Howard Hanna Buys Realty One
Real Estate News
It was announced Sunday, November 2nd (actually a few days earlier due to an e-mail blunder by the President of Realty One) that Howard Hanna purchased Realty One.
What does this mean for Northeast Ohio? First and foremost, it means that a non-local company will be trying to take over more market share in the Cleveland area and reap the profits for their corporate headquarters in Pittsburgh, Pennsylvania. It also means a reduction in competition in Northeast Ohio. We feel that more competition benefits consumers, not less. Olsen Ziegler Realty is a small (by design) real estate company and we do not believe this is beneficial for Northeast Ohio consumers. We believe in choice, especially when it comes to one of the most critical financial decisions a consumer has to make--the purchase or sale of a home.
Did you know that most of these large real estate companies may make more money from their mortgage and title/escrow services than from the actual selling of real estate? These companies generally have "Affiliated Business Arrangements" (ABAs) or "Joint Ventures" (JVs) with title/escrow companies as well as mortgage companies which ultimately profit the real estate companies at the expense of the consumer. What does this mean? It means consumers end up paying higher fees that end up in the pockets of the business owners. What is this called? The industry refers to this as "One Stop Shopping" or "Convenience."
In addition, some top-producing individual Realtors can make $50,000-$100,000 per year just by owning minority shares in title/escrow companies. These title/escrow companies raise their "variable" fees including escrow/closing fees and title exam fees so they can pay out quarterly dividends to their minority Realtor shareholders. Not all Realtors own shares in title/escrow companies.
Olsen Ziegler Realty DOES NOT HAVE any ABAs or JVs and DOES NOT OWN any minority shares in any title/escrow company. We take our legal fiduciary responsibility very seriously. What does this mean? It means we put our clients' financial interests above our own. We recommend low-cost, quality providers that will put more money in consumers' pockets, not our pockets.
At the very least, we recommend that consumers pick up the phone and call Cleveland's own Third Federal, which has very competitive mortgage rates and great service. We also recommend Commerce Title, located in Hudson, because they have saved our clients hundreds of dollars in closing costs and variable title/escrow fees. We have yet to run across a consumer that isn't willing to apply online or in-person to get a great loan and save money in the process. E-mailing a purchase agreement as a PDF file (done by us) to Commerce Title so the consumer can save money is a no-brainer for a consumer as well, so the marketing gimmicks of convenience are just another way, and a profitable one at that, for real estate companies to get a bigger slice of the pie. Do an apples-to-apples comparison and we think you will agree with us, our past clients sure have.
Furthermore, we highly recommend that consumers ask whether a real estate company charges an "Administrative Transaction Fee." What is this fee? It is a fee payable directly to the real estate company at time of closing and it generates a lot of cash. It is not commission, it is not a title/escrow fee nor a lending fee--it is a company fee. For example, if you use $159.00 as an Administrative Fee and multiply that by the number of transactions already closed by Howard Hanna, which is over 22,700 in 2008 alone-- you do the math. That is a total of over $3.6 Million!
Now add to this $3.6 Million, the purchase of Realty One and all of their transactions, and then add one more item to that--the number of transactions that involve two agents from the same company which doubles the Administrative Fee. Is your head spinning now? It should be, because the consumers are the ones that are paying for all of this!
You can read their official press release using the link below. We feel real estate should be all about the consumer, not the real estate company. Our website reflects our philosophy and business model, which is designed so you can easily see what we can do for you, and not make it about us. I read their official press release and noticed there are a total of 27 sentences: 25 sentences talk about their company, and only 2 sentences talk about you, the consumer.
IT IS TIME TO WAKE UP CLEVELAND--Enough is Enough! You need to keep your hard-earned dollars in your own city and in your own pockets! It PAYS to compare. It PAYS to evaluate and understand how things work. Knowledge and information PAY huge dividends--to YOU!
Olsen Ziegler is a 100% Greater Cleveland-owned real estate company. We are all about reducing your costs and maximizing your return on your investment. Call us, read our website, consider our recommendations, but whatever you do...choose your real estate company and Realtor wisely.
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Date: Monday, November, 3rd 2008 @ 11:45:27 AMViews: 57
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