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News vs Fact – The Sky Is Not Falling In Real Estate

Ben Rosales, Founder & Publisher
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I’ve posted many times on the fact that negative spin is what is keeping consumers away from the closing tables. I’ve warned about polarizing consumers with political style commentary on Real Estate and the devastating effect it has on large segments of the economy- finally a journalist picks up that same ball and bats a home run…

I am sick and tired of the negative media constantly ranting about how horrible everything is in our business. It’s time for our industry to fight back against these psychic vampires who seek to suck every bit of hope and optimism out of us just to build their circulation.

Newspaper headlines and buzzwords abound, such as: “Two million people will lose their homes in foreclosure in the next two years!” “Subprime Fiasco!” and “Mortgage Meltdown.”

These are the headlines we hear every day, yet where is the positive news about the real estate market? The answer is, buried in statistics on page 15 of section 3 of your newspaper, provided you can find them at all.

Here’s a typical example from USA Today, Oct. 26, 2007, page 1B:

New Home Sales Unexpectedly Rise

New homes sales posted an unexpected increase in September. But analysts were highly skeptical given the credit crunch and predicted further sales declines. The Commerce Department said sales of new homes rose 4.8 percent last month…”

By the way, here’s what they didn’t report. Sales in the West were up 36.6 percent. The media totally discounted these statistics. What about a different headline: “Great News! Real Estate Sales Surge Despite Biggest Credit Crunch in Decades”?

Here’s another example. In Sept. 6, 2007, article entitled, “New Mortgage Foreclosures Set Record,” Martin Crutsinger provided the following summary of a speech given by Doug Duncan, the chief economist for the National Mortgage Bankers Association. Here’s how it was reported:

“The number of homeowners receiving foreclosure notices hit a record high in the spring, driven up by problems with subprime mortgages. The Mortgage Bankers Association reported Thursday that mortgage-holders starting the foreclosure process in the April-June quarter reached 0.65 percent, marking the third consecutive quarter that this figure has set an all-time high.

“The delinquency rate has risen to 5.12 percent … The worsening performance was driven by two factors — heavy losses in the Midwest states of Ohio, Michigan and Indiana, and the collapse of previously booming housing markets in California, Florida, Nevada and Arizona … Analysts said the problems in the formerly red-hot housing markets of California, Florida, Nevada and Arizona reflected in part speculators walking away from mortgages they can no longer afford.”

This article ends with the negative media’s favorite theme for scaring their readers and/or listeners: “Two million people will face foreclosure in the next two years.”

Here are the numbers that the negative media did NOT report from Duncan’s speech:

1. Thirty-five percent of the homes in the U.S. do NOT have a mortgage.

2. Some 94.88 percent of the loans ARE performing.

3. The foreclosure problem in this country is really a story about seven states.

4. The biggest foreclosure problems are in Michigan, Ohio and Indiana. These are manufacturing states that had horrible job losses. Since 2001, Michigan has lost 300,000 jobs. These states would probably have had problems no matter what the market was doing.

5. The other four states — California, Florida, Nevada and Arizona — experienced significant overbuilding. Twenty-five percent of the foreclosures in these states are on properties that are held by investors who were speculating.

6. Only 25 percent of all mortgages are subprime, and of these, 75 percent are performing.

7. In the other 43 states, foreclosures have fallen in 2007 from 2006 (data from Michael Clawson, vice president, Central Texas Mortgage).

read the balance of the Bernice Ross article at Inman News – this is only part 1 of her 2 part series

This article illustrates why I cannot justify sending Michael Cook that umbrella (I may send it as a Christmas present) I promised if the sky did fall – my fourth quarter rocked and we’re not even finished yet.

Our Spotlight- True Genius on the Street – Daniel Rothamel

Ben Rosales, Founder & Publisher
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I knew when I began reading Danial Rothamel back in 2006 that he was highly underestimated, and overlooked on many levels. I’ve watched several large multi-author blogs overlook Daniel, multiple times (I guess vanity can sometimes affect judgement), but I knew when agentgenius.com went live, I’d want to work with Daniel- and my predictions were correct.

In case you didn’t already know, Daniel chronicled his way through this past week’s NAR convention in Las Vegas as a man on the street real estate reporter using his camera, his trusty Zebra Shirt (referee stripes), twitter, and an internet connection. He gave play-by-play updates on many of the talks he took in and gives real insight into what he saw and experienced at NAR.

Spend a few minutes on Real Estate Zebra and see what Daniel has done using a lot of the technology Daniel talks about here and on Zebra and you’ll see exactly why Daniel is our Genius in the Spotlight.

There’s no way everyone can do what Daniel is doing, and your consumers have no interest in the NAR convention, but- this same technology is available to you to use on a mass of levels and Daniel is simply encouraging you to find an application that satisfies your audience and brings them into the conversation.

Daniel’s Agent Genius Posts

I’m sure Daniel has a lot to say about NAR, Who he met, and what he thinks the future of real estate is- so stay tuned!

Don’t forget to give Daniel your feedback, what impressed you, ask questions, and certainly some pats on the back if you want more!

Quest for the Social Media Production Efficiency (SMPE) Ratio

Shailesh Ghimire
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I admit, I spend way too much time on sites such as Facebook, Active Rain, Digg, Delicious, StumbleUpon, and RE.net blogs. I also have profiles on YouTube, MySpace, Twitter, Zillow, Zolve to name a few. From time to time I get asked, why? Specifically they ask me why I spend all this time and effort on the Internet.

Recently I’ve begun to ask that question myself.

I know I have received business from these efforts, so I’m not going to say it’s not worthwhile, but my question is have I reached the point of diminishing returns. My sites all rank very well. My AimeeLoans.com site is #1 in Google for “home mortgages in phoenix” and my Active Rain profile is #3 for “lender in phoenix”. I have a steady stream of visitors to my blog and quite a bit of subscribers.

More importantly, I get three to five mortgage related inquiries a week from my blog and so far I’ve been able to convert about a quarter of them into applications. I’ve converted a select few of these applications into actual loans. Not bad. But after all this time and effort I’d like to see this thing humming like a well oiled machine!

Since this has not happened, I’m asking myself if I have entered the zone of diminishing returns. Meaning, that no matter how much more time and effort I spend, I can not expect to correspondingly increase my output. To better understand where I’m coming from let’s review the Law of Diminishing Returns.

Here is how Wikipedia summarizes this law:

… the principle of diminishing marginal returns to a variable input …states that as you add more and more of a variable input, you will reach a point beyond which the resulting increase in output starts to diminish.

To apply this to Web 2.0 marketing, the input variable is time and effort in blogging, reading blogs, networking etc. You would think that for every extra input (marginal input), there should be an increase in output (marginal output). I’m not saying there should be a one to one relationship. All I’m saying is that shouldn’t there be some kind of relationship, so that I can expect a corresponding increase in business output for every unit of input? Or, is Web 2.0 the quantum mechanics of business where classical laws do not apply?

Since I’ve been thinking about this I’ve given a name for what I’m looking for. I’m calling it the Social Media Production Efficiency Ratio (SMPE Ratio). And I want to know if we can ever quantify the SMPE Ratio? If so, I’d like to know if in my current environment I’ve exceeded the SMPE Ratio.

What are your thoughts?

CharityUSA Gets It!

John Harper
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genius.jpgThe other day, I received an email from my friend Barclay Law. Barclay lives in Asheville, NC where she performs transformational magic under the banner of Design with Feeling.

Aniumal_rescueBarclay is a big animal person, meaning – if she had the money she would own a continent, so she could take care of all the animals that needed homes and space to roam. So, Barclay sends me an email asking me to visit The Animal Rescue Site and click on the big purple button to help feed the needy. Of course, I’m a little skeptical of things like this (Jonathan thinks I’m paranoid) so I clicked around a bit and wound up at CharityUSA, LLC.

CharityusaCharityUSA did not seem like a non-profit to me which increased my skepticism, so I dashed off an email inquirying into their non-profit status. Now, CharityUSA and their Chief Operating Officer, Lisa Halstead, get the whole idea of transparency. Here is Lisa’s reply to my inquiry (needless to say, I clicked and am encouraging others to do so as well):

Hi John –
Thanks for your email into our Customer Service Department.

In answer to your question below, CharityUSA.com, LLC is a for profit company, registered as a commercial fundraiser in the State of Washington. However, our mission is to generate money for non-profits.

This probably brings to mind more questions than answers for you, so if you’ll grant me a few moments, I’d like to explain how we work and outline some rather complicated regulatory reasons for the way we’re structured.

CharityUSA generates funds for non-profits in two ways: through direct contributions from the public and through royalty payments to charities from product and advertising sales. When direct contributions are made, CharityUSA passes 100% to charity. There are no deductions taken from the charities for fundraising costs, credit card processing, etc. The funds are simply passed through at 100%.

Royalty payments are made to charities from ad sales. CharityUSA passes 100% of sponsor advertising on to charity; again, no deductions are taken. Royalty payments are also made on each product sold in our store (jewelry, apparel, housewares, etc) that CharityUSA sources from around the world. The amount given varies by product, but up to 30% of the item price is paid as a royalty to charity. The remaining amount from product sales covers our operating costs.

When CharityUSA.com generates these funds for charity, they’re passed as a royalty payment to our partner organization, GreaterGood.org, which is a 501c3. (I’d be happy to supply a copy of the letter of determination from the IRS for GreaterGood.org, if you’d like.) GreaterGood.org then passes 100% of those funds on to other charity partners (such as National Breast Cancer Foundation, Mercy Corps and America’s Second Harvest) as grants. The reason GreaterGood is placed in the middle of this relationship is to facilitate the distribution of funds to charity. Washington State requires that a commercial fundraiser register every charity they generate funds for as a separate filing. CharityUSA works with more than 200 different non-profit groups, so you can image that an annual, individual filing for each group would be somewhat onerous. With GreaterGood functioning as the recipient and then distributor of funds from CharityUSA, we only need to file as a commercial fundraiser for one entity – GreaterGood.org.

In FY ’07, CharityUSA.com gave just over $1.7 million to charity. The total amount of contributions from the public was $498,735. 100% of these funds were given to charity through GreaterGood.org. An additional $1,225,295 was paid to charities in the form of royalties on product and advertising sales. That $1.7 million is nearly 7 times our after-tax profit.

If you have any further questions, or would like to talk with some of our charity partners, please don’t hesitate to contact me. I might also suggest snopes.com as a way to vet us. I believe we’re mentioned when you search for either The Breast Cancer Site or The Hunger Site. however, please note however that some of the information on Snopes is rather old. They mention that we give 75% of the sponsor ad revenue received, when in fact, we increase that amount to 100% a couple of years ago.

Lisa Halstead
Chief Operating Officer
CharityUSA.com, LLC

AG welcomes two new genius guys!

Lani Rosales, Managing Editor & Lead Business Writer
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agent genius online real estate magazineAgent Genius is proud to present two new contributors to the sidebar- you already know them, but now you’ll love them more!

In alphabetical order:

Benjamin Bach is our first Canadian- go Canucks! Because Benjamin is in Canada, Agent Genius has now gone international! You’ve seen Benjamin all over- he runs The Wealth Building Guy blog, he’s over at JJL (Joyful Jubilant Learning), been interviewed by Business Networking Advice, featured on the Bloodhound Blog for his marketing efforts, he guest writes at Phil Gerbyshak’s Make It Great! blog and even graces Active Rain. Benjamin’s like the Ryan Seacrest of real estate blogging- he’s all over the place! We welcome Benjamin’s fans to AG and look forward to Benjamin’s fine writing!
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Ryan Hukill is an amazing Realtor who shares a love of Sooner football with my husband! Benn and Ryan grew up in neighboring cities in Oklahoma. What I absolutely love about Ryan (besides his great sense of humor and beautiful family) is that Oklahoma is a challenging place technologically because many people haven’t figured out the dang Internet. Instead of shying away from the web scene, Ryan dominates his entire city (and surrounding cities) because of his presence and amazing content building. Ryan has a gorgeous website and his business is booming while others around him fail. Ryan’s blog stays local and never burdens readers with national issues, so we look forward to hearing his take on all things real estate.

Please welcome both new contributors- they accept tips in the form of cash, credit cards, referrals, shiny cars, or HEY, how about a comment? Hold your breath- Agent Genius is just getting started, y’all!

G-Love

Lani Rosales, Managing Editor & Lead Business Writer
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G-Love Article RoundupWhat’s G-Love? Well it’s short for Genius Love, of course! Each week, I will link to the week’s critical reading and encourage you to go to each and leave your thoughts in the comments of the G-loved article. Naturally, I will miss some, so make sure to link in the comments other articles of interest. So, let’s get the G-Love goin’:

Sellsius says what we’ve all been thinking about Advertising Oversaturation– this article hits the nail on the head… I think we’re waaay past oversaturation.

Mashable notes that Fatdoor gets millions of dollars in funding. Seriously? This has to be a joke. Please tell me they’re not serious?

Larry Cragun keeps it real (ever seen Dave Chappelle’s “keepin’ it real” skit?) and busts the bubble boy’s chops.

Real/diablog celebrates their anniversary by giving Real Estate 2.0 a report card based on their experience. Do you agree or disagree with their assessments?

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…for G-Love and Special Sauce fans, the G-Love of the week won’t feature any special sauce, sorry. For those of you who don’t know who G-Love is, watch and behold the greatness!

Running on the Marketing Hamster Wheel

Jonathan Dalton
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Yesterday I spent an hour-plus talking to two agents in my office about what they could do to try and attract business. Our broker (rightly) persists that listings are the key – you need the listings to generate buyers. Having had a couple of dozen listings this year and listened to my phone not ringing off the hook with ready, willing and able buyers, I’m not as convinced.

The old notion of cornering the market, except in the most hyper-local of circumstances, is fading away. There are exceptions … Russell Shaw remains the Valley’s two-ton gorilla, augmented by a consistent television ad campaign few of us can afford to watch much less initiate. But the Internet as a whole, and IDX in particular, allows enterprising agents to capitalize on anyone’s listings in an effort to attract buyers.

IDX isn’t sufficient, of course. These two agents have a really pretty website designed by Superlative. Superlative sites are terrible from an SEO standpoint and so their website sits virtually untouched. (That they’ve added no content of their own doesn’t help.)

Merely being on the web isn’t enough if no one knows you’re on the web. Yet many agents don’t take the extra step of making sure their presence is known. Further, they spend a lot of time, energy and most of all money on quaint marketing ideas that have virtually no real sticking power.

(Quick intermission … I’m meandering. I know it. I also drank a bottle of Merlot last night and am enjoying the morning-after-glass-of-water redux.)

Much is made of the need for a Web 2.0-type site versus a basic real estate sales site but that’s not necessarily true. My site for Westbrook Village, an active adult community in Peoria, Arizona, has been a gold mine the last few months. And why? Because it has the area’s only IDX listings feed for the Village with no registration required.

Very basic, very effective.

This isn’t to say life on the web is perfect. I’m only now recovering from a year-long beat down from Yahoo! for daring to have reciprocal links on my site. Three months ago I took off the links and Yahoo! loves me again (page one for Phoenix Arizona Real Estate.) You have to be able to adapt.

Much of that adaptation, in my humble opinion, comes online. It’s simply the most cost-efficient form of marketing available to those willing to invest the time. And time is almost more important than technical knowledge.

Tech expertise isn’t necessary. Blogging isn’t necessary.

Desire to succeed is, as is a rudimentary understanding of what works and what doesn’t.

It’s far better to spend little and fail online than spend thousands failing on magnets and fliers and open houses and newspaper ads and magazine ads …

(Okay, the merlot is wearing off.)

The Integrity Question

John Harper
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genius.jpgI woke up this morning feeling a great sadness. The sensation of it felt like it reached into the core of my soul. As I laid in bed and pondered the feeling, two incidents from the previous day came into my thoughts. The first thing I noticed about the incidents was that they seemed to be from opposite polar ends of the experience spectrum. But, as I continued to be aware of them and the feeling of deep sadness, the connection came – it was a question of integrity.

dali-lama.jpgWatching “10 Questions for the Dali Lama” last night, I was disappointed again to see the subject of Google and Yahoo censoring their search returns for their China search engines. Here are two companies started by what I thought were young idealistic people that had great ideas. They make a zilion dollars and now have big companies. It appears they have allowed themselves to fall prey to that fatal character flaw of sacrificing their personal integrity for the idea of more business. It’s sad to think that they don’t see that their decisions directly contribute to the continued pain and suffering of thousands of human beings.

I wrote this post on ActiveRain about Zadzoo. If you read the comments you will find this fellow, Jonathan, standing up for Zadzoo and questioning my position. Now, I’m no genius and I could be wrong, but the only thing that makes sense to me is that Jonathan is Zadzoo. Why would some homeowner find my post on Zadzoo? Why would they take up the cause and come back for more than one comment? Why move off the point about spamming and bring in the absurd accusation that I am afraid of free listing sites?

The only thing that computes is that this guy is Zadzoo and he continues to get it all wrong. Many of you, like me have read a great deal about blogging, the etiquette of blogging and how one should handle negative or challenging posts about oneself or one’s company. The first thing everyone says is – transparency. Transparency works best – forthrightness, honesty, integrity = transparency.

So, here I am with the sadness pulling at me and the question of integrity floating through me like Sunshine on My Shoulders only deeper – penetrating me, floating through my mind like an enticing perfume. What I notice is that a host of associated experiences around the issue of integrity begin to surface. Some involve me and my challenges around the issue. Some involve others – situations I have observed and others that personally affected me.

This brings to mind Otto Kernberg and his notion of affective nuclei, one of the ways that our minds organize information. Not really that important to the point I want to make, but I throw it in to demonstrate that my reading habits are not limited to real estate blogs.

The Courage to Meet the Demands of RealityDr. Henry Cloud has an excellent book on Integrity. It is worth reading. He comes at the question of integrity from observing the character of successful business people. His definition of integrity is interesting – The Courage to Meet the Demands of Realty.

At long last here is my point: Integrity is not fixed or set in stone. Integrity is not a moral code or a list of shoulds. Integrity is more a process of continued refinement and subtlety – it’s a journey into one’s depth. We are in a people business; times are challenging; the industry is changing – I find myself surrounded by opportunities to explore and discover the depth of my integrity.

Google wants to give you $10 million…

Lani Rosales, Managing Editor & Lead Business Writer
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…if you are a software developer. Oh come on, you didn’t think you’d just have it handed to you like the VC “earners,” did you? Seriously, for all of you tech nerds, this is BIG NEWS! Google Android SDK is now LIVE! This is their open source operating system for mobile phones with touch screen capability, high quality graphics, 3G browser ability and more. Google is offering several cash prizes for the top new applications developed and real estate applications seem nearly untouched… are you America’s Next Top Software Developer (did I just write a new reality show in my head?)?

The G-Nerds demonstrate how it works- CHECK IT OUT!

Here’s A Dirty Little Trick For Direct Mail

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My trick isn't dirty, it's just drawn that wayDirect Mailing expired listings because every person in the universe is on the do not call list?

Ya me too.

And does your MLS only give you an address and expiration date? So that you’re addressing everything to…

Owner, Some Street, Anytown, Zip?

And half of the mail comes back to you because the house is vacant and the Post Office doesn’t know who fluffy bunnies “Owner” is to forward the mail?

Try… https://www.whitepages.com/reverse_address

It’s a little tedious to look up every address I know, but it works as long as they don’t have an unlisted number. Mailing to an actual name and address makes delivery and actual reading by the addresse a much higher percentage chance. Plus you’d be surprised how often the listing agent has the street address of their listings wrong.

LostSeriously, maybe half the reason the house failed to sell is because no one could find 135 Winter Street when the actual address was 135 Winer Road.

Zip Code 06010 is Bristol, CT. Zip code 06001 is Avon, CT three towns over. If we can’t find it, we can’t buy it.

Anyway, I digress…

Just reverse address look up for direct mail for names. Tedious, but it works. 

Top Blogging Markets in the United States

Mariana Wagner
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Yay for Austin, TX bloggers! Austin made #1 on this recent Scarborough Report that studies consumer and retail behaviors. According to his report, 15% of all adults in Austin, TX are bloggers.

Where are the Top Local Markets for Bloggers?

  1. Austin, TX – 15%
  2. Portland, OR – 14%
  3. San Francisco/Oakland/San Jose, CA – 13%
  4. Seattle/Tacoma, WA – 13%
  5. Honolulu, HI – 12%
  6. San Diego, CA – 12%
  7. Dallas/Fort Worth, TX – 11%
  8. Columbus, OH – 11%
  9. Nashville, TN – 11%
  10. Colorado Springs/Pueblo – 11%
  11. Washington D.C. – 11%

Holy Moly! Colorado Springs made this list!

They define a blogger as an
adult (over 18) that read or contributed to a blog in the past 30 days. They also noted that, “… the cities that rank highly for bloggers are also prominent Internet-usage markets.”

Other interesting findings on this report included:

  • Bloggers are attracted to user-generated content. – Um, really? No way …
  • Bloggers are early adopters of new technology. – Again… Really? No way …
  • Bloggers tend to have a different relationship with the internet than regular users. – Yeah, THAT is quite true.
  • Bloggers are middle class people who are 66% more likely (than the national average) to be between the ages of 18-35. (Middle class? Who said I had any class? They must not know me very well.)
  • 50% of bloggers have children in the house under the age of 17. That would explain my 12 and 4 year old, “Mom, are you blogging again?”

After reading this report (thanks Brian), I did a little research and found that there are about 4 real estate bloggers in Colorado Springs, with me being the most active – by far…. So far. We have a lot of religious and political bloggers, as well as a very healthy news blog community. Interesting.

To see where you city ranked, check out the recent Scarborough Report.

Mariana Wagner – One of 11% of Colorado Springs Bloggers.

Lead Buyers – Lead Suckers, ‘An Intervention’

Ben Rosales, Founder & Publisher
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web-20-bubble.jpgAs tech2.0 continues to move forward, lead generation sites continue to pop up all over the Internet. This morning alone I have in my inbox 8 new mails from them, offering me anything to use their service with a promise to rebate my commission to my buyers- thanks, but no thanks. I do the price setting round here. As I click through them it is obvious to me that the frenzy to feed off of Realtors and consumers is still in play.

But the more I want to hate them, I cannot, because I know they wouldn’t be in business if you (agents) weren’t suckers enough to allow them to resell your own markets back to you. Why? Why do you allow this to happen? Do you really believe that if they cannot move the lead to you that someone else will buy it? If all agents just said no- then those leads would just filter back in and the lead pushers would go home.

Lead pushers offer no real value to the process or the consumer. They inject themselves into the process as some sort of quasi agent and to be honest, are held to no literal standard whatsoever.

Until Agents wake up and quit the Lead Pipe the tech2.0 invasion will continue. Stop being second stop, refuse to give into the shiny button that says click here to buy your customers back– stop being a sucker…

Stop Today:

  • Forums
  • Any site that charges you for the leads you generate
  • Internet mailers that promise to sell you and then share them with competition
  • Any site that uses your knowledge to build their site information (wiki)
  • Any network that offers to rank you for a price
  • Directories that do not allow your information to be freely public to consumers

You think you’re being competitive by participating, but you aren’t. You’re being suckered with a smile while out the other side of their mouth many are badmouthing you all in the name of getting a share.

Here’s a thought- take the same money & sweat equity you’re putting into forums and wikis, and start your own local tech site to generate your own leads. How’s that for free market competition. And while you’re at it, how about you realize that just because it’s free today, doesn’t mean they shouldn’t be paying you to play. Get expensive, stop giving away your value.

Life of a Blogger

Ben Rosales, Founder & Publisher
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Many folks see fantastic blogs with deep intellectual opinions that seem to shape our politics, religion, and even our commerce. Many walk away with an impressed, and enriched feeling and impression of the writer. I suspect after you see this video, you may rethink the crap you read on blogs… (adult content – you’ve been warned.)

Divorcing Commissions – Disintermediation of the Buyer’s Agent

Ben Rosales, Founder & Publisher
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black_feathers_mask.jpgOver at the Bloodhound Blog, Greg continues his thread on Divorcing the Real Estate Commission. Meaning that the seller pays their agent, and the buyer pays his own agent.

Removing the incentive the seller has to elevate their product over thousands of others does level the playing field and makes all products equal (so to speak), but what it also does is remove the need for the buyer’s agent all together- you get either more stupid people knowing everything, or you get more dual agency- how fun for the seller’s agent.

Now Greg in the past has argued against Dual Agency, but under Greg’s plan, you actually get more dual agency. Buyers are cash poor, and credit stupid. Under Greg’s plan, the idea of saving 20% to put down on a home would now be increased to 23%- as if buyers ever managed to save the 20% in the first place.

Divorcing commissions sounds like a great idea, but it really becomes an opportunity for a seller’s agent to make more in commissions which a seller’s agent could (unlikely) then use as a new incentive to buyers- a rebate perhaps?

The idea of divorcing commissions is a sham. The idea of increasing standards on Real Estate Licensing is also another sham disguised as pro-consumer. It is anti-consumer because it eliminates the idea of a consumer’s ability to learn what we know; it just got harder, and less likely. Consumers would skip the idea of licensing altogether (small investors, estate planners, flippers, buyers who just want the contract classes), drive by Greg’s sign, call him, and Greg would begin the process of entering into Dual Agency- go figure.

Now, if this was not Greg’s intention, great, but it is the outcome of what he is preaching. I am still unclear in Greg’s plan as to who is actually left to protect the buyer- I am confident that I do a great job in shredding the listing agent’s argument in ‘assumed value’ of the listed home. As Greg made his argument, he based his example on the homes value being an absolute $100k- but when I represent, I would calculate the cost to close, cost to sellers, and offer based on what I really feel the homes value really is (wholesale)- in this case $92,000 (I won’t even get into “percieved value”), and we’ll meet somewhere in the middle. Now many would say- yes, but in a hot market where homes fly off the shelves you pay asking. I say (using Greg’s facts as he illustrated) we’ll wait, or we’ll move down the street. A removal of a savvy buyer’s agent would only leave the buyer to believe the seller’s agent when he says, “not a penny less than $100k.” Whatever.

I can tell you right now that I can dent any CMA you’ve based your price on, and I can for sure dent your appraisal- hand me the phonebook. Do you think the seller’s representative would go that far for you? That’s laughable. The great thing about a buyer’s agent is that I can find options to this overpriced, bullheaded seller’s house. I can bring a buyer what he doesn’t know. Would a seller’s agent do that? That’s the buyer’s risk to take.

Buyers should not buy into the charade of divorcing commissions. In this climate where we’ve seen values spike and readjust and sellers cashing out on perceived values, the cost to sell is nothing. If a buyer does not want to finance those costs then the answer is buyers should fight the asking price, and come to the table with cash- it is an investment, after all.

I for one am all for reform, but let’s reform something that’s really broken. How about we reform the idea that seller’s agents are necessary. I mean, why not? What’s good for the goose…

Now, before everyone gets their whitey tighties in a wad– I’m simply pointing out how I see it. I’ve acted on both sides of the transaction, and I for one ask buyers to secure representation. I’ve done the buyer acting alone bit before, and I assure you that I was fair to them, but my seller absolutely won all the way to the bank. They’re still learning that I know what they did not– ignorance is not bliss, it is the difference between cashing out later, and a short sale failure.

Remember this- as an agent, it is always assumed that a buyer’s agent represents the seller until the buyer accepts formal representation. Sellers lose this functionality of the buyer side commission when disintermdiating the buyer’s agent. Now, Mr. Seller, you no longer have an army selling your home- you have one lonely listing agent. That measly 3% drives the entire membership of 1000s of local Realtors to bring you a buyer- now what do you have? Under divorced commissions, you’ve got squat.

Neighborhood Sites: Biting Off More Than You Can Chew

Carson Coots
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I was recently speaking with an agent in my area that wanted to set up a series of neighborhood-specific websites. He plans on setting up about 3-5 neighborhood sites with the hopes that they will drive qualified traffic back to his main site so he can get more leads. Sounds like a great idea… but my question was: How do you plan on writing all those articles while simultaneously building backlinks to each one? It seems easy, but its not.

Optimizing and building links for a single website can quickly become a full-time job depending on how ambitious you are. I cant imagine a full-time agent trying to launch and manage over 3 blogs at the same time when he/she doesn’t even have one going. Although local search is blowing up, and blogging is the new “thing” for all agents to get into. Sometimes you need to take baby-steps to get off the ground.

This isn’t the only agent I know that quickly made an ambitious plan to start a series of sites all at once. I can understand how, as an internet rookie, you can read an article or hear a seminar about blogging and feel like you have to become the master of your area overnight. You can do it, but not overnight.

Start with one site, and make categories for each subdivision if you want. Try to build your empire under one domain to start with. Every article you write will be just as likely to rank for your chosen neighborhood keywords as a “special URL” you set up… and it will help you FOCUS your SEO efforts on ONE site. Not five.

Don’t start a junk blog for every subdivision in your town thinking that you will eventually “find” people who want to write for your blog for dirt cheap. And don’t think you can drive traffic or get leads from a keyword-stuffed splog, because it does nothing but waste valuable time you could be using to write a good relevant article on your main site.

Go Figure Genius

John Harper
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0

genius.jpgstats9.jpgIf I was truly a genius, I would have more facility with Excel and understand statistics better. But I’m not, so my clients have to suffer with me putting what I know into layman’s terms – which, as it turns out, isn’t so bad because the majority of our clients are not rocket scientists nor statisticians either.

In fact, the majority of our clients seem quite pleased when someone explains something to them in plain language they can understand.

If a picture is worth a thousand words, then a good graph must be that times two. The image to the right is updated every week on our site. We collect data from twice as many cities, but these are four of the main communities we service.

These graphs come in handy throughout the year, but seem especially useful as we approach the end of the year. They are useful for both buyers and sellers as they allow us to explain seasonal patterns and how that may affect their situation.

The data used is pulled each week from the local MLS. These charts are different from the other charts on our site. Those scrape data from the Internet and then formulate it for local real estate market trends and insight.

These charts represent our number one source of leads. We get two to five leads a day from people wanting to know more about what is happening with local real estate. Most of these people don’t want to talk to us, they just want information. We give it to them free of charge – like you do.

treed.jpgWhen we call to see if they received the info, they have questions. Because, like me, they are not geniuses either. They’re smart, they want information, they want to understand – they want knowledge. They just don’t want to be hounded or hassled.

If you’re an agent, you probably get about 54 local mortgage brokers sending you their canned reports on the financial markets. I get more graphs and more high-falutin’ language than I could sort out in a month – if I had the time. I’ve asked over 8 of these mortgage brokers to break it down into layman’s terms for me and our clients – none of them seem to be able to do so. They don’t seem to read or understand the information they are spamming me with.

I say spamming because none of these people asked me if I wanted their newsletter or reports. We exchanged cards at some point and they consider that as permission to send me whatever they want. Some are actually offended when after my personal 3-week trial period, I ask them to remove me from their mailing list. (I see I am veering off point here.)

Below is the San Ramon graph with data from October of 2006 forward. The blue line is active listing; the green pending sales. Many of you use similar charts as well. It doesn’t take a genius to recognize the value of how to communicate simply and effectively, does it?

Now if I could just translate that skill into blogging!

san-ramon2.jpg

Let the parties begin

vickimoore
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2

houseOur company party has gone from ballgowns and a sit-down dinner at the Embassy Suites to a potluck at the office. I wish I were kidding. Times are tough. If it’s not tough for you, you’re watching your friends in dire straights. Many of the agents in my office have dark circles under their eyes from working two jobs. It’s survival mode and we’re not laughing.

Last night was the first of the revelry. I was at the title company – they know how to throw a party. The event was disguised as an opportunity to start gift shopping. Although the only people actually purchasing anything were the employees.

We’re standing around chit-chatting and for some reason we start talking about inspections. Gail has the hands-down winner.

She’s at a septic inspection with the seller. The inspector opens the hatch to the tank. There’s a strained silence. She’s not sure what to say or do, so she says nothing.

Inspector: I guess now you know rubbers aren’t biodegradable.

Seller: They’re not mine.

She ends the story with, “It was a condom condo.”

Thanks again for the laugh, Gail.

Not Going to NAR? Follow Along on Your Phone

Daniel Rothamel
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2

nar chicagoIn case you didn’t know, the 2007 National Association of REALTORS Expo and Convention is being held next week in Las Vegas. There is some pretty cool stuff going on (like the BloggerCon). So what do you do if you aren’t going to the conference, but you still want to learn about what is going on? Ben Martin has come up with a solution.

For those of you who don’t know Ben, he is an executive with the Virginia Association of REALTORS. Personally, I think he is the coolest REALTOR Association Executive in America. He has shown an unwavering dedication to improving the real estate industry through technology and new media.

For his latest stroke of genius (I’d call it AgentGenius, but Ben is a CAE, not a REALTOR), Ben has set up an NAR group through TxtMob. All you have to do is follow the instructions in Ben’s blog post to sign up, and you can then either send text messsages to the entire group, or just follow along with others.

I am sure there will be plenty of coverage of the NAR convention throughout the blogosphere, but this is one way you can stay updated instantaneously, thanks to Ben.

Gratitude

John Harper
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4

Seven years ago today, my best friend died of ovarian cancer. A year and a half later, her youngest son suicided. A year and a half after that, her daughter died. Her husband, my friend Dave, has prostate cancer that is rushing him toward the grave.

This time of year is always special to me. I usually create my own card of Thanksgiving and a Holiday one as well. I go through my entire database and write a personal note as the spirit moves me. I have a lot to be thankful for and I’m finding that as the years mount up, I spend more of the year in touch with gratitude and expressing it.

carol.jpg

My friend stopped dreaming today
She opened her eyes in the other world

A kaleidoscope of tears assaults and soothes my soul
Love & Rage, Joy & Sadness, Anguish & Understanding
A shower of memories – like fairy dust
Illuminates our time together
In every future moment
I will miss you – as I wonder
How is this possible?
When everywhere I look inside of me
There you are

Hearken to this reed forlorn
Breathing ever since was torn
From its rushy bed a strain
Of impassioned love and pain

The secret of my song though near
None can see and none can hear
Oh for a friend to know the sign
And mingle all their soul with mine

Twas the wine of God inspired me
Twas the flame of God that fired me
If thou wouldst know how lovers bleed
Hearken, hearken to the reed – Rumi

Realtor.com Press Release- Brace Yourself.

Ben Rosales, Founder & Publisher
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Starting today, iPhone users now have the power of REALTOR.com at their finger tips. Whether searching for homes nearby or looking for listings in a particular neighborhood, iPhone users now have instant access to all details, including photos and contact information for the listing agent, with REALTOR.com for the iPhone.

“We’re committed to enhancing the experience consumers have when they’re searching for real estate on REALTOR.com,” said Joe DeTuno, senior vice president, product management. “Our new search capabilities for the iPhone are relevant enhancements that give consumers the full power of mobility and immediate access to REALTOR.com in a manner that fits naturally into their everyday lifestyle.”

Industry experts(1) predict consumers will purchase approximately 3.4 million iPhones this year, with an estimated 45 million units sold by the year 2009, making the iPhone potentially one of the most popular hand held devices used to search online for real estate.

A leader in wireless real estate search, REALTOR.com also enables consumers search capabilities through their REALTOR.com Mobile application on cell phones and PDA devices running Windows Mobile 5.0, including HP hw6965, HP hw6925, Palm Treo 700w (or Palm Treo 700wx), AT&T 8525, Cingular 8125, O2 Xda Stealth and Audiovox XV6700.

iPhone users can access listings at https://iphone.realtor.com using the browser on the phone for immediate access to REALTOR.com. This URL is provided exclusively for iPhone users.

source cnnmoney.com

DUH!

vickimoore
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3

When a house goes up for sale, the troops line up. There’s checklists to follow. Everything is done in order. As it’s done, it gets checked off. Do it once, and you realize immediately you’ve got to have a list, otherwise something falls through, gets forgotten.

I’ve got a list for the listing presentation. A list for after the listing is taken. A list of the disclosures needed. A list of who to call for what service, inspection, test and repair. A list of who shows the house, when they show it and what their remarks are. A list of the advertising to be utilized, how much it costs, when it’s done, who it’s done with. A contract comes in, there’s a list of what the client’s needs are. Who the mortgage person is. What the buyer’s qualifications are. A list of contact information for every participant; email, cell phone, home phone, fax, home address, work address. A list of all of the contingency removal dates. A list of what the client is responsible for; obtaining insurance, transferring funds, signing documents. A list of inspection dates.

Everybody knows their job. That’s how they got on the list. It’s got to be efficient. Inefficiency wastes everybody’s time.

In every transaction, I can only hope that the agent on the other side has their list. In this case, I learn right away she doesn’t.

I’m representing a buyer in an unusual transaction; a mobile home. Unusual for my market. The agents’ responsibilities are the same. Contract. Disclosures. Inspections.

I write the contract. It gets accepted.

That’s when I know that she doesn’t have a list.

Disclosures. We wait.

In order to locate inspectors, I call my list who refers me to someone on their list.

We receive a couple of pages. We wait. We receive a couple of more pages.

I call the title/escrow company on my list. They don’t handle mobile homes. I call someone on their list.

The contingency deadline for the delivery of disclosures from the seller passes. Representing the buyer, I provide the seller’s agent with 24 hours to perform their end of the contract, or the buyer walks. Easier said than done. The buyer has invested $900 in inspection costs.

24 hours pass. We get all but one page of one disclosure. I write another document reminding the agent that the buyer, who once had 12 days for inspections, now has an additional 5 because of their delay.

The title company calls: I want to send closing documents to the buyer. Sorry, no can do. Just got the disclosures. Inspections were stopped because unless the seller provides them, we have no deal.

I get a call from the buyer. I got all this paperwork from the title company. What is this? I call the title company: I told you not to send those documents. How did you prepare the HUD if you don’t have matching closing instructions? DUH!

The 21 days from start to finish has now turned into 30 plus. I get an email today from the agent wondering why we’re not closing escrow today. DUH! Where has she been all this time?

The title company emails her: I don’t know when we’re closing. We haven’t gotten the buyer’s closing documents or their final deposit. DUH! Where has she been all this time?

One more inspection tomorrow. Then the buyer is going back to the seller for a price reduction. The seller’s agent didn’t get pre-inspections. $20,000 worth of work needs to be done before it starts raining.

Hey Lady! Get a list!

There’s nothing that NAR can do now. She’s been the owner of her own office since I was sucking my thumb. Maybe if they had actual educational prerequisites to the test or real continuing educational requirements – not taking a test while riding the drunk bus to the wine country – she wouldn’t have gotten this far. Maybe, maybe not.

Agent Genius Brings it To Bloodhound – Shock & Awe, Baby

Ben Rosales, Founder & Publisher
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13

shockandawe.jpg

I wasn’t aware that Agent Genius had surrounded Bloodhound on two sides with verbal war ships and began shelling the heart of BHB with Bunker Busters. I also wasn’t aware that we had marched into Greg Swann’s living room to find Greg deep inside a spider hole eating twinkies and reciting poetry. To be honest, I watch FOX News almost constantly and had never heard a word of the massive air strikes we delivered to the towns of Kris Berg, or Jeff Brown in the Geno Triangle of Death.

Like I said, this is all news to me- I bring this up because over the past several weeks, I’ve actually had several folks ask me if this was our mission, rooting me on for their own reasons, some warning me of Greg Hussein’s Viral WMD (words of mass distraction), and I sincerely wanted to set the record straight.

For the record, although Greg and I could never agree on everything, my respect for Greg is beyond that of most men. Greg came to my family’s rescue recently as if my family was his own, and I’ve seen his compassion on many other levels since the beginning of Bloodhound. A war on Bloodhound could not be further from the mission or aim of Agent Genius- Greg is safe with his twinkies and his spider hole really isn’t a spider hole, that’s just Greg buried under mountains of books and cords from the countless tech toys Greg owns.

I really enjoy reading Bloodhound as I enjoy reading geekestateblog, Jay Thompson, and even Inman sometimes. I enjoy many blogs around the internet; I just really happen to love reading those that contribute at Agent Genius. Their contributions to the blogiverse have been many and I’m honored to feature them here. So, I am sorry you’re not getting to see us bring Greg up on sanctions, but you will see us continue to elevate the conversation from different perspectives.

Shall I Be Trendy?

Mariana Wagner
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9

According to the 2007 Swanepoel Trends Report, the Top 10 trends of Real Estate there are a lot of changes on the real estate horizon (oh wait, are we there already?!?). The concept of Web 2.0 is in the forefront of these changes.

I happen to like the whole Web 2.0 thing, and I like real estate … but now this makes me trendy?!? I do not know how “okay” I am with this. I spent the better part of my youth going against the grain – being the anti-trend. And since I still consider myself young (Didn’t you hear? 32 is the new 21 …) I still have that “If every one of my lemming colleagues are going THIS way, then I will go THAT way” kind of attitude. And yes. It IS an attitude.

So in looking at these Top 10 Trends, I am now facing a grain I am not too interested in going against. Ugh …

  1. New real estate business models: What is the impact of ABM’s (Alternative Business Models) on the real estate industry … Internet Real Estate Companies, Flat Fee MLS Shops? I believe that ABM’s are essential in the balance of the business of real estate. Although I disagree with several of them on various points, I still value their place in the business.
  2. What is happening to our local MLS? : The IDX systems out there are giving the local MLS systems a run for their money. A National MLS is definitely on the horizon … but IMHO it won’t be a TRUE National MLS as disclosure laws vary from state to state. (For example, in Colorado it is illegal to disclose that a house may be haunted, whereas other states demand that disclosure.) However, the exclusivity to listings that the MLS once had is quickly becoming a thing of the past, and that is FINE by me. I have no need to hoard my listings. I would rather SELL them.
  3. How does Web 2.0 fit into your life? : I know plenty of agents who run screaming from anything remotely “new fangled” like that pesky “internet”. Okay. Fine. I know that (just like their fashion sense and Glamour Shots) they are stuck in the day where door knocking and cold calling reined king. Well, they can HAVE their gold embroidery blouses and PUSH their advertising into everyone’s lap. I would rather answer the phone call of a new client that has researched me, like what I say and do and wants to do business with me, than cold call a “lead” that doesn’t know me from Adam.
  4. The New Consumer: Great time to plug a post I wrote a year ago about being a GenX Consumer (opens in new window). … Oh how the landscape is different when dealing with a Baby Boomer vs. a GenX or GenY consumer. I get it.
  5. How to deal with the poor image of real estate agents: Um. They suck and deserve that image. So there. Okay … not all of them, and definitely not
    you, my genius friends. But, c’mon! I REFUSE to deal with that poor image. I would rather CHANGE it. GO RENEGADE REALTORS!®
    (BTW, go to Google and type in Renegade Realtor®…)
  6. Consumer and Realtor® Demographics: Who IS a consumer? Who IS buying and selling and investing in homes right now? Who IS representing them? Who IS successful in real estate? Somehow, I am under the impression that thick polyester blend suits and greased back hair do’s are not in the picture as much … Yah, not so much.
  7. Race for/with/against/because of CHANGE: Things are changing so fast that those who are not “in the know” will be left “in the snow”. You might as well just wrap yourself up in toilet paper and ride the Subway to Manhattan … This report mentions CRITICAL MASS. AH! I have been brewing that phrase in my little head since I started real estate and saw the changes coming faster and faster and faster. If we are not on top of the wave of this “new” business of real estate, it will be too late. Early adopters of this Web 2.0 / Life 2.0 way of thinking and doing business will be the ONLY ones still doing business before long. Oh well. So Sad. No. Not really.
  8. Opportunity is knocking: 2.3 kids, a dog and a white picket fence are not the norms anymore. (I could argue that it never was, but that is a whole different post… )The home buying and selling public is a whole new breed of consumer – sprouting from every corner of every possible way of life and culture. Opportunity is endless and many avenues are untouched in regards to niche marketing and making a name for yourself. Yay for niche marketing!
  9. WTF are Realtor® Associations for, anyway? : Who cares? I know they serve a purpose, and I happen to really like mine, but their usefulness even 5 years ago is pretty obsolete today. To be seen as worthy – even a little bit – they are going to have to make some hefty changes in WHO they are and WHAT they offer their members.
  10. The Legacy of Today: Remember the Housing Bubble? What happened to the foreclosure rate? Where did all the Sub-Prime lenders go? Major events of yore are shaping the business that we call Real Estate, today. Do you ignore the importance that each of these have on your business, or do you find ways to make your business BETTER because of (or in spite of) it? I am always up for a good challenge, and these recent events have taught me more about the housing market and my business than any CE class ever could.

I am actually quite excited about these new TRENDS. So, shall I hang up my roller skates, pack up my skate board, put away my stripey tights and Doc Martins and be trendy? No. But, in real estate … if it means making this business a better place to be, then trendy I shall be. (But my yellow Doc’s are still great to wear to closings …)

(All photos courtesy of the Photo Archives of Mariana.)

Real Estate Implosion, Lawyers, Realtors & Disintermediation – Oh My.

Ben Rosales, Founder & Publisher
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8

0000036548_20061218145010.jpgThe cool thing about lawyers is that even though they compete with one another, they understand the basic reality that business is there for the taking. Rarely can you walk down a street in America and not find someone divorcing or guilty of a crime. The best thing about lawyers is that even though they get a lot of ribbing about being this and that (not generally polite) they’ve never been guilty of eating themselves alive publicly- meaning, you rarely see them out publicly bucking the system. They have an understanding that the systemis what affords them a lifestyle and a profession, regardless of how twisted the perception of it is.

Realtors on the other hand (we’re not lawyers) have very much the same dependencies and lately have very much the same reputation as lawyers. Insane as it may sound, we’ve recently been compared to car salesmen and we’re even accused of being the devil in some cases, and having spun millions into subprime disaster, single-handedly causing a real estate bubble with our cat like commission skills– hell, we even set the fires in California to spark future growth! I kid. It was just a kid and matches I hear, but hey, he’s probablya future Realtor if you ask those that wish to disintermediate us from the transaction.

The truth is, the only thing Realtors are guilty of is playing into the less than 1% of 1% of 1% that would call free agency a trend. Realtors are guilty of playing into mass hysteria created by a public relations campaign created by a certain discount business model. Realtors are guilty of the thing lawyers already understand- s*itting where you eat is probably not a good idea.

The perfect storm against our chosen profession is this- we’ve always thought the other guy’s services to consumers sucks, and we spend big money saying just that. The genius in the PR campaign waged by our fishy competition plays on that vulnerability and honestly, I see a lot of hysteria in the marketplace because of it. We had a guest commenter here last week that said we were complaining about the end of the profession, but the reality is- it’s simple self defense, another mechanism used as a vulnerability in the game to weaken the position of the membership (NAR). Although, as quiet as the membership is, and as clumsy as it still remains, the collective membership matters not to the profession. The hysteria created by those seeking rankings and comments on a blog, or to score points with the pissed off of the real estate consumer is a gift to them and no one else.

I think maybe folks might want to take a look at how and where lawyers compete- it’s in the courtroom, not in the court of public opinion. They get up ever day, notwrite a blog, and they pass up the hype by those who would say lawyers are vultures and march into the courtroom and lay it down in no uncertain terms why they’re valuable. Their personal reputations are what drives the most successful, the ones you never see at midnight offering to bail you out on a DUI.

Yes, I think Realtors could learn from the blood-sucking lawyers out there on how to handle negative press and attacks on their profession. We could learn a thing or two about how to be gentlemen and where to duel , and just so you know- that’s not in the court of public opinion… just because one Realtor, market or PR campaign is bad doesn’t mean the entire industry is. Comparatively, because one lawyer is an ambulance chaser doesn’t mean the entire BAR is chasing them too- and the only lawyer that would ever be guilty of saying it to be so would be the guy on TV at midnight offering you midnight DUI representation.

Wall Street Giving Consumers the Shaft – Roughly

Ben Rosales, Founder & Publisher
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2

215264558_f93af477e1.jpg

Just some quick thoughts on how consumers are seeing the state of things…

Oil

What excuse do you have this week to raise oil prices

  • Increases in gasoline
  • Increases in consumer products
  • Increases in heating oil
  • Increases in natural gas

Mortgage Rates

What excuse do you have this week to raise mortgage rates or tighten guidelines

  • Cannot qualify even with great credit
  • Higher rate for great credit
  • Higher down payment requirements on everything

The fact is, industries seem to shoot consumers in the foot when the economy gets to firing on all cylinders. Political spin & opinion spread like a wildfire whether true, false, or half truth corrupting consumer confidence, and eating into grocery budgets. The average consumer sees right through the BS or market overreaction as a chance to gouge, and I for one am betting on the consumer to punish wall street for playing games with their Christmas money & their dreams of a better life. I think consumers see one excuse after another to inflate something only to see it come down in a few months- analyst call it a correction on an over reaction- consumers call it shaft me hard while you can.

I’m pretty fed up with it myself and hope consumers sit out the drama in the credit market. I hope they sit out so long that large controlling forces have to bend over and take it themselves- roughly.

Consumers ask, do I believe the sky has fallen on the economy? No. Am I being charged for the perception that it is? Yes.

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