Category Archives: General

"Tiptoeing" through ethical minefields

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It’s getting a little warm in the kitchen of Real Estate

Two questions have been eating at me for some time.
First, one of the most difficult questions to answer deals with my own brethren in the escrow industry. Why is it that a traditionally transaction “neutral escrow company or service” only receives compensation if a transaction successfully closes?

To me, at least in the realm of escrow, this is the mother of all potential conflicts of interest. Isn’t it a conflict of interest to the parties involved and our fiduciary duty to the lender (yes, folks we do have a duty to protect the lender from potential fraud, which is clearly stated in escrow instructions from some lenders) if we are only paid if the deal closes? Wouldn’t that create a lot of problems, particularly if you have pressure from loan officers or Realtors to “just get it done

10 Great Conversations

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Just for fun, I started recording notes on real estate conversations I enjoy following and I decided that when the list hit ten, I’d hit publish:

  1. David Smith has a great (no wining allowed) article about the housing bubble. I only wish David interacted with the real estate blogging community a little more because his stuff is great but easily missed…
  2. Continuing on the bubble topic, Dan Melson puts on a great effort describing why renting really is for suckers (and what yo do about it). For me, this is a great example of why real estate professionals should not write about the bubble (David Smith being the exception! 🙂 ) It reminds me of the “fool“ish investment advice so popular in 1999/2000 that said it didn’t matter what price you bought a stock at as long as the company was good, you would make money in the long-term. Here’s my problem with this argument… If rents are cheaper than the interest payment (i.e. both of these being the completely sunk costs) and home prices go down slightly in the near future (which doesn’t seem inconceivable for selected markets in the country), then no amount of number juggling will replace the fact that if a potential home owner would be best served waiting to buy until the prices bottom out. I realize there are more than a few “ifs” in my statement, but my goal is not to say that it is a bad time to buy, only that a blanket statement “it is always a good time to buy” falls on deaf ears.
  3. On a related note, it is timely that the NYTs notes that rents are rapidly rising across most of the US (with Seattle being a highlighted area!).
  4. Greg shows off his custom signs. I think these are brilliant marketing moves and every agent should look for ways to market themselves through their listings. Beautiful stuff…
  5. And talking of beautiful ideas, Claudia Wicks mentions a very simple marketing idea ($1.50 simple) that could go a long way… There’s a beauty in simplicity (and it reminds me of an idea that Anna and I were batting around a while back…)
  6. And if you really want beauty, Fraser Beach takes staging to a new level by hiring actors (beautiful ones!) to play house during an open house…
  7. It takes a certain level of confidence to have fun with your previous mistakes. (Kris is clearly a confident agent and I like that!)
  8. ActiveRain is getting some hype from both the Real Estate Tomato and the Future of Real Estate Marketing. I definitely think that Matt Heaton is onto something interesting, and he doesn’t get particularly phased by either Greg or Joel, which I think is a great sign.
  9. Because I’ve been there…
  10. Greg (Linden this time!) creates a list with (nearly) all the Seattle start-ups and their associated Alexa rankings. It is a list that is definitely worth checking out as you might be surprised at the massive activity within the Seattle start-up community! For those interested, the rank of the real estate sites were: Zillow (976), Homepages (21,720), Redfin (22,117). RCG was not included in his list, but we are ranked at 75,844. You might also be interested to know that despite the fact that we’re not ranked as high as some of the other sites, our reach is right up there with HomePages and Redfin. (not bad for a site with no paid staff and $120/year hosting fees!). And since I mentioned ActiveRain earlier (and they are based in Kirkland), I think it is interesting to note that they are seeing awesome growth in the number of pageviews that is blowing away all the local real estate sites save Zillow. Considering their Alexa ranking is only 108,655, they are obviously creating a sticky user experience.

Painting the Industry with a Broad Brush

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[photopress:paintcanc.gif,thumb,alignright]Before I take the full rap for painting the industry red with a broad brush, let’s look at this line from an interview in Inman News today. “To bring buyers and sellers together requires lying, cheating and manipulating.”

Defending bad behavior does not invoke change. Let’s hear from some agents regarding how they were trained:

1) How and why they should not consider the amount of their eventual commission, when selecting homes for their buyer clients.

2) How they should advise seller clients, and assist them in getting the property in proper showing condition, before taking photos and entering them in the mls.

3) What classes are available to assist agents in taking better photos and in photo editing, now that this skill has become such an important role in selling a home for top dollar.

4) How they are taught never to use a listing to promote themselves, and to get new clients, from a seller’s most valuable asset.

5) How they are taught that doing an Open House is not solely or primarily a means to obtain new clients.

6) How to recognize when their buyer client is a victim of predatory lending, and being pushed to spend more on a home than they can reasonably afford.

7) How NOT to push in house listings on the buyer clients of other agent’s in the office.

8) How to stop in their tracks when a buyer or seller client looks uncomfortable, as in sweating profusely or shaking with tremors, and determine the root of their concerns, before proceeding.

9) How to get up from the table without getting something signed by the client, if the matter at hand does not have immediacy issues to the client’s advantage, and give the client time to consider the information presented to them until they are satisfied that their answer is a well thought out and informed decision.

10) How to determine why a house has been lingering on market, without taking verbatim the listing agent’s representation of same to properly advise your client, if they like the property enough to make an offer.

11) How to deal with inspectors who don’t write what they say, and point out problems verbally, that they do not write in the inspection report and summary.

12) How to forewarn sellers, especially of older homes, that there will likely be a few things to negotiate at time of inspection, and put a misc. buffer amount to cover repairs, in the estimate of seller’s net proceeds before they sign the listing contract.

13) How to stay involved with the process during escrow, and be proactive in the escrow process and not just hand over the file and walk on to the next sale.

There’s a Baker’s Dozen of issues, that could literally fill volumes. Where did you as an experienced agent learn these things and where do new agents get this training today?

Inman News and St. Joseph

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[photopress:St_Joe.jpg,thumb,alignright]Dustin, Glenn Roberts and I received an email yesterday from Bill over at The Real Estate Cafe, about an Inman News article on the use of St. Joseph statues to sell real estate, and a comment I made on it. Dustin didn’t know about the practice, which is fairly well known around the Country, so I thought I’d shed some light on why, how and when the statue is used in the real estate business, from my personal perspective.

Many years a go I had a wonderful client who was losing her home. She had started her own business and had used her home as collateral for the business start up expenses. Her husband had a good job, they were doing well financially. She was not behind on her mortgage payments. They had lived in their home for a very long time with their now grown daughter and little poodle. But the lien against the house for the business bankruptcy was causing them to lose it.

The woman was so beside herserlf, because she caused it. She was a dynamic person. So when she approached me rather sheepishly one day with a request, I was a little surprised at her quietness and hesitancy. She said, “I really need your help with this and I don’t know how to ask you to do this. Someone told me to plant a St. Joseph statue in my back yard upside down and all will be OK. I wouldn’t have any idea where to get one, since I’m Jewish, and I thought you might be able to do that for me. I know it’s a lot to ask of a real estate professional, but since you’re Italian…I thought…”

While Bill over at The Real Estate Cafe, and many Catholics, are up in arms over using St. Joseph in this manner, I didn’t hesitate to jump into my car and find the little plastic statue shown here. I didn’t know there were actually “St. Joseph kits” designed for this purpose. I just went to the same place I might buy rosary beads and they knew right away what I needed. I went back to the house. It was one of those houses that appraised at $185,000 but the owner “had to have $205,000”. When I first listed it I didn’t know why they were selling it, or let’s say I wasn’t buying their story that they were just downsizing. I didn’t know why they HAD to have a certain price.

The owner wasn’t present when I performed my little ritual for the first time of “planting St. Joseph on his head in the yard”. Needless to say it worked. The owners received the price they had to have from a buyer who loved the house. It was one of my favorite sales, as the woman came home every day at lunch to vacuum. This was in the days when agents called the office for an appointment and no one in my office would speak with her. They thought she was difficult, I knew she was distressed. I asked her to remove the blue tablecloth in the kitchen and replace it with a white one. An hour later there was not one white table cloth, but two, so that if it got dirty she could quickly lift off the top one. She worked like a dog to get top dollar, I came up with the spiffiest flyer anyone had ever seen and she and I, together with St. Joseph, accomplished the objective that seemed near impossible.

The bankruptcy attorney cut the commission down at the last second and my office manager was freaking out. She even went to the closing where the bankruptcy attorney, she and the other agent were duking it out. I stayed outside with my clients while they where fighting, and assured them that it was one of my favorite sales, regardless of what happened in there. It was truly a pleasure to have known them and to have helped them in their dark hour. I never contacted them again because I knew I was part of a memory they should never have to revisit. “Follow up postcards” from me would have been painful reminders of a time they wanted to put behind them.

While Bill is upset over the fact that there are some agents who order St. Joseph statues in bulk like business cards, the custom of burying St. Joseph to assist in the quest of real estate pursuits goes back to at least the 1500s, when St. Theresa of Avila buried a St. Joseph medal. They needed some land for a Church and St. Theresa buried a St. Joseph medal in a plot of ground that was perfect, but they could not afford, and of course they did eventually raise enough money to buy the land with St. Joseph’s assitance.

St. Joseph is “the worker”. He’s the symbol that any pursuit backed by one’s sincere desire and hard work is achieveable. For many years after he helped my clients, I had this little statue (right side up) where ever I worked. When I had too many closings all at the same time, I would lay him down and put a little felt blanket over him and tell him it was time to rest. St. Joseph and I performed some great miracles together and he was my guiding force my first few years in the real estate business.

We haven’t heard about this custom for quite awhile because it has been a seller’s market. But based on Inman News giving the custom some attention recently, it looks like St. Joseph may be making a comeback. To Bill Wendell at The Real Estate Cafe, try not to think of all of the agents buying 100 statues at a time and using it as a “gimmick”. Think of my lovely story, and how St. Joseph, while standing on his head, brought some comfort to some very nice people in need of his gentle touch.

Perhaps a buyer’s perspective…

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Sometimes a comment is so darn good, it really should be a post.

Perhaps a buyer’s perspective might be useful here.

I don’t know jack about real estate. My husband and I have been burned in the past by a string of dishonest agents, most recently in January when we relocated to Seattle. We were so full of loathing for the industry in general that we seriously considered Redfin, simply because we had no hope of finding a “real person

Public Service Announcement

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As a “Certified Emergency Response Team” Member here in Kirkland, I was invited to attend the class on being a “weather spotter”.

Not my cup of tea, but thought some of you might be interested.

SKYWARN WEATHER SPOTTER TRAINING ANNOUNCEMENT

Site: Redmond Public Safety Bldg – Redmond, Wa
(8701 160th Ave NE – see map below)
Date: Monday, November 20, 2006
Time: 6:30 – 9:00 PM
RSVP: Lt. Charlie Gorman, Redmond Police Dept. (425) 556-2566 or e-mail: cgorman@redmond.gov

The National Weather Service will train new and veteran spotters, including interested citizens, amateur radio, CERT, citizen corps, and law enforcement staff, on how to look for and report significant weather events. Training includes video demonstrations. Spotters are needed, particularly in rural parts of King County, as well as those who have weather instrumentation, such as an anemometer.

If planning to attend this spotter training session, please RSVP so an appropriate number of handout materials can be on hand. Class capacity is 60, so sign up early! We look forward to seeing you at this or other Skywarn Weather Spotter training sessions, and receiving your hazardous weather reports.

Babies Crawling

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I filmed Peter crawling yesterday and uploaded the video to YouTube only to find that dozens (hundreds) of proud parents had done the same thing before me.

Because crawling babies make me happy, I’ve gathered the highlights for your enjoyment:

(The closest I can get to relating this to real estate technology is to say that their engine does such a great job recommending similar videos that it makes for a very addicting experience!)

The Super Agent

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It seems to me that the agents who post and comment on RCG are ‘mom and pop’ agents whose business is limited to their ability to work with clients directly throughout the real estate transaction. I’ve not heard from any of the ‘Walmart’ agents who have built organizations allowing them no upper limit on their ability to service clients. In fact, many comments and posts have implied that the latter approach is bad for the consumer. Is Walmart bad for the consumer? We all may hate how Walmart shuts down mom and pop stores that can’t compete with the scale and volume pricing of Walmart, but does this have anything to do with the end consumer? Macroeconomically and politically, absolutely; however, consumers have voted with their wallets that the Walmart model makes sense.

When an entrepreneurial agent builds a business, hiring a licensed assistance, then listing specialists, then buying specialists, then a business manager, then a lead manager, why do the lone agents seem to have little respect for the organization they have built? Given the state of the industry today, as others have defined it, where new agents get little training and modeling by experienced agents, wouldn’t such a scaled organization be welcomed? Think of the licensed assistant? It seems to me that by working with an agent so successful and productive, this assistant would be exposed to every type of transaction, and grow up to be a better agent.

To me, it’s the scaled super agent business organization that would be the best place for a new agent to learn the ropes. As many have written here on RCG, the traditional brokerages have little motivation to spend a lot of time growing an individual; however, a good super agent aligns incentives so that the training and modeling he/she provides others within his/her organization contributes to the organization’s bottom line, and such an investment pays off as productivity grows.

Do consumers suffer with these super agent organizations? The mom and pops would claim they do, for in their paradigm, the real estate transaction can only be truly successful if the agent is hands-on throughout. Do the consumers feel slighted, unsatisfied? My guess is no, for the most part. No matter big or small, an agent needs a bedrock of referrals to succeed long term. Clearly, these super agents excel in lead generation and marketing, but a happy client is a happy client, and they’ll refer their friends.

As a new agent, and as an investor, I would love to be in a position where I could lead an organization and model it for success, and get paid handsomely for it. If any super agents are out there reading RCG, I’d love to see your perspective represented here on these pages.

Do me a favor, Eric

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I wrote this story for you, Eric.  Maybe it will give you a glimpse into what the real estate industry really is all about. 

Please read the story from beginning to end.  I have a lot of stories like this one Eric.  Too many. 

I know you have recently become a real estate agent from a previous career.  I know that you are “investor” oriented.  But a very, very large percentage of this business involves all too many stories like this one.   I have a skazillion of them.  I’ll tell you some more if it will help you, but I don’t really want to.  It still rips my heart out to remember these stories.  Most of them had happy endings, depending on how you view life.  Kind of bittersweet more than “happy” endings.

Yes, I get on my soapbox now and then, not often enough Eric.  Not nearly often enough.

We must be held to the highest standard of care, because sometimes we are the only ones standing there with the seller who can care with them.  Care with them when we are selling their house before having to face a foreclosure.  Care with them when they are selling their home to fly to the other Coast to be with their child who is dying of aids at age 36.  Care with them when they are selling their home because their husband ran off with a younger woman.  Care with them when they are selling their home because they can no longer get in a car and make it to their hair appointment without getting killed.

This is the real estate business I am in, Eric.  The one where people sell their homes out of necessity and need someone to be with them, not just “sell their house”.  I represent people, Eric.  I get on a soapbox from time to time to remind other agents that they also represent people for a living.  Maybe only a few will “get it”.  But that’s enough for me. 

Yes, blogging will change the industry…one agent at a time.  Some day many years from now you will remember this story I asked you to read when you are called upon to sell the home of a very elderly person going into a nursing home.  And you will do it a little differently, I hope, having read my story first.

If you read my story…we’ll call it even. And my offer still stands.  I’m here if you ever need help or advice.  But you may have to bring me flowers and chocolates next time 🙂

"Frank"-speak on "broads" and the mls' lame 24 hour rule

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[photopress:bgrable.jpg,thumb,alignright] This broad is lonely. You know, the kind of lonely that just has to be scratched…like an itch. So she says to me, she says, Frank, I just gotta get out there and get a man, and she starts putting on her coat. I say Whoa there…hold up, Babe. You ain’t gonna get the right man that way. Go in the toilet there and fix yourself up a bit first. Pin up your hair like Betty does, and put on that fancy armored under-stuff that makes every woman look like a Betty Grable pinup at first look, till you get up real close and see the spines on ’em. That’s right. Take your time, honey. The better you look, the more successful your gonna be at this venture. Now put on that lipstick and pull down that thing over there and hike up that and stand up real tall, like you don’t need nobody! That’s better. If youse goes out lookin’ like a loser, that’s exactly what you will end up bein’ at the end of the night…a loser!

Now someone please tell me who came up with that stoopid mls rule that says a seller HAS-TA put his house up for sale within 24 hours after he signs a listing contract? Hell man, da ink isn’t even dry yet! Do yus really think an owner can get his sh-t together that fast and spif up da joint in 24 hours?! Heck…he barely has time to pull up his pants and douse his tonsils with his “Jack”. Are you guys kiddin’ me??

And what agent worth his weight in peanuts is gonna have a fancy, glossy, snappy flyer ready in 24 hours? Heck, can ya even get a sign up that fast? Who made up that rule anyways? You guys better stop drinkin’ that NAR Koolaid and get da F outta here pronto! Cause I ain’t puttin’ my house on the internet for everyone to peek at until it’s good and ready! Ya hear dat! GOOD and ready. And youse guys can go pound sand with your lame mls rule dat says udderwise. I don’t give a rat’s behind if you guys stab each other in da back or in da front or any other ways. Dat ain’t MY problem! You can’t tell me what I HAVE to do and you sure as hell can’t tell me that I ain’t got no say in it. So what that I can give you some letter saying “hold up, pal”, what about da poor slobs dat don’t know any better and have their underwear hanging over the shower curtain in the mls photo. Scratch that rule…scratch it now…cause it’s lame. Like my pal Robbie says…Lame, Lame, Lame MLS Rule! Trash it, cause it’s garbage and its stinkin’ up da place!”

I’m signing this here contract to get me the best damn agent there is and I’m sure as hell payin’ him plenty of dough! So’s he better damn well work his butt off for a whole lot more than TWENTY FOUR HOURS before HE pushes that button that sends me LIVE into the cyberworld.

I thought it was jes dose NAR Koolaid drinkin fools spoutin’ this garbage. But when I saw David Barry sayin’ his NEW Consumer Oriented Free Public mls was gonna go and copy that same stoopid lame mls rule, I said dat’s IT. I’ve HAD it. Jilly…go knock some sense into dos guys before the whole planet goes koo-koo on dat koolaid! Knock some heads together if ya has to…but don’t let the poor public be fooled into thinkin that they have to go out in public lookin’ like a LOSER! It ain’t dare right to say so…cause I say so and it just ain’t the right way to treat people and their most valuable asset. Heck, a girl takes longer than that to spruce herself up to find a guy. How da heck is a fella supposed to spruce up his whole house in 24 hours! It ain’t right…it just ain’t right.