Sorry iBuyers! Los Angeles isn’t “buying” your act

Better luck in the next metro!

Grace Townsley
November 19, 2021

A $75M pretty-and-pink Mexican modernist mansion just hit the market in the Brentwood area of Los Angeles. The seller? None other than Joel Silver, producer of The Matrix and Die Hard, the classic Christmas movie (just kidding, don’t be ridiculous). Currently, Tom Brady holds the record for biggest sale in the city at $40M. If Silver’s listing succeeds, it’ll probably be the first record anyone has ever taken from Tom Brady.

Source: LA Times

Today’s Blueprint:

  • L.A. is throwing shade at iBuyers
  • Trelora keeps agents on their toes
  • Some renters aren’t going anywhere
  • The seven habits of winning agents

L.A. says bye-bye iBuyers

Source: Orange County Register

The iBuyer crackdown continues. In an effort to ease the city’s affordable housing crisis, officials asked the city attorney to help block iBuyers (Zillow, Opendoor, and Redfin) and large private equity firms from snapping up the limited local single-family homes.

iBuyers aren’t taking this sitting down. Opendoor claims it is easing the affordability crisis by reducing the friction in the home transaction process. No speculation to see here! Plus, iBuyers point out that they represent only a small fraction of overall purchases. This year, they have only been responsible for about 1% of homes bought in L.A.

Our take

If your clients are tempted to ditch you for an iBuyer, tell them real estate is a personal experience. You need a true advocate when it comes to negotiations, inspections, and market intel. All the AI in the world can’t beat having a real live human being in your corner. It’s called “real” estate for a reason! 

Trelora wants to take your lunch money

Source: Trelora Real Estate (@Trelora) / Twitter

Watch out California agents! Your biggest competition may now be Trelora. The Denver-based discount brokerage just received its California licensing and is making itself at home in the L.A. market. Trelora promises low commissions and hassle-free home sales. They operate on only a fraction of traditional industry fees by processing a high volume of monthly transactions through their listing platform and offering only basic agent services to buyers and sellers. 

For California sellers using Trelora, the savings are impressive. Instead of paying both agents a 3% commission, Trelora (acting as the seller’s agent) will charge only 1% of the closing price as a listing fee. On a median-priced sale of $800,000, that’s a savings of 2%, or $16,000.

Our take

You’ve got to show them why you are worth the extra commission. Show them what you offer that bargain brokerages can’t. Your connections, your commitment to their needs, and your local expertise. We like to say, “to save a penny could cost you a dollar.” Make sure your clients understand that! 

Fact check: Some eviction moratoriums live on

Source: Ideastream Public Media

Many investors don’t know that roughly half of renters are still protected from eviction. While the national moratorium on evictions did end over the summer, many states and cities have put their own protections in place. Over 15% of adult renters report being behind on their rent right now. Their average back-rent totals $3,700, while some households report owing $10,000 or more. 

For struggling landlords, selling the property is an option. Even if the tenants owe back rent, many cities allow the unit to be sold with proper documentation and disclosures.

Our take

Tell your investors to start prepping as many rental units as they can. These moratoriums are really restricting the leasing supply. When they expire, there's going to be massive movement in the rental market. Don't let it take you (or your clients) by surprise.

Schematics 

The news that just missed the cut

Source: Village Vacations in Italy

Foundation Plans

Advice from James and David to win the day

This video highlights the seven best habits a successful agent can cultivate. One of the most effective tips he mentions is to put the first things first. That means cutting out the distractions and blocking off time in your day to make your calls, follow up on leads, research the market, and grow your expertise. 

Let’s get real. How do you spend your time on a normal day? Are you scrolling social media and catching up on TikToks or are you booking showings and networking your a$$ off? Show us your day planner and we’ll show you your future. 

We challenge you this week to find one area where you can improve. Even just a 1% improvement in your business will have a massive impact over time. C’mon, you’ve got this!

Just in Case

Keep the latest industry data in your back pocket with today’s mortgage rates:

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Get your beauty sleep this weekend. Just because Thanksgiving is around the corner it  doesn't mean you should take it easy. While everyone's taking a vacation next week, it's the perfect opportunity for you to get ahead of the game. We'll share some advice in Tuesday's newsletter about what we mean ;) 

- James and David

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