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Author: Sean Purcell (page 4 of 11)

Real Estate Renaissance Man

February 16, 2010

The Only Thing We Have to Fear, is Ourselves

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Real Estate Renaissance Man

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In my late twenties, as a trader on the floor of the options exchange, I was a “Master of the Universe”.  That’s a very common affliction down there.  Apparently, when you put a bunch of young, fearless, risk-takers together and give them the power to move markets around the world, you end up with a bit of a monster.  At one point I attended a symposium with my fellow traders; each of us secure in our status as Cowboy and Superman rolled into one very special gift for the world.  We listened to the latest market analysis systems and celebrated our shared royalty.  Amidst all the revelry was a speaker who didn’t have a financial background; he was more of a self-help, motivational kind of guy. (Believe me, the last thing that group needed was motivation!)  I remember not paying much attention to him – you know, being a “Master of the Universe” and all – but I wish I had.  He wasn’t there to motivate us, he was there to help us – to keep us from losing ourselves… an effort made mostly in vain.

Within days of the symposium all was blissfully forgotten; let’s face it, what could these talking heads possibly teach a “Master of the Universe?”  All, I should say, but this bit of wisdom from the self-help guru – the one who was so out of place.  This stuck with me and I damned him for it:

If you want to know who you really are, listen to that quiet voice you hear while driving home after a meeting, late at night and tired, with no one else in the car and the radio off.  That voice is who you really are… and the fears that voice brings forth are what you really fear.

Over time I was pretty sure I understood what he meant… but I didn’t.

I was thinking about this the other day.  I had just finished with a group of agents in my POPs Program, where we had been favorably comparing the stress AND the fun of being Read more

February 4, 2010

A Scary Thought on the (Non-Existent?) Shadow Inventory

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Real Estate Renaissance Man

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The shadow inventory has been a topic of interest with almost every agent I talk to lately.  Most believe it is large and few understand why it isn’t in the marketplace rather than held by the banks.  Russell Shaw recently wrote about the shadow inventory being gibberish.   It is an interesting article and one I recommend reading.

I rarely disagree with Mr. Shaw, and rather than do so now I’ll simply suggest that we are talking past one another.  As I read it, he is suggesting that this inventory doesn’t exist because it is, for the most part, out there already; just not listed as REO.  He makes it quite clear, however, that he is not talking about foreclosures still to come. (Apologies to Russell for over-simplifying.)  This is where we begin to part ways.  I submit that the shadow inventory must necessarily include not only actual REOs (or REOs not listed as REOs), but the entire picture.

More to the point, if we look at all the homes that have been foreclosed on, are in foreclosure and should be in foreclosure, we are left scratching our heads and find ourselves back to the same question: why aren’t the banks taking these homes in, putting them on the market, and selling them?   (I’m talking here especially about those homes where people have stopped making their payments and continue to live for 6, 12, even more months.)

MORTGAGES IN DEFAULT
Here’s a graph courtesy of the New York Times:

Sources: Federal Reserve Board and Mortgage Bankers Association, via Haver Analytics

That is an awful lot of mortgages in foreclosure; but add to that that lower line – of mortgages in default and not yet in foreclosure – and the numbers are staggering (again, think of people staying on a year after they’ve stopped making payments).  So no matter what we call it, the question remains: What are the banks doing? Why aren’t these mortgages foreclosed?  Why isn’t this inventory on the market?

I know all real estate is local and there are plenty of areas around this country where the last thing agents want Read more

December 23, 2009

Need Big Bear Bloodhound for a Listing

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Real Estate Renaissance Man

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A couple I am fairly close to, both personally and as fellow investors, are going to sell their second home in Big Bear.  I can proudly say their expectations have been raised and they are well versed in the Bloodhound way.  If you are – or know of – an agent in that area who leads the pack in marketing and listing activities based on the great foundation of “WHY,”  I have a listing for you.

December 8, 2009

Should I Touch You or Contact You?

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Real Estate Renaissance Man

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Yesterday in a marketing Mastermind Group with a half dozen agents, a bit of confusion arose over two of the primary principles I use when developing their marketing campaigns.  The question was new to me and that means it might be new to some of the readers here at BHB.

Earlier, we had discussed the parameters of an effective drip campaign on those we already know: friends, family, past clients, past prospects, and so on.  I call this group your S.O.I.L (Source of Income List) because we want to grow a very robust referral business from it.  Gary Keller, in his outstanding book Millionaire Real Estate Agent, refers to this group as METs and suggests you touch them or drip on them 33x per year.  I have “adopted” this philosophy wholesale and – as with most of the concepts in that book – find it applicable to agents no matter where they work.

A little later, I mentioned that statistically speaking, 80% of all business happens after the fifth contact.  This is not real estate specific.  It’s more of a universal rule borrowed from the direct marketing world.  (You may notice I do a lot of “borrowing” and “adopting”… most great marketing is based on ideas stolen from another industry or product.  Take a look around outside the world of real estate.  You’ll be amazed how many great ideas you find.)  While discussing this idea, one of the agents asked why we need to touch our sphere 33x when most of the business is going to happen after the fifth contact.  Great question because it illuminates one of the basic misunderstandings in marketing.

When you drip on your sphere – touch them regularly – you are practicing Epiphany Marketing.  This is very similar to branding but, in my opinion, more effective.  It’s designed to generate referrals and is on the very edge of what we can accurately call “marketing”.  On the other hand a true, honest-to-God marketing campaign revolves around a specific concept (hopefully a USP) and is designed to carry people along a well-lit path until they inevitably reach the decision to Read more

December 7, 2009

What’s in a name? That Which We Call a “Job” Summit, by Any Other Name…

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Real Estate Renaissance Man

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“When I use a word,” Humpty Dumpty said, in rather a scornful tone, “it means just what I choose it to mean — neither more nor less.”

“The question is,” said Alice, “whether you can make words mean so many different things.”

“The question is,” said Humpty Dumpty, “which is to be master — that’s all.”

Through The Looking Glass – Chapter VI

Lewis Carroll

Small business accounts for over 65% of all new jobs.  If you wanted to create new jobs (I mean, if that was your actual goal and not just a cover story) you might decide to sit down with people who represent small business interests.  The guest list for an actual, according to Hoyle, “Job Summit” then, might look like this:

  • The Chamber of Commerce
  • The National Federation of Independent Business
  • The National Association of Manufactures
  • and so on…

If, on the other hand, your actual goal was to consolidate power and become the de facto benefactor of jobs, you might want to sit down with the people who kill small business on a regular basis.  To keep things simple, you should probably limit yourself to those with whom you are already sleeping.  The guest list might look like this:

  • The Service Employees International Union (S.E.I.U.)
  • The American Federation of Teachers
  • The United Steel Workers Union
  • Policy wonks with absolutely no real world business experience
  • And of course, Paul Krugman (an economist/columnist so far to the left he can’t ever be right)

Which list do you think showed up for the White House “Job” Summit?

To paraphrase Lewis Carroll (and, quite possibly, President Obama?):
“It is a job summit damn it! It is because I say it is.  The question is, which is to be master: you… or me.  That is all.”

December 4, 2009

Embarrassing Confessions & Marketing Memory

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Real Estate Renaissance Man

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Two quick confessions:

I can’t throw a baseball.
I’m pretty sure I just scared a potential client away.

I used to be able to throw a baseball.  I played little league and pony league with some success.  There weren’t any pro scouts putting radar guns on me or anything, but I played right up until high school and I was regularly elected to the all-star team.  (Although looking back, it probably helped that I was much bigger than all the other kids and threatened to show them my Bruce-Lee-super-fist-of-temporary-death if they didn’t vote for me…  Nah, I’m sure it was my prowess inside the foul lines.)

Anyway, in high school I discovered my true calling: shot-put.  After that, I didn’t have occasion to pick up another baseball until my boys started playing just a year or two ago.  That’s when I discovered that I now had all the throwing grace and accuracy of a little girl.  You see, by my estimate I probably threw the shot – over the course of my competitive career – 15-20,000 times.  That pretty much wiped out any skill I ever had for throwing a baseball.  On the other hand, it created a near perfect shot-put technique that I can still demonstrate even now… as I enter my peak “mid 40s” athletic years.  (These are a lot like my peak “mid 20s” athletic years, only everything is now done while carrying around the extra weight of a small child.  It’s actually quite impressive if you think about it…)  Think about it or not, I can still summon dynamic and purposeful form because of a powerful adaptation called muscle memory.

Earlier this week, as I was parking my truck,  I noticed a car stopped in the middle of the street.  The driver was craning her neck to jot down information from an agent’s For Sale sign.  She then pulled up two houses and stopped again to take down information from another agent’s For Sale sign.  By this time I was walking down the sidewalk; I veered in toward the middle of the street and approached her on the drivers’ side.  “Hi,” I Read more

November 13, 2009

Embrace the Homebuyer Tax Credit: Solution to the Problem

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Real Estate Renaissance Man

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The $8000 first time home buyer tax credit is a mistake.  Congress should have enacted the original idea: a $15,000 tax credit.  This goes for the repeat home buyer tax credit as well.  As a matter of fact, I would like to have seen both tax credits even higher.  If you’ll maintain an open mind for the next few minutes, I hope to show you how embracing these tax credits actually creates a “win-win” situation that benefits you and this great nation.

The inherent spirit of humankind is individualistic, creative and inclined toward action.  The heart of man is inexorably drawn toward freedom: freedom to live, freedom to express and freedom to choose.  No matter what short-term damage is effected by an oppressor or institutionalized by a government, men and women will devise ways to rebuild and overcome.  Even in countries where the idea of freedom has been systematically driven out by force, we witness people taking action toward freedom.  It is a natural state that can be delayed, but not denied.  We are DOERs.  This country, the United States of America, is the poster child for taking action toward freedom.  We are a nation made up of DOERs.

So what does this have to do with the tax credit?  It empowers us with a “win-win” opportunity.  The immoral bribes to home buyers, the unconstitutional mandate for health insurance, the socialistic bail-outs, even the very destruction wrought by stimulus packages:  embrace them all!  These are all opportunities to make that “win-win” choice.  Embrace the home buyer’s credit and ACT on it!  Be a DOER.  It’s the DOERs who create the success of our society.  A nation of DOERs – of independent, entrepreneurial, action-based DOERs – will always bring about the necessary changes to save this republic.  If you desire your own success, then you desire to become a DOER.

More specifically: every action you take to help another person receive the tax credit strengthens you as a DOER while at the same time weakening the architects – the very architecture – that imposes itself upon a free people with that tax credit.  Eventually, Read more

November 12, 2009

The #1 Obstacle in Real Estate

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Real Estate Renaissance Man

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Would you like to know what the #1 obstacle is to achieving success in the real estate profession?  If you did know, would you create a marketing campaign around it and start knocking the ball out of the park?  I love marketing campaigns.  I love creating them and prodding them into action; I even love writing about successful real estate marketing campaigns.  But the truth is, the biggest obstacle to our success isn’t a lack of good marketing ideas.  It’s not the economy or interest rates or the inventory.  It’s actually nothing “out there.”  That’s because there’s nothing “out there” nearly so scary or powerful or destructive to our success as we are to ourselves.  That’s right: our #1 obstacle in Real Estate… is us.  We all carry around a few self-doubts, maybe even a few “I can’ts.”  If asked, I bet you could list five things you don’t like about yourself without even putting much thought into it.  It’s as if we’ve gone on a date with ourselves and halfway through dinner decided we’re not good enough for the other person at the table… and the other person is us!

Knowledge is power and knowing that we are our own biggest obstacle is very powerful. Yes, you have to have goals.  Yes, you need a marketing plan to achieve them.  But I guarantee you that plan will be much more successful if its very first step, is to fall back in love… with yourself.  Sound a little corny?  Maybe easier said than done?  Fear not: I’m going to leave you with a small, powerful two-word phrase for that all-important first step.  Not long ago I was talking to my 7 year old son and I was congratulating him on figuring something out for himself.  He immediately threw his arms into the air and said “Yeah Me!”  No pretense.  No guilt.  Only genuine admiration.  Imagine that: “Yeah Me!”

Go ahead, try it yourself.  Stop reading for a moment, put your arms in the air and say “Yeah Me!”  Come on… say it with feeling – really mean it.  “Yeah Me!”  Does it feel Read more

November 9, 2009

Goldman Sachs and God’s Work

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Real Estate Renaissance Man

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I guess I haven’t reached that point in my life yet when I’m so jaded (or is it cynical) that nothing will surprise me.  I say this after reading an interesting little article in the London TimesOnline.  They had the chance to interview Lloyd Blankfein, the Chairman and CEO of Goldman Sachs.  It seems he’s convinced – or at least he’s convinced he can convince us – that Goldman serves “a social purpose.”  As a matter of fact, Mr. Blankfein is so enamored with the self-importance of Goldman that he proudly proclaims he’s “Doing God’s Work.”  Wow…

Just to refresh our memory:

  • Goldman received $10 Billion in Tarp Money
  • Goldman received $12.9 Billion of government money through AIG
  • Goldman received $20.9 Billion in FDIC debt guarantees
  • Goldman, restructured as a “bank holding company” borrows at the Fed Window (at basically no cost)

Oh, and one more thing: Goldman will be paying $21.9 Billion in bonuses for 2009.  I don’t begrudge them bonuses, after all: they’ve had a helluva year.  Although some of that might be due to their oligarchical position within the federal government.  It would be nice – every once in a while – if Goldman would send a little thank you nod our way; maybe a quick wave or even a wink.  I guess I’m saying that when you’re screwing me this bad, a little dinner wouldn’t hurt.

John Lennon stirred up quite a spot of bother when he said: “We’re more popular than Jesus now.”  Have to admit though, that seems like such a trifle compared to the CEO of Goldman Sachs.  I mean, who cares if you’re more popular than Jesus?  Mr. Blankfein is angling to BE Jesus.

November 6, 2009

The Deeds for Lease Program Coming Soon to a Slum Near You (Also Coming Soon: the Slum)

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Real Estate Renaissance Man

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Fannie Mae announced today it’s implementation of the Deeds for Lease Program (which name, interestingly, they have trademarked). I cannot begin to count the problems with this latest attempt by the government to sober up an alcoholic nation by supplying enough booze to drown a water hippo.

You can read the press release and imagine the nightmare yourself so I’m not going to recount it here, but I will point out one of the less reported aspects of this program that has the potential to cause a whole lot of those pesky unintended consequences our political leaders are so loathe to anticipate:

… (the borrowers or tenants) lease back the house at a market rate… Borrowers or tenants interested in a lease must be able to document that the new market rental rate is no more than 31% of their gross income.

Interesting wording there at the end.  It’s not clear at first glance, but what this means is that if the borrower – who has generally endured a financial hardship to begin with – doesn’t make enough money, they’re still eligible… the rent will just have to drop to below market.  Well what could go wrong with a government/landlord artificially lowering rents throughout the nation… That shouldn’t bother anyone who works with real estate investors should it?  Anyone here, reading BHB, work with real estate investors?  I didn’t think so.  Sorry to have brought it up.  I’m sure the people who paid $70,000 for $30,000 trailers that are STILL housing people post Katrina know exactly what they’re doing.

November 2, 2009

CIT + FED = BK

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Real Estate Renaissance Man

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A few months back, as part of a Tin Foil Hat Production, I mentioned CIT’s desperate need for funds and the Fed’s decision not to bail them out. Why is this noteworthy? After all, I don’t believe the Fed should bail anybody out.  I cheer wildly to see Ford record surprising profits while competing against the Frankenstein creation that is GM, just as I quietly root for GM’s justified demise.  But here we are, with CIT declaring bankruptcy and the hypocrisy is just too much.   Apparently, a company focused on financing small business (70% of the entire factoring business!) is not worth a bail out from the administration that claims to look for ways to spur Small Business.  Color me cynical, but I think CIT’s main problem was a lack of Goldman-Sach’s alumni on its board…

September 28, 2009

The “I” News

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Real Estate Renaissance Man

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Happy Monday everyone.  Sean here, with the “I” news team bringing you a few under-reported items from last week.  Stay tuned for the Inspirational, the Inscrutable and the Indefensible.  You decide if any of it is Indispensable.

The Inspirational:
James Krenov died last week.  He was an artist, writer and philosopher who left an indelible mark upon this world.  You may not know him, but you have most likely seen the influences of his work in your work.  He was a creator of sublime furniture and leader of one of the most highly regarded woodworking schools in the nation (if not the world).  Take a moment from your busy day to click here and enjoy a little beauty.

The Inscrutable:
Football season is underway and those wacky kids running the NFL are at it again.  Texas receivers Andre Johnson & Jacoby Jones were fined $7500 & $5000 respectively for their roles in a fight during a game last week.  In related news, Eagles cornerback Sheldon Brown was fined $10,000 for wearing a Halloween mask to pre-game introductions.  Apparently, the NFL feels that a little embarrassing publicity by one player is twice as offensive as the violent offenses of two players… They do say image is everything.

The Indecent, Incredible & Indefensible:
The increasingly authoritarian nature of our Federal government continues unabated.  It is becoming widely understood that the Neo-Progressives bridle under scrutiny and brook no criticism; but this is outrageous even for them.  It seems the U.S. government is now sending threatening letters of warning to private companies who have the temerity to disagree with the administration’s proposals.

Humana Healthcare notified its customers that proposed health care plans before congress could reduce their benefits.  This, according to the non-partisan Congressional Budget Office, is simply a matter of fact.  The Department of Health & Human Services then sent a letter to Humana as well as all the other private insurance providers of the Medicare Advantage programs essentially saying: “Shut-up… or else.”  Click here to read all the gruesome details of central power run amok.

That’s all for now.  While you’re out there today, take the time to admire and appreciate Read more

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