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January 22, 2007

WordPress 2.1 has been released, and it may be the perfect platform for real estate web sites as well as weblogs . . .

by

Suburban Phoenix Real Estate Broker

Author website

WordPress 2.1 is out. More news from BloggingPro.

Standout among the new features:

You can set any “page” to be the front page of your site, and put the latest posts somewhere else, making it much easier to use WordPress as a content management system.

What this means is that there is no need to distinguish between your real estate web site and your local real estate weblog. The two can both run on WordPress, reaping the SEO advantages in tandem.

Caveats: WordPress 2.1 wants MySQL 4.0 on the server side. If, like us, you’re hosted by GoDaddy.com, you’re all set.

Ten Things You should Know About WordPress 2.1. Best news: A lot of legacy code that was to have been killed is retained, albeit deprecated, so most 2.0.x plug-ins should still work.

BloodhoundBlog won’t be making the switch right away. I like to let other people find bugs in new software. But Cameron and I may start playing with it as a tool to use with single-property websites.

Further notice: Joel Burslem at The Future of Real Estate Marketing has already taken the plunge.

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January 22, 2007

The Carnival of Real Estate . . .

by

Suburban Phoenix Real Estate Broker

Author website

…is up at Minneapolis Real Estate Market Update.

And the winner is… our own Kris Berg with The Plastic Pig (and How to Pick Your Agent).

Kris also wins The Carnival of BloodhoundBlog, a testament to her excellence amidst the stiff competition around here.

The Carnival of Real Estate Investing is up at Real Estate Investing For Real. We entered Jeff Brown’s Compounding, Return On Investment, & What Matters To Investors — Invest $1 Get $2 Back, but, alas, it didn’t win.

But: There is more to life than BloodhoundBlog. There are lots of great articles at both carnivals. Check ’em out…

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January 22, 2007

A New Agent Guide to Getting the Listing… and Getting Over It

by

Realtor, Associate Broker

Author website

One of the best pieces of advise I was ever given came from my first Broker. She said that when you encounter disappointment or failure, you have 15 minutes to get over it. Cry, whine, feel sorry for yourself, but in 15 minutes you are going to put it all behind you. I have tried to adopt the 15-minute policy in life and in business, although sometimes my watch is admittedly running a little slow.

Contrary to the clearly posted warnings, objects in the rear view mirror are actually farther than they appear. What you did yesterday, last week, or last year is truly immaterial in real estate. Get mired in your past successes or your past failures and the engine will stall, preventing any future forward progress.

Allan Dalton, President of Realtor.com, was quoted as saying at this year’s CAR Tech Tuesday event (in reference to Zillow’s Zestimate concept):

One consequence is that consumers will be educated to infer that your home’s value can be predetermined. If my home’s value is predetermined, let me just find the person that I can pay the least to execute what’s preordained…

Now, here is the real deal from the trenches. You will certainly encounter the how-low-can-you-go sellers, but these are a minority, at least in the sense that fees alone will dictate their selection of an agent to represent them. We have talked at great length about the personal nature of the real estate transaction, and a seller’s choice of agent is the perhaps the most personal aspect. I don’t see any Zillow truly changing those personal dynamics.

If the decision were based solely on objective criteria, the same top-producing agent would get every listing every time, and new agents would never be able to develop business and enjoy success. We know this is not the case. The harsh reality is that the majority of sellers in a listing interview are not hearing what you say, but are seeing it – in your appearance, in your mannerisms and in your personality. During the interview, they are deciding not so much whether they like your message but whether they Read more

January 22, 2007

The Right Time to Buy: An Investor Perspective

by

Real Estate Investor

Author website

As we considered when to restart Cook Squared Enterprises, one question we had to ask ourselves was if it was the right time to buy. With interest rates creeping up and home values creeping down, is now the time to make a large purchase? Additionally, in my spare time I dabble in a little econometrics. For those of you who are unfamiliar with the term, it is essentially taking a lot of past factors and trying to predict something in the future. In this case, I look at past real estate value indicators and trying to predict future trends in real estate. For those of you who think this is getting ready to get technical, don’t worry, it is definitely not (sorry to those of you who thought it was). I only do this to see if there are clear markets I should avoid, markets like Las Vegas and Florida that have shown obvious signs of over building and over investing.

Back to the topic at hand, when should you enter the market? First and foremost, it is always a great time to start investing. There is always value in the market, though some times it is harder to find that value than other times. There is always a house or building that has not been taken care of properly, with motivated sellers. These are great properties to buy, just about anytime. More importantly, the real estate market is cyclical. Predicting cycles can some times be like predicting the weather. Since many of the greatest economists cannot seem to do either, it is not worth trying to jump in at the trough and get out at the peak. If anyone tells you differently, ask them if they have any swamp land they can sell you as well.

Buy and hold investors almost always make money because of the nature of real estate price increases. Even if you get in at a peak and hold, real estate typically comes back to bail the hold investor out. Established investors who only work in certain markets have even more of an advantage because they have seen Read more

January 22, 2007

Your Retirement — A Few Questions

by

Real Estate Investments Broker

Author website

For those of you over 40, take a few minutes and contemplate your retirement. Here are a few tips on how to figure out more closely what it could be.

  • Bring into focus your current financial state. In other words, where are you now?
  • Recall the last time you thought about your retirement. How much income did you want to create?
  • Given your current age and retirement age, if you keep doing what you’re doing now, will that income be there?
  • Is that income, after tax, enough?
  • If you think you might need to modify your current approach, what would you change?
  • What should you do if you feel you may have to work years after your planned retirement age?
  • Do you know folks over 60, still working full time, and who may have to for the foreseeable future?

It’s shocking to me the number of people I know personally who are at least partcially supporting their parents, and still haven’t asked themselves those questions. The average guy in his mid-late 50’s has less than $60,000 saved for retirement — usually in a 401(k) or IRA. He doesn’t owe much on his home, and figures if he can figure out how to pay it off in the next 10 years he’ll probably be ok. Between the safety of his free and clear home, Social Security, and his savings, retirement should be just fine. That brings up one more question.

How do you feel about that?

January 22, 2007

BloodhoundBlog is adding another hard working dog to the pack

by

Suburban Phoenix Real Estate Broker

Author website

Today we add a new contributor, Michael Cook of the Cook Squared Real Estate Enterprises weblog:

Partnering with his wife, Michael Cook is a commercial real estate investor who complicates his life as an MBA student at The S.C. Johnson Graduate School of Management at Cornell University.

Michael is relatively new as a weblogger, and, here and at his home weblog, his plan is to share with us his journey as an entrepreneurial commercial real estate investor.

We trimmed a couple of names from our roster, as well. Tony Fredericks and Ronan Doyle have been too busy in their real lives, for now, to add content here. We’ll be welcoming them back into the pack when they are able to free up time.

We are talking with several other potential contributors, and, as always, we are eager to consider more. If we haven’t approached you directly, it doesn’t mean we’re not interested. If you would like to write with us, assert yourself.

How big is too big? The RE.net is turning strongly local, which I think is a sound idea. But at BloodhoundBlog we are not competing for business. Our goal is to apprehend if not completely comprehend the art, the science, the business and the philosophy of Real Estate writ large. We’ll stop growing when we’ve caged that beast, not before.

And: This question has come up: Qui Bono? Who benefits? This is what I said in the Rain City Guide interview with BloodhoundBlog’s contributors:

What we’re really up to is an idea I call The Third Career. Most of us came to real estate from something else, and, as we are wise, we know this is not our last stop in the world of work. My immediate goal for BloodhoundBlog is to make it the best-read, most-rewarding real estate weblog in the RE.net. Further out, I want for our contributors to be so well known that they can pursue other opportunities: Public speaking, freelance writing, books, seminars, television shows, etc. I don’t know that we will attain this, necessarily, but the goal itself is definitely attainable: Witness Glenn Reynolds, the Instapundit.

For now, I’m interested in growing Read more

January 21, 2007

This home is one-of-a-kind — and it’s got the back-story to prove it . . .

by

Suburban Phoenix Real Estate Broker

Author website

Richard Riccelli and I were talking today about the power of the back-story to sell historic and architecturally unique homes. Here are two car stories to make the point:

In both cases, what “sold” was not the “fair market value” of a vehicle, but, rather, the unique story that comes as an intangible accessory with the vehicle.

The same kind of “added value” can be applied to homes, if you know their stories well enough to share them with buyers. “The simple truth is, Mr. and Mrs. Carlyle, there are plenty of homes you can have in this neighborhood. But this is the only one that was built by and for a returning Civil War General. The original plans are mounted on the living room wall. Isn’t that something?”

That Cobra Supersnake is a smokin’ automobile, and a true “comp” might easily run you half-a-million dollars. Except there are no truly comparable vehicles. Not only was it Carroll Shelby’s personal ride, it is the only surviving Shelby Supersnake. How much is it worth? How much ya’ got…?

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January 21, 2007

Are appraisers being pimped as involuntary seeing-eye-dogs for the congenitally blind AVMs . . . ?

by

Suburban Phoenix Real Estate Broker

Author website

From this morning’s Boston Herald:

Appraisers have resented AVMs for years, in part because the computer estimates have cut into appraisal companies’ business.

But the industry also challenges AVMs’ accuracy – especially in today’s market, where prices in some locales are falling rapidly.

And now, some firms claim a key industry player is even stealing data out of human-produced appraisal reports.

Critics say AppraisalPort.com – which appraisers use to electronically ship reports to banks – is extracting information and reselling it to AVM users.

To add insult to injury, appraisers say they must pay AppraisalPort parent FNC Inc. $5 every time they use the site to send reports to lenders.

“We are paying, (but) they are stripping out our work product without paying us a dime,” said Patrick Turner, a Richmond, Va., appraiser.

FNC spokesman Angela Atkins admits that her company extracts property-description data from appraisal reports.

But she said the firm can legally do so, and doesn’t take proprietary narrative analyses or valuation estimates.

She said FNC is building a national property-data repository for its customer base, which mostly consists of major U.S. mortgage companies.

“We are not an AVM company, and we could not exist without appraisers,” Atkins said.

But appraisers claim that what they include in reports – a home’s square footage, number of rooms, etc. – is proprietary information that goes way beyond public records.

For example, Turner said one appraisal he recently did showed a house had 2,900 square feet of above-ground space and a 1,200-square-foot, newly renovated basement.

By contrast, public records listed the home’s size at 1,100 square feet.

“Imagine the difference in (appraised value) between a 1,100-square-foot house and a 2,900-square-foot house,” the appraiser said. (AVMs) can’t be accurate when the public records they are relying on are out of date or wrong. That’s why everybody wants to strip out our data – it’s valuable because it’s accurate and current. But they don’t want to pay us for it.”

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January 20, 2007

Don’t Drop That Listing Price…Just Yet

by

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

Author website

Real estate agents have consistently used pricing as the primary mechanism to sell your home. Don’t forget owner-financed terms as a selling feature. Let me give you an example of how to offer a seller-carryback (and cash it out):

You listed your home at $500,000 and it isn’t selling. You are getting nervous and your real estate agent thinks you should lower the listing price to $460,000 to attract more potential buyers. You’ve already come down $50K. Don’t drop the price… just yet! Try offering a seller-financed second mortgage at 12% for $150,000. You can sell that note as early as one day after COE (settlement). You may only get 80 cents on the dollar when you sell the note but that is only $30,000 (less than the proposed reduction). If the home was fairly priced at $500,000, it might make sense to offer terms before reducing the price.

Let’s see how this would work:

Buyer obtains a 70% first mortgage for $350,000 (that isn’t too hard to get, even with lousy credit). You offer a $150,000 second mortgage at 12% and sell it for $120,000 after closing. You net $470,000.

When you offer terms, you open the property to people with recent bankruptcies, past credit problems, and hard to verify income. Seller-carrybacks significantly expand the pool of buyers. Your real estate agent can advertise in the paper and attract many buyers who need this help.

Realtors: Customers who buy on “owner terms” are grateful and become excellent referral sources. You will also develop quite a list of buyers from your advertisements to call when your next listing is not moving.

So what’s the downside?

1- You have to have equity in your home or you’ll be bringing cash to the closing.

2- You have to employ a savvy mortgage broker (or note broker) to market that owner-financed note. The secondary market for private mortgages is not large and highly illiquid.

3-The seller may have to hold that note for a period of time (and collect 12%).

4-The buyer may eventually default on that Read more

January 20, 2007

I Told My Agent About The House I Wanted To Buy

by

Mega-Producing Realtor

Author website

Rob wrote:

After moving to the area and looking around at properties for a while, I saw one place I was interested in and contacted the seller ‘s agent directly. She agreed to show me the property, and since she was located out of town encouraged me to find a local agent who could show me more things in the area. After looking for a while with another agent and not finding much that I was interested in, I told him about this place that I had already seen and we went and looked at it together.My question:
-Is there any reason that my agent would like me to buy another property instead of this one? Is the sellers agent entitled to more of the commission? I get the impression that he was hesitant to show me this property again and that he is trying to steer me toward other places.
-Also, would it be unreasonable to ask that he reduce his commission since I was the one that found this place?

I just saw the excellent response from Doug Quance, after writing this one. Decided to go ahead and post mine too – as my answer is a bit different.

Rob, the issue your current agent seems to be concerned about is called “Procuring Cause” – who was the “reason” you chose that particular property. Based on my understanding of how it works – and would be enforced if a subsequent agent were to interfere with an existing relationship – your current broker doesn’t have much to be worried about. There is a vital component of procuring cause that is not evident here and that is usually referred to as an “uninterrupted chain of events“. Also, taking into consideration the fact that the listing agent encouraged you to get your own agent, my take on this is it would be totally alright for your current agent to write the offer on the house you want.

I wouldn’t have any way of knowing what the listing agent’s commission would be if she wrote the offer or if it was written by another agent, so can’t answer that Read more

January 20, 2007

Ask The Broker – Why Is My Agent Steering Me Away From This House?

by

Associate Broker

Author website

After moving to the area and looking around at properties for a while, I saw one place I was interested in and contacted the seller’s agent directly. She agreed to show me the property, and since she was located out of town encouraged me to find a local agent who could show me more things in the area. After looking for a while with another agent and not finding much that I was interested in, I told him about this place that I had already seen and we went and looked at it together.

My question:
-Is there any reason that my agent would like me to buy another property instead of this one? Is the sellers agent entitled to more of the commission? I get the impression that he was hesitant to show me this property again and that he is trying to steer me toward other places.

-Also, would it be unreasonable to ask that he reduce his commission since I was the one that found this place?

You have a small predicament here that I’ll try to explain.

The listing agent who showed you the first property did so in the interest of selling her listing… but not to pick you up as a client, as you are geographically undesirable… hence why she recommended you find a local agent who could show you more listings.

When she showed you the property, she became the procuring cause of your interest in purchasing the property… and as such, she might try to deny a commission to the subsequent agent who has been showing you properties that you don’t want to buy.

The reason why this subsequent agent is hesitant to show you that property again is that he fears he will not get paid to represent you… which may happen should he write an offer and take you through to closing.

If I were the listing agent, I would pay the new agent… and so would Bloodhound Broker Greg Swann, as well as many other brokers. Ultimately, we want our listings sold, and many Read more

January 20, 2007

A potentially canonical list of real estate weblogs: 150 down, infinity to go . . .

by

Suburban Phoenix Real Estate Broker

Author website

Continuing on the subject of building what I hope can become a canonical catalog of real estate weblogs, we arrive at the starting place: 150 RE.net weblogs, each one of them vetted by at least one currently-active real estate weblogger.

I can’t promise that the list is 100% accurate — and I know it’s not complete — so I entreat you to email me about any errors or omissions you identify. If you can send me one or ten or a hundred missing weblogs, so much the better.

Dustin and others wondered why I want to do this is this way. Why not a social networking scheme or a wiki? The reason is that there is no substitute for human editing. Any system that allows self-selected volunteers to make entries will be instantly flooded with spam. For what it’s worth, I think we will discover that the purported “wisdom of crowds” consists mostly of coming up with new ways to spam or scam or both.

This list was built by human editors, and, going forward, I want it to be policed by human editors — volunteers suggesting additions and deletions as well as contractors going through the list link-by-link. At some point, I would like to have someone go through the list and split it by categories and locales, but that’s a job for another day.

For now: If you want to participate in this project, jump in. What’s wrong? What could be more right? What’s missing? What’s there that shouldn’t be?

And: What’s next…?

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January 20, 2007

Technology Review on Microsoft’s forthcoming Vista operating system: “Windows is complicated. Macs are simple.”

by

Suburban Phoenix Real Estate Broker

Author website

Microsoft is about to obsolete its entire user base yet again, as it prepares to release its long anticipated replacement for Windows XP, the new Vista operating system. In a scathing assessment in Technology Review, long-time Windows champion Erika Jonietz reluctantly ends up here:

Ironically, playing around with Vista for more than a month has done what years of experience and exhortations from Mac-loving friends could not: it has converted me into a Mac fan.

Here is an extended rendering of her findings:

My efforts to get Media Center working highlighted two big problems with Vista. First, it’s a memory hog. The hundreds of new features jammed into it have made it a prime example of software bloat, perhaps the quintessence of programmer Niklaus Wirth’s law that software gets slower faster than hardware gets faster (for more on the problems with software design that lead to bloat, see “Anything You Can Do, I Can Do Meta”). Although my computer meets the minimum requirements of a “Vista Premium Ready PC,” with one gigabyte of RAM, I could run only a few ?simple programs, such as a Web browser and word processor, without running out of memory. I couldn’t even watch a movie: Windows Media Player could read the contents of the DVD, but there wasn’t enough memory to actually play it. In short, you need a hell of a computer just to run this OS.

Second, users choosing to install the 64-bit version of Vista on computers they already own will have a hard time finding drivers, the software needed to control hardware sub?systems and peripherals such as video cards, modems, or printers. Microsoft’s Windows Vista Upgrade Advisor program, which I ran before installing Vista, assured me that my laptop was fully compatible with the 64-bit version. But once I installed it, my speakers would not work. It seems that none of the companies concerned had written a driver for my sound card; it took more than 10 hours of effort to find a workaround. Nor do drivers exist for my modem, printer, or several other things I rely on. For some of the newer components, 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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