Category: Real Estate (page 128 of 266)

March 25, 2008

If I asked you “what business are you in” and your answer is “the real estate business,” you (like 98% of REALTORS®) are wrong according to Michael Russer of Russer Communications. Michael is a genius of sorts; he claimed the title Mr. Internet before we even found out that Al Gore invented it. Russer was tech before tech was cool. He made quite a name for himself in real estate circles back in the 90’s with his Mr. Internet moniker and a passionate belief that the Internet is not about technology, it is about connecting people. Now he flies all over the world telling real estate and other businesses how to use the Internet to market themselves and connect with clients and customers.

So why does Michael Russer think 98% of agents don’t know what business they are in? Actually, he asks his classes a different question. He asks attendees at his seminars if they have a specific target market that would be recognizable by visiting their personal web site. 98% do not have such a specialty or niche market. In other words, only 2% of REALTORS® are NOT generalist.

I am not a REALTOR®, but I did stay in a Holiday Inn Express last night, and that empowered me to come up with a few niche market suggestions for those of you who might want to stand out from the 1.3 million other REALTORS®. One of my strong beliefs is that if you try to be everything to everybody, you will end up being nothing to nobody. This is as true for an association of REALTORS® as it is for each individual member. It is also true in every other part of our lives. Remember High School? If you did not find your niche (band, AV Club, football team, etc.) you really struggled to fit in – to be relevant.

Why then, do 98% of REALTORS® fail to develop a niche within the overall real estate industry? For the same reason many other businesses fail to find a target market – they fear that limiting the pool of potential clients will Read more

March 25, 2008

Redfin.com beats the field again, this time in both Seattle and San Francisco: Buyers pay less and reap commission rebates, too

by Greg Swann

Suburban Phoenix Real Estate Broker

Redfin.com has news this midnight, but it’s the sort of thing I would normally ignore: It’s basically the kind of rah-rah-for-us stuff I leave for the vendor cheerleaders and the mainstream media. But: I gave Redfin a lot of grief last year when they made a similar announcement, so today I’ll give them a bit of their own back:

Online real estate broker Redfin Corporation today published an analysis of the last 12 months’ public real estate records in Seattle and the San Francisco Bay Area that shows its buyers and their Redfin agents negotiated a better price than buyers who used other brokerages. Redfin’s average negotiating advantage was $5,048. The company also reported a 95 percent customer satisfaction rate for users of its home-buying service, and an average commission refund of $10,520.

This is the actual news, which you will not find in any news source: Redfin beat the field for the second year in a row. Is it plausible that particular agents beat Redfin? Not just plausible, highly probable. I don’t know of any teams of buyer’s agents like the kind of team Russell Shaw runs for listing agents, but a team like that would be much more useful for comparison purposes than the entire field of Realtors in three MLS systems. But give Redfin its due: The company deploys the kind of task specialization common to every sort of business except residential real estate brokerage. It’s very hard to resist the idea that specialist negotiators, more often than not, could out-dicker ordinary jack-of-all-trades Realtors.

And all of that is caviling, and wasted caviling at that. Stand in awe as Redfin.com CEO Glenn Kelman illustrates the high art of PR triangulation:

“Why do Redfin customers consistently tend to negotiate a better price, in different markets and different market conditions?” said Redfin CEO Glenn Kelman. “Last year, we concluded it was because of our agents, whom we pay bonuses based on customer satisfaction rather than commissions. Others argued that it was because of our deal-savvy customers, who benefit from Redfin’s transparency to take a more active role in the deal. Today, we think it’s Read more

March 24, 2008

The Real Estate Bailout Act of 2008

by Brian Brady

Commercial Real Estate Finance Expert
Structured Debt and Equity
Licensed Real Estate Broker in AL, CA, and FL

When successful financiers achieve a certain level of success, they up the ante and practice social engineering. Robert Rubin, Jon Corzine, and Hank Paulson advanced to government service after piling up the pesos at Goldman Sachs (in financial circles, we say those two words with hushed reverence). After decades of whipping and driving the markets, the titans answer the call of noblesee oblige and decide to play with EVERYBODY’s money. While I haven’t risen to the austere positions Messrs Corzine, Rubin, and Paulson have, my friend Nick and I

have a little idea about how to save the American real estate market.

Let’s start with the premise that lenders are taking 20-30% hits on short sales. Then, let’s have the US Treasury loan 30% of the balance, of the aggregate debt, to homeowners whom request it, in order to pay down the first mortgage (or second mortgage). If I have $200,000, in aggregate liens against the property, the US Treasury will lend me $60,000, to pay down those aggregate liens, to $140,000. This reduces the lenders exposure.

What type of loan will the Treasury make to homeowners?

The term can be for the lesser of:

1- the remaining term of the first mortgage

2- 65 less the age of the primary borrower.

The interest rate can be the corresponding term treasury rate, plus .5% (for administrative costs). Maybe we can use some of that “yield spread” to coerce a few mortgage brokers to “originate” this government debt (okay, that was completely self-serving). For a 42 year old, with a 27 year term on his first mortgage, the term of this new government loan (in second position) would be 23 years (65-42=23). If a 23 year treasury bond yields 4.1%, than the note rate for the new loan will be 4.6%.

The borrowers never have to make a payment on this debt; it accrues like a negative amortization loan. In the aforementioned example, the balance would grow to about $168,000, after 23 years. With a first mortgage paid down to $140,000, we’re banking on Read more

March 24, 2008

Commission

by Sean Purcell

Real Estate Renaissance Man

There were a number of interesting articles last week regarding the value of a real estate agent. Essentially asking the agent to justify their commission. I know it got heated up over on Active Rain and there was some discussion on AgentGenius as well. Here at BHB we enjoyed two very good posts. You can read Brian Brady’s post here and Barry Cunningham’s post here. I disagree with both of them, which is all the more reason to recommend you read them. That and the fact that they are both very good reads.

Let’s Clarify the Question
First things first: the timing of the whole “justify your commission” question is counter-intuitive. It is coming up a lot lately, yet one would expect clients to question commissions when home sales are rapid and appreciation high. During those periods it appears simple to sell a home but, probably because of the prices being greater than the seller assumed, we rarely hear this conversation. Yet times like the current, when homes are not selling and people are most in need of a professional agent, you get the most questions about commissions. This has a lot to do with the fact that they are making less money than they expected. So let’s start by clarifying the true nature of the question. It has little to do with the agents’ value and everything to do with the clients’ profit.

Also, the question of value is directed primarily to the listing agent. There are some who will question the selling agent about their commission and they will do so regardless of the market. But for the vast majority of clients the selling agent has very little to do with this conversation. Why? Because the selling agent’s commission is already loosely tied to the market and so a function of supply and demand more than intrinsic value. When homes are moving quickly and inventory is small, the seller and the listing agent discuss what to pay the selling agent and often arrive at 2.5% or even 2% because there is no demand to pay them more (supply of buyers is high). When the market is slow like it is now, we begin to see the seller and listing Read more

March 24, 2008

While The National Real Estate Market Is Soft – Google Pay-Per-Click Real Estate Advertising Still Going Strong

by Doug Quance

Associate Broker

Is Your Online Marketing Costing You Too Much?

As one of those with an online presence, I am always interested in how others attract “eyeballs”. Back in the early days of Google, I proudly staked my claim on some choice keywords in their pay-per-click program – which brought me a great deal of traffic at a relatively low cost.

But that was then – and this is now.

The pay-per-click rates for the major cities are now – in some cases – astronomical.

Currently, the rate for Atlanta Real Estate is between $0.80 – $3.17… which is what is was a few years back when I quit advertising there. Three bucks a click is too rich for my blood. Average daily clicks on that search term is between 38 and 48… not that much, really.

For Houston Real Estate, the rates are between $0.86 – $3.76… with between 89 and 113 daily clicks for that term. A little more expensive – but there is more activity.

For New York Real Estate, the rates are between $0.65 and $2.18… with between 32 and 41 daily clicks. I thought that was odd, so when I researched New York City Real Estate, I see that rates are $0.69 – $2.44… and only 7 to 11 clicks daily on that search term. Unbelievable.

Manhattan Real Estate, on the other hand, has rates of $0.67 – $2.32… with daily clicks of between 10 and 13. You would think that in the Manhattan market, there would be more online competition for that Google space… but the truth is in the numbers – the searches just aren’t there.

For Los Angeles Real Estate, we find rates of $0.96 – $4.85… with daily clicks between 105 and 133.

For San Francisco Real Estate, the rates are $0.93 – $.43… with daily clicks between 43 and 55.

For Chicago Real Estate, the rates are $1.03 – $5.97… with daily clicks betwteen 122 and 154.

For Las Vegas Real Estate, the rates are $1.07 – $9.92… with daily clicks between 76 and 97. Getting kinda pricey, eh?

For Phoenix Real Estate, the rates are $0.77 – $3.01… with daily clicks between 29 to Read more

March 24, 2008