Wanted: Experienced Realtors…

Just like other areas of life, there was a recent push to replace experienced real estate agents with “millennials”.  The thinking was that millions of home buyers would be people in this age cohort, that they would be THE buyers and that they would want to work with agents who were their peers.  Well that wasn’t on target, to put it mildly.  Many of the younger buyers are renting and paying off college loans, or even staying at home with Mom and Dad…not buying.  Real estate planners shouldn’t feel bad; retail made that mistake too.  Many of the millennials are educated, savvy, street smart and skeptical about anybody wanting their sparse cash.  They want details, they want to know their agent has a solid knowledge of the market and is well capable of walking them through the jungle of tasks associated with buying and selling a home.  In other words, millennials expect to be leaders and as such, their real estate agent had better be qualified to take that lead.

Millennials who do buy are not usually in the higher end market; rather, they are usually in the first time buyer and first time move-up buyer price range.  They, and other who ARE buying in the high end market do not want a “millennial” guiding the transaction.  Well, I’m a 10,000 foot view person.  I saw this stumble coming a mile and a half away.  Don’t get me wrong; I love young people.  The ones I get to meet and work with are very smart, very motivated and very sensible about buying.  They give  me hope for the future.  But young real estate agents are not well rounded, confident and knowledgable about the market just yet.  They deserve to grow and build a skill base, yes; but that doesn’t negate the value of experience.

So some of the same companies who were nudging the older agents aside are now actively recruiting experience.  It’s a shame that experienced agents are often overlooked by the ‘planners’ of the future of area market movement, and that that experienced agents are re-noticed only when the cavalry is needed.  But that’s how it goes.

My advice to you is this: Realize that you are making one of the largest transactions of your life, and that you should put that transaction in the hands of experience and knowledge.  That doesn’t mean someone who made a high score on the test, although that’s important.  It means someone who understands the nuances of the market beyond what the publications say.  It means someone who understands that prices in neighboring communities can be very different and why.  It means someone who has experience with inspectors and builders.  It means someone who knows how to spot hidden potential issues.  It means someone who knows what’s worth worrying about and what is not.  It means knowing the importance of pricing and how it impacts the overall market.  It means knowing how to put the most cash in your pocket at the end of the day.

I decided to write about this subject today because I have been working on a market analysis for the last several days, in a new growth-spurt area, where prices have jumped significantly in the last year.  I want to push my list price as high as I can…and be able to have it appraise at that value when the time comes.  This of course prompted a deep dive into that area and into that community, and a subsequent spreadsheet…mine, not a canned product.

One of the values I use, LOOSELY, I might add, is price per square foot.  And while this is the WRONG WRONG WRONG value to use in pricing a home, it does give you a nice snapshot of market activity at-a-glance, and it can be quite eye opening.  It was for me.  In my area of interest there were 3 of 14 homes I studied, which had VERY much lower sold price-per-square-foot.  This prompted me to look at the listing agency AND agent, and each case, the agent was inexperienced.  This costed the home owners/sellers a lot of money they could have made on their transactions and it hurt the overall market.  These low-ball prices will be put into the “comp” pot, and will be used by appraisers in pricing other homes for mortgages.  And this tells me nobody’s guiding these agents appropriately and nobody has told them the value of strong pricing.  Nobody has shared with them that listing with strong prices raises the entire market, which is actually our job…to protect the market.

So, while other home sold in the 118.00 price per square foot, these homes sold at around 108.  That adds up.  To loss for the sellers.  The moral of the story is this: If you hire inexperience, it will cost you.  You may never know it…which would be the best scenario.  If you do know it, you have to wonder where else you got short-changed.

I need to also say that sometimes it pays to price low if a quick sale is needed…for the SELLER, not the agent.  And that’s all I will say about that.

Bottom line: Be sure your agent is experienced enough to be a strong, successful advocate for you.  That’s what you are paying for.  This isn’t an opportunity to be trendy; this is your money at stake.  Experienced agents will understand that.

 

MARKET STRATEGY FOR THE TRIANGLE

If I said it’s a crazy market would you think I’m repeating myself?  Well, it’s a crazy market.  There’s a housing shortage folks, which makes it the strongest seller market I have experienced.  For the first time in my experience, all of my buyer clients (and one seller) are BUILDING their next home.  That’s because…duh…there’s as housing shortage, and people can’t find a home they want to buy!  If they find one, there are five offers on the table already! ALERT!  TIME TO LIST IF YOU ARE THINKING OF SELLING!!  I’ve said that so much I’m out of breath.  Again, you can make the MOST on the sale of your home now, while there are people clamoring for a great home to buy and who don’t want to wait six months to build!

Remember when I said I couldn’t wait until the pendulum swung back to center?  When I was tired of my sellers getting the pants beaten off of them?  Well, I’m glad alright.  Sellers are now in control.  Like I said, the universe WILL balance.  Never fails.

But like always, there’s a “but”.

I find that many real estate agents negate the power of supply-and-demand when pricing homes to list.  For example…one-level living is the hottest thing going right now, except for senior living communities…which are also one-level living.  So if you have a ranch style home, you are in the proverbial cat-bird seat.  Now that only applies if you home is marketable.  I’ll explain later.

Back to pricing:  Yes, look at the price range of homes in your zip code and focus on your comps.  Then search for ranch style homes in the MLS AREA, and see how many ranches are out there.  If you find ONE or NONE?  Instant benefit to you, Seller.  You may now price at the high end of the range and expect to get it.  I recently had an agent lambast me in her feedback telling me that my listing was priced TWENTY THOUSAND too high. Well, we sold that house for the price I set.  Booyah!  Pricing is my strong suit folks.  I get it done.  If she had listed the house, well, not a happy face on that one.  And it would have hurt the market for the community too.

When you meet with me, I will ask you this, “What is your selling goal?”  Now that might sound stupid, but bear with me.  If your goal is to get rid of the house FAST, that initiates a different STRATEGY for pricing your home.  In other words, we might aim a bit lower in price, or come up with some enticing concessions.  But if your goal is to get every last penny the market will allow for your property, well that’s another STRATEGY, and its my favorite.  That means we price you at the high end of your range, but we expect to MAYBE take a bit longer to sell.  I don’t know about you, but I’d wait two or three more weeks to net 5 grand.  If you are not in a rush, relax and focus on your bottom line getting BETTER.

If your agent doesn’t talk strategy with you…ask why! There is more to pricing your home than pulling up some comps and taking an average!  Supply and demand MUST be considered!  If you have the only ranch style home with an acre or more lot in the whole area?  You just hit the jackpot on pricing; I don’t care what the other homes went for.

Understand that pricing your home is a many-faceted operation that takes time, it takes knowledge of the greater market, your LOCAL market…which sometimes means your exact community…and it takes an understanding of what you, the seller, want to achieve.

My goal in any listing situation is to get you, the seller, every penny I can get for you on pricing.  But if you just need to move on, we can change that strategy.  It’s a team effort and your agent MUST know your needs, not just how to average the sale price of three properties sold in the last three months.

Now, back to having your home “marketable”…People sometimes hate to hear this, but here is the cold, hard truth.  If you want TOP DOLLAR for your home, it MUST be in top dollar CONDITION.  That means you have to roll up your sleeves and do some cleaning and re-arrange or maybe even remove some pieces of furniture.  Remember we look at houses ALL THE TIME.  We know what sells and what doesn’t.  You HAVE TO DECLUTTER.

Buyers are buying space, not your decor.  Don’t fault the professional real estate agent when she tells you what you have to do to get top dollar.  Is your decor worth ten thousand dollars to your bottom line?  I’ve seen people say yes to that time after time!  Amazing!   I don’t have that kind of money to spare, how about you?  If you do, don’t worry about making your home “marketable”.

So…remember that if you want top dollar, the house must be WORTHY of it. If you are not willing to put in the sweat equity to get top dollar, do NOT blame your real estate agent! Instead, look in the mirror.  Remember that selling your home is a team effort and you…let me repeat…YOU are one half of the team.  So get involved, know your strategy, and get that home spiffed up to garner the best price!  If I’m your agent, I’m going to work very closely with you to get you that price.

Let me just add one more thing: Don’t start getting antsy.  If you have chosen a savvy real estate agent who has clearly understood your needs and laid out a great pricing strategy, listen to her and settle down.  Selling a home is nerve wracking I know, but you will shorten your life by pacing around being nervous.  Relax and let the strategy work.  You can count your money and your blessings later, trust me. And if you can’t trust your agent, you’ve got the wrong agent.  Just sayin’.

Interest Rake Hike

Well, we’ve been on the roller coaster of opinion about a rate hike for some time.  Latest news is that there won’t be one…but there might be one by year end.  I wonder how much it cost to have all of that discussion in the ether…but I could have done it free, right here.  MIGHT be one?  Please.  Seriously, I could have said that.  I DID say that, in fact.

Janet Yellen had some apparent brain “pauses” in her speech and was, according to CNN, seen by doctors when she finished.  It takes a lot out of you to predict the future politically correctly, I guess.  I’m not having any brain cramps, spending no money, and I can tell you exactly what will happen.  Here goes.  Note that I don’t have any wolves at my door that I know of.

OK.  Cracking my knuckles.  Here goes:  As soon as the “FED” decides they can successfully take more money into their coffers, they will.  There.  Not dehydrated, not feeling dizzy.  I’m good.  But make no mistake about it, the powers that be know that if they MENTION rate hike the economy…our THRIVING economy…goes running for the hills.  We have NOT recovered from the fall, we are not back to the pinnacle.  We’re not ready.  And I’m guessing that many of us have decided that its a good idea for us to keep more of our hard earned money, rather than sending it out in interest.  Call me crazy but I think that’s ALWAYS been a good idea, although believe me, I’ve paid my share of interest.

I have heard a hundred people say they don’t do credit cards anymore.  Why?  Interest.  People are buying so many homes there’s a housing shortage.  Why?  Interest.  It’s LOW.  How stupid do you have to be to think that the very thing people AVOID would be a good idea to INCREASE…for the economy?

Watch these people.  Watch how many times they threaten to raise rates and then back down because the ‘economy’ runs for the hills.  They’re testing the waters on a regular basis.  When the economy really IS strong and people have confidence it will stay that way?  Then it will be time to raise rates.  In the meantime, if you’re thinking of buying or selling, do it now before they pull that trigger.  Great time to list while there is a housing shortage…and to buy while rates are…I can’t believe it’s been low so long…low.

Do something joyful today.

On Being a Good Advisor…

Any good real estate agent is also a trusted advisor…or should be. Our advice is based on years of experience and heaven knows HOW many hours of classes and training and updates.  I know:  You can get a BOAT LOAD of information from the internet.  But listen up: That’s not good enough.  Here’s why.

A good real estate agent will know things about rules, the law, building code, builders, different areas and what that means to commute times and shopping, how homes are built and what to look for to find hidden issues, things you won’t find online.  We’ll know how to negotiate: when to hold and when to fold.  And I can’t say for sure, but I’m willing to bet my accuracy is better than most of the automated valuation systems when it comes to pricing a home to sell.  Your agent will have had boots on the ground where the internet has not trodden, and your agent will know things about buying or selling that the internet cannot convey.  So it doesn’t matter what kind of phone you have, which internet provider you use, what iteration of I-pad you have.  Your agent will win the competition.  Or at least this one will.

In other words, it would behoove (cool word) you to avail yourself of your agent’s expertise and realize that there’s one real estate agent in the car…and it ain’t you.  Yeah, I said ain’t.  I like that word.  It has personality.  And I’m a bit arrogant that way. I think I have a good enough grasp of the English language to tweak it when I want to.

But I digress. Bring along your smart phone because if you ride with me, you navigate.  I don’t want you to be bored.  Bring along your notes, your ideas, your opinions, because they matter.   But remember to ask a lot and don’t act like the realtor. 

I want my clients to be smarter than me in case we break down and I need someone to figure out the computer system operating my car…or to feel brave about finding a nearby repair shop.  I want my clients to be able to discuss the Hadron Collider with me or the latest news about time travel.  But I do not want them to try to be me.  First of all, they can’t handle it, and second…and seriously here…I’m the real estate agent with the license and training…and I’m very good at my job.  Let me do it and you?  Relax and enjoy the tour.  I promise to take good care of you.

 

Stubborn and real estate don’t mix.

The One Hundred Thousand Dollar Stubborn Streak
(or, Blood is Shooting Out of My Eyes)

There is a …maybe a million dollar home which just sold for about ONE HUNDRED THOUSAND DOLLARS less than its value, primarily because of one outstanding attribute of the sellers: Stubbornness. I have to talk about this, people. I just have to. These sellers deserve to be applauded, even lauded for their supreme grasp of the phenomenon of stubbornness, because they took it to soaring heights and even paid six figures for the sake of holding on to it. They are my champions so far. Nobody else beats this streak.

Somebody will though. Somebody will. You can’t make this stuff up.

Don’t get me wrong. They’re lovely folks. But they take resistance to good solid advice, presented in the interest of getting them top dollar, to new heights. Or should I say depths. I should say depths. There it is. I am not the listing agent by the way. If I WAS I couldn’t write because you can’t write with an exploded head.

I’ve run across this tendency many times in my career. Usually the ones who own it best are the ones who think they are the Realtors, the ones with professional real estate training and professional real estate experience, even though they’ve never actually BEEN a Realtor. They think this because 1) they have big egos; 2) they think they are smarter than everybody else…everybody; 3) they hold Realtors in low esteem; 4) they don’t do well with separating emotion from business; and 5) they have bought or sold a home before. Okay and 6) they want to hold on to their ‘decorating’ theme…and I use that term loosely at times…even at the cost of oh say ONE HUNDRED THOUSAND DOLLARS!

I can hear all of the realtors saying, “AMEN!”. No, wait. Some are looking around and saying, “Are you kidding me? One hundred THOUSAND?” That’s right. I’m not kidding. Do I look like I’m kidding with smoke coming out of my ears over here??

You need to think about this. Just because you’ve been IN a courtroom, does that make you an attorney? Because you’ve had surgery, are you now a surgeon? If you’ve had surgery twice are you now CHIEF of surgery? I think some people think they ARE! If you look at beautiful art, are you then an artist? NO! So why would you think that just because you’ve bought or sold a home, or bought AND sold one, you are now a Realtor?? It makes about as much sense as the art analogy or any of the others. People, you are not the real estate agents; you are the CLIENTS. I should make a sign.

Gone are the days when realtors are the ones who can’t do anything else and that’s why they’re realtors. That was gone a LONG time ago. Realtors today are educated, strong, talented and up to the minute with stats on YOUR market. We have to be because everybody sues EVERYBODY these days…yes even CLIENTS (that would be YOU), whom we protect. We have a responsibility to you that we take very seriously. 


We protect you, we encourage you and we do our level BEST to make sure you get the MOST for your home that the market will bear. The way we DO that is by making sure you know how to be COMPETITIVE. We tell you what will make your home stand out and get that buyer to make an offer on your home, and we advise you about how you can make that offer SING, not hack like a life-long smoker about to keel over. You can listen to us, OR, you can disregard us and lose ONE HUNDRED THOUSAND DOLLARS.

Here’s a good one. Even after receiving feedback after feedback about grandma’s quilt or the blue wall or the CLUTTER do you think ANYTHING gets changed? NOOOOO! You can’t make this stuff up! You really can’t! The market speaks and some clients pat their ears and say, “la la la la I can’t hear you”. Now I’m crying.

Can you tell I’m upset? I’M UPSET.

And these sellers are mad at the REALTORS!!!! We are the ones who warned you about being competitive, about LISTENING to the feedback and actually DOING something about it. We are the ones who tried to get you top dollar!! My head is about to explode. I can hear it expanding. I really can. It’s creaking.

There was no earthly reason for this house selling this low except for pure, unadulterated, boiled down, precipitated, strained, dried, sifted, freeze-dried, died in the wool STUBBORNESS. Now blood is coming out of my ears too. THIS WAS COMPLETELY UNNECESSARY, LOSING THIS KIND OF INVESTMENT DOLLARS!

Let me alert you. I have two college degrees, one in chemistry, a subject which makes most people cringe. And I graduated at the top of my class. The other degree is in business, where I studied marketing, economics, sales…I’m good at what I do and I’m qualified to have an ego just as big as anybody else. That’s why, if I visit you to talk about selling your home, you should listen to me. And you should listen to other realtors who have been down this road a thousand times and who tell you exactly what you need to do to be competitive in this market. We don’t make this stuff up, people. It’s based on data. Set aside the stubborn streak and think about what you might do with ONE HUNDRED THOUSAND DOLLARS. Is it worth paying that much to keep your grandmother’s quilt on the bed or that neon blue wall in the den? NO! IT’S NOT! For crying out loud, redecorate or paint! You’re LEAVING, remember? Is there still LOGIC in the world? I think there is, but why not in REAL ESTATE?? If you have a 14×14 foot room and enough junk in it to fill an 18×18 foot room, MOVE SOME STUFF OUT! Or, think about what you could do with ONE HUNDRED THOUSAND DOLLARS that you are about to flush down the gold plated TOILET.

You’re selling space, wide open space. Not your ‘décor’, not your grandma’s quilt, not that carving of an amoeba eating a shark. NOT that flower arrangement you made when you were on the crack pipe. SPACE is all you are selling. And not neon blue space. If you have to kick chairs and pillows out of the way to get INTO a neon blue room, LIGHTEN UP THE CLUTTER or kill me now. This is not rocket science, people. I’ve done rocket science; this ain’t it.
So there was this couple who sold their home for ONE HUNDRED THOUSAND less than market value, but they showed US didn’t they? I don’t think so. I think they shot themselves in the foot. Twice. Per foot.