If you visit home sellers forums on line, or read home selling tips books or blogs, one thing you’ll read in several places is that the listing real estate agent’s fees are always negotiable. What they are saying is that you do not have t simply accept the fee the listing agent quotes to you to start with. This is, usually, a true statement. There is no law that sets the commissions real estate agents charges for their  services.

There are even discount rate real estate agents and companies that charge a  substantially lower fee than other agents as a matter of course. Some of these discount real estate companies will even charge just a simple flat rate fee.

The sole purpose for hiring a real estate agent is to take advantage of their professional approach to selling your home. The agent has specialized knowledge of home sales, the local market, advertising and marketing campaigns, and other home selling skills. By contracting the agent you gain the advantage of these skills to sell our homes. The reason people want the agent selling their home is that they  recognize that the agents have access to resources they do not have access to. They have a greater chance of putting a buyer together with the home and getting that buyers signature on the real estate forms that will sell the home. A faster sale, hopefully at a higher price offer, means more money in the seller’s pocket and fewer expenses getting there. Often the mortgage payments a homeowner will not have to

pay alone will make up for the agents commission. There is no other reason to hire an agent.

When you consider it this way it doesn’t actually make a lot of sense to use a discount agent or broker to sell your house. It also doesn’t seem as attractive to try to negotiate the commission with the real estate agent. If you get the agent to accept a 50% reduction in their fees, they know that at best, selling your home will earn them half of what selling another home in the same price range would earn them. If you knew that you could do the same amount of work and receive twice the compensation from one source as you would from another source, which would you invest your time and money in? The real estate agent’s answer to that question is the same as yours. Why would they push your home when, for the same amount of time and effort, they could push another comparable home and earn twice as much income.

Given this scenario, which home do you think is likely to have a new owner filling out the real estate forms and going to closing first? Think twice before negotiating on the agents fees, what little you save there may cost you a lot more before the home is sold.

Central San Diego Real Estate Market – Mid Year Snapshot of Median Prices (2006) – Single Family Homes

As of this writing, the San Diego real estate markets appears to have shifted from one that favors sellers to one that favors buyers. However, this premise may not hold true for all communities within San Diego, as median prices for some communities continue to rise while others fall.

While there are many metrics to evaluate the real estate pricing trends of a community, one commonly used parameter is to evaluate the median price of homes from one point in time against a prior point of time. The median price reflects the point at which half the homes are above a particular price point, and half the homes are below a particular price point. The median price metric provides one method to analyze the direction of home prices, but should not be used as the sole source of data from which to form conclusions.

The data below is a comparison of median prices for various communities in central San Diego County, comparing data from June 2005 against data for June 2006. This information is only one metric at a particular point in time, and other metrics or data from future months may support or dispute the pricing trends noted below. For some of the San Diego communities presented below, very few homes sold during June 2006, which diminishes the usefulness of the median price metric.

COMMUNITIES WITH INCREASES IN MEDIAN PRICE – SINGLE FAMILY HOMES – JUNE 2006

The data below pertains only to the sales of single-family homes, and does not include condominiums or townhomes. The data is organized by the magnitude of change in median price, with the highest change in median price presented first.

For the Coronado real estate market, the median price was $1,775,000, which represents a 14.7% increase from the same time last year. Approximately 15 homes sold in June 2006 (21 homes sold in June 2005).

For the Point Loma real estate market, the median price was $1,024,068, which represents an 11.4% increase from the same time last year. Approximately 20 homes sold in June 2006 (14 homes sold in June 2005).

For the University City (UTC) real estate market, the median price was $780,000, which represents a 10.6% increase from the same time last year. Approximately 5 homes sold in June 2006 (19 homes sold in June 2005).

For the La Jolla real estate market, the median price was $1,692,500, which represents a 10.3% increase from the same time last year. Approximately 28 homes sold in June 2006 (38 homes sold in June 2005).

For the Logan Heights real estate market, the median price was $425,000, which represents a 7.6% increase from the same time last year. Approximately 13 homes sold in June 2006 (14 homes sold in June 2005).

For the Paradise Hills real estate market, the median price was $507,500, which represents a 5.7% increase from the same time last year. Approximately 8 homes sold in June 2006 (16 homes sold in June 2005).

For the Mission Hills real estate market, the median price was $927,500, which represents a 3.1% increase from the same time last year. Approximately 11 homes sold in June 2006 (12 homes sold in June 2005).

For the Scripps Ranch (Scripps Miramar) real estate market, the median price was $759,250, which represents a 2.8% increase from the same time last year. Approximately 34 homes sold this month (43 homes sold in June 2005).

For the San Carlos real estate market, the median price was $563,000, which represents a 2.4% increase from the same time last year. Approximately 12 homes sold in June 2006 (16 homes sold in June 2005).

For the Del Cerro real estate market, the median price was $557,500, which represents a 2.1% increase from the same time last year. Approximately 13 homes sold in June 2006 (30 homes sold in June 2005).

For the Normal Heights real estate market, the median price was $676,250, which represents a 1.7% increase from the same time last year. Approximately 20 homes sold in June 2006 (19 homes sold in June 2005).

COMMUNITIES WITH DECREASES IN MEDIAN PRICE – SINGLE FAMILY HOMES – JUNE 2006

The data below pertains only to the sales of single-family homes, and does not include condominiums or townhomes. The data is organized by the magnitude of change in median price, with the highest change in median price presented first.

For the Old Town real estate market, the median price was $580,000, which was a 19.1% decline from the same time last year. Approximately 5 homes sold in June 2006 (14 homes sold in June 2005).

For the Golden Hill real estate market, the median price was $451,000, which was a 16.4% decline from the same time last year. Approximately 10 homes sold in June 2006 (13 homes sold in June 2005).

For the Pacific Beach real estate market, the median price was $851,960, which represents a 14.8% decline from the same time last year. Approximately 15 homes sold in June 2006 (19 homes sold in June 2005).

For the Tierrasanta real estate market, the median price was $570,000, which represents a 12.6% decline from the same time last year. Approximately 9 homes sold in June 2006 (17 homes sold in June 2005).

For the North Park real estate market, the median price was $560,000, which represents a 9.7% decline from the same time last year. Approximately 31 homes sold in June 2006 (16 homes sold in June 2005).

For the College Grove real estate market, the median price was $475,000, which represents a 5.9% decline from the same time last year. Approximately 38 homes sold in June 2006 (40 homes sold in June 2005).

For the City Heights real estate market, the median price was $390,00, which represents a 5.3% decline from the same time last year. Approximately 17 homes sold in June 2006 (30 homes sold in June 2005).

For the Mira Mesa real estate market, the median price was $510,000, which represents a 4.7% decline from the same time last year. Approximately 45 homes sold in June 2006 (47 homes sold in June 2005).

For the Linda Vista real estate market, the median price was $510,000, which represents a 4.2% decline from the same time last year. Approximately 16 homes sold in June 2006 (17 homes sold in June 2005).

For the Mission Valley real estate market, the median price was $510,000, which represents a 3.8% decline from the same time last year. Approximately 7 homes sold in June 2006 (18 homes sold in June 2005).

For the Encanto real estate market, the median price was $435,000, which represents a 3.3% decline from the same time last year. Approximately 36 homes sold in June 2006 (47 homes sold in June 2005).

For the Clairemont real estate market, the median price was $555,000, which represents a 2.6% decline from the same time last year. Approximately 30 homes sold in June 2006 (34 homes sold in June 2005).

For the Sorrento Valley real estate market, the median price was $861,000, which represents a 1% decline from the same time last year. Approximately 6 homes sold in June 2006 (5 homes sold in June 2005).

ADVISORY

Homebuyers and home sellers should keep in mind that the data above is simply a snapshot in time, and is not conclusive of the pricing trends for any community. For some communities presented above, very few homes were sold during June 2006, which makes the use of the median price metric of limited value. The data must be evaluated over a longer duration, and involve multiple metrics to fully understand enduring market trends. Contact your Realtor to obtain information about enduring market trends for any given community.

Energy Efficiency and Green Building Offer New Hope for Real Estate

All of the changes that are still being proposed for more bailout money, these are still not addressing the real estate buyer’s mindset. Have you asked why a buyer is not buying? Try asking your friends and family this question. The response will be: too much for a home, taxes are too high and job security is an issue. Who wants an investment that is going south in value. Would you? The state of the real estate market is what is on the line. Ideas from real estate practitioners are what policy makers both Democrats and Republicans, need to be seeking. (And don’t ask NAR, the National Association of Realtors — they are just more policy makers.)

Ask the people in the trenches. Having completed close to 400 real estate transactions, ask me. We need to give the buyer reason to buy again. Create and advertise local and federal tax incentives and make them visible for homeowners to renovate green. A healthier home that comes with lower utility bills and reasonable taxes is an overall better investment. In these economic times, would you buy a home with a $600 utility bill and taxes at $200-$400 a month together that comes to over $10,000 a year? Would buying even be a consideration if your job is at risk or you feel insecure?

Sellers, builders, and renovators need to renovate and produce a product worth buying. THINK WHAT TAX INCENTIVES TO RENOVATE AND BUILD GREEN WOULD DO TO THE MARKET! Then the buyer will come. Then the value of that investment will increase again. Housing prices and real estate taxes need to be adjusted, big time. Who wants a mortgage at $1100 and another $1100 in taxes and utilities and HOA fees? The upside is that these tactical moves by government will create a job base building a new energy sector. This will also increase small business growth aimed at these types of renovations, as well as jobs for administrative forces. My company Green Real Estate Education, has established a “green leadership” certification program for those in th many professions in real estate for under $100.

Already 5,000 are training buyers and sellers, offering the guidance to make a difference for their high utility bills. Those real estate agents and mortgage professionals can now offer a new reason to visit their clients, with good news for bringing up the value of their investment.

The real estate and mortgage industries need market transformation. Consumers care about  how their home can build real value again, not lose value. It is not and will never be business as usual again. We are doing this with education in the field of energy consumption. Realtors learn how they can guide clients to mortgage professionals whose companies develop programs that can help fund a home to be energy efficient, using renewable energy. That creates better value. Through our educational programs, we push the mortgage industry to offer “green funding” programs for consumers to have upgraded systems installed in their homes to save on energy costs. The real estate industry needs to know how to save money and create valid reasons to want home ownership again.

I can tell you the real estate market will not recover with just lowering interest rates, or with just a focus on another bailout. Buyers want green homes. If a consumer looks at a home today, not only can it not lose value, but it better be energy efficient. It better offer a healthier interior space.