Today many people are conflicted about listing their homes because prices are rising and they want to get the maximum out of their house.
The fear of selling too cheap has now replaced the fear of paying more than you would have to if you could buy at the bottom (like we had for the past 5 years).
Low ball offers have given way to price wars and multiple offers and I believe some pretty astronomical price rises in desirable areas to live.
Bankers and appraisers have changed the rules. I observe that we are once again granting appraisals for the amount of the loan even when there aren't comps to back it up.
I mentioned in a previous blog a house that was sold way above the market and I wondered if it would appraise. It did! Just a couple years ago I tried to sell a very nice, totally updated house and the appraiser refused to appraise the house at the level we listed it for and for which there were many buyers because the comps in the neighborhood did not support it.
So why is it a Perfect time to sell your home when no one knows how far prices will rise? Because I have learned in my life that market timers always miss their target. Nobody buys at the absolute bottom or sells at the absolute top.
If you are holding your home off the market because you want to time your sale to get the most out of your house, think twice. How long will this boom last? What if you miss your chance to sell your for a very acceptable price to you in a shorter period of time
Since the market is being supported by tens of billions of dollars in FED purchases of Real Estate loans keeping the interest rates on mortgages low, and bank regulations and qualifications appear to be slackening on mortgages - you should get a good price for your home. I cannot promise you that you will get every last dime, but you will get a good price and you will sell in a shorter time than 6 months. How long will the government continue to stimulate the market?
Inventories are down to 13 year lows. There is pent up demand from those who didn't buy at the bottom and are now trying to move into the perfect home.
It all adds up to be the perfect seller's market.
Thursday, April 18, 2013
Wednesday, April 3, 2013
What is a Comparative Market Analysis CMA
One thing I never expected to write about was Comparative Market Analysis or CMAs for short. However, recently I have learned that I have to say something. People are anxious to know if their house has increased in value. They want to know what is the maximum they can get.
The problem is in certain areas like Montrose, the Heights and Bellaire prices have really increased a great deal in the past couple of years. Even in areas north of HWY 6 prices appear to have increased. But prices are not evenly rising throughout the Houston area.
That said, CMAs look back 6 months generally and need to stay as close to the Subject House as possible. You can't compare a house built in 1940 to a house of the same square feet built in 2013. You can't compare a house with a 10,000 square foot lot to a house with a 5000 square foot lot. I use the standards of the National Association of Broker Price Opinion Professionals NABPOP.
People often disagree with the CMA since the CMA does not include the house that sold a year ago down the street. They might consider a house that is much larger, older/newer, etc. as a comp for their house. It might not be. There are standards and that is all we have to go on. There is no magic in the writing of a CMA.
PRICE! is such a sensitive subject with people. All agents use the HAR CMA program to produce beautiful customized presentations of THE PRICE. The presentation is about 19 pages long and is quite impressive, only I have not found a way to get around the program default which is to take the average price and multiply that by the square feet in the house and label it SUGGESTED PRICE.
Recently, I sent a Machine-Generated CMA to a couple of prospects.
All they looked at was the suggested price and they got angry. How could I evaluate their house so low when everybody knew that all you have to do in the Heights is put your house on the market to get $700,000 these days even if the house was purchased for $400,000 in 2010.
True, I said, but I did try to tell you that the Suggested Price was machine generated and still they got upset. So upset that they didn't list their house with me.
So I decided to try not using the program. Instead I would get the raw data and write a discussion in which I explain everything.
Just this week I tried my new theory out. Monday, I had visited this client at his home and had discussed everything even the price with him and everything seemed good until I emailed him my analysis.
His email came back saying that he wanted to know what I thought the correct price was, which is exactly what I had done. I have to admit that it is a little strange when you diplomatically tell someone the price you would ask for their house and they come back with "NO REALLY WHAT DO YOU THINK THE PRICE SHOULD BE?" Just saying - .
When the client no longer returned my emails I finally got him on the phone and he said that I had been all over the place with the price.
Actually, I told him, he was all over the place with the price. We had agreed on the price, but then he lost trust in what I said, which is shocking because I was doing everything I could to say in the best way and clearest way I knew how.
You just can't win any more. People want to know what the magic price is, but prices are actually established by supply and demand IN THE MARKET IN THE FUTURE. Really, as I like to tell my clients. This isn't science, it's art and science.
I also find it amazing to have people arguing with me about comps. If your house was built in 2008 NABPOP says you can take comps 5 years in the future which would make your house a comp for a house just being built.
This client did not want me to use the newer comps. He wanted me to use other comps as if you could simply choose any house as a comp or actually come up with new comps when the list of houses to choose from is by definition finite.
The price issue is going both ways.
Recently I took on a listing in which the sellers wanted to sell their house for $200,000. The problem was the average comp was listing for $156,000 and the highest comp sale was for $180,000.
A qualified buyer made an offer yesterday at $208,000. He was rolling $8,000 in closing costs into the loan.
So what's the problem?
There are no comps to support $208,000 in that neighborhood. When the FHA appraisal comes in the house will have to be reduced. - Or who knows they might just do like the did in the old days and take the price the buyer is willing to pay, appraise it for that and sell the loan to the FED.
The problem is in certain areas like Montrose, the Heights and Bellaire prices have really increased a great deal in the past couple of years. Even in areas north of HWY 6 prices appear to have increased. But prices are not evenly rising throughout the Houston area.
That said, CMAs look back 6 months generally and need to stay as close to the Subject House as possible. You can't compare a house built in 1940 to a house of the same square feet built in 2013. You can't compare a house with a 10,000 square foot lot to a house with a 5000 square foot lot. I use the standards of the National Association of Broker Price Opinion Professionals NABPOP.
People often disagree with the CMA since the CMA does not include the house that sold a year ago down the street. They might consider a house that is much larger, older/newer, etc. as a comp for their house. It might not be. There are standards and that is all we have to go on. There is no magic in the writing of a CMA.
PRICE! is such a sensitive subject with people. All agents use the HAR CMA program to produce beautiful customized presentations of THE PRICE. The presentation is about 19 pages long and is quite impressive, only I have not found a way to get around the program default which is to take the average price and multiply that by the square feet in the house and label it SUGGESTED PRICE.
Recently, I sent a Machine-Generated CMA to a couple of prospects.
All they looked at was the suggested price and they got angry. How could I evaluate their house so low when everybody knew that all you have to do in the Heights is put your house on the market to get $700,000 these days even if the house was purchased for $400,000 in 2010.
True, I said, but I did try to tell you that the Suggested Price was machine generated and still they got upset. So upset that they didn't list their house with me.
So I decided to try not using the program. Instead I would get the raw data and write a discussion in which I explain everything.
Just this week I tried my new theory out. Monday, I had visited this client at his home and had discussed everything even the price with him and everything seemed good until I emailed him my analysis.
His email came back saying that he wanted to know what I thought the correct price was, which is exactly what I had done. I have to admit that it is a little strange when you diplomatically tell someone the price you would ask for their house and they come back with "NO REALLY WHAT DO YOU THINK THE PRICE SHOULD BE?" Just saying - .
When the client no longer returned my emails I finally got him on the phone and he said that I had been all over the place with the price.
Actually, I told him, he was all over the place with the price. We had agreed on the price, but then he lost trust in what I said, which is shocking because I was doing everything I could to say in the best way and clearest way I knew how.
You just can't win any more. People want to know what the magic price is, but prices are actually established by supply and demand IN THE MARKET IN THE FUTURE. Really, as I like to tell my clients. This isn't science, it's art and science.
I also find it amazing to have people arguing with me about comps. If your house was built in 2008 NABPOP says you can take comps 5 years in the future which would make your house a comp for a house just being built.
This client did not want me to use the newer comps. He wanted me to use other comps as if you could simply choose any house as a comp or actually come up with new comps when the list of houses to choose from is by definition finite.
The price issue is going both ways.
Recently I took on a listing in which the sellers wanted to sell their house for $200,000. The problem was the average comp was listing for $156,000 and the highest comp sale was for $180,000.
A qualified buyer made an offer yesterday at $208,000. He was rolling $8,000 in closing costs into the loan.
So what's the problem?
There are no comps to support $208,000 in that neighborhood. When the FHA appraisal comes in the house will have to be reduced. - Or who knows they might just do like the did in the old days and take the price the buyer is willing to pay, appraise it for that and sell the loan to the FED.
I am always learning. I am not surprised at anything.
Monday, March 11, 2013
What I do as a Buyer's Agent
When I started out on my own in Real Estate, I prospected sellers with Expired listings because I thought they would know more about the process of listing their homes and because they might even be less than impressed with the service they had received.
I wanted to set up my own shop and not just try to replicate what everyone else was doing. I knew I would make mistakes and I needed indulgence from people and I needed for them to give me a chance. I laugh at myself now because you don't need to reinvent the wheel to make a personal statement, but I just didn't think I fit the stereotype - whatever that was! I decided to be a discount real estate listing broker.
With very hard work my idea enabled me to quit my day job and work full time at being a Real Estate Broker. This is 6 years later and times have changed. Instead of being just a listing agent like I had planned, it turns out the majority of my income comes from helping clients find homes in places like Bellaire, where I live and all over Houston.
Generally the people who do business with me are very individualistic, in control types of people. They are also very creative, generally tech savvy (because they find me on the Internet) successful individuals. I am always thrilled to meet such people and enjoy doing business with them. Conversely, I am always disappointed when one of these individuals aren't sure about what kind of broker I am and go with someone else as a result.
This afternoon I called one such prospect. This man had contacted me through the Internet a couple weeks ago. He had a nice townhouse in Rice Military he wanted to sell at a very reasonable price. I always call prospective listing clients who did not choose to employ me in the sale of their homes in order to find out if there was something I could do to gain their business the next time.
When I got him on the phone he very politely told me that he had decided to go with someone else who knew the neighborhood better and he felt like I had left out buyers from my website.
I hung up and thought about it and I thought to myself - - IT WAS RICE MILITARY! Who doesn't know about Rice Military? Six years ago for two years I mailed out a monthly CMA to everyone in Rice Military. My office was in the Heights. Alas!
Anyway I got to thinking about the second part of his criticism regarding buyers and I think maybe I should comment on what I do for buyers. I have a small list. Here it is:
#1 By far most of my income comes from buyers. If you want to know what I do most of the time I represent buyers!
#2 I have always focused on getting listings because when you get listings, you get other clients, buyers and sellers too. There is a saying in Real Estate "List to Exist"! Listings are primarily what I focus on online, but I am always working with buyers.
#3 I enjoy getting to know my buyers. I show them my listings if I have a listing they are interested in. I call my clients if I have a listing I think is of interest to them. I work with them to find what they do want.
#4 I help my buyers understand the market in general and specifically for the house they are looking for. It does not matter to me if the house my clients are looking for is not listed at the current time. We keep in touch as often as necessary to discuss what is available or not. We take as long as necessary to find the perfect home.
I keep all my clients in a notebook and I check the new listings every morning when I get up to see if any of the new listings matches one of my client's profiles. If I find a house like the one they are interested in, I send it to them. It can cake several months and even a year to find the right house, but I maintain the relationships I have with my clients always supplying them with good invaluable information tailored to their particular needs and wants.
When we find the right house, I assist my clients in their offer showing them what I think the house is worth. If the house is a great value, I show it to them. If there are problems with the house, I also point them out to my clients.
For more sophisticated clients who are corporate in nature, I supply good service and availability to show them houses when they need it. I help with CMAs and market analysis.
Individuals or corporate, love helping buyers.
I am just not trying to get every single listing. I know I can't compete with "I've been living in the house next door to you for the past 15 years and been a Realtor for the past 20 years in this neighborhood. I respect that.
However I would counter that there is hardly a neighborhood in Houston that I haven't been involved with in the past 9 years. I daily follow all the new and expired listings within the HWY 6 loop. (I used to go out to Spring and Cypress and Humble but just found that market too far out for me.)
Houston has a greater than 400 mile square mile area. You have to limit yourself.
Finally, I am a good negotiator. If you are always doing a deal, you are always learning. I am always negotiating and I feel that keeps me in top form and makes me more helpful to my clients both buyers and sellers.
I do all my own work so naturally I am not paying attention to what everyone else thinks is most important. I try to do my best and I try to make sure everyone I do business with does their part to make buying or selling a home a good experience for all involved.
If you are not looking for the agent that has advertised themselves as the neighborhood specialist, but for an agent who can show you the same sales and active data any other agent has available from MLS and who by the way enjoys working all over the city of Houston, maybe you should give me a call!
P.S. The guy who lived in the Heights Townhome, did sell his house in the first week it was listed. He also found another new home the next week. He was interested in finding an agent who could also represent him in the sale of his townhome and also in the purchase of a new home. He, in fact made that clear in his initial phone call. Since I only talked about listings on my website, he chose another agent who had made it clear could represent him in both the sale and the purchase.
By selling through me, he could have saved a lot of money and still sold in a week. The market is hot in Rice Military! I missed out because I had not made it clear that I represent buyers too.
Real Estate is a competitive business and we all have to do represent both buyers and sellers if we are truly going to stay in the business. That is exactly what I do. I represent both buyers and sellers. Hopefully all my clients will think that I only represent them. I would love it if that happened.
Regards,
Volley
I wanted to set up my own shop and not just try to replicate what everyone else was doing. I knew I would make mistakes and I needed indulgence from people and I needed for them to give me a chance. I laugh at myself now because you don't need to reinvent the wheel to make a personal statement, but I just didn't think I fit the stereotype - whatever that was! I decided to be a discount real estate listing broker.
With very hard work my idea enabled me to quit my day job and work full time at being a Real Estate Broker. This is 6 years later and times have changed. Instead of being just a listing agent like I had planned, it turns out the majority of my income comes from helping clients find homes in places like Bellaire, where I live and all over Houston.
Generally the people who do business with me are very individualistic, in control types of people. They are also very creative, generally tech savvy (because they find me on the Internet) successful individuals. I am always thrilled to meet such people and enjoy doing business with them. Conversely, I am always disappointed when one of these individuals aren't sure about what kind of broker I am and go with someone else as a result.
This afternoon I called one such prospect. This man had contacted me through the Internet a couple weeks ago. He had a nice townhouse in Rice Military he wanted to sell at a very reasonable price. I always call prospective listing clients who did not choose to employ me in the sale of their homes in order to find out if there was something I could do to gain their business the next time.
When I got him on the phone he very politely told me that he had decided to go with someone else who knew the neighborhood better and he felt like I had left out buyers from my website.
I hung up and thought about it and I thought to myself - - IT WAS RICE MILITARY! Who doesn't know about Rice Military? Six years ago for two years I mailed out a monthly CMA to everyone in Rice Military. My office was in the Heights. Alas!
Anyway I got to thinking about the second part of his criticism regarding buyers and I think maybe I should comment on what I do for buyers. I have a small list. Here it is:
#1 By far most of my income comes from buyers. If you want to know what I do most of the time I represent buyers!
#2 I have always focused on getting listings because when you get listings, you get other clients, buyers and sellers too. There is a saying in Real Estate "List to Exist"! Listings are primarily what I focus on online, but I am always working with buyers.
#3 I enjoy getting to know my buyers. I show them my listings if I have a listing they are interested in. I call my clients if I have a listing I think is of interest to them. I work with them to find what they do want.
#4 I help my buyers understand the market in general and specifically for the house they are looking for. It does not matter to me if the house my clients are looking for is not listed at the current time. We keep in touch as often as necessary to discuss what is available or not. We take as long as necessary to find the perfect home.
I keep all my clients in a notebook and I check the new listings every morning when I get up to see if any of the new listings matches one of my client's profiles. If I find a house like the one they are interested in, I send it to them. It can cake several months and even a year to find the right house, but I maintain the relationships I have with my clients always supplying them with good invaluable information tailored to their particular needs and wants.
When we find the right house, I assist my clients in their offer showing them what I think the house is worth. If the house is a great value, I show it to them. If there are problems with the house, I also point them out to my clients.
For more sophisticated clients who are corporate in nature, I supply good service and availability to show them houses when they need it. I help with CMAs and market analysis.
Individuals or corporate, love helping buyers.
I am just not trying to get every single listing. I know I can't compete with "I've been living in the house next door to you for the past 15 years and been a Realtor for the past 20 years in this neighborhood. I respect that.
However I would counter that there is hardly a neighborhood in Houston that I haven't been involved with in the past 9 years. I daily follow all the new and expired listings within the HWY 6 loop. (I used to go out to Spring and Cypress and Humble but just found that market too far out for me.)
Houston has a greater than 400 mile square mile area. You have to limit yourself.
Finally, I am a good negotiator. If you are always doing a deal, you are always learning. I am always negotiating and I feel that keeps me in top form and makes me more helpful to my clients both buyers and sellers.
I do all my own work so naturally I am not paying attention to what everyone else thinks is most important. I try to do my best and I try to make sure everyone I do business with does their part to make buying or selling a home a good experience for all involved.
If you are not looking for the agent that has advertised themselves as the neighborhood specialist, but for an agent who can show you the same sales and active data any other agent has available from MLS and who by the way enjoys working all over the city of Houston, maybe you should give me a call!
P.S. The guy who lived in the Heights Townhome, did sell his house in the first week it was listed. He also found another new home the next week. He was interested in finding an agent who could also represent him in the sale of his townhome and also in the purchase of a new home. He, in fact made that clear in his initial phone call. Since I only talked about listings on my website, he chose another agent who had made it clear could represent him in both the sale and the purchase.
By selling through me, he could have saved a lot of money and still sold in a week. The market is hot in Rice Military! I missed out because I had not made it clear that I represent buyers too.
Real Estate is a competitive business and we all have to do represent both buyers and sellers if we are truly going to stay in the business. That is exactly what I do. I represent both buyers and sellers. Hopefully all my clients will think that I only represent them. I would love it if that happened.
Regards,
Volley
Tuesday, February 26, 2013
What is a Flat Fee Real Estate Broker?
In 2007 I became a licensed real estate broker and I did not enjoy working within the confines of a large, well-known brokerage. For every reason I could think of I wanted to go out on my own and do business as I imagined it should be done.
In the full service brokerage I worked with people who had been in the business all their lives really got the most help from the company. They had a portfolio and over time I would too, but I didn't want to spend years obtaining a portfolio. After all I believe in competing business models everywhere including real estate.
My ideas have not changed.
It stands to reason. Not having a recognizable name makes starting a real estate business more difficult. Never having been a traditionalist I figured I could do a lot of business if I could lower the commission and give similar service. As an independent business broker, I could be as creative as I wanted to be, and I could work for less by being efficient and not sharing my commissions with another broker.
A typical real estate transaction is often shared between four agents, the listing agent, the broker, the buyer's agent and the buyer's agent's broker. The agents and brokers agree on the split of shared commissions and those scenarios vary The split could be 60% to the broker 40% to the agent, 50/50, or in some cases agents pay the broker monthly rent for an office and, in turn, 100%on commissions.
I heard about some broker who charged $1500 up front to handle a transaction. He was using high tech methods to increase his productivity. He is no longer in business, but I sat down and wrote down all the things I would do if I was to do 100%+ service.
When I worked in Financial Services I was the largest broker in the nation for a certain period of time for a well-known national Financial Services Firm. It was a discount brokerage, but they charged full commission on bond sales and some mutual funds. It was a great synergism because people came in to sell stock at a low commission but they sometimes wanted to re-invest in good quality bonds and I felt that was a good marketing ploy considering I didn't have any name recognition.
I felt I could do something like that in Real Estate Brokerage.
Anyway I decided to charge a Flat Fee of $1500 to cover the service I was previously providing for 3%.
A lot of people were upside down in their home mortgages owing more money than they had borrowed. If I could lower the commission somewhat, it might give them more breathing room when they sold. Traditional Realtors make from 3% + on what they do though recently competition from FSBO, For Sale By Owner, Flat Fee MLS Listing Houston has begun to eat away at that commission if ever so little.
As anyone knows who has bought or sold a home the process is stressful, often emotional and labor intensive. But you are in business to make a profit. How do you do everything a traditional broker does and stay profitable on a fraction of what they charge?
I was once invited to a seminar that called Flat Fee I didn't expect it but certain other persons began to say that Flat Fee brokers were lesser brokers than full service brokers. Of course that is not true in my case. I have never given people less service though I do cut back on the frills. As a Flat Fee Broker, I always have prospects. I do a lot of prospecting so it is not surprising. Most broker open houses are just an advertising show for the agent listing the house. In my opinion and I have done hundreds of open houses, you aren't selling the house when you have an open house. You are selling yourself. For me that is a waste of time. I would rather work with people who need me right now than build up my name in the community. Speaking of I always despised that Realtor Saying "I'm your neighborhood expert!" Most Full Price agents "farm" an area of about 300 houses and they have built up their name in the community as the neighborhood expert. I would feel claustrophobic if I was only working with 300 houses. Anything inside HWY 6 is my territory and I have no problem with it. I can't reach every single person in that area of course, but I could not handle all the business I would have it I advertised on the Internet.
I focus my marketing on people who have already listed with an agent and their homes did not sell. These are not easy homes to sell yet I have an excellent record. I got an email from a man who was promoting his seminars as teaching agents how to compete with "lesser" i.e., Flat Fee Realtors. Now I have dealt with hundreds of agents and I absolutely never criticize them, but I know very well that there are all sorts of people selling real estate in Houston. Just because you are working a large franchise does not make you a superior agent. Far from it. There are excellent agents everywhere! Absolutely essential to making the best real estate situation possible is honesty. Merely judging the character of an agent by the reputation of their agency seems weak to me.
As an individual, it matters to me that I do the best I possibly can so that people become my screaming fans - or if not screaming fans at least fans of my business practice!
My ideas have not changed.
It stands to reason. Not having a recognizable name makes starting a real estate business more difficult. Never having been a traditionalist I figured I could do a lot of business if I could lower the commission and give similar service. As an independent business broker, I could be as creative as I wanted to be, and I could work for less by being efficient and not sharing my commissions with another broker.
A typical real estate transaction is often shared between four agents, the listing agent, the broker, the buyer's agent and the buyer's agent's broker. The agents and brokers agree on the split of shared commissions and those scenarios vary The split could be 60% to the broker 40% to the agent, 50/50, or in some cases agents pay the broker monthly rent for an office and, in turn, 100%on commissions.
I heard about some broker who charged $1500 up front to handle a transaction. He was using high tech methods to increase his productivity. He is no longer in business, but I sat down and wrote down all the things I would do if I was to do 100%+ service.
When I worked in Financial Services I was the largest broker in the nation for a certain period of time for a well-known national Financial Services Firm. It was a discount brokerage, but they charged full commission on bond sales and some mutual funds. It was a great synergism because people came in to sell stock at a low commission but they sometimes wanted to re-invest in good quality bonds and I felt that was a good marketing ploy considering I didn't have any name recognition.
I felt I could do something like that in Real Estate Brokerage.
Anyway I decided to charge a Flat Fee of $1500 to cover the service I was previously providing for 3%.
A lot of people were upside down in their home mortgages owing more money than they had borrowed. If I could lower the commission somewhat, it might give them more breathing room when they sold. Traditional Realtors make from 3% + on what they do though recently competition from FSBO, For Sale By Owner, Flat Fee MLS Listing Houston has begun to eat away at that commission if ever so little.
As anyone knows who has bought or sold a home the process is stressful, often emotional and labor intensive. But you are in business to make a profit. How do you do everything a traditional broker does and stay profitable on a fraction of what they charge?
I was once invited to a seminar that called Flat Fee I didn't expect it but certain other persons began to say that Flat Fee brokers were lesser brokers than full service brokers. Of course that is not true in my case. I have never given people less service though I do cut back on the frills. As a Flat Fee Broker, I always have prospects. I do a lot of prospecting so it is not surprising. Most broker open houses are just an advertising show for the agent listing the house. In my opinion and I have done hundreds of open houses, you aren't selling the house when you have an open house. You are selling yourself. For me that is a waste of time. I would rather work with people who need me right now than build up my name in the community. Speaking of I always despised that Realtor Saying "I'm your neighborhood expert!" Most Full Price agents "farm" an area of about 300 houses and they have built up their name in the community as the neighborhood expert. I would feel claustrophobic if I was only working with 300 houses. Anything inside HWY 6 is my territory and I have no problem with it. I can't reach every single person in that area of course, but I could not handle all the business I would have it I advertised on the Internet.
I focus my marketing on people who have already listed with an agent and their homes did not sell. These are not easy homes to sell yet I have an excellent record. I got an email from a man who was promoting his seminars as teaching agents how to compete with "lesser" i.e., Flat Fee Realtors. Now I have dealt with hundreds of agents and I absolutely never criticize them, but I know very well that there are all sorts of people selling real estate in Houston. Just because you are working a large franchise does not make you a superior agent. Far from it. There are excellent agents everywhere! Absolutely essential to making the best real estate situation possible is honesty. Merely judging the character of an agent by the reputation of their agency seems weak to me.
As an individual, it matters to me that I do the best I possibly can so that people become my screaming fans - or if not screaming fans at least fans of my business practice!
Saturday, February 23, 2013
Declining Listings Brings on New Sales Wrinkle
Below are exerpts for an email I received on Wednesday a wonderful client who I consider a friend of mine wrote me the following email.
Hello Volley
I think we may put our house on the market toward the end of March. Also I am a bit discouraged because there does not seem to be a lot on the market in River Oaks now. I have visited a couple houses, but they are either too big or too small or not within walking distance to St Johns. We would like to consider you for our agent but I wonder if we shouldn't use someone who might know properties that will be listed before they hit MLS. I hope our relationship is such that it does not offend you. . .
Another client who had never signed a Rep agreement with me but who I had been working with wrote me last summer:
I wanted to make sure that we didn't sign a buyer's representate4ion agreement form with you. It's absolutely nothing personal at all. Our cousin who lives in Briarbend might have found a house "by owner" that she knows personally.
Months later I don't think those clients have found a house in Briarbend.
So I am actually losing buyers who ordinarily would be working with me but who feel they need some kind of an edge - any edge to get the kind of home they are looking for.
It sounds like other agents who are working for large firms have begun to tell people that they have some kind of special ability to get houses - Even houses not even on the market! for people desperate to get a home in River Oaks within walking distance from St. Johns for example.
There was an article in the New York Times that mentioned how "some" brokers in NYC are handing the decline in listings. http://www.nytimes.com/2013/02/24/fashion/what-really-killed-spencer-cox-aids-activist.html?pagewanted=3&_r=1&hpw
It mentions how Realtors will call people and ask them if they want to sell their home. I have a real problem believing this has a very good possibility of success because the people selling their houses would then need to find a place to go to and would face a daunting task of finding a home also.
I just find the whole thing about being able to call people living near St Johns in River oaks would yield the (sort of implied) result. I asked my client what are the odds that this agent will find just the right house in River Oaks and call the owner and they say yes?
I know there are many examples of Real Estate Agents knowing of a home that is coming on the market but not been listed yet. But saying you can do it is not the same thing as always being able to do it.
But anyway it just goes to prove with listings continuing to decline sales people will always find new ways of capitalizing on them.
Hello Volley
I think we may put our house on the market toward the end of March. Also I am a bit discouraged because there does not seem to be a lot on the market in River Oaks now. I have visited a couple houses, but they are either too big or too small or not within walking distance to St Johns. We would like to consider you for our agent but I wonder if we shouldn't use someone who might know properties that will be listed before they hit MLS. I hope our relationship is such that it does not offend you. . .
Another client who had never signed a Rep agreement with me but who I had been working with wrote me last summer:
I wanted to make sure that we didn't sign a buyer's representate4ion agreement form with you. It's absolutely nothing personal at all. Our cousin who lives in Briarbend might have found a house "by owner" that she knows personally.
Months later I don't think those clients have found a house in Briarbend.
So I am actually losing buyers who ordinarily would be working with me but who feel they need some kind of an edge - any edge to get the kind of home they are looking for.
It sounds like other agents who are working for large firms have begun to tell people that they have some kind of special ability to get houses - Even houses not even on the market! for people desperate to get a home in River Oaks within walking distance from St. Johns for example.
There was an article in the New York Times that mentioned how "some" brokers in NYC are handing the decline in listings. http://www.nytimes.com/2013/02/24/fashion/what-really-killed-spencer-cox-aids-activist.html?pagewanted=3&_r=1&hpw
It mentions how Realtors will call people and ask them if they want to sell their home. I have a real problem believing this has a very good possibility of success because the people selling their houses would then need to find a place to go to and would face a daunting task of finding a home also.
I just find the whole thing about being able to call people living near St Johns in River oaks would yield the (sort of implied) result. I asked my client what are the odds that this agent will find just the right house in River Oaks and call the owner and they say yes?
I know there are many examples of Real Estate Agents knowing of a home that is coming on the market but not been listed yet. But saying you can do it is not the same thing as always being able to do it.
But anyway it just goes to prove with listings continuing to decline sales people will always find new ways of capitalizing on them.
Monday, February 11, 2013
Why there are so few listings
It may come as a surprise to people who are shopping for a home this year that the supply of homes on the market is shockingly low.
We have become so accustomed to bad news about Real Estate (http://frbatlanta.org/news/conference/11real_estate_recovery_agenda.cfm )
- from hearing how bad the real estate market is that it is now requiring quite an adjustment to understand the reality that the market has turned and is nothing like what the experts expected it to be as recently as 2011.
The true market snapshot right now can be easily seen in the numbers: According to Realtor.com the number of for sale properties is down 50% below the levels seen at the height of the crisis in 2007,
There were 3,100,000 listings in September of 2007 compared to 1,565,425 for sale in December of 2012.
The inventory of existing homes for sale is continuing to drop. Currently there is only a 4.4 month supply according to National Association of Realtors data. That is down from 5.3 months supply last November.
Year over year Houston listings are down 22.58% while nationally they are down on average 17.32%. ( www.Realtor.com/data-portal/RealEstate-Statistics.aspx?source=web ).
And the sellers appear to be in a better position to negotiate. According to CoreLogic, a leading provider of consumer, financial and property information, analytics and services to business and government, the number of underwater borrowers continues to fall while home prices are improving.
Home owners who owe more than their home is worth declined in number quarter over quarter to 10.67 million down from 10.78 million.
In economics and in the real world we are always projecting the past out into the future, but it is wise to remember that the only sure thing about the future is that it will ALWAYS be essentially different from the past.
It is always humorous that we have to include the disclaimer that we obtained the information from sources we believe are reliable but make absolutely no warranties that the information contained in our writings is correct. We encourage you to make your own decisions and to independently verify the information yourselves.
We have become so accustomed to bad news about Real Estate (http://frbatlanta.org/news/conference/11real_estate_recovery_agenda.cfm )
- from hearing how bad the real estate market is that it is now requiring quite an adjustment to understand the reality that the market has turned and is nothing like what the experts expected it to be as recently as 2011.
The true market snapshot right now can be easily seen in the numbers: According to Realtor.com the number of for sale properties is down 50% below the levels seen at the height of the crisis in 2007,
There were 3,100,000 listings in September of 2007 compared to 1,565,425 for sale in December of 2012.
The inventory of existing homes for sale is continuing to drop. Currently there is only a 4.4 month supply according to National Association of Realtors data. That is down from 5.3 months supply last November.
Year over year Houston listings are down 22.58% while nationally they are down on average 17.32%. ( www.Realtor.com/data-portal/RealEstate-Statistics.aspx?source=web ).
And the sellers appear to be in a better position to negotiate. According to CoreLogic, a leading provider of consumer, financial and property information, analytics and services to business and government, the number of underwater borrowers continues to fall while home prices are improving.
Home owners who owe more than their home is worth declined in number quarter over quarter to 10.67 million down from 10.78 million.
In economics and in the real world we are always projecting the past out into the future, but it is wise to remember that the only sure thing about the future is that it will ALWAYS be essentially different from the past.
It is always humorous that we have to include the disclaimer that we obtained the information from sources we believe are reliable but make absolutely no warranties that the information contained in our writings is correct. We encourage you to make your own decisions and to independently verify the information yourselves.
Monday, October 29, 2012
Values And Economic Theory
Today's big issue is all about how to get the economy rolling again. People need jobs. How does a nation get back to full employment?
Whether you believe in tax cuts or whether you believe in New Deal like government intervention, you will probably be referring to economic theory and all economic theory is based on assumptions - valuations of things.
Importantly humans seem to view the world through different linguistic (symbolic) prisms. It seems we see things we have concepts for. Can we see a thing we have no concept for?
If we are all buying into seeing our well being through the lens of economic theory, we may not be getting the whole picture. Economic theory tends to ignore variables that cannot be measured in monetary terms. When Economic Theory runs onto unmeasurable variables that cannot be expressed in monetary terms, it tends to exclude those variables as non-significant instead just because they are immeasurable, however does not mean they are not important or do not exist.
Adopting an Economic world view produces an incomplete, dare I say FALSE view of the world.
Concepts matter because without concepts you will not "see" realities. For example, in Japan there is a concept for "No Thing" - in English we do not have such a concept so English speakers are unable to "see" or visualize "No Thing", but Japanese speakers know it intuitively.
To make sense of reality economic theory focuses in on the small part of reality economic theory can evaluate. The richer your data becomes the less data means. We really need a framework through which to "see" the world or else it is just chaos. It is valid and necessary to select your data rather than trying to account for everything, but since economic theory evaluates "quality of life" in terms of always having more material units, it misses the point of the opposite point of view - "Less is More" which is equally valid.
A theory that tends to focus only on things it can measure financially will also tend to ignore or dismiss things that cannot be evaluated financially like happiness, joy or self-fulfillment.
A long time ago when I believed in Utopias, I read Gandhi's lovely Autobiography, My Experiments with Truth.
The Mahatma "Great Soul" wrote about Economics while he attended University in England. He said when it came to Western theories of economics he preferred Ruskin because Ruskin took into account the quality of life.
Ruskin said England was like a home with a front and back yard. They discovered coal in the front yard, and built a mine that took up the front yard. Then they discovered oil in the back yard.
If they drilled for oil in the back yard, they would no longer have a place for their children to play. Sure they could have more things if they gave up their back yard, but the quality of life their children would be lost when they no longer had a place to play. The implication is financial wealth does not always equate with better quality of life. If we only evaluate well being in financial terms we will miss the real picture.
Ruskin also said that he believed people worked harder for an employer who they loved than they did for employers they hated or felt no love for. Doesn't it make sense that if I love my work or my employer that I would try harder on my job than if I didn't, but present economic theory doesn't get that because it is based on fear and greed as if fear and greed were the only things that motivate men? Such a world view is misses the reality of human motivation.
I understand that business managers today think that they are not in the business of making people love them, but that is exactly my point. Things have changed since Gandhi and Ruskin lived.
I wish to say right now and right here that I do not buy the current business model being adopted in America. It is a business model that marginalizes people who work at jobs. It is a ruthless baiased world view. You may like the story Economics tells of greed and fear of diminishing marginal returns etc., but there are plenty other more meaningful stories that probably describe human nature better if one cares to look.
I believe some people even think that they are "contrarians" when in reality they slavishly follow the monetary values fostered by economic theories of the current day. They desire only to be in the winner's circle which is determined by what "others" define as winning. They can not see the value in making work interesting or maximizing the value of the human person. Their economic values devalue the person person to simply an input, "labor".
There is a show airing on the History Channel, The Men Who Built America. It features men like - Vanderbilt, Rockefeller, Carnegie and others. These men are shown to be - Ruthless, determined ambitious men. There were plenty of other men and women who built America. Sister Elizabeth Ann Seaton in New York who tended to the hungry, needy imigrnats who were pouring into America for example. The Missionary men and women who built the churches and cared for the needs of others who came to America also built America. I don't buy the mean, nasty story.
The mean, nasty stories tend to reinforce the modern day economic theory's focus on selfish self-interest, which blindnding some to the only real success in life - Love or Benevolence (The happiness one feels in giving of one's self to the betterment of his or her world).
Since Kindness (or benevolence) cannot be evaluated financially in current day financial modeling, it is not considered. It is "No Thing". It is simply not part of the mindset or consciousness fostered by modern day economic analysis. And since it can't be measured, it is filtered out of consciousness.
Though I have always seen the value of Economic Theory, my concept of success can be summarized to seek out the Higher Spirit in all things - even economic pursuits and not to focus exclusively on money or other economic inputs.
I believe that by pursuing a Higher Spirit in my business makes me feel no concern about little topics like being the biggest money maker, or how to get every single customer. I am focused every day and well into every night on doing my best at the jobs I currently have and then see how everything comes out.
When I created Callvolley.com my goal was not to be number one in everything. My goal was not to simply do business. I wanted to do the kind of business I wanted to do and the way I Wanted To Do Business.
In short I wanted to do business differently than what everyone else was doing in Real Estate so I advertised myself as a Flat Fee MLS Listing Serviceto attract individuals who needed to save on commissions but who still needed expert attention to every detail of their Real Estate Sale. A lot of times these people needed an innovative idea to help them get out of a hard financial situation. They needed to save money but they needed expert help also. I have made friends who come back to do business with me again and who would recommend me because of the great job I did for them. At least I hope they do because that is the best advertising you can get!
However you slice it, I am really A Full Service Discount Real Estate Broker but since I am such a rare business, I use the words Flat Fee MLS Listing since those are the search terms people are using to find Discount Real Estate Listing Companies.
I am sure that those who do business with me define me as Full Service Discount Realtor. My goal is to do the same job that any of the best Realtors in Houston can do for their clients at a great saving to my clients. I intend to add some testimonials later this year as I try to make my site rank better.
Regards,
Volley Goodman
Whether you believe in tax cuts or whether you believe in New Deal like government intervention, you will probably be referring to economic theory and all economic theory is based on assumptions - valuations of things.
Importantly humans seem to view the world through different linguistic (symbolic) prisms. It seems we see things we have concepts for. Can we see a thing we have no concept for?
If we are all buying into seeing our well being through the lens of economic theory, we may not be getting the whole picture. Economic theory tends to ignore variables that cannot be measured in monetary terms. When Economic Theory runs onto unmeasurable variables that cannot be expressed in monetary terms, it tends to exclude those variables as non-significant instead just because they are immeasurable, however does not mean they are not important or do not exist.
Adopting an Economic world view produces an incomplete, dare I say FALSE view of the world.
Concepts matter because without concepts you will not "see" realities. For example, in Japan there is a concept for "No Thing" - in English we do not have such a concept so English speakers are unable to "see" or visualize "No Thing", but Japanese speakers know it intuitively.
To make sense of reality economic theory focuses in on the small part of reality economic theory can evaluate. The richer your data becomes the less data means. We really need a framework through which to "see" the world or else it is just chaos. It is valid and necessary to select your data rather than trying to account for everything, but since economic theory evaluates "quality of life" in terms of always having more material units, it misses the point of the opposite point of view - "Less is More" which is equally valid.
A theory that tends to focus only on things it can measure financially will also tend to ignore or dismiss things that cannot be evaluated financially like happiness, joy or self-fulfillment.
A long time ago when I believed in Utopias, I read Gandhi's lovely Autobiography, My Experiments with Truth.
The Mahatma "Great Soul" wrote about Economics while he attended University in England. He said when it came to Western theories of economics he preferred Ruskin because Ruskin took into account the quality of life.
Ruskin said England was like a home with a front and back yard. They discovered coal in the front yard, and built a mine that took up the front yard. Then they discovered oil in the back yard.
If they drilled for oil in the back yard, they would no longer have a place for their children to play. Sure they could have more things if they gave up their back yard, but the quality of life their children would be lost when they no longer had a place to play. The implication is financial wealth does not always equate with better quality of life. If we only evaluate well being in financial terms we will miss the real picture.
Ruskin also said that he believed people worked harder for an employer who they loved than they did for employers they hated or felt no love for. Doesn't it make sense that if I love my work or my employer that I would try harder on my job than if I didn't, but present economic theory doesn't get that because it is based on fear and greed as if fear and greed were the only things that motivate men? Such a world view is misses the reality of human motivation.
I understand that business managers today think that they are not in the business of making people love them, but that is exactly my point. Things have changed since Gandhi and Ruskin lived.
I wish to say right now and right here that I do not buy the current business model being adopted in America. It is a business model that marginalizes people who work at jobs. It is a ruthless baiased world view. You may like the story Economics tells of greed and fear of diminishing marginal returns etc., but there are plenty other more meaningful stories that probably describe human nature better if one cares to look.
I believe some people even think that they are "contrarians" when in reality they slavishly follow the monetary values fostered by economic theories of the current day. They desire only to be in the winner's circle which is determined by what "others" define as winning. They can not see the value in making work interesting or maximizing the value of the human person. Their economic values devalue the person person to simply an input, "labor".
There is a show airing on the History Channel, The Men Who Built America. It features men like - Vanderbilt, Rockefeller, Carnegie and others. These men are shown to be - Ruthless, determined ambitious men. There were plenty of other men and women who built America. Sister Elizabeth Ann Seaton in New York who tended to the hungry, needy imigrnats who were pouring into America for example. The Missionary men and women who built the churches and cared for the needs of others who came to America also built America. I don't buy the mean, nasty story.
The mean, nasty stories tend to reinforce the modern day economic theory's focus on selfish self-interest, which blindnding some to the only real success in life - Love or Benevolence (The happiness one feels in giving of one's self to the betterment of his or her world).
Since Kindness (or benevolence) cannot be evaluated financially in current day financial modeling, it is not considered. It is "No Thing". It is simply not part of the mindset or consciousness fostered by modern day economic analysis. And since it can't be measured, it is filtered out of consciousness.
Though I have always seen the value of Economic Theory, my concept of success can be summarized to seek out the Higher Spirit in all things - even economic pursuits and not to focus exclusively on money or other economic inputs.
I believe that by pursuing a Higher Spirit in my business makes me feel no concern about little topics like being the biggest money maker, or how to get every single customer. I am focused every day and well into every night on doing my best at the jobs I currently have and then see how everything comes out.
When I created Callvolley.com my goal was not to be number one in everything. My goal was not to simply do business. I wanted to do the kind of business I wanted to do and the way I Wanted To Do Business.
In short I wanted to do business differently than what everyone else was doing in Real Estate so I advertised myself as a Flat Fee MLS Listing Serviceto attract individuals who needed to save on commissions but who still needed expert attention to every detail of their Real Estate Sale. A lot of times these people needed an innovative idea to help them get out of a hard financial situation. They needed to save money but they needed expert help also. I have made friends who come back to do business with me again and who would recommend me because of the great job I did for them. At least I hope they do because that is the best advertising you can get!
However you slice it, I am really A Full Service Discount Real Estate Broker but since I am such a rare business, I use the words Flat Fee MLS Listing since those are the search terms people are using to find Discount Real Estate Listing Companies.
I am sure that those who do business with me define me as Full Service Discount Realtor. My goal is to do the same job that any of the best Realtors in Houston can do for their clients at a great saving to my clients. I intend to add some testimonials later this year as I try to make my site rank better.
Regards,
Volley Goodman
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