And Realtors wept

American Home Mortgage, one of the largest and most well-known mortgage lenders in the United States of America, just announced the layoffs of 7,000 of it's 7,750 employees. AHM has also stopped accepting mortgage loan applications following a cease and desist order from the states of New York and Connecticut as an investigation into violations of mortgage banking laws at the company goes into overdrive. More will be known as to AHM's business future following hearings August 24th to determine whether the cease and desist order will be permanent and whether AHM can even keep it's lending license going forward.

AHM CEO Michael Stauss:

"It is with great sadness that American Home has had to take this action which involves so many dedicated employees. Unfortunately, the market conditions in both the secondary mortgage market as well as the national real estate market have deteriorated to the point that we have no realistic alternative."

More evidence that the real estate market is slowly, but surely unraveling.

Let's hope the guy behind the curtain comes out with a mattress to ensure that soft landing repeatedly promised by the NAR, that group of oh so in-the-know, trusted advisors.

Redfin CEO Kelman: REIC "Marketing Itself Off A Cliff"

The manifestation of online real estate search engines, sales and buying tools with links to all that the MLS previously afforded real estate consumers - and much more is scaring the shit out of certain individuals who have chosen the profession of home realtor.

Realtors mistakenly view themselves as the most motivated party to sell your home or help you buy a home.

This assumption is incorrect.

They are NOT the most motivated to do either. They are motivated to make sales commissions which are directly proportional to the sale price of a home.

The truth is that home sellers and home buyers are more motivated. And they no longer need realtors in the same way they did before to intermediate on their behalf. If 80% of prospective homeowners are no longer looking at newspaper ads, no longer phoning up Joannie Loves Chachi Realty Group, and prefer to research home information, sales history, prices and neighborhood data online, including crime and school district statistics, then the realtors job and importance suddenly becomes less significant.

Realtors might be tempted to assert that only they "understand your needs" when it comes to buying or selling a home. But those days are over. A computer really can perform the light lifting regarding the research.

So why are realtors necessary? What tasks or duties of the home selling and home buying process make them so indispensable?

Perhaps there are certain duties and legal paperwork items to which realtors have traditionally attended.

Glenn Kelman, CEO of Redfin offers the following in the Ad Age article:

"The most motivated advertiser is the seller and millions of homeowners are proactive now. If people can see a home without an agent, where does that leave the industry? It's kind of marketing itself off a cliff."

Right off a cliff, indeed. Sometimes CEOs like to use the damnedest of metaphors to get their point across.

Mr. Lawrence Yun of the N.A.R. Weighs In Again

Mr. David Lereah was the Chief Economist of the National Association of Realtors (N.A.R.). Now that Lereah is pulling the ripcord and escaping the N.A.R. before the house literally burns down, Mr. Lawrence Yun, the Senior Economist of the N.A.R. steps up in his new flame-retardant suit.

He's not just a "senior economist". He's the freaking Managing Director of Quantititative Research for the National Association of Realtors.

OK, but who is this Mr. Yun really?

Does he have some fresh or even forthright comments about the state of the American housing market?

Will he come clean about the N.A.R. being a cartel driven by realtor sales commission earnings and sales strategies, not consumer education, market principles, business ethics, and operating as "trusted advisor"?

The answer is a resounding no.

Mr. Yun is a Lereah lacky. In February of 2007, he echoed Lereah's comments about the true state of the American market. If one were to follow this N.A.R. quantitative propeller head around all day, he'd have real estate consumers believing that the market bottom was hit 4 months ago and that everyone should get ready for a recovery later in the year:

"Sales will recover gradually over the second half of the year and prices will begin to edge up again"

Mr. Yun was wrong in February. He and the N.A.R. are wrong again now.

The U.S. economy is slowing down significantly, the U.S. dollar is approaching an all-time low in value versus the Euro and the British Pound, U.S. inflation remains completely unchecked by the United States Federal Reserve Commission, fuel prices in the United States are approaching unchartered territory at almost $4.00 per gallon in California, a jaw-dropping number of mortgage lenders have been completely or partially destroyed, surviving lenders have restricted their lending standards substantially, HELOC loans are down by 20% year to date and subprime and Alt-A loan foreclosures are rocking the entire industry - and we haven't even explored the probabilities that prime loans may also weigh in badly before the year is out.

To Mr. Yun and members of the National Association of Realtors: It's time for someone from your decrepit organization to step up to the plate and tell it like it is.

If you trust realtors, you are delusional.

Here's why:

If the NAR chief economist David Lereah, realtor posterboy extraordinaire, and the more prolific cheerleader of the American real estate industry boom over the last 5 years, author of infamous books like these:

then stated in late 2006 that the market was now in correction mode, but that we were all certain to experience a "soft landing", who then stated in late December 2006 and again in February 2007 that "we've hit bottom" already.

Now it is May 7, 2007. Mr. Lereah already has his bags packed up, ready to leave the real estate big leagues of the National Association of Realtors, and join a new, hole-in-the wall, real estate sales organization called Move, Inc.

But the final act in the play has not yet been shown. Prior to providing his last major NAR speech at an upcoming Washington real estate conference, the Bob-Saget-Look-Alike, Mr. Lereah, had the audacity to make this admission - probably the most damning one ever about the current American real estate market.

"Ask him in a couple of weeks", indeed! I think by now, Mr. Lereah, we already know what your duplicitous reply will be.

Bob Saget

Also, Bob Saget

So, I ask you: how can any prospective homebuyer in America today turn to a home realtor in good faith anymore for "help"in purchasing a home, assist them making the right choice, and work to protect his financial interests?

I submit to you that he cannot. Not anymore. The game is up.

Bob Saget has played you all, the home consumer, the realtor, the mortgage lender.

Time for the theme music to start. This really is America's Funniest Home Videos.

Mr. Lereah, you have a credibility problem.

In case America's real estate agents haven't figured it out yet, they need a new spokesperson because the one they have, Mr. David Lereah, has lost credibility.

After consecutively denying the existence of a housing bubble in 2005 and 2006, then later retracting and insisting in 2006 that a "soft landing" surely awaits the American housing market, then going back on his previous market hype to forecast a down year in 2007, but one that will still grow at historic levels over 2006 results, to then in February 2007 insinuate a recovery for the American real estate market, to today - forecasting a real estate market recovery only sometime in 3rd quarter 2007 following devasting news that existing home sales declined 8.4%, the worst sales performance for the real estate industry in 18 years.

By now it should be obvious to prospective American homebuyers, future home sellers, economists, mortgage lenders and even realtors themselves that the N.A.R. cannot be viewed as a trusted advisor any longer with respect to the real estate market. It's motivations are completely and utterly duplicitous. There is no interest in sharing with the public full and unfettered, objective housing market data.

The N.A.R. continues in April 2007 to promote the idea that today is no less a "great time to buy" than it was in 2006 or 2005 - despite completely different real estate market growth patterns, rising inventories, declining home values, declining home prices and heavily restricted real estate market financing conditions, not to mention completely different economic circumstances, not the least of which is the all-but-decapitated U.S. Dollar!

It's about time for people to quit their bitching and come to accept the National Association of Realtors for what they are. The N.A.R. is simply a pseudo-public relations organization for realtors whose sole motivation is to sell property and earn commissions on the value of that transaction. The N.A.R. is constantly trying to sell. Once that relational vector becomes well understood by the American public and the mainstream media, it might call into questions some of the assertions made by it's President, posterboy spokesman Mr. Lereah and its 1.3 million members.

Some realtors have been in the industry a long time and have worked their asses off, surviving by referrals through the roughest of markets. Before you select a realtor, I recommend you ask them what they did from 1989 to 1999. Many have obviously proved themselves, demonstrating strong business ethics, and have chosen to help people objectively. They know the ins and outs, and are even more fed up with the N.A.R. than the lay person.

But the majority of realtors, I submit, are unlicensed or poorly licensed, poorly trained, inexperienced, opportunistic, self-centered, easily corrupted, and dead-focused on earning that 6% commission check. To hell with convention, business ethics and regard for your fellow man, they want that commission check! How else are they supposed to make payments on that f*** off huge Hummer they drive around town with their realty website and cell number painted all over it?

Realtors are basically all about a business transaction. Many prefer to portray themselves as some sort of societal counseling service for America: to go that extra mile to "help you and your family find that perfect dream home - just for you. It's all about you".

Bullshit!

Realtors want the transaction done and they want their freaking money! Period. And all of the stupid questions you ask, repair demands, price offers and counter-offers during price negotiations are nothing but Tourette's-inducing irritations obstructing the path to THEIR commission check.

The mere idea that the N.A.R. is somehow of help and "looking out for the interests" of prospective homebuyers and homesellers is so ridiculous anymore, it no longer is funny. It's infuriating. Ask the thousands of subprime homedebtors about their realtor experience. They'll tell you, and in detail, exactly how helpful they were in getting that loan to secure their dream house.

If there is a positive to the 2007 U.S. housing crash and David Lereah's repetitive PR goofs (read: lies) as to the U.S. real estate market's true condition, it is that some daylight might now expose the N.A.R. charlatans for what they really are, and might convince more Americans to show vigilence when selecting a realtor - or even first determining whether a realtor is even needed!

Remember today's quote: "There is no way to spin this news" - David Lereah, National Association of Realtors, April 24, 2007.

If that is the really case, Mr. Lereah, then perhaps you're no longer as useful to he N.A.R. as you used to be?