There’s always something to howl about.
Inman News is reporting today on a possible reprieve for seller-paid down-payment assistance programs like AmeriDream and Nehemiah. As you will recall, Brian Brady gave you the heads-up on this initiative on August 27th. Brian will be checking in shortly with details of his schmoozing adventures with Barney Frank’s kitchen cabinet. Cliff’s Notes: Don’t tear up those purchase contracts just yet.
Technorati Tags: real estate, real estate marketing
Commercial Real Estate Finance Expert
Structured Debt and Equity
Licensed Real Estate Broker in AL, CA, and FL
San Diego City Attorney Michael Aguirre attempts to halt the flow of new loans, into San Diego , by calling a “do over”:
San Diego’s city attorney said on Wednesday he filed a lawsuit against Bank of America and its Countrywide unit to prevent the mortgage lenders from foreclosing on homes in the city, which he aims to make a “foreclosure sanctuary.”
City Attorney Michael Aguirre plans to file similar lawsuits against Washington Mutual, Wells Fargo and Wachovia in an effort to make the lenders negotiate with mortgage borrowers facing foreclosure.
“We would like to see San Diego become a foreclosure sanctuary,” Mr. Aguirre said.
Oh brother. This is so stupid I don’t even know where to begin. Foreclosure is an important part of a loan contract. If a government interferes with the execution of that contract, then a precedent of interference will be set. Two things can happen:
1- Lenders will need to assess the cost of the “foreclosure sanctuary” and build it into the cost of the newly originated loans. Buyers will reject the new loans, priced far above loans made in Del Mar, and the City of San Diego housing prices will plummet even farther.
2- Lenders will, most likely, just ignore San Diego. We saw it happen in Cleveland, about ten years ago.
I knew a shylock, back in Philly. He worked the union halls. He’d loan a guy a few hundred bucks, until payday, and make 30% vig for the effort. His default rate, for first -time borrowers, was extraordinarily high. I asked him about his collection policy, visions of The Sopranos in my head. The “shy” didn’t like to get his hands dirty.
If a borrower defaulted, the shylock refused to lend money in that particular union hall. He let his steady customers enforce his collection policy. If a bright borrower decided to alert the authorities, the shylock simply denied any lending activity, and took the loss. Of course, he never lent in that union hall again.
Mr. Aguirre’s political stunt could lead to that “mob mentality” should lenders halt all activity in the City of San Diego. Sellers, frustrated with the Read more
Commercial Real Estate Finance Expert
Structured Debt and Equity
Licensed Real Estate Broker in AL, CA, and FL
I guess we saw this coming. Robert Kerr has been talking about the collapse of the GSE’s, in the comments section on Bloodhound Blog, for close to a year now. Sean Purcell and I recorded a teleconference for California REALTORS about the Treasury bailout of the GSEs.
We talk about what exactly happened and what the near-term (3-4 month) effects and medium-term (12-18 month) effects on underwriting guidelines and rates. We also guessed at what the long-term (2-10 years) effect on conforming loans will be, in light of the mandate for the GSEs to reduce their portfolios.
The podcast lasts for about 15 minutes with 10 minutes of good questions and commentary by Marlene Bridges, Orange County REALTOR, Roberta Murphy, San Diego REALTOR, and John Novak, Las Vegas REALTOR. While I told the participants that their questions wouldn’t be recorded, it appears that they were. Thanks to everyone who participated in the call.
We’ll be doing more of these teleconferences on a regular basis.
Real Estate Success Tracker is a Customer Relations Manager/Transaction Manager for Realtors. It comes in Windows and Macintosh versions, plus a networked version that will work with clients on either platform.
REST CEO Matthew Hardy — a BloodhoundBlog Unchained in Phoenix matriculant — has been paying attention to the marketplace — unheard of among real estate product vendors — so REST has been quietly moving into the cloud. But Hardy has always been committed to both data security and to your ownership of your data, so REST in the cloud will be available only from your own REST client software — with the database running on your REST network server in your office.
And so the next logical step in this cloudwise progression is an iPhone client, and that is nearing completion. Shown below are three reduced screens from REST for the iPhone, which could be released in beta form as early as this afternoon:
REST is free to try. As a CRM it rocks, but it’s designed to bring systemization and automation to every aspect of a Realtor’s practice. As an example, it’s very easy to build Gary-Keller-style drip/touch campaigns for your clients, customers and prospects. Also very easy to build task scripts for assistants, which can then be assigned to clients or transactions.
Matthew and his team are working hard to integrate REST with the iPhone, bringing us one step closer to one of my long-held dreams: A unified contact database that is synced to every computer and mobile phone in our business. REST is one of the key components we are counting on to take our business into the cloud, and the iPhone app will be a big step in that direction.
BloodhoundRealty.com is a REST installation, but I confess we haven’t made the best use of it, so far. The software has been there for us, but we haven’t been there for it. We have an intern working now to correct our RESTlessness. But: Cathleen and I will both be running the beta iPhone app, so I’ll let you know how it’s working for us.
Technorati Tags: real estate, real estate marketing, technology
There was an interesting article just published in Editor and Publisher Magazine. (HT to Jon and Jennifer Karlen for sending me this via email this morning) It describes the new real estate advertising deal between 282 newspapers and Zillow.
Rather than offer my opinion(s) on this up front, I’d like to have Bloodhound Blog Readers take the time to read it and offer THEIR take in the comments section….here’s your chance to analyze today’s real estate news! (grin).
Let me ask some questions to get the party started!
Will this change SIGNIFICANTLY change the fortunes for either Zillow or the 282 papers? Will this add the local traffic that they are starving for? Which entity will get the “better end of the stick” in this deal? Is it really REALTORS vs everyone else in the battle for eyeballs? Will it be a saving move for both entities as they push for more traffic? OR is it rearranging deck chairs on the Titanic?
Bonus research question: Is your location impacted by this deal?
Ok, folks…if you have been longing to throw your views out there for a while and have not done so, here’s your chance!
What say you? ( I will offer my opinion in the comments section after the conversation’s in full gear!)
That image looks nice, but I’m pretty sure it’s a mistake. We’re growing, always, but I don’t think we’re growing quite this fast.
I know that Technorati has been cleaning out its sock drawer, so, for all I know, that could be a true reflection of our Technorati reach. But I think I’ll wait a few days before borrowing against that number…
Technorati Tags: blogging, real estate, real estate marketing, technology
[This is the introductory text to an eBook I have prepared discussing the idea of divorcing the real estate commissions, a topic I have discussed here at some length. You can find the eBook by clicking here. If you like, you can post a button linking to this book — there is code at the end of this post. But my primary motive for putting this together is to appeal to the various consumer-facing personal finance weblogs. I don’t foresee any meaningful reform in the real estate industry originating from the inside, so I am doing what I can to arm consumers against the pernicious evil that is the National Association of Realtors. –GSS]
Introduction
Here are three interesting real estate questions, two that came to me directly and one that was commended to me by Rudy Bachraty of Trulia.com.
Question #1: “Potential buyers for our home ($800K – California) have a realtor but he did not find our home for them. The buyers did and have visited both times without him. He has played no role whatever in bringing us these buyers. If we accept their offer why on earth should we give him 3% ($24K) of our home’s equity for contributing nothing whatsoever?”
Question #2: “When looking at homes on our own and calling the listing agents ourselves to set up appointments, does that obligate us to go with the listing agent if we decide to place an offer on the property?”
Question #3: “Since the amount of work involved doesn’t really differ according to the value of the house, financially, it seems like the percentage commission would make higher prices more favorable from a buyer’s agent’s perspective. If this is the case, why would the buyer’s agent be motivated to help negotiate the price down?”
Now, there are nice, long, complicated answers for each of those questions, and nice, long, complicated answers are the very essence of a certain type of salesmanship. It’s called Tap-Dancing, and it works — at least if you’re easily confused. But here are much shorter, much more truthful answers to those three questions:
Answer #1: If you want to hang Read more
This is my column for this week from the Arizona Republic (permanent link).
August was a great month for real estate sales, but when 40% of buyers are pushed off the playing field, home prices could plummet
We won’t have reliable numbers for a few days,* but preliminary results leave no doubt that August was a huge month for real estate sales in the Valley of the Sun. Not for prices, alas, which continued to slide by around 1.5% last month. But, of the bread-and-butter suburban tract homes we track, around 200 will have sold, a two-year high.
September promises to be a banner month also, with nearly 280 homes currently under contract. Not all of those homes will make it through the escrow process, but most of them will.
What accounts for all this activity? The single greatest factor is seller-paid down-payment assistance programs like AmeriDream and Nehemiah. An FHA loan requires a 3% down-payment, and these grant programs permit the seller to fund the grant, along with up to 3% more for closing costs. The upshot is that buyers can take possession of the home for “nothing down.”
In recent months, down-payment assistance programs have accounted for as much as 40% of sales of resale homes, and as much as 90% of new-build sales.
Here’s the catch: Under the mortgage relief act recently signed into law, seller-paid down-payment assistance will be forbidden. The restriction takes effect on October 1st, but most lenders have already closed the window on new AmeriDream and Nehemiah loans.
It’s possible these programs will be reinstated by future legislation, but, even if they are not, it’s not the end of the world. It’s no great challenge to find a decent starter home for $100,000. And if buyers cannot manage to save up $3,000 for a down-payment ($3,500 after October 1st), acquiring a huge new debt may not be the best solution to their financial problems.
But the short-run prognosis seems pretty obvious: When 40% of resale buyers are forced onto the sidelines, the downward pressure on prices should accelerate.
The bottom line: If you’re prepared to buy a house in the Phoenix area, either Read more
Well, it’s Friday again, everyone is back in school, my 18 year old is off to college (only 35 minutes away but still) and the mortgage world keeps moving on. So what’s this week look like? Well, frankly there were a couple of other things going on, but the main thing that happened was jobs this week. Which jobs? The ones that were getting cut and the ones that John and Sarah are running for (yes I am going to talk about politics!)
First, the jobs that are getting cut. The August employment numbers came out and they were frankly quite dismal. We lost 84,000 jobs in August and both June and July’s numbers were revised downward. In addition to that, the unemployment rate jumped upward to 6.1%, the highest level in, I believe, 5 years. The numbers were not only bad, they were worse than the markets had expected and that has correspondingly renewed the use of the “R” word (not Republican, recession) and has reduced the fear of inflation. The silver lining in that dark cloud is that mortgage rates have benefited this week. The dark side is that there are a lot more people out of work.
So what does that mean? Let’s focus on the “obvious” first:
1. It means that there are very few if any employers who are expanding right now. I’ve heard discussions that in order to handle the growth in our society, we need to create an additional 100,000 plus jobs every month. We aren’t even close to that number. So that’s not a good sign for the overall economic picture.
2. It’s probably also a byproduct of the fact that the credit crunch is moving from just being a subprime mortgage problem to being a mortgage problem to being an overall credit problem. Why is that so? If you were a business owner who was looking to expand but can’t borrow the money needed to expand, it is going to be harder to hire more people. It’s a vicious cycle, know what I mean?
3. If more people are afraid of losing their jobs, then Read more
There is so much pop-demographic-driven hype about Gen X, Gen Y and the “Millennials” (I saw that movie…cartoon family in red suits, right?) in the RE Blogosphere that it has become a bit of a cliché.
It makes sense: The industry is dominated by Boomers, and if you are a self-proclaimed RE Guru, there is no better way to scare a Boomer into downloading your eBook than to suggest that they are no longer “hip”, that the next generation is smarter about technology than they are, and that the alignment of these two trends threatens their very way of life.
Sort of like how their parents felt about the Beatles.
Then something comes along that syncs up with the hype, and it reminds me that there really is some substance behind the idea that generational demographics are at work, and that it matters.
On the Property Detail pages of our RE Search Engine, we encourage people to ask our agent a question. We have cleverly named this feature “Ask Our Agent” (AOA). This recent question is my new favorite:
“Straight up: Does this neighborhood suck? Don’t lie, I will be there soon, and if you do, I’ll know.
You can tell me if it sucks without saying, “Hey Jay, It sucks out there.” Be smart.
P.S. Don’t lie.”
This question reveals so much in so few words:
The property in question is a $105k, 3 Bdrm row house in Bridgeport, CT , so it is within reach of a younger buyer. The listing is not our client’s, so all we have on it is what came out of IDX – the base facts and the one picture (complete with garden hose and trash cans) that shows a house that looks to be in reasonably good shape, but tells us nothing else, including the name Read more
“I wonder who was your intended audience?”
A question from my inbox, and one I hear occasionally. I’m always pulled up short by questions like this, or this, because they tend to come unexpectedly and in this case, it greeted me first thing in the morning, and the writer, who shall remain nameless but knows who he is (and is, I’m sure, laughing right now) was by his own admission, a bit grumpy when he asked this question. So Good Morning to you too!
Actually, this question, or variations of it, has been on my mind lately because I forgot this intended audience for awhile, and the post to which this writer was referring was my way of going back to the beginning of my blogging days, when I was writing to the very same people to whom I wrote this post- local bloggers. How did I lose my way? Quite honestly, I think it was Twitter, but that’s another story for another time. Let’s return to my blogging roots.
Possibly the first piece of advice Greg gave me when I started blogging on The Brick Ranch was to find other local blogs and connect with them. Notice he didn’t say other real estate blogs, but local blogs. A Google search, and Google alerts, turned up only a handful of blogs back then- March 2007. Seriously, I think there were about five non-political blogs, and most had only been at it for a few months, which is a cool thing as I’ll explain shortly. At first I simply left comments on their blogs without a return blog url, because I wanted to be there as a participant, not as a spamming Realtor- there is an implied accusation when visiting local blogs, am I really there to sell them a house? Um, no. I’m really there because I like talking with people, throwing ideas back and forth, and I know that most bloggers like comments, so leaving a thoughtful comment, using my name, not “TimbuktuHomesForYou” in that tiny little blogiverse where everything was shiny and new, was an easy way to say “Hello! Nice to meet you.” It was about Read more
Has SellsiusRealEstate.com (“Just like Craigslist, only not free!”) hit the Dead Pool? The weblog rages on, but the main site doesn’t even 404. The “About” page for the weblog has been re-rendered as yet another those-who-can’t-teach pitch, and, of course, Sellsius was a pioneer in the suddenly-popular practice of making net.friends in order to sell them out to advertisers. Perhaps these business models are enough to keep the wolves at bay. Sic transit gloria mundi.
But despair not. Even today, there is something new under the sun. RealtyBaron.com is introducing an idea it calls “risk management for Realtors.” What it is is a hedging strategy — akin to an insurance bet in Blackjack — whereby listing agents pay a premium to insure that listings are profitable whether or not they sell.
Worth a thousand words:
Oh, wait. That is a thousand words. 😉
This is not quite stoopid, although it shares some genes with stoopid. It’s a Realtor-milking scheme, beyond all doubt. It’s not quite as scurvy as some scams, but it does amount to you betting on your own failure, hardly the food of a good attitude.
I don’t completely hate the idea. But, assuming it takes off in sufficient numbers to matter, it seems to be misaligned to rational market incentives.
As I’ve discussed in the past, we charge a non-refundable retainer to sellers for similar reasons, to cover our front-loaded costs if the rug is pulled out from under us. But the primary reason for the retainer is to impose a meaningful cost on the seller for pulling the rug out from under us. We want for our sellers to have some skin in the game, to make cancellation an unattractive prospect — and to make sure they’re completely committed before we start working. The hedge bet does nothing to assure the commitment of the seller.
Moreover, as above, the entire plan is built around a bet on failure. If you as the lister know your ass is covered both ways, are you as likely to do the whatever-it-takes to get your listing sold? And if you are not, what direction should you expect the Read more
I was inspired to republish this post, which was first seen here almost 18 months ago, after reading the answer my son gave to a Brown & Brown client yesterday via email. I’ve spent four years mentoring him within an inch of his life. Pride bubbled up from nowhere as I read his response. At 27 he’s already where I was at 40. (I just turned 57.)
His journey to full ‘agentship’ is another post altogether.
Not being a hi-tech guy by even the most lenient definition, I try to bring to the fore, skills required to actually list or sell real estate. Until GeekWorld figures out how to interact with prospects and clients belly to belly, cats will continue to be skinned in every conceivable way — except hi-tech. Even Hal hasn’t figured that one out.
The ability, the art if the truth is told, to answer questions is almost always the difference between consistent success, and consistently being just ‘this close’. You’re reading that and know exactly what I’m talkin’ about.
It’s shameful the way I used to answer questions from prospects or clients. The excuse of age is available, as I was only about 25 or so. But even youth, or having just transitioned from homes to investments doesn’t wash as an excuse for my pitiful performance back then. It’s truly a blessing there were no hidden cameras or recorders in the office back then.
Clients would ask me if the rents in the area would tend to rise during the holding period. And I’d answer yes. The problem? Most folks asking questions want the answer, of course. But what they really want is the ‘why’ or ‘how’ behind your answer. Back then it irritated me no end that they wouldn’t just accept my answer as if I was quoting from the missing third tablet Moses forgot on the mountain. I knew the answer. Why couldn’t they just take my word for it? What a moron I was. I could have been more full of myself back then, I’m just not sure how.
That’s about the time I was blessed by Read more
Chrome: Yawn. Firefox, OTOH, is coming along nicely. I now run it side-by-side with Safari on my Mac. Safari is still my fave, but I don’t rail at Firefox like I used to.
The user interface of the iPhone is actually a hugely subversive paradigm shift in computer design: Tapping, multi-touch, micro- and macro-spatial awareness — these are all new things under the sun. Cathleen has been hearing interesting rumors about this UI being the basis for a MacTablet computer. And Apple has an event scheduled for next week…
I mentioned a week or two ago that I’m having Cameron build a session-tracker for our web sites. What he’s working on will live at the top HTML level of our server, so that, if necessary, he can track activity from the same one IP address across multiple domains. In other words, if someone follows a link from here to BloodhoundRealty.com, then from there to one of our single-property web sites, we should be able to see every movement.
I find myself wanting something like Jott without the limitations. When I’m previewing a house, I’d like to be able to dictate my impressions on the spot. I’d also like to be able to dictate emails, weblog posts and miscellaneous memoranda. Is there anything out there like that, ideally phone-based like Jott?
Technorati Tags: real estate, real estate marketing, technology
The Pledge of Allegiance
Alright now – simmer down – relax – this is not a political post.
With the advent of a new school year here, I couldn’t help but be reminded of days gone by – in the classroom – Ms. Sukula, my second grade teacher – with Bewitched hair – stood proudly at the front of the classroom, hand over her left breast – slowly reciting the Pledge of Allegiance. She told us to stand like soldiers – hand over our chests with pride – you’re an American!
Now if you didn’t recite it along with her – her eyes would focus on you with the deep intent of causing bodily harm – lips firmly and taughtly pulled back to bare her brilliant white teeth – still slowly reciting the words – almost melodically.
It was definitely not a smile – believe me – her message did not lack clarity.
Ahh – memories …
Now – surprisingly, this draws parallels in my current day-to-day life as a real estate agent deeply embroiled in the pursuit of sorting out of all the new technology solutions in the Real Estate 2.0 cyber space. You’ll notice from my last post – this is a taking some time.
Greg has shared with us the cool new Trulia app for the iPhone here on Bloodhound. I recently saw on Twitter that Trulia has already surpassed over 10,000 downloads – this new functionality not only is cool, it clearly has legs.
But why am I not running to Trulia?
I am a member – I participate on TruliaVoices. I’ve claimed all of my listings and have subscribed to Trulia Pro – but their latest feature has me frustrated – blogging. While it is a great feature, I can’t help but ask myself, why do I want to put all of my eggs in the Trulia basket?
I have spent the last several idle months re-alphabetizing my CD collection, sorting through my closets and more importantly, really being focused on learning the new Web 2.0 tools and building my online presence. I’ve invested in my own domain for my blog and Read more
