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Hitting the Real Estate Market Bullseye

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Bullseye Black and White

Sound familiar:

Professionals who fake home appraisals are helping fuel a rise in mortgage fraud in Indiana, bilking would-be home buyers or lenders out of millions of dollars, officials warn.

Oh great, another “negative” story on the industry, yeah, it is. But this one is dated November 12, 2002 and appeared in the Cincinnati Enquirer in an Associated Press article.

I wish I could find these “experts” and find out what they are doing now. They hit this market on the money.

Authorities say mortgage fraud drives up foreclosure rates, promotes urban blight and hurts property values in some areas because when lenders realize the homes are worth much less than originally appraised, they usually don’t fix them up.

Of course there predictions weren’t very hard. Simple economics — and physics — drive the economy: what goes up, must come down.

However, too many people are focusing on today, without keeping in mind — any time something of value goes down, it bounces back. The markets are like a pendulum, first they go too far one way, then too far the other, and finally settle on a nice equilibrium.

So if you are riding the housing market’s pendulum hold on tight and enjoy the ride.

Photograph by Bailey Kirkpatrick and used with permission.

Writer for national real estate opinion column AgentGenius.com, focusing on the improvement of the real estate industry by educating peers about technology, real estate legislation, ethics, practices and brokerage with the end result being that consumers have a better experience.

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4 Comments

4 Comments

  1. Toby Boyce

    April 18, 2008 at 7:12 am

    One point to keep in mind though is that the pendulum effect only works if the property has true value.

    Enron stock will never bounce back.

    Some of these housing developments may never bounce back.

    You need to know your local market, or find an agent that does.

  2. JBourne

    April 18, 2008 at 10:14 am

    I agree with both of you, although I wouldn’t really classify real estate in the same league as Enron and other big name companies with huge stock drops.

    The real estate market always goes through a cycle just like the economy. Many economists will describe it as a healthy cycle because it weeds out inefficient elements, such as houses being overvalued, people getting mortgages they can’t afford, and lenders giving out mortgages they don’t have the money for and just write off to people willing to invest in bonds.

  3. Landflip

    April 18, 2008 at 11:56 am

    There are times that I feel like some get better home appraisals than others. In some cases with some professionals it is all about who you know and what they are willing to do. We can act like this does not happen, but I think in some cases it does. From what I hear, the banks are cracking down on this and paying more attention to what appraisers are doing.

    About the market…yes it will eventually swing back, but the questions how long will it take!

  4. Jayson

    April 21, 2008 at 10:57 am

    I agree that the market will bounce back – the lingering recession will definitely play it’s part and hold the market back but it will come back. Toby brought up a great point about real estate being local, there are better areas than others and it’s important that we all recognize and learn about the best areas in every market.

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The most spectacular streets of L.A.

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Dollar Sign

$wimming Pools, Movie $tars…and $treets of Gold!

Hey  friends – instead of  a humorous look at the MLS this week, I wanted to share something personal – my wonderful city of Los Angeles.  If you’d like to know where and what the most desirable streets in L.A. are, check out this great report in the L.A. Times by Lauren Beale:

https://www.latimes.com/business/la-fi-hot-streets27-2010mar27,0,6734165.story

I drive down these streets all the time, but I never take them for granted. I am still as star struck as the hordes of folks who come through here daily hoping for a glimpse of a movie star. The only difference is that we Angelenos want a glimpse, and then we want them to move the hell out of the way or risk getting run over (proceed or bleed!). After all, we all have somewhere to go, and that’s a monumental task in L.A.  The star dust on these streets is knee high…but there is an exhorbitant price for “$pectacular”!

Now you know why I love my job so much. See you next week with more MLS super-bloopers!

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Housing News

HUGE News From Twitter – Trending LOCAL Topics

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Twitter announced yesterday the roll out of Local Trending Topics.(We knew they would be putting to good use their purchase of GeoAPI last month).  This is a big event for the real estate industry and for real estate bloggers especially.  “Who cares what I ate for lunch yesterday?” you ask…. it’s not that, it is the ability to have your finger on the pulse of your local community in real time like never before (and leveraging that power)…

Think about it… you see a big news topic trending on Twitter and write a blog about it. When someone Googles the topic, you have a good chance of coming up high on Google, pulling people to your blog and positioning you as the go-to blog for hot local info, often scooping those asleep at the switch.

OR a news reporter shoots out a request for comments on the hot trending topic and you answer them (this happens OFTEN!) and you end up as a quoted source. Great! (This technique landed us on top of the 6 PM news when Obama announced the Help for Homeowners Plan, can you say priceless?)  You will become friends with local news reporters and be possible future sources as well.

Twitter Trending Topics

At a minimum, you will become a highly knowledgeable source on your most current local news.  Twitter is FASTER than local papers, TV and other sources due to the real time nature.  People post video clips and other live media (Ustream).  What if you were capturing those links on your own site?

Right now there are only a select few cities, but plans to roll out more are in the works.

If you couldn’t think of a way to use Twitter specifically for real estate before, with this new Super Local capacity, you might just think differently now….

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Media Coverage

Real Estate is About MEA CULPA

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It’s my Fault

(With a nod to a well know blogger who has a propensity for using latin, I would explain to those readers who are not familiar to the phrase that "Mea Culpa is latin for “my fault”)

Over the years, I find that people handle problems and successes differently. There are people who take responsibility for their success and their failures equally. These people are in my experience usually pretty confident and successful. They have found a balance in life. Too often people accept responsibility for their success but avoid responsibility for their failures. These people can also be successful, but I think they lack the balance that would allow them to really enjoy the success they achieve, and probably limits that success.

And then there is a third category of people that are modest about whatever success they have individually (though they may brag like anyone about their company or their achievements), but will take responsibility for things that may even have been out of their control – mainly because they feel they should have anticipated the problem or known that there was a wild card element that might need ot be addressed.

I Worry all the Time

Even when things go well, I tend to worry. I want to know that I have not only done everything I could to reach my intended result, if I don’t reach it, I want to learn why so I have a better result next time.

I don’t worry about making a mistake (If its noon and I haven’t made at least two mistakes I figure I wasn’t working or I didn’t get up yet) I just don’t want to make the same mistakes again and again. And I am not uncomfortable admitting that I made a mistake. That may be because I am confident that I can correct the problem, or at least that I am not defined by the mistakes I make.

I tend to trust people too much. According to one of my partners, I am literally “loyal to a fault” – but that’s a fault I am willing to own. But most importantly I don’t blame other people for the problems affecting me, and I look to myself for the solution

Last year Benn Rosales wrote a post about minimum standards and the Right to Practice. I agree with much of what was said in that post, and was interested in his suggestions for mandating minimum standards. But the real problem is that we as brokers (or managing brokers depending on your state) often don’t take responsibility for our agents because its too tough, or we want the licensing authority to do it, or our trade association, or someone else to mandate it so that we’re not the hard nosed bad guys. Maybe we don’t want to impose our standards on others even though we want other people will live up to our standards.

Everyone doesn’t do things the way I do – and they don’t have to. When I blog, it takes me a while because I don’t want to say something that I can’t back up factually. And I get nuts when someone else does that. I hate rhetoric without facts to back it up. I hate when people talk about what they think instead of what they know and I hate it when they speak in generalities instead of specifics. We can work on specifics, we can’t fix generalities.

If Its Your Problem, You can Fix it

If you aren’t accountable for something, you can’t fix it. If you give up the power of the problem, you give yp the power to solve the problem. Let’s take that aggravating listing you took 5 months ago and see how this theory plays.

You aren’t getting much activity through the listing, even though you’re advertising it and holding open houses. Its just that the market is so bad. There aren’t any serious buyers. The sellers arent cooperatvie. The house doesn’t show well. So obviously its not your fault that the home didn’t sell. Right? Wrong!

None of those things are your fault, but it is your fault that you took a listing that isn’t selling.

If buyers aren’t going through the property, then perhaps it isn’t priced properly?

If the property is being shown, but there are no offers, you need to re-examine the price and determine if there are issues with the physical condition of the home that need to be addressed. If the phyical issues with the property cant be addressed, then perhaps we need to.. you guessed it, review the price again.

If there are inquiries about the property but you aren’t able to show the home when you need to perhaps you need to get a key to show the property or install a lock box.

I could go on and on, but when you review the activity on a property, the home itself, and the terms you are offering , you can usually find the answer to the problem – and the key to that is being responsible for the problem, and therefore having the power to find a solution to the problem. And if you have a seller who will not cooperate, then the solution may be to solve the problem by firing the unreasonable seller ad moving on to a seller who wants to listen to your advice and get their home sold.

In any event, taking control of your life by being accountable for your problems should empower you in a manner that I’m sure you will find envigorating and enlightening. Now that you own your problems – go forth and solve them!

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