Opinion: Yes, The Agents Are to Blame | Meir Bergman

I’m sorry to stir the pot yet again, but the fact is that it has become clear to me that something must be done about real estate brokers hiking up prices on homes, completely shutting out hundreds of families from the ability to buy a home.

I have studied this for well over a year now, and it’s quite obvious what is happening. Firstly, yes, it is true that home prices are organically high; this is true not just in Lakewood, but across the United States. In Lakewood and its surroundings, in particular, there are not enough homes to satisfy the demand from families. Naturally, this will cause prices to rise. However, this isn’t why the prices are so mind-boggling.

Rather, here’s what’s happening: Five families all want one house. Real estate brokers tell each couple that if they want the house they will need to pay above the asking price because there will be a bidding war. Fine, there’s no issue with that. But the next step is the problem. When there is another house in the area, the real estate agents list it at the price point that the first house sold for, which is already above market value!

For example, if a home was listed at $450,000, it will likely sell for $475,000 or higher because of the bidding war. But the next home in the area – similar in size and value – will be listed at $475,000 because that’s what the last home sold for. Then, agents tell prospective buyers that they also have to pay more than asking because there will again be a bidding war. So the second home will sell for $500,000 or more. And then the process repeats itself, again and again, until most families simply cannot afford to keep up with the ever-rising prices.

The only way to fix the problem (though it might be too late by now) is for real estate agents to stop raising the price of homes every time that a house in the area sells for above the asking price. The second house should be listed at the same listing price point as the first one, not at the sale price of the first home.

Unfortunately, there are simply too many agents right now who care only about their bottom line. They know they can list homes for very high prices and it will still sell for above asking because people are simply so desperate to get out of their apartments.

It should be noted that this is not true for every agent. There is a nice amount of agents who really do their best to keep prices reasonable while also getting their clients a home. However, they are fighting against a tsunami of other agents who just want homes to sell for the highest price possible so that their commission is higher.

So, if you are one of the agents doing this, please, for the good of everyone, knock it off.

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71 COMMENTS

  1. i hear the misery ! yet the agent is technically a shliach or representative of the seller , so is it in the best interest of the seller to get the most money? yes it hurts the tzibur and thats why the only solution as in the chssidish towns is control from the grand rabbi”, yet us westerners were never comfortable with takanos… vaads…also the roshei yeshiva in lakewood never viewed their role as shtots rav CEO…rather a melamed torah who tried being mechazek his talmidim … many years ago in discussing the growth of lakewood one of todays satmar rebbe’s told rav malkiel shlita ” “AH SHTOT DARF HOBEN A TATTE”

  2. This only half the issue. What about the goy agents? Try controlling them ! The tzibbur has to recognize and come to the realization that it’s a tough situation we’re in and we’re more likely then not to miss out on houses; so why jack up the price? The right hishtadlus is by not over pay for housing! No more bidding wars that go 100k over asking! Let’s not give the goyim there payday.
    There’s also the issue with the developers that’s another can of warns and too much for my kosher phone to type.

    • Food for thought:
      There is a possibility that if the Jewish agents do their best to make the houses affordable and also like you said we need everyone to participate to not engage in a bidding war, if all the Jewish people together totally united and we will all try together to get the prices a little lower, then I am 100% certain that the Almighty will intervene and he personally will persuade all the Non-Jewish agents to be on the same page with us. God is ready and willing to help everyone even more but we need to do something ourselves.

  3. Very true and the sad thing is that these Realtors are not only making it hard for the people who need homes to find one but are ruining neighborhoods the same time as well. They don’t care about newer communities that are growing beautifully and are looking for the same. It’s very sad that a Realtor who can use his/her profession to help build a community do the opposite. Many very nice families would move in but because they rake up the prices most people cant afford it. What ends up happening is some guy or investor buys the home and sells or rents it out to very much unpleasant neighbors. This is currently happening in my neighborhood. It boggles my mind how supposedly an erlich yid on the outside can destroy a potentially beautiful neighborhood.
    Like the author wrote there are some truly erlich Realtors, Hashem should bentch them with an endless amount of bracha and hatzlacha.

    • No its not.

      The only reason these prices are being considered is because of all the “home-buyer” programs, plus the feeling that “it will work out” engendered by the current bail-out climate.

  4. You are asking people to be less profitable… Regardless of the cause and effect as long as no physical harm is being done you are out to lunch buddy.

      • Thats what you think, but in reality you are asking them to bring home a smaller $$$ number. Now would anyone do that?

        Are we going to ask people to drive safer and slower because there were 12 pedestrians struck last week? Yes we do!

        But do they? No! Because speeding and recklessness benefits them in the moment regardless of other people. And they are blind to the larger picture obviously. Yes this may be a different crowd were preaching to, but you will have the same return.

        Sometimes people are selfish, life isn’t fair, deal with it.

  5. A real estate agent is a fiduciary agent for the seller. This means that it is his obligation to get the highest possible price for the seller. If he does not, he can be sued in court (and likely Beis Din).
    The agent does not work for the community at large and he is not allowed to (nor is it Yashrus) for him to consider anything other than the best outcome for the seller.
    Also, market forces are powerful. If there is indeed a shortage of housing, the prices will rise regardless.

    • I’m sorry, but unfortunately you are mistaken.
      Any learned person wld know you are NOT ALLOWED to aim to get more than it is currently worth, which is what is often unfortunately being done.

  6. You have a misconception of who the agent is working for. The agent is an employee of the seller. If they ignore any strategy to get the seller anything less than the highest amount they can possibly get for them it may be outright geneiva.

  7. hey if there wasn’t a huge campaign on many fronts to import large sects of out of state yidden, there would be many more hundreds of houses for local Lakewood families, you need to wake up before all the damage is done, but its to late now

    • When looking to move to a different location in LAkewood 4 years ago, everything we were looking for was at lesat $150- 200K above market value. When I finally caught on and told the agent that they aren’t selling to Lakewooders- just to someone’s parent/in-laws in Boro Park, Flatbush or Monsey, who will think it’s a bargain after they sell their house for over a million and come here with a half a million in pocket change, he just smirked and said I got the picture. Better off to look in Jackson, Howell or Tom’s River.There is no longer a Lakewood Housing Market – it’s a NY market. Face reality.

  8. I don’t think that you can blame the real estate agents alone. The people who are willing and able to pay those inflated amounts are the ones that are really driving up the costs. For example, many people are selling their houses in Brooklyn for $1m+ and therefore have a higher budget than the people that are living here. That is one big reason that the prices are so high.

  9. Someone is ignoring the facts! There is literally a shortage everywhere, and that my friends is called an inflated economy; to much money chasing to few goods, so it’s a supply and demand issue. Go blame whoever you want!

  10. As someone else mentioned, isn’t this straightforward capitalism? No one is forcing anyone to buy a house. If a buyer is willing to pay the price, then good for the seller that they get it. If the was really too high, then buyers would stop buying, and the prices would drop on their own. If prices are not dropping, it’s seems like an indication that this is the current going price.

  11. I witnessed this myself. A (non Jewish) neighbor said they were listing their house at 700k. A high but relatively fair price for the house. The house was suddenly listed for 900k and didn’t sell for months. When asked why they listed it so high and why they wouldn’t go back to a fair price, they replied that the Jewish real estate agent swore to them that they’ll get it. Eventually someone from Brooklyn came along and bought it at the over inflated 900k price. This real estate agent prevented people locally from buying a somewhat affordable house, brought more people from NY (different type than that of the local community) and at the same time – forced prices up and is raising local tax assessments.

    “Chaval Al Memona D’Yisroel”
    Shame! Shame! On many levels..

  12. You are correct prices keep rising and many families are priced out. However, agents aren’t to blame. If they can price a house higher and someone will buy it, that’s where the market is. They aren’t doing anything wrong. If you want to blame someone- blame the chasidim. Had they not come to lakewood yungerleit would be able to afford houses in Jackson/TR/Manchester.

  13. @Joe @Clueless

    When the agents go ahead and market directly to Brooklyn to come here for more affordable housing, they are creating a demand for their personal agenda that wasn’t there before. When a Brooklyn Family gets sold on the bigger houses/land at a lower cost, they don’t know the actual value. They are very often misled by agents telling them they are getting a “steal”. The agent I mentioned did that to the family that bought the very much overpriced house. Misleading people is dishonest not supply and demand.

  14. While there is no one answer to this issue, perhaps if the seller is trying to make the most they can then they should not higher any broker rather sell it yourself so you (the seller) doesn’t need to pay any commission or fees.

    To all those holy comments about the responsibility of the agent to the seller, let’s remember that their achrayus to the seller does not permit them to steal or price gauge- something both the Torah and Dina Demalchuscha do not allow.

    Supply and demand might be true but that doesnt excuse morality. When shoprite sells passion fruit 2 for $5 on erev Rosh Hashana that doesn’t give the frum store the right to charge $16 for one (true story in Jackson a few weeks ago) simply because of supply and demand.

    Klal Yisroel is morality 1st yashrus 1st not make a buck first.

  15. Real missed opportunity with this article. If it would have been presented as a rally to arms for buyers rather than a dictatorial demand on agents would have made a lot more sense.
    But alas we live in an age of enmity rather than cooperation.

  16. I’m pretty sure the market price is determined by what a buyer is willing to pay. It doesn’t matter what an agent lists a home for. If a buyer (any buyer) is willing to pay the asking price or more then the market has spoken and has determined that the home is worth that amount. If the buyers reject the asking price and offer less then that tells you the home is not worth the asking price. Why is this so difficult to understand? An agent no matter who they are have zero “control” over market pricing. They can’t force anyone to pay the price. The buyers hold that control. It’s very simple and the agents are simply doing their jobs.

  17. I think you are vastly oversimplifying the issue. The fact that you spent a year studying it doesn’t mean that you grasp how free markets work (this is somewhat like anti-vaccine moms who say that they spent years studying vaccines and determined they are dangerous, when all they did during those years is surf anti-vax sites) , It has nothing to do with agents, and everything to do with supply and demand. If there are only x houses, and x+y buyers, y number of people will be unable to buy a house. What determines whether you are from x or from y is if you can afford to outbid x. Very simple.

  18. To all those who are claiming that the agent is the shliach of the seller so don’t blame him. How about when the agent is the one who convinces the seller to want to sell in the first place. I personally know an agent who only cares about his bottom line so he looked around for a house that he knows is being rented (by paupers mind you) and went and convinced the seller that he can be making it big if he sells the house, listing it for Way over the value, Never mind that the current tenant will become homeless (since rent prices are about 1k more than what they are currently paying (with lot’s of difficulty)

  19. I bought my house a few years ago. The seller’s agent kept trying to get me to hike up my offer. She told me that there’s alot of interest in the house, she mentioned specific names of people whom she said will bid against me. She pretended to root for me saying she wants me to win this, trying to get me to increase my offer.

    After I moved, I heard from people in the area (whom she had mentioned) that they had merely looked at the house, but had never really expressed interest. The agent was lying and knew it.

    I hope other frum agents do not behave this way. I try to be Dan L’Kaf Zchus but it’s hard. I hope others don’t fall into this trap.

  20. Eh… give it a little more time and the housing market will crash again and you can get the houses for way cheaper.
    Its just the build back better biden boom. And as all booms go… eventually they go BOOM and everything crashes.

  21. Changing the fee structure may help. it isn’t any harder to sell a more expensive house today than it was a year ago. In fact it is most likely easier as the market is hotter. yet the agents are getting a lot more to sell the home!

  22. I stopped half way through your article to argue. Supply and demand as well as inflation is what causes these problems. If gas, chicken, workers wages and haircuts can go up 25%, so can the cost of home. Don’t blame the realtors. I recently sold and bought a home myself. All the realtors I spoke to are really trying to help and are just facing the reality of the situation.

  23. Please stop blaming this situation on long term residents like myself who are being forced out by outrageous and unfair taxes for private school busing. When my kids were in school, if I wanted them to attend private schools, I had to PPi at for it myself. You knock down our houses and build five family houses on the same foundation to lower your taxes and park in streets too narrow to accommodate one lane of traffic. You caused your own problems.

    • Janice, I really can relate to your frustration with this. However, I am a member of the Jewish community here and I’m guessing most others will agree with me, that MOST of us do not support these actions! We dont support building in too small of spaces, we dont support making streets too crammed to drive, and we dont ask for any extra money for bussing more than what any non-private school wld receive. I just wanted to share that I hear you, and im guessing many others from within dont feel differently, which means a small percentage caused this,not “US” as a whole. ty for sharing.

  24. There is another angle that is worth pointing out. There are many potential neighborhoods that potential buyers may consider. However, there are certain neighborhoods that agent(s) may feel are more profitable for them to promote. This can be because the area is larger and can open up more houses for them to put on the market. This is causing certain areas to be “pushed” by the agents and others to be ignored. The bottom line should be what is better for the client, not what is more lucrative for the agent.

  25. Just returned home after spending YT in Cleveland where I met many Lakewooders who moved there over the past 2 years. Why? It’s like the old time Lakewood in terms of the ruchniyus and pashtus. The housing is extremely affordable. Why? They have a VAAD and everyone who moves in knows that they have to adhere to the takanos or DON’T MOVE THERE. Period. It’s a shame that we lost our town. We’ve been living in Lakewood for approximately 25 years but after our visit, we are actually thinking of maybe moving to Cleveland.

    • So move to Cleveland:
      Get a job there for $8 an hour.
      Visit your family once a year.
      Don’t step outside from 7pm till 7am to avoid being shot or stabbed.
      But it’s cheap!

  26. Instead of enriching the sellers with money more than the value , let’s create a fair waiting list so as houses come for sale no one has to outbid 10 others and overpay $100-200k or more.

  27. There’s is no doubt that while the local Frum market is desperate for houses, agents are definitely doing their part in raising the prices. With so many agents operating in our area, The competition and desperation to get listings is evidence. Need proof of this? The most recent one I’ve noticed, is a home being sold in the extremely popular Hampshire Hills development (Jackson). It was for sale by owner for $769k. An agency got the listing, and the price immediately increased to $779k. Really shameful.

  28. Just Wondering,
    I’m sure my Ultra-Modern cousins are not following any “Takonos” and my Reform cousins don’t even know what a Vaad is. Both live in “Frum” Cleveland.

    • CLEVELAND? how many frum families have moved to clevland say in the last 5 years? bmg has 600 chassanim a year?
      if out of town is so wonderful why are there 4 shuls with a total of 150 families ,

  29. I have a better idea to all of you (young families?) looking to purchase a house in the Lakewood area. DON’T!!!

    Move out of town! Anywhere but Monsey, Lakewood, Brooklyn and 5 Towns areas which are expensive for the middle class family.

    Live in a place which is affordable for your family! Look around. Think outside the box! Be a pioneer! You can make a huge difference in some of these out of town communities.

    Signed by current Out of towner of 10 years who grew up in Monsey, went to High School in Lakewood in the 90’s and lived in Brooklyn for a nice amount of years.

  30. No need to blame anyone. If one doesn’t have enough money to purchase a house, that’s it, you can’t buy a house. The End. Please be happy for those that can afford to purchase a house.

  31. The author should do a quick Google search of the concept of supply and demand. It’s the same concept that explains why women get paid less and biavoiseinu harabim, Rebbeim.
    Same applies here.

  32. All self righteous people talking about “agents caring about their bottom line” obviously never worked a day in their life to support themselves and don’t have the greatest bitachon either if they are kvetching about a housing crisis.

  33. The only plausible solution that I have heard is to start a new community somewhere. A realtor told me there are over 600 homebuyers that would spend 350K, if 100 go to a town in PA and buy, you can be assured that drs, stores and others would follow
    anyone interested?
    Hatzlacha

  34. Don’t Blame the Brokers ( I’m not a broker and I have nothing to do with them) A shortage is a Shortage! On every problem a yid does like is said in Yiddish “ A Yid Get Zich an Eitzah” . A housing shortage among us has been going on since 1981, exactly 40 years, and with this problem there’s simply “No Eitzah” all we can do is be mispallel.
    We may have a roof over our heads, but what about our children and grandchildren.

  35. Instead of askanim working to raisie the Lakewood Kollel budget which will go straight to cover the new jacked up real estate costs, why can’t a few million be raise to open a new area within an hour or 2 where the 500-1000 families(which will increase drastically every year)can live at “Cleveland” prices but within driving distance to family? Many yungerleit can sell their Lakewood houses and live for 10 years off of the savings alone, while if they stay they will be giving way over their Kollel check to cover the upcoming tax increases. Open Lakewood west jersey-maybe BMG can send over someone to give shiur even!

  36. While there is an issue with supply and demand. The agents and builders are not catering to most regular and local residents. One prominent builder told me straight out that these houses are not for you, – you move to Detroit. It’s being catered to ppl from outside of the Lakewood.
    They’re making homes to be million dollar homes.

  37. The frustration is everywhere not just Lakewood, and what you are pointing out with the realtors, hate to break to you is going on everywhere, not just with the realtors in Lakewood, so unless you are trying to tackle a worldwide problem, don’t single out the Lakewood realtors. It’s a general frustration that happens to be effecting all people not just Lakewood, you just feel better pointing the blame just on Lakewood realtors, bec you have an extra sensitivity for your own kind that are being priced out of homes. Which is beautiful, but don’t make it like it’s just a Lakewood problem. No I am not a realtor, but I do invest all over the state and see this everywhere..

  38. I find this a bit humerus. As a long time Lakewood resident I watched back in the 70s and 80s when the community was small and all the agents came from NY with their pockets loaded with money and bought up homes for insane prices. Now the people that have benefitted from that “buy out” are crying because they are priced out of the market.

  39. Zman, whom are you referring to? I’ve been in Lakewood for many decades, who were the ppl who bought up property in the 70s & 80s who are now “crying”, it’s young ppl who are trying to keep a roof over the head and have adequate space to raise their growing families who are sharing their frustration
    investors from 1970 are now in their 60-70s, they’re probably in retirement villages or Florida
    Bottom line you can call this capitalism/supply-demand or whatever you want but as far as I know we all have a day of reckoning, real reckoning! And one of the primary questions – were you ne’eman? There’s no way that the current real estate practices are ehrlich or neeman, PERIOD!
    You can fudge and rationalize here, not so in the next world, and we all get there
    A little introspection, fellow yidden
    Ps we can make gemachim up to the cazoo but lowering the standard and employing restraint and Pashtus is chesed in a much higher form

    • Who are the young couples looking for houses here now? They are the children or grandchildren of those older couples who came here with the pockets of money. Why can’t they afford them? Because many of those older couples who came here in the 70’s – 90’s tore down the affordable homes and replaced them with larger more expensive homes. I don’t have enough fingers and toes to count the many friends who sold and left Lakewood during those days who had their really nice homes torn down just to be replaced with a larger home jammed onto a small lot.

  40. Categorically untrue. Everything is based on supply on demand. Agents cannot ultimately control how much you pay. Lakewood has become a victim of its own success and now that it has all the conveniences of flatbush and monsey there is no reason that it should be cheaper( but it still is and thats why you have all the people moving in from broooklyn). essentially its growing now the way that monsey has expanded by people moving to new city etc. (equivalent of toms river/jackson). For the same reason that yungeleit have been priced out of flatbush for years, they are now going to be priced out of lakewood. This is just natural evolution of something thats been going on for years. And extremely predictable too!

  41. here’s my breakdown of this problem:
    40% supply and demand
    10% realtors
    50% Brooklyn people with deeper pockets moving here

    Cleveland- Beautiful community, very hard to find jobs.

  42. Very simple. The next house goes for the previous house sold for. That’s nit the agent. That’s the home Keene wanting what his height got!

  43. People should look at Pine Lake Park in Manchester, NJ. Right outside lakewood. Already 70 families under contract. Much more affordable!

    • There are also other locations in Toms River and Jackson closer than Pine Lake Park worth looking into. People need to keep in mind that Pine Lake Park is a very large area so 50 families are likely not walking distance to each other. Pine Lake Park also has much smaller yards and is a more tougher neighborhood than other locations in Toms River.

  44. Zman, that’s ridiculous, this town grew exponentially, to say the yungeleit now are all or even predominantly children of former investors is ludicrous
    They are from all areas of the globe
    And run the gammet

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