Author: Kris Berg (page 3 of 5)

by Kris Berg

Realtor, Associate Broker

Author website

What factors contribute to price declines in a downward trending market? Interest rates, affordability, demand, and consumer confidence to name a few. Today, I have a new one: Crappy agents.

My beef of the week is the confidence crisis I see among agents, at least in my local market, and there are two camps cast in our realty reality version of Fear Factor.

“We fear things in proportion to our ignorance of them”. Titus Livius

First, there are the newer agents who haven’t experienced anything but a flying-off-the-shelf listing environment. Their training and mentoring has been focused entirely on getting the listing, the listing being the Holy Grail of real estate. Listings are King, they are told, and once that listing is secured, the check is in the bank. And the future checks are just around the corner. Use the listing to populate your marketing copy, snag those sign calls, and spawn new listings. Keep the car warmed up, because off to the bank you will again be – very, very soon.

“The greatest mistake you can make in life is to be continually fearing that you will make one”. Elbert Hubbard

Even veteran agents have seemingly forgotten that markets change, and with that, our approaches to the business need to adapt. Speedy-quick contracts, contracts proferred and negotiated without breaking a sweat, contracts which are all but guaranteed to make their way to the County Recorder’s office in 30 days with narry a hiccup, are a thing of the past. Unlike the new agent, they once lived a time when the hard part wasn’t “winning the listing”, but when the real work ensued once the contract was inked. Many seem to have forgotten.

Listings are becoming a dime a dozen, and it’s what you do with the listing and the trust the client has placed in you that now separates the men from the boys, the “salesmen” from the “professionals”. What does it take for an agent to successfully represent a seller today? Hard work, time (a lot), money (a boatload), and patience.

“Time is money”. Benjamin Franklin

I often tell sellers that I don’t make the market; Read more

by Kris Berg

Realtor, Associate Broker

Author website

This is perhaps a regional topic. I admittedly don’t know how it is done in other cities, but in San Diego we still have the time-honored tradition of the weekly Broker Caravan. This is an entrenched ritual which has historically been preceded by a “pitch session”, a practice originally born out of necessity. Steve shared his disdain for the archaic ritual this morning at our home blog, and being in the same philosophical camp, I felt compelled to add my two-cents.

In the Beginning

In the beginning, absent a computerized MLS data base, the “book” was published, weekly or monthly depending on the region. The “book” held the key to the real estate agent’s business: All active listings. For new listings taken between publication, the only way to get the word out to the real estate community was to have a little social gathering. The homes were the draw, and the free donuts and coffee were a nice side benefit. Agents shared information, networked with one another, and truly brokered homes. The term caravan was appropriate to describe the pitch session aftermath, where the agents all piled into their respective Realtor Mobiles and visited the new offerings in succession. Ah, the good old days.

The Origin of Species

Darwin would be proud. With time and progress came change. In many instances, thankfully, the pitch session was eliminated. All listing information is now available online, real time. If an agent has a new listing, I know about it, and no 60-second oral presentation is going to give me more information than the MLS already has. The Broker Caravan still has value, that value being a convenient opportunity to allow agents to gain access to a home without having to make appointments and preview. It is a convenience for the sellers as well – Give them a two hour window to get it, get out, and get it over with.

Survival of the Fittest

About a year ago, a local title company got the fabulously fabulous idea to reinstitute the pitch session in our local community of Scripps Ranch. To my amazement, they successfully sold the concept by Read more

by Kris Berg

Realtor, Associate Broker

Author website

Signs of the times.

When the going gets tough, the tough jump ship. I am starting to see the telltale signs of a challenging market for many agents as manifested in the game of Musical Brokers that is typically played when agents sense business could be better.

I, too, have been guilty of going agent-overboard in the past, several times actually. Two of the moves were pure genius, yet another was impetuous and, in hindsight, downright stupid. In each case, Steve and I were inspired to make a change because of vision: Our vision of the future of our industry and our perception that our Broker lacked it. I have come to the conclusion that real estate companies generally fall into one of three categories: Cruise Ships, Battleships, and Dinghies. (Tiresome methaphor ensues).

Cruise Ships

These are the big boys who captain the party boat. They are large, they enjoy huge name-recognition, and they barrel blindly ahead with a full boat. Everyone is having such a good time that no one is looking to the iceberg on the horizon. Alternative business models? An evolving client base? Shifting technological and economic tides? Everyone is too engrossed with the all-you-can-eat buffet to see it coming, at which point it is too late to change course. At the first sign of rough waters, bookings decline, profitability tanks and excursions are canceled. They are used to these dry-dock periods, and they will be back the next time people are ready for a good time.

Battleships

Battleships are also huge and unwieldy, and corporate. They are in charge of the troops, they have rules (too many), and they thrive on control. They are most concerned with image, image of the company, and individual rights and privileges are routinely subordinated for the greater “good” (read “bottom line”). They have a long-range plan, yet the Joint Chiefs are too bogged down in red tape to read or react swiftly to the undercurrents of a changing industry. Battleships, like the Cruise Ships, are unable to turn on a dime, but correct course they will – eventually. In the meantime, too many sailors have gone AWOL.

Dinghies

Dinghies Read more

by Kris Berg

Realtor, Associate Broker

Author website

When did people stop being genuine? In our uber-competitive world, it seems every gesture is intended or at least construed as self-serving. Professionally, we have all become salesmen; we sell our products, our services, and ourselves. We have become increasingly skeptical and cynical, our actions are premeditated and our lives are scripted. We have a script for our acquaintances, for the telemarketers, and for our customers and clients. “I’m fine, how are you?” (I’ve had a sucky day to end all sucky days); “Thank you, but we are happy with our long-distance service” (I have no idea who my long-distance service provider is, but I am currently watching Forest Gump for the eighth time); and, “It is important to list with an agent who cares about your family and your equity, wouldn’t you agree?” (I have said this so many times that it has lost all meaning and sincerity).

New agents and even the multitudes wanting to take their business to the “next level” are constantly being coached to learn and rehearse The Script until the objections can be overcome in their sleep. Knowing what you might say in a given circumstance is one thing, but spewing forth a rehearsed scene with the passion of a high school science teacher is another.

In all things marketing, I continue to believe that we should think like the consumers we in fact are. How would this ad impress you? Would that brochure inspire you to purchase the home or consider employing this agent in the future? Is the quality, content and overall flavor of the piece consistent with the image you really want to convey?

Our words are no less important. How do you react to a too-practiced sales pitch? Do you enjoy being pitched at all?

The reality is that we are all ego-driven, and being primarily motivated by self-satisfaction and personal fulfillment is not a character flaw, it is the human condition. Even the kindest, most generous among us practice magnanimity as much for the way it makes us feel good about ourselves as how it might serve another. The bottom line is that we Read more

by Kris Berg

Realtor, Associate Broker

Author website

It’s a strange real estate world we live in. Some markets, such as Manhattan and San Francisco reportedly thrive, while others such as Southern California have been more than mildly affected by declining home prices and slower sales. And then within each region there are micro-markets. In my own San Diego, it is the tale of two cities.

It is the best of times, it is the worst of times. There are two distinct buyer psychologies at play. One segment is looking for a deal; the other is looking for an upgraded, turnkey opportunity. There are similarly two demographics at work. One wants (needs) the lower-end, entry-level product (in San Diego, these prices start with a “4”), while the other is less affected by trivialities like mortgage rates, economic indicators or general market trends (in other words, money is no object). Mediocrity, whether it be price or condition, is just not being rewarded. It’s enough to scare the Dickens out of a seller.

“Ms. Blogging Person, have you actually read A Tale of Two Cities?”, you ask. Heck no. I, for one, detest Dickens. Given the choice of being subjected to one more reprisal of A Christmas Carol and bamboo shoots under my fingernails, I will opt for the root canal every time. That’s what SparkNotes are for.

And, Multiple Offers are alive and well. Having been involved in several during the past month, it has become painfully clear that newer agents who may have missed the wacky knock-down-the-sign-installer-to-be-the-first-offer-in-the-door antics of the late ’90’s and early 2000’s may be unfamiliar with the intricacies of multiple offer situations. It has also become clear to me that many veteran agents just don’t get it. Thus, I generously offer a few tips to the buyer’s agent who may find himself in a competing offer position. If you missed the book, here is the cheat-sheet.

1. “Multiple” means “more than one”. Fancy yourself the expert negotiator? Well, Mr. Kissinger, good luck with that. You are not the only offer on the table, and your “look at me – I have a Buyer!” position of strength has been compromised. You need Read more

by Kris Berg

Realtor, Associate Broker

Author website

I have been busy lately, so busy that while my back was turned I missed about 47 Russell Shaw Podcasts. Sorry, Russell. I fully intend to listen in, uninterrupted, when I have a sufficient block of time (say, the month of May?), but I have been too busy with business to learn how to do more business. I have been reading Inman like I read the daily print rag – Headlines only. And only a teaser along the lines of “Greg Swann to Speak at Annual Humility Conference” would have tempted me to get side-tracked.

So, what I have been doing all week is a lot of mechanical real estate stuff (prepare for the listing, take the listing, market the listing, manage the escrow). What I have been doing a lot more of, however, is listening. By Friday, my husband Steve (or, my wacky sidekick, as he often calls himself) may be threatening to have the phone surgically removed from my ear.

What I have learned can be generally categorized as follows:

• A bunch of well-intended people are knee-deep in bad loan doo-doo in my area, far more than I knew.
• Steve and I are finding that Pro Bono work is taking a considerable amount of our time these days, and we don’t mind.
• Lenders and loan brokers are making us look good.

Steve and I, in the past week alone, have met or spoken repeatedly and at length with three different couples in trouble. The situations have ranged from the sad to the tragic. In each case, we have felt it was our obligation and duty to meet with the parties to pencil out scenarios and discuss the implications of the various options. In each case, we knew that we would not be paid for our time, now or in the future. Call it social responsibility.

My “tragic” example involved a military family with three properties totaling approximately $1.7 million in value, all acquired within the past two years, the most recent having closed escrow just a couple of months ago. Each was purchased with or refinanced into a 100% interest only loan with negative amortization. Due Read more

by Kris Berg

Realtor, Associate Broker

Author website

Do you know what the most common name in America, or perhaps the world, is? Undisclosed Recipient.

From another inductee into the Realtor&174; Hall of Shame, yesterday I received a most exciting offer. “Mr. Realtor”, as he calls himself, had this to say:

When I was in the trenches, I always tried VERY hard to spend at the MOST 3 hours with a buyer AND sell them a home. It didn’t work EVERY time, but it did work MOST of the time.

Now, this just impressed the socks off of me and made me proud as punch to call myself a Real Estate Professional. After all, my goal when assisting buyers is to sell them something in record time so that I can move on to my next victim sucker easy mark client.

I understood one fact…

I am suddenly riveted to my computer screen, as I sense the voice of authority coming my way.

The more houses a buyer sees, the more confused they get – and you along with them. Let’s be honest. After you show 10 homes, no one remembers much.

Amen, brother! I just get all those silly houses confused. I saw eight homes during the Broker Open House yesterday, and I’ll be darned if I can remember one from the next. Yet, I know all the words to the Green Acres theme song, and I managed to put my socks on the right feet this morning. Go figure.

Mr. Real Estate is shopping his book “Secrets of Selling a Home in 3 Hours or Less”. Wind-up, pitch:

You’ll discover how you can “program” the buyer in your office first. In the book you’ll see how they buyers were “pre-sold” in the office.

I have to wonder if “they buyers” knew they were being programmed. I also have to wonder how one sleeps nights promoting the showing of “less” houses in the name of making a fast buck.

The message from Mr. Real Estate got progressively more painful. It involved a P.S. (suggesting that you “sell” the buyer anything even if he can’t afford it, or someone else will), a P.P.S. (announcing the must-attend upcoming seminar), and a Read more