…is PR6. And as personal good news for Cathy and me, the Page Rank for BloodhoundRealty.com went to PR5.
Technorati Tags: blogging, real estate, real estate marketing, technology
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(If you are not a country music fan, you may have a serious character flaw, but that is the subject of another post on another Blog. For now, here is a video that will help you “get” the title of this post.)
Across the nation, in most markets, we not only have too many listings, we also have too many overpriced listings. It is true in Charlottesville; it’s true in Atlanta, Austin, and Atlantic City. I know it is true even without looking at the local statistics for all these markets because “too many listings” and “too many overpriced listings” goes hand in hand. The basic law of economics – supply and demand – dictates that prices will adjust downward when supply is too high.
Following that logic, what we need is a good old fashion INVENTORY REDUCTION SALE! Can you picture this ad as part of the NAR public awareness campaign?
“Hi, I’m Charles McMillan, President-elect of the National Association of REALTORS® and I’m here to announce an across the board 30% reduction in home prices. That’s right, this is the REALTOR® Spring Spectacular event of a lifetime. Buy before July 1st and save BIG on any home in any market.”
Okay, that’s not going to happen, nor could it. The real estate market is not like the market for toilet paper at Wal-Mart. In real estate, we have something like five million owners (sellers) of the “company” that would have to approve an across the board price reduction. That’s a lot of decision makers even by Wal-Marts standards.
Some sellers have figured out the economics of the current market and agreed to price their home correctly. Guess what? Those are the homes that are selling. In the CAAR MLS, homes that sold in March sold after and average of 130 days on the market (DOM). That’s not a particularly good number, but it beats the 149 days (and counting) that the current active inventory is averaging for DOM. In addition, a closer look at the numbers will show that many of the homes that sold in March, sold quickly; Read more
Well-written piece by Mark Gimein in Slate this morning asks an interesting and important question:
In ordinary circumstances, the people and institutions you deal with reinforce social norms. They say it’s not OK to lie. But what happens when the structures and institutions break down and start telling you the opposite?
The answers it portends are unsettling.
Remember when Enron was still everyone’s darling? Remember when they were a high flying company that could do no wrong?
Remember when AOL was high flying and had the audacity to buy Time Warner?
Or even Bear Stearns? Kmart, Qwest, MCI/Worldcom, Lucent Technology, Arthur Andersen, all were at one time ‘highly regarded’ companies that lost a huge percent of their value. That’s a ‘top of head,’ list without considering the Airlines.
There are countless more examples of big companies getting wiped out in a day. People’s pensions are inevitably the big story. Middle class families get wiped out because they had all of their ducks in one basket. Employees sue the company because senior executives didn’t tell them that there were risks inherent in the stock. The media has their normal pity party. But the real shame? Nobody stops to think for a second: no matter how good the company, is it sane to put all of your money in one place?
When I get on someone about blogging (un artfully), the real message was meant to be this: if you only have one widget for getting money, you’re nuts, and you’ll be destroyed someday. Maybe not soon, but someday. It might, temporarily, be a most efficient to do what works, and chase a single source of leads. How was business done 15 years ago? We didn’t predict the nature of today’s changes. Blogging is great, and it might last a long time. But you cant operate with the assumption that it’s going to be here. That leads to complacency and obsolescence.
To have a healthy business, you have to have many sources of income and leads, so if one of ’em dries up, you’re not on the streets. Because…no matter how good the widget, no matter how efficient the model, you MUST have several great sources for your business. It’s a baseline survival requirement for this new market.
What would happen to you if the top 2 sources of leads dried up in a short time. Even if ROI Read more
This is my column for this week from the Arizona Republic (permanent link). The lender in the story? Brian Brady, America’s #1 Mortgage Broker.
The challenge for Realtors and lenders in the future: How do you sell to consumers who don’t want to be sold?
We represented a cute couple in the purchase of their first home late last year. That much is not news: First time home-buyers are the bread and butter of the real estate business. What was interesting to me was how internet-focused they were.
The husband, Michael, is an internet adept, but his wife, Danielle, is a true wizard. Her primary interface to the commercial world is the world wide web.
They found me on the internet, of course, and I referred them to a lender that I know through the nets.
Consider this: There are 30,000 Realtors in Phoenix, and at least that many lenders. All of them are advertising at a furious pace — newspapers, real estate magazines, supermarket shopping carts, bus benches, billboards, radio, TV — plus balloons, free pens and scratch pads and coffee mugs, refrigerator magnets, flower seeds, recipe cards and Halloween pumpkins.
Real estate professionals spent millions of dollars trying to get Michael and Danielle’s attention, and all of that money was wasted. They are not paying attention to advertising.
To the contrary, if Danielle cannot completely research a product or service on-line, she won’t have anything to do with it. They never once went into the home they were buying without a digital camera. I watched Danielle crane around in impossible contortions so she could read and write down the model and serial numbers from the washer and dryer so she could research them on-line.
Looking forward, nothing changes as fast as we expect it to. But looking backward, the world seems always to be changing like dreams. Danielle is immune to advertising. She recycles her junk mail unread. She doesn’t want to be pitched, she doesn’t want to be sold, she doesn’t want to be wheedled or needled or cajoled. She doesn’t want to be closed on.
All those old school gimmicks still work — on some Read more
On April 12th, I posted some “news” from NAR regarding the unanimous approval by RESO (Real Estate Standards Organization) of the draft data standards for listing display.
On Friday, April 11th, NAR announced that the Real Estate Standards Organization (RESO) had unanimously approved a “draft standardized data format for distributing real estate listing information.”
A few of you wanted more information, so I contacted NAR’s Technology Center and got the full scoop.
First, the draft is NOT available on-line, at least in a format that non-techies can read. Here is a link to some really technical stuff for those of you who know what an “enum” is all about (I do not have a clue).
Second, I found out that these standards are a subset of the RETS data. The RETS Syndication Standards (the official name) includes less than 2 dozen fields (I’ve heard 14) from RETS. That sounds like a lot of field at first, but once you count up the obvious ones (e.g., agent name, contact, beds, baths, etc.) that is not very many. Not that I’m second guessing the wizards who came up with this stuff.
Finally, the near riff I reported in the original post was reasonably accurate. The big aggregators were tired of the slowness and bureaucracy of the process, but after they threatened to create their own standards, the process moved very quickly. Essentially, they are beta testing now and will make the final decision in August.
So, what does this mean to REALTORS®? Here’s what Chris McKeever from NAR said in an e-mail:
With the RESO and NAR backing of this Syndication Specification, this could very easily be adopted into MLS systems to allow them to be the clearinghouse for data transfer between all points. In other words, your single point of listing data entry into the MLS could then also dynamically be sent to every site that you choose, very similiar to how REALTOR.com is fed now. This, coupled with the growing number of consumer facing MLS search portals(link) could throw a complete paradigm shift into how listings are marketed on the web.
Choice is becoming more critical as options increasingly expand. I have read about this potential problem for years and now we seem to be well along the road to increasing abundance of options. As real esate agents, we’re inundated with options regarding web sites, social networking avenues, blogs to read, models to consider, marketing techniques to employ and advertising venues to use. It’s the flip side of the blessing, the curse of too many options and the problem of choice.
One of the benefits of sites like Bloodhound is that people are giving consideration to these problems and openly writing about what has been found to be the best practices. Awhile back I talked about an article written years ago predicting how the internet would intially be chaos, then experimentation and selection and winnowing, then a standardization period. I want to give credit to the writer, but I can’t find the source. Perhaps someone will remember.
It seems we are still in the experimentation stage, but as we quickly change and learn, choices will hopefully become easier. There is still a dearth of statistics showing the effectiveness of blogging, social networking and online marketing through website providers, RE sites and social sites but anectdotal evidence and personal experience based on analysis are beginning to give us an indication that these new forms of doing business have much potential for those who are adopting the right methods and utilizing them in a committed way.
I do have evidence in my own company that online business has increased by at least 20-30% each year for the last three years, I just haven’t pinpointed which methods produce what part of that business — perhaps it’s a holistic effect of it all.
Making choices is based on knowledge gained through experimentation, our results and the results of others, developing certain guidelines I can use to measure new offerings. In other words, I’m getting to a point where I don’t have to experiment with every new online offering, wasting money on useless gimmicks — it’s easier to tell now which ones have merit and which ones are just a snazzy remake of something I’ve tried that didn’t work.
I suspect many real Read more
With the median age of real estate agents being 52 years of age (source NAR), new Realtors hoping to make their mark in the real estate business are casting aside conventional wisdom.
New Real Estate Agents Seeking Gen X And Gen Y Buyers Break From The Mold
New real estate agents, cognizant of the fact that 84% of homebuyers start their home buying journey on the Internet and that the median age of first time home buyers is 32, now realize that what may have worked for the elder-statesmen of the industry is not what their clientele are looking for.
In a demographic wherein 50% of which use social networking websites,the axioms of traditional real estate sales is not viewed as being prudent.
Young agents are now finding that chaperoning prospective buyers from house to house and acting as the veritable liaison between the Buyer and Seller is not generating sales among the Gen X and Gen Y hip and technologically advanced home buyer.
“People, especially my peers, aren’t looking for a ride to the property or a go-between; they want to IM me to find out how big the basement is,” said Lisa Johnson, 33, who works for Coldwell Banker in Haverhill. “They often have more information on the properties than most realtors. They don’t want a new friend; they want answers fast and will make decisions quickly when you provide them. I know this because I’m the same way.” (As reported recently in the Boston Globe.)
It is becoming more and more apparent that a fresh, younger, breed of real estate agent is in great demand in an aging industry struggling to keep pace with a market populated with an emerging younger homebuyer. The dilemma? The real estate industry continues to get older while the industry’s consumer base begins to skew younger.
This widening gap poses a great conundrum for traditional real estate agents.Younger prospective home buyers seek to do their own research, on their own time, and in their own manner. They expect a real estate agent to “chill-out” and just be there when they are ready. They definitely do not want to be involved Read more
Taken While Up In The Frozen North
Kinda sums it up, don’t it?
I recently found myself in the unenviable position of taking a good long look in the mirror. Not your typical mirror on the wall (although I often find that to be no picnic either), but the metaphysical mirror; the “pot calling the kettle black” kind of mirror. I often comment on posts (lately they have been Barry’s) decrying what I perceive to be criticism without construction. But as soon as the topic turns to our beloved NAR (a favorite around the BloodhoundBlog), I join the nattering nabobs of negativism. Barry’s post on the NAR’s recent attempt at a technological video is the latest example. At last count there were 66 comments and I am in there at least twice with some snide sizzle and no meat. (Hello pot, you’re black!) But there are also some comments from Ian Smith, one of the people vested with producing the video. He came into what can only be described as hostile territory and acquitted himself quite well.
So here is what I propose. The contributors, commenters and readers of BloodhoundBlog may very well constitute the premiere brain trust in RE2.0. We complain, sometimes with great vitriol, that we would like to see more from the NAR and here is our chance. I challenge as many of you as possible to step up in the comments to this post and offer your services to Ian for the production of these videos (I’ll start if off below). I imagine we have many experts here abouts: video, editing, graphics, music, writing, production, agent advice, technological advice and so on. Ian, your challenge is to get whatever bureacratic sign-offs you need in order to open the project up to some expert volunteer help. The progress will be reported from time to time right here on BloodhoundBlog and we can all take a hand in improving that which we so often pillory.
Michael Wurzer at FBS Blog fingered an astounding exposition by Clay Shirky on the impact participatory media will have on us all:
This hit me in a conversation I had about two months ago. As Jen said in the introduction, I’ve finished a book called Here Comes Everybody, which has recently come out, and this recognition came out of a conversation I had about the book. I was being interviewed by a TV producer to see whether I should be on their show, and she asked me, “What are you seeing out there that’s interesting?”
I started telling her about the Wikipedia article on Pluto. You may remember that Pluto got kicked out of the planet club a couple of years ago, so all of a sudden there was all of this activity on Wikipedia. The talk pages light up, people are editing the article like mad, and the whole community is in an ruckus–“How should we characterize this change in Pluto’s status?” And a little bit at a time they move the article–fighting offstage all the while–from, “Pluto is the ninth planet,” to “Pluto is an odd-shaped rock with an odd-shaped orbit at the edge of the solar system.”
So I tell her all this stuff, and I think, “Okay, we’re going to have a conversation about authority or social construction or whatever.” That wasn’t her question. She heard this story and she shook her head and said, “Where do people find the time?” That was her question. And I just kind of snapped. And I said, “No one who works in TV gets to ask that question. You know where the time comes from. It comes from the cognitive surplus you’ve been masking for 50 years.”
So how big is that surplus? So if you take Wikipedia as a kind of unit, all of Wikipedia, the whole project–every page, every edit, every talk page, every line of code, in every language that Wikipedia exists in–that represents something like the cumulation of 100 million hours of human thought. I worked this out with Martin Wattenberg at IBM; it’s a back-of-the-envelope calculation, but it’s the Read more
Have you even had an afternoon off (yeah right!), looked forward to some quiet reading time and been overwhelmed by the shelves full of thick novels, success books and hi-tech, how-to manuals? All you wanted was a light read and a glass of wine. BloodhoundBlog is sometimes a bit like that shelf. So much hi-tech content and cutting edge theory designed to help you improve, yet – and I can not speak for anyone else – sometimes a little low-tech advice is just what the doctor ordered.
The Little Voice
By the end of a long week in this business of ours, you can be pretty tired. This week ended on a particularly poor note for me as one of my fellow tri club members was fatally attacked by a Great White Shark during a morning group swim. The real estate market is especially volatile and change is afoot. At times like this it can be helpful to reflect on your goals and your expectations. Pay particular attention, as you fine-tune those objectives and create your strategies, to that little voice in your head. You know the one: the voice that pops up and tells you some of your goals may be a little too lofty. That slight feeling of negativity that creeps up and quietly suggests you should perhaps… think about… maybe considering… possibly… revising that weight loss target – or the number of closed transactions for the year. It is the voice of doubt that tells you more deals would be a better goal for next year; after all, this year is going to be a tough year. As a matter of fact, this voice inside suggests, just getting through the rest of the year without weight gain will be accomplishment enough. Spend more time with family? Start that blog? Lose weight? “Why don’t we save the truly aggressive goals for next year, when we are more prepared” is the very logical compromise often proffered by the little ‘helper’ inside us all.
Learning to Fly
The thing to remember as you review your plan is this: the little voice is not real and the only limitation you have is the limitation you put on Read more
It doesn’t really matter what someone says they are trying to do. Or what they say their motives are. Know them by their actions.
Regardless of what anyone says, all any person is ever really doing is attempting to make something out of nothing or they are trying to make nothing out of something. Obviously, this can be accomplished in various ways. The primary effective method is by one’s thoughts. Take a relationship, for example: it exists solely because it is created and as long as it is created. Beings making something out of nothing. A business or organization that exists is an example of of something out of nothing. Sometimes we wonder why anyone would work on making something out of that? Why? Mountain out of a molehill. Not anything that anyone really wants but there it is, “created” for you. So, creation, is neither good or bad, unless one considers the creation “good” or “bad”. There are some things in life that get broad agreement as being “good”. Others that have broad agreement that they are “bad”.
All I want to look at here is what do you want? What are you trying to create? What are you attempting to make something of? What directly helps you do that? What people do you come into contact with or receive communication from that cause you to feel like you are more able to create what you want? When you are in communication with them your goals and aspirations are more real. It is easier to see yourself accomplishing them.
How about the flip side: nothing out of something? What are you trying to make nothing of? What are you attempting to reduce the effectiveness of or make smaller? Does making it less powerful or less effective help you to achieve your goals? Does working on that fully align with your stated goals?
There are those that offer advice and counsel on what you ought to be doing. Oddly enough, they haven’t ever actually done it themselves, but they can still clearly see what would be good for you to do. It isn’t really necessary Read more
by Brian Brady
Commercial Real Estate Finance Expert
Structured Debt and Equity
Licensed Real Estate Broker in AL, CA, and FL
Loan originators are taught to develop REALTOR relationships. While development of those referral relationships is important, I’ve seen originators waste time and money on unprofitable “partnerships”. This initial article, in my new series about REALTOR marketing, will explore how to quantify the referral relationship to more efficiently understand how to focus your efforts.
Why prospect REALTORS?
Well, that’s where the money is, right? REALTORs deal with buyers who need financing for homes. Their clients have means, motive and opportunity to generate fee income within 60 days. What can be expected of such a relationship? If it’s a good relationship, the originator can expect three loans annually, from the average, full-time REALTOR.
Three loans each year. Did you hear that?
Move up REALTORS are perhaps the least productive for an originator to target. Most of their clients show up with a pre-approval letter (or lending relationship) in hand. The REALTOR who overzealously recommends you runs the risk of “steering” accusations. A successful real estate agent, who works this market, is probably closing 15-20 sides annually. Half of them will be listings so there are only 10 loans available to you. Half will have their own financing so you’ve got a shot at five. Throw in a couple of new home purchases and your number drops to three…IF…everything goes well. The expected value of the move-up REALTOR relationship is about $9,000 GCI annually. Assuming a 70% commission split, that number drops to $6,000. Remember that number when asked about “co-op advertising”, Padres tickets, or joint seminars.
Mega-agent teams can be a great source of loans for you until they get into the mortgage business. The deteriorating profitability, of a full-service brokerage, forces broker-owners and team leaders to explore ancillary services as an alternative income stream. I can’t say that I blame them, either. Control of the customer experience combined with the added revenue make affiliated business agreements attractive to REALTORS who consistently produce. While you may feel that you “hit the motherlode” when you connect with the mega-agent, keep in mind that you’re “security” can be short-lived.
Where then, can an originator target her referral marketing efforts?
1- Read more
New home sales are at a 17-year low? Dan Green posts an excellent example of how the news media distorts and misrepresents the news.
Technorati Tags: blogging, real estate, real estate marketing