Archive for the ‘Realtors’ Category
Monday, May 23rd, 2016
If you are a real estate agent or a home buyer you may notice that the market is obviously low on inventory right now. Being that it is the “selling season” of Spring/Summer, and since there are a lot of buyers out there looking at homes, there are many situations involving multiple counter offers and homes selling for well over asking price…all great if you are a seller. However, there are also some fishy things going on out there and it is frustrating to agents and their buyers.
Let’s take a look at what is happening:
1. Homes listed well over comparable value. Many, and I mean a LOT, of homes in North San Diego are being listed over market value – some slightly and some way over. Buyers, who normally would avoid such homes until the price drops, are flocking to them and making offers anyway. No one seems concerned that the home likely will not appraise, and if one buyer walks there are many more who will step right in. This is pricing out first time homeowners and bringing prices up…you may think the latter is good, but it is dangerous because such inflation could create problems for the market – especially when there are many buyers who have incomes that will price them out of neighborhoods they should have been able to afford had prices reflected comparable sold values.
2. Many sellers are taking a long time to respond to offers – even very strong ones. If a buyer makes a very strong offer over asking price, many listing agents are waiting for 4 or 5 days to even respond, during which time they collect more offers. Many then submit multiple counter offers to all bidders asking for the best and highest price. This prices many potential buyers out of the running, and most already submitted an offer slightly over their budget.
3. Sellers are refusing to make repairs or pay for reports. In a seller’s market the seller knows s/he is in the driver’s seat, and many sellers are countering back stating the home is sold as is, and that they will make no repairs and pay for no reports – like termite reports. They want the cleanest offers possible with the least amount of money out of pocket. This means the buyer can get stuck with multiple repairs, termite work, etc. If the buyer is already paying top dollar for the home, s/he has to make sure those things are affordable. No one wants to see a new foreclosure wave hit in a few years.
4. Appraisals are not coming in at contract value – but that is not deterring sales. I have not had problems with appraisals on listings (I don’t market properties in the “insane” price category), but have heard from many agents who have. Even if the home does not appraise at contract value, there are plenty of buyers who are willing to pay the difference in cash if sellers will not negotiate prices down to the appraised value. They feel that is the only way to secure a home purchase in these crazy times. Does this sound like 2003/2004 – “pre-crash” – to anyone else besides me?
5. Overly aggressive listing agents seem to be multiplying, and they are not being cooperative. There are many listing agents who are ruthless and even rude. They don’t care that your buyers love the home and have been looking in that neighborhood for a long time, or that they wrote a very strong offer and submitted it first. To these agents, it’s all about playing the game and finding the highest bidder. Some agents do not return calls and emails, and some violate the Realtor code of ethics – a few may even commit fraud. It is extremely frustrating for buyer’s agents, who are trying to find a home for their well-qualified buyers.
6. Pocket listings and homes listed “off the MLS” are increasing. Many agents are marketing their listings on third party sites like Zillow, and not placing them on the MLS – the cooperative tool used by Realtors to benefit all parties looking in particular areas/price ranges. While it is their right to do so, it makes a problem for buyer’s agents whose clients may see these listings and want to visit them – but when their agent calls the listing agent to make an appointment she is often told that the seller is not paying a commission to buyers’ agents. Imagine you have been helping your buyers for months to find a home and now you cannot show them this one home because the broker will not cooperate with your broker. It puts buyer’s agents – who play an imperative role in protecting buyer’s rights – in a very sticky situation. You may ask why listing agents do this: the answer is so they can find buyers who will work with them, thus saving the seller from paying out a commission to the buyer’s agent. Hopefully the California Supreme Court will soon put an end to double ending sales and this will no longer be a problem.
I am a bit concerned and hope that we are not heading into trouble in the real estate market. I hope that agents keep in mind the spirit of cooperation that is inherent in our business – we all need to work together and be fair. If we do not then buyers and sellers will not be protected from future lawsuits, and many people will be priced out of the housing market – which could cause a domino effect with local economies and eventually the US economy.
Thursday, January 21st, 2016
The real estate business has definitely evolved over the last few decades, with the growth of technology being the main contributor. But when it comes down to it, working with a real estate agent is not just about finding a savvy salesperson, but rather it is about finding someone who truly has your best interests at heart and is willing to work hard to find the right property or sell your home, at the right price, with the best terms. It is not so much a sales relationship as it is a trusted adviser relationship. An agent plays many roles throughout the buying and selling process – researcher, chauffeur, adviser, negotiator, paperwork coordinator, and therapist – to name a few.
As they always will, many people try to come up with ways to find and convert “leads” to clients, from advertising to cold calling to handing out cards to people all day long and asking for referrals from past clients, friends and family members. In the last year I have seen some interesting attempts to woo potential buyers and sellers, and although I am impressed with those who are trying hard, I must say I have been surprised at some of these methods:
1. Recorded Calls: I received my first recorded sales call from a real estate agent last year. I was surprised because the agent, who had a lot of enthusiasm, sounded like he was trying to sell me a used car. He went on and on about how he could help me buy or sell a home, and about his strengths as an agent. Now, I must say that selling real estate is not difficult – anyone can do it. BUT not everyone can do a great job at taking care of the PEOPLE, the clients. I have always said that this business is not about houses, it is about people.
2. Print Marketing: Marketing via mail and email has always and will continue to be a very strong way for the real estate agent to get business – s/he creates a lovely flyer or brochure and lists skills and past sales and testimonials to make her/him look amazing. S/he even uses words like “Number 1 agent” and “Top agent,” “sold more homes than anyone else.” The trick is that many agents can say these things by putting a spin on the information, and these statements can be true.
Many of these advertisements actually constitute ethical violations in my opinion (and I have been trying to get the rules changed to prevent this, but that is another story). For example, if you are a broker who oversees say 30 buying agents, and among those agents your brokerage or team sold 100 homes last year, how is it ethical for you yourself to claim you sold over 100 homes last year – you did not do that personally, your agents contributed many of those sales. But to the average homeowner who receives your marketing piece, you look like you have done more business than anyone else. Glossy marketing pieces with claims to being “the top producer” do sway the average Jane and Joe many times. Like the political arena, I think that if agents are going to make claims like this they need to explain the truth behind the claims.
3. TV Commercials and movie theater advertising: These types of marketing can also be valuable, but again the time is limited and the agent has only a few moments to convince you of how incredible they are at their job. There is no fine print – but if it gets you to remember their name and call them then the piece has achieved the goal set by the agent. Again, anyone can make a great marketing piece that makes them look like the best agent ever – and of course that is what all salespeople try to do.
4. Broker Calls to Agents About Homes “Coming Soon” to the Market: This newest method is interesting, and is aimed at local area agents. A broker has an agent make calls to other agents’ voicemails, reading from a script about a home that is not yet listed on the open MLS but soon will be – they tell the agents (it seems agents are chosen based on who sells the most in a given area – not all agents receive these calls) that they are giving them a chance to show the property to their buyers before it hits the MLS. Now, if you happen to be an agent working with a buyer and get a call describing the perfect home, this could be a win-win for your client. But if you are an agent and do not get that call, or if you are a buyer looking online and waiting for the perfect home to pop up, you are truly at a disadvantage in such a situation. So this can be a good or poor method of advertising, depending on how you look at it.
5. “Coming Soon” Listings Posted on Third Party Sites: There are some third party sites (such as Zillow and Trulia) that allow agents to post “coming soon” listings. Not all agents can do this – they must pay to become an elite member of these sites, and then they have the “privilege” of posting such properties. It’s great for the agents – they likely get at least some calls from potential buyers – but for those buyers who are not looking on those sites they get the short end of the stick if the home sells before hitting the MLS. Similarly, agents can send out e-flyers or emails about listings that are coming to the market soon, and if this is done fairly (sent to ALL agents in a county), then that is a great advertising tool. It is not fair to the potential buyer who is not working with an agent and who waits for properties to list on the MLS, but of course this is just one of the many benefits of working with an agent (we tend to hear about up and coming listings from many industry sources – agents, appraisers, lenders, sellers, etc.).
From my perspective I believe that all agents should be able to advertise and “sell” their services and skills. But I think there are 2 rules that need to always be adhered to by real estate agents and brokers: 1. Keep it classy. 2. Be honest and ethical. If the local real estate associations who govern agents and make rules set out to make the rules stricter, I think it would be beyond valuable to potential buyers and sellers.
If you are looking for a real estate agent, remember to get the full picture – what can s/he do for you that is different from other agents? Make sure you will not be just a number – some agents have teams of people working for them and they represent many clients – if you like this than great, if not you may want to look for an experienced agent who treats you like you are the only client. Everyone has different needs, so make sure you get all your questions answered and find the person who is best able to help you; shiny materials and boasts about being a “top producer” should play into your decision minimally (although you do want someone who can sell your home with strong marketing and advertising abilities), but you need to feel comfortable with the person and what s/he can offer you.
Thursday, May 28th, 2015
Yesterday I found out I was the victim of fraud, resulting from a purchase I made from a well-known real estate business products company. It turns out one of their employees, who had helped me place an order over the phone (I tried to do so online but needed the art department to fix some art work), stole my credit card number and went on a shopping spree – spending about $1000 on my card.
I found out about this because of the kindness of a vendor, who realized that my zip code and the shipping zip code were different. He Googled me and called me to ask if I had spend a large sum at his online fishing clothing site. I don’t fish, nor do I wear fishing related clothing. Thank you to this vendor, who took the time to investigate what he thought was a “fishy” purchase (pun intended), I contacted my bank.
It took me a few hours to realize that I knew exactly where the fraud occurred. Luckily for me, I do not use my business credit card often, other than some monthly recurring business fees. I happened to use it to order some products early in May, and the company was based in Florida. The 9 charges that were made on my card were in Florida, so I put it all together and contacted the company. They were able to figure out who it was and I filed police reports both in Florida and in my hometown.
The lesson I learned from this is that I will never again provide my credit card information verbally when placing an order. I did receive apologies from management (personally I would have comped me for my order for all the trouble I went through – I had to deal with this for several hours during my work day – but that’s a difference of opinion in the definition of customer service).
So next time you order business products online, no matter how trustworthy the site, if you have no alternative than to pay over the phone make sure to ask for the supervisor or top manager – do not give your personal information to ANY employee. Sadly, the guy who helped me place my order that day was great on the phone – hopefully he will be practicing those skills from a cell for the next several years (I was told that he had done this before and they couldn’t prove it – they now have evidence to do so). Makes me miss prosecuting people like this guy. In short, he messed with the wrong lady.
If you are into fishing and want to buy some great clothes, please shoot me an email and I will hook you up with the vendor’s site, as I checked it out and he really has some nice clothing! There are still good people in this world, and that solidifies my belief in the human race. So thank you to Neil from Florida!
Thursday, December 4th, 2014
“The average person puts only 25% of his energy and ability into his work. The world takes off its hat to those who put in more than 50% of their capacity, and stands on its head for those few and far between souls who devote 100%.” – Andrew Carnegie
There is nothing wrong with being average – in fact, some people are quite content with the moniker – not fighting to break glass ceilings and striving to be “better,” however that may be defined. Societies rely on a mixture of those who are happy with “average” jobs and those who are not and need to achieve “more.”
I find the old adage that 20% of people do 80% of the work to be true in the real estate sales profession. The industry exemplifies the average/exceptional delineation: the average agent sells 4-6 homes a year (personally I think it’s probably more like 2-3), and makes $34,000-45,000. The main reason is most agents are part-timers, which means they have other jobs and consider real estate a second (or third) job, or even a hobby. They do not put in enough hours and dedication to make real estate a profession, for many because it is a tough thing to do and income is never consistent (except for those who are top producing agents).
To excel at any job one needs to put in sweat and time, and real estate is no exception. Those who spend years building relationships with clients will eventually benefit from referral business; those who stick to their own proven way of doing business and work hard at it on a daily basis will see results, which will allow them to climb out of the average category. This is true in any profession. The question becomes”is average good enough for you?”
Many real estate agents and brokers lament over average agents and the problems that can accompany them – mostly issues related to ethics, not working hard enough or not being careful enough from a legal standpoint. After all, there are legal ramifications galore in this business, so one can ever be too careful, stop learning, or fail to stay on top of current laws and rules. I have written many blogs about the need for stricter rules and licensing standards in the industry, so I will not go into that here, but the irony is that if those things existed the profession would be treated more like a profession, and people would have to hold themselves to higher standards (brokers too would have to hold salespeople to higher standards).
So, are you average in your industry and want to get out of that rut? If so, you may want to ask yourself why you feel that way. If you are a person who strives to be above average but are not in that space, you should figure out how to excel. Evaluate your business, make a business plan, educate yourself further, reach out to all your clients and find a mentor. There is no need to be an average agent. On the other hand, if you are happy where you are then stay there, but make sure you do not ignore important issues like learning new rules, laws and forms. Either way, decide where you want to be and be the best you can be in that position.
Thursday, August 7th, 2014
The marketing pieces I receive in the mail on a daily basis amaze me…but not in a good way. It feels as if as the world gets more and more technologically savvy,people become lazy and less professional…real estate agents are not the exception (in fact, they are one of the biggest culprits). Your first point of contact with a potential client, whether via your website, an ad, email, video or mailer, is the only first impression you get to make. If you lose the client at that point you usually do not get a second chance.
The good news is that it is not difficult to be professional – it just takes a little more effort and patience. Here are the best ways to make sure your marketing materials make you look professional:
1. EDIT. I cannot say enough about the necessity of editing, and I have written entire blogs dedicated to its importance. Honestly, some of the nice glossy pieces I get in the mail every day from real estate agents look horrible… the information presented is useful, but many are filled with spelling and grammatical errors, and poor quality photographs. If you are a real estate agent who wants to be seen as a professional, you need to be able to demonstrate that you understand the English language.
There is nothing more frustrating than reading these poor marketing pieces. Many come from “big” area agents who spend lots of money on advertising. With all that money you’d think they’d hire an editor. If you can’t afford to do that then you need to have several educated people check over whatever you send out, before you do so.
2. Preparation. Just like a face-to-face meeting with a client, you need to show you are prepared through your marketing materials. Your marketing pieces reflect your preparation and attention to detail. If it is sloppy, has grainy images and typos/grammar errors, that is a reflection on your work ethic (even if in reality you are a hard and dedicated worker). Take the time to lay out the piece and get a proof before printing anything in bulk. It takes extra time and may cost a bit more, but it is time and money well spent.
3. Appearance. I don’t care what anyone tells you to the contrary – if you want to be perceived as a professional you need to dress the part. Showing property in your gym clothes might be convenient, but it doesn’t portray a professional image, and the same rule should apply in your marketing. It doesn’t matter if the recipient is a casual person or is coming from the gym herself. You should always dress professionally – it is not only a statement that you care and that your clients’ needs are important to you, but also that you take your job seriously.
In marketing, as in everything you do to promote your brand and your services, there should be no corner cutting. What you put out there is a direct reflection on yourself, your business ethic and your ability to represent your clients professionally.
Friday, July 25th, 2014
There have been several forces in the real estate universe as of late that seem to be conspiring against real estate agents. In theory some of them make a lot of sense, but the fact that they are all being brought to light at the same time make it appear we agents just can’t get a break…at least when it comes to our wallets.
Let’s look at what has been going on that could end up costing real estate agents and brokers a lot of money and time.
Data sharing restrictions. Real estate agents may soon be unable to post data on their sites that documents racial and ethnic information about neighborhoods. You must understand that an agent or broker is not allowed to provide this information directly to clients (it is a violation of fair housing laws and the real estate code of ethics). However, many agents link to third party data sites that provide tons of information on neighborhoods, including school and education levels, crime data and ethnic and racial makeup.
This data is not private – any person can go online and find it. Therefore, the real estate agent is not the one providing the information directly, nor is he or she presenting any information that is not publicly accessible – other (non- real estate) websites will still be able to provide this data. If the agents are forced to not allow links to such information on their sites, then people will go elsewhere and the agents will lose out on providing valuable information (unless the third party sites decide to cut just a few categories and still provide the other, allowable information).
Drone photography restrictions. You may have heard about the controversy surrounding drone photography. Relatively new, the use of drone photography in the real estate industry has become popular, especially with agents selling luxury homes and homes with land or views. Many real estate agents across the country have begun incorporating it into their marketing, and both buyers and sellers love it. Soon that may be allowed no longer, and it already is restricted in several states.
The issue here seems to be that the FAA regulations ban the use of drones for commercial purposes. Selling homes is classified as a commercial purpose, but there have been several lawsuits challenging the use of drones for real estate photography – and in one case a fine imposed upon a real estate agent was overturned. Still, agents have received subpoenas and cease and desist orders; until there are changes to the law it is unclear how this one will play out, but the bottom line is that some agents use this technology to win listings and restricting access to technology such as this could affect their livelihood.
Hobbyists are allowed to fly drones without issue so long as they stick to height restrictions and are not within 5 miles from an airport. Many real estate professionals argue that this is not fair at all – why distinguish between a hobbyist and a real estate agent, when a hobbyist can shoot a picture of a house or building with no consequence, but a real estate agent cannot? I am sure the issue will continue to receive more press.
Website accessibility changes. Agents and brokers may soon be required to make changes to their websites so that the hearing and visually impaired can access those sites with the same freedom as those without disabilities. The Department of Justice (DOJ), which enforces the Americans with Disabilities Act (ADA) is investigating, as there have been numerous lawsuits filed against non-real estate companies who have websites that are not accessible to those with disabilities. The websites are considered to be the same as a physical storefront if goods or services are provided.
What will this mean for real estate professionals? They will need to make the following changes should the upcoming rule declare:
1. Font size and screen background should be adjustable (to assist people with vision issues)
2. Sites should not present images without captions (blind people use readers to transfer words into speech, so with only images these systems cannot “read” the page)
3. Videos should have captions, (same reason as above)
4. Sites should allow for the ability to extend the time to respond to what is presented (for example, if a site says that the reader must “act now” to avail themselves of a benefit)
5. Sites should not use CAPTCHAs with only visual verification. These are the windows that pop up asking for the person to verify they are a live person by copying a word/number sequence into a box. Many sites today use CAPTCHAs that allow the user to hear the word that must be copied.
The ruling is supposed to be handed down soon by the DOJ, so until that happens we will not know when or whether the above changes will in fact be necessary. But attorneys familiar with the situation have surmised that real estate websites will have to comply in the future. This means agents will have to spend money getting their websites into compliance mode. How much it will cost will depend on the website creators – who it seems will benefit from such requirements.
The bottom line is that there are several potential future regulations that will cost real estate agents money in order to comply. These restrictions could impact many. It is getting more and more expensive to be a real estate agent/broker. What are your thoughts?
Wednesday, July 23rd, 2014
Kudos to the California Bureau of Real Estate for a smart new rule that could get unethical agents into trouble more quickly. One of the biggest problems in the real estate industry in California is that agents who are accused of committing unethical acts, or those who break laws or rules, were subject to a lengthy process of administrative hearings. The agent or broker could continue to work in the industry for a long time until it was found they actually did something wrong (and many claims are not even investigated because there is not enough people-power to do so – but that is a story for another blog).
Here are the highlights of the new rule, which was announced this month:
1. Citations issued more quickly. The new rule, referred to as “cite and fine,” will give the BRE the authority to issue citations and assess fines prior to hearings. The rules apply to both real estate professionals and those who practice real estate without licenses (those without licenses will likely be subject to higher fines). Fines will go up to $2500.
Here is how the new rule will work. Once a complaint is filed, the administrators will conduct an investigation, audit or examination of records. Action will be taken depending on the type and degree of the violation. Most minor offenses (such as failure to include the agent’s BRE license number on first point of contact marketing materials) will be subject to fines.
2. Offender names will be available via public record. Names of those who are cited and/or fined will not appear on the BRE website or under the licensee’s record, it will appear in the public records for anyone who chooses to submit a request through the Public Records Act.
3. Money collected from fines will go to a good cause. All the money collected by the BRE from offending licensees and non-licensees will go into a fund that helps victims of real estate fraud. Again – kudos to the BRE.
This new citation and fine system is a step in the right direction toward the prevention of rules and ethics violations in the real estate industry. Hopefully the BRE will continue to refine policies AND licensing and training requirements. I will keep my hopes up that this is the first in a succession of positive moves to make the real estate industry more professional and respected.
Wednesday, July 16th, 2014
Once again the powers that be are trying to restrict the content that real estate agents and brokers can post on their websites, and it is creating a lot of controversy in the industry.
The National Fair Housing Alliance stated this week that is investigating complaints that could lead to forbidding real estate websites from sharing neighborhood racial and ethnic data – information that is available to anyone willing to search online via other types of sites, like the Census Bureau. Granted this information is much easier to acquire from a real estate website, but regardless it is still out there for anyone searching.
The Fair Housing Act forbids real estate agents and brokers from steering clients into or out of certain neighborhoods due to racial or ethnic makeup. They are not allowed to discuss or provide any information if such questions or concerns are posed. Agents and brokers are further governed by the code of ethics of the National Association of Realtors, which prohibits disseminating “information regarding the racial, religious or ethnic composition of any neighborhood.”
For as long as there have been real estate websites, agents and brokers have provided information about the housing market and real estate practices. This information benefits consumers and has created a culture of uber-informed buyers and sellers. The knowledge one can acquire from both large and small real estate websites can really educate and assist those looking to purchase or sell a home.
Most websites link to services that provide neighborhood and community information, myself included. Potential buyers can gather a plethora of information about any neighborhood, including statistics on education levels, jobs, languages, and other categories including racial and ethnic data. If estate websites are required to remove such information, there will still be places where anyone can obtain it.
So what do you think – should real estate websites be allowed to continue to provide such neighborhood information? Do you think it violates Fair Housing laws or real estate ethics? How much can we as a society control the information that the consumer desires to obtain, and at what point are we infringing on freedom and democracy? Please share your views!