers.

Well, follow-up question for you, and this is for me. Do you see salespeople operating without the realtor distinction and instead operating just as a real estate agent? The realtor distinction done for what? Code of ethics, marketing, branding.

Do you see that becoming more real estate agent instead of realtor? Well, we talked, and I'll jump in because I don't want to put them on the spot since they're on the board on this. I'll take this one on. You know, look, in the state of Virginia, you do not need to be attached to an association.

You just got to be attached to a broker, right? So how I do business in Richmond, I'm not a member of the Richmond Association. I use homes.com. I talk to the agent, just like we're going to have to do. Tell me what you got. Tell me what's going on. We have a communication. I'll tell you about my buyer. You tell about your seller and we go out and look at the house and do it I've done multiple transactions recently that way and it never makes anybody's book of business because you don't see it because it's not running through the MLS a simple way to do it too unfortunately my crystal ball has not worked in 41 years I don't think Keith brought his today.

Oh, no, we got him. Oh, you do? Well, hand it over. It's not the Magic 8 ball. No, no, no, no. We have one of those. We actually have real crystal balls. But, you know, again, I liken us to small business owners in general. broader case across the board. Do all businesses and organizations have to account for loss and

decrease of membership and changes? I think realtors, I love the friends, pivot, pivot, you know, Ross, in the stairwell with the couch, watch it. But realtors have to pivot all the time. So we're used to this, we're accustomed to this as small business owners and with different associations all have their own budgets. Maybe the nation doesn't need to have a budget and abide by it, but most business owners do. So budget appropriately, we account for loss, we account for members leaving, and we account for the pros, pros, to continue to strive. So if it's decreased a little bit, you know what, every day there's new agents coming on and asking about licensing and getting trained. So our area, I think, is a different statistical bubble than the national average is. We are different as a community of professionals. I mean, I work in several

different associations across the state because our firm specializes in mansions and luxury property. So our geographical coverage area is pretty large. So we're in multiple associations. I came from RAINN originally. That's where I started my business many years ago. It was in Tidewater. It's more cutthroat down there than it is up here. This is a, and I'm not trying to In that area, they don't belong to NAR, right? They do not. The MLS is actually a separate entity from the association. It's a co-op among the brokers.

And I'm not trying to throw them under the bus. It's a great community down there too, but it's very predatory in the sense that predatory is the wrong word. It's just cutthroat. That's the right word. Maybe just not for air. Yeah, for sure. I'm going to get some phone calls on that one, I'm sure. Because we do have people that watch from down there. But what I will share is an analogy. The appraisal profession and the real estate sales

profession are, they're not that different or they weren't for a long time. You know, we have the Appraisal Institute for appraisers which is the largest professional organization we've gotten our which is the largest professional organization for real estate sales appraisers have done very poorly advocating on behalf of themselves because they have for the most part well I think we have 14 or 15 thousand members in the appraisal Institute now out of 75,000 practicing appraisers nationally. It's a very small... So here's the difference. You don't have to belong to that. We don't, but...

We do. Because we chose to... We want to be in the local MLS at the moment. We need to be a member to part of these... Do you think that'll change? I think that's the... I'm sorry to interrupt you, Woody. I think that is the crux of these lawsuits, crux of DOJ pursuing it. I think that's what they want to see is this, quote, unquote, decoupling, decoupling of that.

And I've been public. Yes, I think that's going to change. Well, the reason I'm bringing up the analogy that I'm bringing up is because we do a poor job in the appraisal side of advocating for ourselves as a profession. And as such, we've got a lot of downward pressure on us from appraisal management companies and lenders are really controlling. They have an ogleopoly going on on the appraisal side. And that's because we have voluntarily decoupled ourselves from big professional organizations like the Appraisal Institute. If we see a mass exodus from agents from NAR, it's going to become a problem because then you're going to be an island unto yourself, and you're not going to be able to advocate and lobby as a group as effectively as they have been able to do. The reason NAR is so powerful is because they have numbers, you know?

And that, At the end of the day, that's somebody's game plan. I don't know who it is, but that's somebody's game plan is to reverse that influence that NAR has. Guys, the show's been

fantastic. I always close with some final thoughts for the panel here. We've covered NAR. We've covered decoupling. We've covered dual agency, market trends. I think it's pretty dynamic today, Guy. Thank you.

So we're a little bit over. As always, thank you, guys. We all get a little bit passionate about what we love. You guys are great. One of the things I love to say, we all get to help somebody with one of the three things. We're crying for a trip around the sun, which is, in our case, shelter. So we take what we do very seriously. We're very passionate about it.

How about some closing thoughts from anywhere you guys want to go? That's where I was going to jump in at. I would say your lovely wife says the same thing, too. So I love hearing that. Yeah, no, thank you guys. I did have a valid, beautiful point, but now I'm put on the spot. So I'll let Woody take over. It's always a pleasure being on the show. And as always, you know, Finchman Associates is here to help, you know, all of our professional colleagues on the sales side and brokerage side, just, you

know, call us with questions. I'm always happy to help. And whether we're working on it as an appraisal assignment or not, it's a, it's a, that's what a true professional does. You know, we like to talk about what we do and I learn a lot from those situations where someone brings me a weird scenario and it's like, oh, I never thought about it that way. It's always a good thing. So we do appreciate that. And, oh, I did remember now. So for our members and those involved with our local organization, we do have a lot of great information. Look on the CAR portal, the education, the calendars. We're answering questions nationally.

Can't tell you about that, but locally we are here to help, call with questions, and that's my spiel on that. Thank you, everybody. We're a little bit over, and that's my spiel on that. Thank you, everybody. We're a little bit over, and Jeffrey's got a show to get ready for. So thank you, everybody, and we'll continue this conversation next week. Candice Vanderlin, Woody Fincham, Keith Smith, Judah Wickhauer behind the camera. The show is archived on Real Talk with KeithSmith.com. Click the Partners tab where you will find trusted advisors.

Thank you so much for joining us this Friday morning. So long, everybody. Thanks, guys. 시청해주셔서 감사합니다.