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December 20, 2008

Workable real estate deals may require even more creativity

by

Suburban Phoenix Real Estate Broker

Author website

This is my column for this week from the Arizona Republic (permanent link).

 
Workable real estate deals may require even more creativity

I do a lot of work with buy-and-hold rental home investors, more and more of whom are able to come into Phoenix with all-cash offers. Poor me, I know.

But: I’ve been spending a lot of my time, lately, thinking about “triangle-trade” strategies — old-style funding mechanisms that we were happy to forget all about when money was easy.

So picture a buy-and-hold investor with 100% equity who wants the best deal he can get when he sells his former rental home. Why not do a lease-purchase instead of a straight sale? The investor can help his buyers accumulate a down-payment, perhaps working with them to improve their credit score at the same time. The investor gets a higher purchase price, the buyers get a lower monthly payment, everybody wins.

Or how about selling with a contract-for-deed? There are a lot of people out there with great incomes but lousy credit — more every day. If an investor — or ordinary homeowner — is willing to take on the risk of a carrying back a note, the home can sell now, rather than languishing on the market.

Or if the seller isn’t able to carry the whole mortgage, how about carrying back a second loan? If the seller has the equity, and if that will swing the balance with the buyer’s lender, it can make sense.

San Diego Realtor Don Reedy has come up with his own blast from the past: Parents help their kids get into homes by co-signing on the loan and helping with the payments, then share in the equity on resale.

Single people or single parents or childless couples could do the same sort of thing with a larger home: Go in on the home together as tenants-in-common, using their combined income to qualify for the loan, then paying the mortgage and sharing in the equity on a pro-rated basis.

Buyers are not in short supply, nor are homes available for sale. Creativity could make all the difference, going forward, in putting workable deals Read more

December 19, 2008

Blogger? Hell, No! I’m a Cyber Pro…Just Like You

by

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

Author website

I’m glad that Greg Swann addressed the whole blogging question.  Today, I’m going to share with you,  the members of the CyberProfessionals group, the genesis of the Bloodhound Blog Unchained University of Online Marketing Event, in Phoenix, on April 28-May 1, 2009.    I also want to tell you about the Bloodhounds and how this rag-tag group of agents and originators transmogrified from a pack of swaggering bloggers into some of the most nimble marketers on the web.

I think it’s important for you to know who we are …

…and why you should listen to what we have to say.

My online marketing game started on LinkedIn, in 2003. I had just moved from Phoenix to San Diego as a National Sales Manager of a start-up mortgage bank.  As start-up was the key word, I had to retain some personal production to pay for the higher cost of living, associated with the SoCal Lifetsyle.  I was invited to LinkedIn by a buddy in the tech field.  With the soon to be enacted “Do-Not-Call Legislation” on the horizon, a platform filled with high earning geeks was a phone-dialing, mortgage originator’s dream.  Rates were under 5.25% and LinkedIn was the “Online Chamber of Commerce” meeting…and I was the only mortgage guy in the room.

I didn’t call it social networking then, I called it prospecting.  You see, I’m a lot like you.  I started my sales life dialing the phone 300 times a day, selling municipal bonds and mortgage-backed securities to widows and dentists.  I moved over to mortgage origination in 1995 and dialed homeowners with FHA loans, selling them savings of “over one hundred dollars a month”.  LinkedIn wasn’t about the conversation to me, it was about the contact. Online media wasn’t some “experience”, it was a chance to get in front of someone and sell them…and it worked…and I was hooked.

Do you remember how you felt when you tried something new and it worked?  It felt amazing, didn’t it?  That was me when I closed my first loan from LinkedIn.  Only two things felt better than that first closing:  the first time I kissed my Read more

December 18, 2008

Random Thoughts For The New Year

by

Real Estate Investments Broker

Author website

Thought:

The only folks I know who can multitask without dumbing down the results are stay at home moms, God bless ’em. They’re seemingly capable of doing a dozen tasks simultaneously while being asked to kiss the booboo on Suzie’s knee, or laugh at the faces being made by Suzie’s big brother. The rest of the population? Multitasking for them is an ongoing disaster generating mediocre results at best, and shamefully embarrassing results at worst.

Go ahead, tell me you haven’t victimized yourself via multitasking, I dare ya. ‘Course I’m uh, challenged when it comes to doing too many things at once. It’s only been a recent victory — talking on the cell while pacing. Little steps I guess.

For 30 days, consciously eschew multitasking when it comes to your professional life. Focus like a laser beam on the task at hand. Produce the best of which you’re capable. Just 30 days. Try it and you should find out what I did. Everything I did improved in an easily measurable way.

Thought:

My favorite Two and a Half Men episode is ‘Call the Guy’. Because one brother refuses to get a pro to fix the satellite dish, he ends up with several painful injuries. He abhors calling the guy. Of Course, the running joke then becomes, ‘Hey, why didn’t you just call the guy?’

I bring this up because I’ve come close to tossing my cookies more than once after reading or hearing someone talk about their website woes. Seems they do everything themselves, but I’m thinkin’ they didn’t get the memo — they’re not web guys.

Yeah, I know, the proprietor of this site does everything himself. Well duh. If I had his ‘puter programming background I’d consider doing mine myself too. Probably not, but I’d consider it. But since most folks adopting the do-it-yourself approach could study what Greg knows on the subject for a year, and still not know what he’s forgotten, why bother?

Not convinced? Look, I get it if it’s because of the additional cost a pro brings to the party. If that’s the case, it is what Read more

December 18, 2008

Inman “news” has always been a FUD-driven vendorslut cesspool — that’s not new — but what is it doing to the Web 2.0 ideal?

by

Suburban Phoenix Real Estate Broker

Author website

Can you read this?

It came this morning in a piece of spam from Inman “news.”

Spam — unsolicited commercial email from vendorslut central.

And: Spam with FUD, InmanStyle: “If you can afford to ignore breaking real estate news and emerging technology trends, then Unsubscribe.”

That’s creepy, sleazy, slimy and repugnant — which is to say it’s marketing as someone from Brad Inman’s epoch understands it. Like all the relics Inman “news” tries to shove down our throats, Bran Inman is a dinosaur — a giant, thrashing reptile incapable of discovering his own irrelevance. Holding someone like him to Web 2.0 standards of behavior is like expecting an actual dinosaur to regulate its own body temperature — it’s more than he can ever do.

But remember that Inman “news” is now allegedly run by people from “our” world.

Do you wish to claim that they don’t know what spam is?

Is it your contention that they don’t know what FUD is?

Evil is doing something you know in advance is wrong. Is there anyone who believes they didn’t know that issuing this treacly piece of spam was morally wrong by standards they understood perfectly well, in advance of their acting?

I’ve been telling you this for a long time, but, sadly, we could not have asked for a more telling example:

When exponents of the vendorslut cesspool — Inman, vendors, the NAR — tell us they want to be a part of our world — what they always mean is that they want to suck us into their sewer of lies.

The things we call surprises almost always result from our failure to pay attention to stone obvious manifestations of reality occurring right before our eyes.

My advice, always: Mind what goes into your mind…

December 18, 2008

A Poke (in the eye) from Facebook

by

Real Estate Renaissance Man

Author website

You know, they say it isn’t wise – when you visit the Wizard of Oz – to look too closely behind the curtain.  Might not like what you see.  In Australia we were recently treated to a quick look behind Facebook’s curtain and I have to tell you: the king ain’t wearing any clothes!

Seems a nice young couple had bought a house, got upside down, stopped paying their mortgage and were doing everything they could to avoid the process servers and foreclosure coming their way.  Not altogether different from the unfortunate antics of a great many folks over in our neck of the woods.  I doubt many of us condone their behavior, but I find it difficult to root for the mortgage company either.  Sort of like watching a tether ball game between your ex-wife and her attorney: I don’t really care who wins just so long as both sides take one or two in the kisser.  Aaaaanyway, the mortgage company finally won the game.  Want to know how?  They looked this couple up and served them legal documents on Facebook!  (Read the full story here.)

Better yet, the local Supreme Court in Australia ruled that this was an acceptable use of the social networking platform.  Are you surprised?  Shocked?  Maybe even a little outraged?  I should say so.  I’ll bet Facebook was none too happy either.  Imagine the chilling affect this development may have on their social network site.  Let’s listen in:

Facebook spokesman Barry Schnitt praised the ruling.

“We’re pleased to see the Australian court validate Facebook as a reliable, secure and private medium for communication,” he said.

“The ruling is also an interesting indication of the increasing role that Facebook is playing in people’s lives,” Schnitt added.  The company said it believed this was the first time it has been used to serve a foreclosure notice.

I can only guess at the pride they’ll feel when the first paternity suit is served.  Are you kidding me?  I read this and the first thing I did was look up hubris in the dictionary, just to make sure I was using that word correctly in Read more

December 17, 2008

Making a Scenius scene to make an impact on your target market

by

Suburban Phoenix Real Estate Broker

Author website

Lender Bob says, “Hey, I’m a lender. I want to get Realtors to notice me. Hell, I want to get in front of them so often they can’t forget me. What can I do?”

Realtor Beth chimes in with, “He’s got the right idea. I’m a Realtor. I’ve got a blog and all, but I don’t feel like I’m talking to the people in my farm. How can I get my name and my ideas in front of them ever day?”

Vendor Bill adds, “I’ve got things once worse. I need to sell marketing ideas to Beth and Bob, both, but how can I break through the clutter?”

These are problems that can be solved by Scenius scenes. With the right scene, you can aggregate content and share it with people you want to do business with.

Watch:

Lender Bob can link to financial news and stories on factors that influence interest rates. He can make this scene available to Realtors in his market, who will have Bob’s free content available to share with their own readers. Florida Lender Kevin Sandridge is getting ready to do just this in his market.

Realtor Beth can link to local news stories and then echo that content to other weblogs in her market area. I’m doing this with Phoenix Area Headlines, but Beth could do other things as well. For example, she could do a “best of local blogs” scene to spread the link love around. Or, like Chicago Realtor Thomas Hall, she could do a scene on green real estate.

Vendor Bill has the easiest job of all, if he learns to think Scenius: He doesn’t need to cut through the clutter, he needs to slice it and dice it and serve it up in his own scene. I’m playing with this idea with Switched-On Marketing.

There’s more. Eric Blackwell is using a scene as a way of getting his 100+ agents to get on-board the social media marketing train. Cheryl Johnson and I are both using Scenius scenes to manage our listings on-line — but that’s an advanced-class topic.

The point of this: If you’re in the business of self-promotion, we’ve Read more

December 17, 2008

“Ben Bernanke Is Now One Of Us” Booyah !

by

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

Author website

“I demand that you refinance your home in three months and buy a bank stock“- Jim Cramer

Cheerleader Jim Cramer is now certifiably confident that housing will bottom in 2009 and the economy is saved because of the Fed’s recent action.

Cramer was, of course, ecstatic. This is exactly what he’s been calling for since his infamous “They know nothing!” rant on Aug. 3, 2007. The Fed’s move was so bold that he’s confident that his housing-bottom prediction for the third quarter of next year is virtually guaranteed. And the willingness with which the Bernanke seems ready to throw money at the problem – any amount of money necessary – has opened the door for the lending and borrowing that is so essential to a properly-functioning market and economy. Banks will open their coffers. Mortgage money will be available

Cramer finishes his monologue with the statement, “It’s raining Benjamins from the sky“.  That’s not inflationary, is it?

Check it out.

PS:  I”ve taken over 20 appplications, in the past three days, for refinance transactions; maybe 6-8 can fund.  If the FHFA and Bernanke abolish appraisals for rate/term refinance transactions, which seems like the next step, Bernanke will truly be “one of us”.

I”m not saying nuttin’ other than “operators are standing by“

December 16, 2008

The Fed Translated…..

by

Mortgage Officer

Author website

Release Date: December 16, 2008

The Federal Open Market Committee decided today to establish a target range for the federal funds rate of 0 to 1/4 percent.

What’s up with the “range” of rates?   Well, they’d look pretty foolish if they said they wanted the rate to be at .25% and the market was already trading fed funds futures at .14% as of this morning.   Calling the rate at .25% would be sort of like predicting yesterday’s weather.

Since the Committee’s last meeting, labor market conditions have deteriorated, and the available data indicate that consumer spending, business investment, and industrial production have declined. No arguments there. Financial markets remain quite strained and credit conditions tight. I’m not sure that a lot of people are as aware of the strain on the financial markets as they should be. Overall, the outlook for economic activity has weakened further. Enough said there….

Meanwhile, inflationary pressures have diminished appreciably. Saying that inflationary pressures have diminished is being modest.   Inflation is dead for now. In light of the declines in the prices of energy and other commodities and the weaker prospects for economic activity, the Committee expects inflation to moderate further in coming quarters. For inflation to moderate any further, deflation will become a huge issue. Let me rephrase that, in light of the Consumer Price Index report this morning, it’s pretty apparent that deflation is an issue.

The Federal Reserve will employ all available tools (available tools – oh and since we’re running out of ammo in our normal tools, we’re going to come up with some new ones.   We hope that they work and we hope that they persuade people to start spending and borrowing money again) to promote the resumption of sustainable economic growth and to preserve price stability. Price stability – yeah, we are kind of concerned about that deflation thing and we’re afraid that all of the money we are printing is going to have a very negative effect on the value of the dollar and the value of our stock market investments, but we’ll worry about that some other time. In particular, the Read more

December 16, 2008

What matters more — Attitude or Aptitude? I had always put my money on Application, but I realized the best bet is all three

by

Suburban Phoenix Real Estate Broker

Author website

I edited 1,407 files in 1,407 folders on Friday. Not by hand, mind you. That would have been a tedious and error-prone path to an inevitable suicide for someone like me. No, I built a spider to do the job, and it took a surprisingly long time to run — almost four minutes.

But I wanted to put the Phoenix Area Headlines Scenius scene into every engenu web page we’ve built so far, and that entailed editing 1,407 files in 1,407 folders — dispersed among thousands of folders in dozens of domains all over our file server.

I didn’t really edit them, of course. Software doesn’t work that way. I sucked the files to be altered into memory, concatenated my new code on at the end, killed the original file and then wrote down my new version under the same name. I built the engenu file architecture anticipating that I might want to do things like this.

And that kind of thing makes me a hard sell on the idea of Attitude with a capital A. I definitely believe in working from a positive frame of mind toward positive goals — all based firmly in reason and logic. But it doesn’t matter how many times you say, “I can do it!” — if you don’t actually know how to edit 1,407 files in four minutes. Attitude is nothing without Aptitude.

But Aptitude is nothing without Application. We are all of us buried up to our necks in work we could be doing, and our success at digging ourselves out is entirely a function of how we apply ourselves.

Aristotle said, “We are what we repeatedly do.” For most of my life, I’ve regarded that as being the essence of human character. But there is an interesting question about those 1,407 engenu pages: Where did they come from?

Each one of those engenu folders represents a web page, and many of them are grouped together into web sites. A single-property web site might consist of 20 or more engenu folders. An extensive home search could run to 60 or more folders — 60 or more web pages linked Read more

December 16, 2008

More on Detriot: “Change” is a four letter word, too.

by

IDX Search Entrepreneur

Author website

Right before I read Thomas Hall’s earlier post about his experience in Detroit, a friend sent me the ad below.

(Really interesting post, btw, Thomas.)

Considering the situation they are in now, its too bad the Big Three didn’t lose the white collar dinosaurs along with blue collar dinosaur in Thomas’s post. Maybe they would have built cars other than SUVs that Americans would buy and at least have a plan in place for $4/gallon gas.

(Side note: Now that we are down to $1.70/gallon, how much do you want to bet Hummer sales rebound?)

December 15, 2008

The deathless prose of the Bloodhounds: Against advice of broker

by

Suburban Phoenix Real Estate Broker

Author website

This is a form I wrote for a house that Cathleen may or may not have in play. The details have been fictionalized, but the underlying situation — a house trashed so badly that it becomes a menace to safety — will probably only become more common.

Caveat lector: I am an Arizona real estate broker, empowered by our state’s constitution to prepare documents incident to the transfer of real property. Your local laws will be different.

BUYER IS PURCHASING REAL PROPERTY AGAINST ADVICE OF BUYER’S BROKER

Buyer’s Broker herewith explicitly advises Buyer against the purchase of 123 Mulberry Street, Hadleysburg, AZ.

1. Buyer is aware that property has been looted by a previous owner, tenant, burglar, interloper or tenant-at-sufferance.

2. Buyer is aware that all kitchen appliances, fixtures, counters, cabinets, shelving and appurtenant items have been removed from the property.

3. Buyer is aware that the truss-mounted air-handler has been removed from the property.

4. Buyer is aware that the extent of any additional looting is undetermined and is substantially indeterminable.

5. Buyer is aware that attempts to repair or refurbish this property could result in further damage to the property and/or injury or loss of life to Buyer or Buyer’s contractors or employees.

6. Buyer is aware that repairing or refurbishing a property in this condition is a task that should be undertaken only by experienced building contractors.

7. Buyer is aware that additional damages resulting from attempts to repair or refurbish this property could destroy any or all residual marketable value in the property, with such loss in value being Buyer’s sole responsibility and liability.

8. Buyer is aware that injuries or deaths resulting from attempts to repair or refurbish this property could be construed by courts or insurance companies to be Buyer’s sole responsibility and liability.

9. Buyer is aware that many other residential properties, substantially in turn-key condition, are available nearby at reasonable prices.

10. Buyer has been advised numerous times of Buyer’s Broker objections to this purchase.

ERGO, BUYER ACKNOWLEDGES BY HIS SIGNATURE HEREUNDER THAT BUYER IS PROCEEDING WITH THIS PURCHASE AGAINST THE PROFESSIONAL ADVICE AND JUDGMENT OF BUYER’S BROKER, EXPRESSED REPEATEDLY AND STRENUOUSLY.

Buyer agrees to release, indemnify and hold harmless Buyer’s Broker for any and all losses, Read more

December 15, 2008

In Detroit, Idle is a Four Letter Word

by

Realtor, Rabble-Rouser

Author website

In a prior life, before becoming a licensed real estate professional, I was responsible for implementing supply chain technology in the discrete manufacturing arena – more specifically – the auto industry.

Over a 7 month period, between 1998 and 1999, I made a temporary home in Sterling Heights, Michigan – 16 mile and Mound Road to be exact – home to Ford Motor Company’s largest real axle and transmission manufacturing and assembly facility – one million square feet of real estate, generating roughly $1.7B of product.  The plant was as vertical an operation as I have seen, short of a foundry.  From raw forged metal, UAW workers machined gears and assembled rear wheel drive transmissions for Ford’s cars and trucks – the Mustang, Lincoln Town Car, Explorer and the Ranger pickup – at the time, some of Ford’s hottest products – the Explorer was selling like crazy.

Before setting foot in Sterling Heights, I was tasked with creating a new sales methodology, tools and implementation plan that calculated the ROI of our supply chain technology solution once implemented.  The sales methodology walked a senior executive through the hard dollar, tangible savings and return to bottom-line profit contribution our technology solution would deliver.

Process created – tools developed – mission accomplished.

Or so I thought.  Now go prove that it actually works.

My first – and my team’s feat was to sell our solution to the VP of Operations.  We walked through the process and learned from our discussions that the VP of Operations was given the directive to reduce Work In Process inventory – WIP had grown disproportionately to end-unit assembled transmissions.  This particular problem was a no-brainer – our sweet spot.  Our solution optimized the flow of WIP and synchronized the flow of raw material to end-unit assembled transmissions via planning and scheduling algorithms.  Cake.

Unique to our solution was our commitment to reduce WIP over a 12 month period.  Our proposition – Ford would pay our travel expenses and small overhead expenses for our 12 month assignment – nothing more UNLESS we delivered results over and above the $20M goal.  Any additional savings above and Read more

December 14, 2008

Hope and despair at the onset of economic recession: Who cares about the tunnel? All I can see is the light…

by

Suburban Phoenix Real Estate Broker

Author website

I don’t do well in despair.

Clarify that. I don’t mean that, when I find myself in despair, I fare especially badly.

What is mean is, if despair were a classroom discipline for which one could be tested and graded, I would probably flunk out.

I’ve lived through some ugly stuff in my life — who hasn’t? — but mostly I didn’t notice. I’m good at thinking — or so I like to think. And, good at it or not, I really do like to think. But I can only think about one thing at a time. For most of my time, for most of my life, I like to think about work. I like to think about what I’m doing. I like to think about what I’m getting done.

That doesn’t leave much room in my mind for despair. Or depression. Or gloom or sadness or fear or doubt or pain or worry or any of the things that people talk about when they’re not talking about work. I know about those ideas, much as I know about ideas like schadenfreude or universal guilt, things that I’ve heard about or read about but never seen from the inside.

You could say that’s my good luck, I suppose, but I’m sure it’s a choice on my part. Who hasn’t known sadness, after all? It’s not that I’ve never lived with painful emotions, it’s simply that I choose not to live with them any longer than I have to — which almost always turns out to be no time at all. I turn to my work not to escape from pain, nor even to work to alleviate it. I turn to my work because that’s what I love most in my life — and my purpose in living is to love my life.

But I come up short, I think, because I’m so badly equipped to prepare for desperate times. We’re headed into an economic recession, perhaps a depression, and I truly don’t know what to think about it. I’ve lived through several of these episodes in the past, and I worked right through all of them and Read more

December 13, 2008

For some, the most financially-astute course of action may be to fake their way to foreclosure

by

Suburban Phoenix Real Estate Broker

Author website

This is my column for this week from the Arizona Republic (permanent link).

 
For some, the most financially-astute course of action may be to fake their way to foreclosure

Looking for some good news in the Phoenix residential real estate market? So is everyone else.

New foreclosures are down, as are new foreclosure filings. Lenders are working with homeowners to help them stay in their homes, just in time for Christmas. That’s good news right?

Maybe. It turns out that, of the folks who negotiated loan workouts in the first quarter of 2008, 60% are back in default on their loans.

It gets worse. The typical newer stucco and tile West Valley tract home lost 7.41% of its value. In November. Year-over-year, that house is down 35.46%. Compared to its high in December of 2005, that property is down 48%.

Now there is a silver lining. If you bought your home in 2003 or before, and if you have resisted the impulse to refinance it, you’re probably still ahead of the game, at least by a little bit. And with interest rates at historic lows, this might be the time, finally, to refinance to lower payment.

And investors and first-time homebuyers could not have things better: The selection of available homes is still very broad, prices are below replacement costs, and interest rates are deliciously low.

Better news — for people who don’t own homes: Prices could go a lot lower, and interest rates could drop even more.

But what, then, is the implication for loan workouts? Until home prices stabilize and start to rise again, a loan workout against substantial negative equity might not make the best financial sense.

As we talked about last week, the hit on your credit rating from a foreclosure is a terrible thing. But it’s plausible to me that you could recover from that faster than your home will once again be worth what you’re paying for it.

And that’s the worst news of all: We have mismanaged our economy so dreadfully that, for many people, the most financially-astute course of action they can take is to pretend to be deadbeats, to fake their way to Read more

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Inventing Real Estate 2.0

Welcome to BloodhoundBlog, the national real estate industry marketing and technology weblog written by, for and about real estate professionals. Better yet, welcome to the wired world of real estate. We are busily inventing Real Estate 2.0 – technology, marketing, service and salesmanship. Like all Bloodhounds, we are smart, frisky and fiercely independent. We've built a spot on the earth – beloved over all – where each one of us can be who we are, no matter who that might be. We are committed to an idea of excellence that will flush the bums, the con-men and the crybabies out of the real estate industry. If you yearn to have your failures excused, your moral lapses absolved or your boo-boos kissed, seek elsewhere. But if you are sick to death of mediocrity – welcome home. Read all about us, subscribe to our feed and steel yourself for the hunt. We work hard, we play hard, we learn everything we can – and we bow to no one.

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