Time Magazine Article “Less Vegas” Stirs Up A Hornets Nest

This last Sunday, people started asking me if I’d read the Time Magazine story “Less Vegas: The Casino Town Bets On A Comeback” . I flagged the email but didn’t get around to reading it till this morning when I started getting emails with a link to the story about the story that appeared  in today’s SUN.  

Here’s the final paragraph of the lengthy Times story. It’s not a flattering piece. He tells of optimism, but dismisses it all offhand as pollyanish bull crap.  I’m ever the optimist….. I’m all in, myself.

So Vegas has made its bet. This recession, it clearly believes, is just another business cycle. It will end, sooner rather than later, and the world will go right back to gambling on slot machines and real estate and tasting menus and double-digit corporate earnings. In fact, Wynn bet me $100, an amount I had to spend several minutes explaining to him, that the U.S.’s GDP growth will be positive by April 2011. In the meantime, he and the other people who run Vegas believe the deck will get reshuffled and new players will sit down at the table as casino owners, but the game itself won’t change. Americans, they think, will continue to get economically better off. It sounds a little hollow, especially looking at this city in the desert that creates nothing, the world’s greatest ghost town in waiting. But a lot of people have gone broke betting against the people who run Las Vegas. Besides, the Las Vegas people have no choice but to bet things will go back. They’re all in.

Much of the piece focuses on the big picture of closed down construction projects, bankrupt major casino owners, and a small part (that begins on page 2) about a real estate agent in Las Vegas who “spills the beans” about some unscrupulous practices of some real estate agents. It’s these couple of paragraphs that a few of you email me about on Sunday, and that caught the attention of Brendan Buhler in this morning’s SUN.

The story by Joel Stein in the Aug. 24 issue, “Less Vegas,” is a high-spirited and high-altitude view of the troubles facing Las Vegas, which he calls both “our most American city” and “an entire city of John Dillingers.”

In the story, Brooke Boemio — “a bouncy, sweet, recently remarried 31-year-old mom” — is cast as one of the Dillingers. She helps Stein break into a foreclosed home and brags about helping clients who are underwater on their mortgages buy a second house on the cheap and stop making payments on their first mortgages, pressuring the bank into selling the houses for a loss. Everybody’s doing it, she says in the story. In fact, she said, she did it herself.

I bring all this to your attention because I want to describe the Real Estate Industry from my point of view. Even though there’s some rebuttal in the remarks of the Sun article, most of the commenters seem to blame the entire meltdown on Realtors.

I know why I’m a Realtor.  I like (some) houses. I like people. I like making a living. I like being recognizable. I even like the stress and frantic pace of real estate. I find that the people I work with as clients believe as I do on most issues, and share my values most of the time. It may be true that opposites attract romantically, but in the business world, I think people attract those who are similar. The honest find the honest, and those without integrity find dishonest people to play with. I never get asked to do anything illegal or dishonest by my clients. I NEVER volunteer, either. And the other thing that I don’t do is try to put the entire blame for the whole recession and housing meltdown onto the back of any one of the players. EVERYONE played a role, real estate agents included.

I’ll give Time credit for one thing, they have internal links in their articles to just about everything pertain ant that they’ve ever published. One of them is “25 People to blame for the Financial Crisis”.   The American Consumer is #5 on the list. Wall Street is well covered, as is the banking and mortgage industry, the government, Presidents Clinton AND Bush, homebuilders and many others. There’s plenty of blame to go around, and just as before it’s all going to happen all over again because people just don’t change their stripes.  There’s plenty of people who are going to try to game the system, work a hundred new angles, seek out other dishonest players, and to greedily grab at others expense. I don’t have to play with them, however and neither do you.

The specific “crime” of buy and dump that’s mentioned in the Times article is one that started to happen at the beginning of the downturn, but new rules (tightening of guidelines) were put into place to stop the practice. Personally, I’ve heard that it happened, but I’ve never heard of agents actually promoting it as a business practice.

More of concern, are some of these things that need to be looked into NOW. Offers that aren’t being presented to the sellers at all; banks that aren’t taking the highest bid for the property, just the most convenient and quick to close cash bids; requiring all bidders to prequalify (again) with bank that owns the property; and hoarding of inventory. Yes there’s practices out there that range from the not nice to the scandalous, and it’s all part of the “game with no rules”. It’s a game worth playing….but not an easy game at the moment.

Mostly I just want to tell you that most Realtors are honest, hardworking, ethical and the bad apples do damage not just to our industry but to  the consumer and the economy and the nation.

And in case you didn’t click over to the article in Time, one of the links that shows up in the article is about modernist homes for rent including Frank Sinatra’s Palm Springs Home. There’s some great pictures  there.