Danger, Will Robinson… theft types for all to be aware of

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Prescription Drug Thefts
NWMLS has once again received reports of prescription drug thefts at Broker Open Houses in the Seattle area. NWMLS advises you to request a business card or require registration at all open houses from everyone in order to keep track of those in attendance. In addition, please report similar thefts to NWMLS, as well as a list of attendees so that we may look for patterns in behavior and conduct. Please also remind your clients to remove or secure their possessions, particularly their prescriptions, before their home is shown or held open.
Staging Thefts Reported
Area 500: Keyboxes were missing on two new construction properties. One house was missing all staging items, including high-end appliances. The second property was missing the keybox (no staging was taken). Police have been notified.
Area 770: All staging material was taken — including a ceiling fan removed from the ceiling. The keybox was not broken into. Marysville police have been notified.
These notices were just put out by the NWMLS to highlight recent thefts – this after the notice about copper being stolen out of new construction and vacant homes. Thieves targeting houses seem to be getting more common or we’re just hearing about it more.
What can you do to help thwart these kinds of problems? Make sure also to leave outside lights on if you aren’t living on the premises so people in the neighborhood can see what’s going on in your yard. Perhaps have a friendly neighbor keep an eye on your place and to be willing to call if there is any suspicious activity. I’ve often knocked on neighbor’s doors to tell them if the house will be vacant and to ask for help in watching out for predatory types. Especially if we’ve already moved some things out for staging I’ll be sure to tell the neighbor, “if you see another moving truck here and there is no SOLD sign on the yardarm or we haven’t told you the place is sold, call the police.”
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The NWMLS tells agents to secure keyboxes to properties yet I still find them on front porches of homes without any kind of attachment such as a bicycle lock or otherwise. Why are these sellers and their agents not securing the keys to the home? There really is no good reason not to given the number of resources available to do so. I’ve also spoken with other staging companies that have had their products stolen out of vacant homes including the home’s appliances. This is pretty serious stuff and if it doesn’t get better soon it could make people very nervous about selling their homes.
For goodness sake, if you’re going to sell your home be sure your agent is going to secure the keybox at the property – in fact, help them secure it. Good ways to do this include not having the keybox out in the open where it’s obvious, using a strong bicycle lock, or putting the keybox in an area that requires someone know where it is (notes can be put in agent remarks of NWMLS listings).

Where's Dogbert when you need him?

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Before Reba posted her article on the upcoming House Values layoffs, I recently ran across an interesting article about HouseValues on MSN Investor. It was basically a press release from Zacks Investment Research that stated HouseValues (SOLD) made their list of the top 5 stocks to sell now. Needless to say, this is not a glowing recommendation.

Also during that same surfing session, I stumbled upon an article about AutoByTel (ABTL). At first glance, it may not be that germane to the issues that face HouseValues, but AutoByTel is essentially a variation of the HouseValues business model. AutoByTel’s business model is essentially, generate lots of internet traffic and sell leads to auto brokers/dealers. HouseValue’s business model is essentially, generate lots of internet traffic and sell leads to real estate agents/brokers.

A problem with this model (as the article noted), is that traffic acquisition costs are going up. The deals that a company like this are going to strike with Google, Microsoft, Yahoo or some other major internet portal that brings in a lot of traffic are increasingly low margin / high cost deals. After all Google, and it’s fellow portal competitors know what the value of their net traffic is (and it isn’t going to get any cheaper).

Furthermore, there’s the $50+ million gorilla on the horizon…. Zillow. They have a more customer centric business model,  superior technology, lower head count expenses (last I heard they were about 100 employees), and would probably fare better in a beauty contest as well. Even if HouseValues were to reverse course by attempting emulate Zillow’s business practices, I get the feeling that they’d be less successful than Microsoft’s search efforts have been against Google.

Another problem, is that nationally the housing & mortgage market is cooling down. I guess this means there are fewer agents out there who are able to buy leads from the company (either that or there are fewer agents out who willing to buy leads, which portends an even bigger problem). It’d be interesting to see if this problem corrects itself when the housing market heats back up again or if the company has hit a strategic inflection point.

[photopress:sales_dropping.jpg,full,alignleft]What’s also interesting is ABTL has 377 employees (and $116.6 million in annual revenues), while SOLD has 522 employees (and about $101.9 million in annual revenues). Even though HouseValues just laid off 60 employees, it still feels there’s more head count there than what they need. Especially since their Selling/General/Administrative expenses are over 8 times what their Research & Development expenses are! For comparison sake, AutoByTel’s ratio is closer to 2.5 times, Microsoft’s ratio is a little under 2, Google’s ratio is a little over 2. It appears that the PHB (Pointy Haired Boss) hired too many sales drones and not enough Dilberts.

Frankly, if I ran the company, I’d probably try to get InterActiveCorp (IACI) to buy me. Why? InterActiveCorp is a diversified internet commerce company with 28,000 employees and had revenues of $6.6 billion last year. They own many popular web sites (Ticketmaster, Ask, Match.com, Home Shopping Network, Evite.com, Lending Tree, RealEstate.com), and they used to own Expedia, Hotels.com, Hotwire, and other travel related properties prior to their spinning off.

Because HouseValues would complement IACI’s LendingTree / RealEstate.com business units nicely and since a IACI spin off (Expedia) is already located in Bellevue, I’m sure there’s a way that IACI could extract more value out of the combined company that than HouseValue’s current management could do alone. Perhaps there’s a way in which the HouseValues employees who stuck around would only have to change their Kirkland commute to Bellevue commutes?

So is this the beginning of the HouseValues death spiral, or is just a temporary hiccup on the road to better days?

Is EVERYBODY Happy!?!?

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[photopress:ted_Lewis.jpg,thumb,alignright]Using Ted Lewis’ famous line, “Is Everybody Happy?” as my guide, I am going through all of the people who bought and sold homes last year.  Not just our personal clients, but the clients of other agents in the Company as well.  While it is very common to do so at this time of year for financial reasons,  I take some extra time to study who was very happy and why, and also who was unhappy and why.   

I’d have to say 90% to 95% were happy, but I find myself more interested in those who were not happy.  I think by writing about the unhappy people, maybe a few readers will learn not to go down that same path. 

The least happy prospective home buyer, was one who was being forced to move.  I had one prospective client who was being forced to move from her apartment due to a condo conversion, which is now Mira in Downtown Kirkland, behind the Post Office.  Cheap rent; great location.  While she could afford to buy a condo, she could not afford to buy a condo in the same location.  She considered Juanita and Kingsgate and Totem Lake and finally I said, “Why don’t you just rent right here in the same location for now?”  Finally…she was happy.  Because what she liked most was being able to take her two dogs out for a walk and enjoy the same sights and scenery she had come to love, visit the same coffee shops that let her two little doggies come in with.  Just because she was forced to move out, didn’t mean she was forced to leave her everyday happy times, which were location dependent.  So the least happy prospective buyer was somone who really didn’t want to buy at all…and so she didn’t.  Sometimes you make “a client” happy, by not selling them anything at all.

The least happy client of one of our agents was pretty much the same scenario.  She was renting a house with her handicapped daughter, and the owner of the house sent a notice that she had to leave because the house was being sold.  The agent was a friend of hers and found her house after house to buy, and nothing seemed good enough.  Mainly she was extremely unhappy because she really just didn’t want to move!  Unfortunately no one could fix that part for her.  She did buy a house and eventually got used to the idea and the new home.  But the only thing we really did for her was make it impossible for someone to knock on her door again and say, “You have to move because we are selling the house you are living in.”  When you have a handicapped child, moving is ten times more difficult.  The added burden of having someone give you 60 days or so to find a new place to live can be an overwhelming burden.  At least it is not likely that she will have to face that event again, and will only move if she chooses to do so, not because someone sends a notice saying she has to move now.

The other day someone came to me who lives on Lake Washington Blvd saying, “I have to move by March 1 because I was just notified that the place I live in is becoming a condo conversion.”   I am finding him a place to rent nearby so that when and if he chooses to purchase a home, more likely closer to the time when he is getting married next year, he can do so by his choice and in his own timeframe. 

Studying the patterns of unhappy clients, can help you set the wheels in motion in the right direction for that next person, who is being told that they have to move now.

Unhappy sellers pretty much fit the same criteria, those who are being forced to move due to a divorce or job transfer.  Those who did not electively choose to sell their homes, often leave “with a bad taste in their mouth”.  Being forced into moving out of your home by events not set in place by you, seems to set the stage for the least happy buying and selling experiences…at least in the short term.  Best you can do is try to make lemonade out of those lemons.

So when someone is telling you a war story about their terrible ordeal in buying or selling homes, ask WHY they were buying or selling.  You may just find that what they were least happy with, was the fact that they had to move in the first place.

Ah… the joys of a shared driveway

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In Seattle, many houses share a driveway with an adjacent property.  Typically, the driveway is created by an easement on each property running on either side of the common boundary.  Each property is burdened by a five foot easement that benefits the other property, thus creating a 10 foot strip of driveway.  Each property then has the legal right to use the driveway, and one neighbor cannot legally impede or impair the other neighbor’s reasonable use of the driveway.

So where’s the joy?  Well, it’s really more like “joy” — as in “Holy $#%*, what a giant pain in the ^*$!” The fact of the matter is that not every neighbor gets along well with others.  If you find yourself living next to such a person, the shared driveway can quickly become a flashpoint for conflict.  Because you each have a legal right to use the driveway, you legally must cooperate as to its use.  Such cooperation can quickly break down if there is some underlying dispute or existing friction.  You may need to resort to litigation simply to enforce your right to use your own driveway.  Litigation, of course, is neither pleasant nor cheap, and it certainly won’t help repair your relationship with your neighbor.

So how do you avoid this “joyful” arrangement?  When purchasing property, you should always include a title contingency. This allows you to review the title commitment and identify any existing easements or other restrictions on title that may not be consistent with your intended use.  If you need help in interpreting the title report, you should consult an attorney and not your real estate agent (another good reason to have both an attorney and a real estate broker on your team from the beginning).

If you see an easement for a shared driveway, remember that fences — not shared driveways — make for good neighbors. With such a contingency, you can then rescind the contract, get your earnest money back, and move on to another house that doesn’t include the seeds for a good ol’ fashioned neighborly feud.

On mentoring and blogging…

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Another frequent contributor here on RCG asked me to write a little ditty about this subject matter as she was interested in how I saw the differences between the two.

My view of mentoring is that it’s done a very personal level and typically occurs between individuals with one person in the relationship acting as the “teacher” and the subordinate being the “student” in most cases. Also, these relationships are chosen between the parties. I’ve never seen a mentor/mentee situation where the two parties hadn’t agreed to it – most folks that have good information to share are usually quite disciplined and discerning about who they want to share that knowledge with and the people I’ve known that want to be mentored are usually pretty targeted in their choices of who that person or persons will be – it usually starts with the mentee taking note of respected colleagues in higher positions whether at the same company or elsewhere within an industry.

Blogging, on the other hand, is very public and generic in nature. When I put my thoughts down in this techno environment I’m releasing all of my thoughts into the universe to be picked up by anyone and everyone that might be interested and open to my ideas. There is no real selection process.

Another question has been put to me like this: “I am curious to know how struggling agents are managed in your office. Is there a framework set up to help new agents or any agent write a business plan? Maybe this is a sign of a wider industry problem, maybe not.”

First, I’ll say that I believe agents not knowing how to write a business plan is an industry wide problem and it’s a BIG problem in the real estate world. When I joined the broker’s office where I’m located I was brand new to the industry (but had bought 3 homes and sold 1) but I walked in the door with a business plan, a marketing plan, and a funded budget in hand. My brokers, who have been around 30+ years, told me later that I was the first agent they’d ever had do such a thing. From what I’ve sorted out in speaking with agents of all levels of experience is the majority of people got into this industry with no inkling of how they should get themselves prepared for doing anything other than selling houses. As independent contractors (the majority of us) we are all small business owners and that means you must have experience or willingness to learn how to run a business. I’ve noticed such a lack of business planning and understanding in this arena that I’m launching a side business this year to teach agents these skills via online classes.

There is much more to being a real estate agent than just knowing how to read and fill out a contract, stage a home, or answer buyer’s questions about financing and closing documents. The main reason upwards of 90% of first year agents fail in the first year of business is usually due to lack of planning and a lack of proper funding. Even in the 2nd year of business between 60-80% of those agents fall out of the business – again, usually from a lack of planning and funding. The majority of agents I’ve spoken to never knew how expensive it was to be an agent with respect to broker fees. And then there is the “herd mentality” of ordering the same marketing stuff that everyone else does because rarely does a new agent know to ask the right questions about a product before deciding to buy large quantities of it. Example – I received more calendars this year from vendors than I could possibly need in my home and office yet I know large numbers of agents that use this as part of their “touch” programs. Differentiation is key. How can you stand out when you are doing what everyone else is doing? Companies like HouseValues (who I write about in a post below and in previous posts) also can be expensive lead referrals services cutting a lot of the potential revenue stream for an agent. Plus, you have to understand the difference between advertising, branding and marketing and what those programs mean to your bottom line.

Anyhow, the question about struggling agents is not too common in our office because our brokers tend to only take on those that have demonstrated ability. But, for those new agents (we’re now bringing them in) and some that are beginning to struggle there are methods in place to help such as training programs that are offered via a proprietary satellite network, we have onsite managers that will provide coaching opportunities, and there are some mentoring programs as well.

HouseValues lays off 60 employees locally

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Hmmmm, the Seattle Times article in today’s business section talks about HouseValues reducing staff because they’re moving out of selling leads to mortgage brokers and they had also overestimated where they’d be financially at this time on top of the fact that sites like Zillow.com have taken over part of their target site user. HV will now go back to the original focus of selling directly to real estate agents and I have a feeling they’ll have some difficult days ahead of them.

Not only was there a layoff but yet again there are upper management shifts. In the short time this firm has been in business they’ve had a lot of staff changes in the upper tier management and C-levels of the company.

Surreal Comment Spamming

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I’ve been heavily hit by a spammer for the last few days and I figured I’d share the story…

Despite the fact that the spammer is using the same one line text and always links back to the same website, Akismet is having a hard time picking up this spam and has let 150 or so spam comments through today (out of over 5000 total spam comments attempts from today alone!). Nonetheless, I realized pretty early on that I could create a second line of defense by “moderating” any comments that come through with a specific phrase that is always used in the text.

It’s so bad now that for most of today, every time I hit the “delete spam” button, there is more spam already in queue.

I decided to look up the URL that was being linked to and it turned out to be quite easy to find a email of someone who owned the domain. Despite my better judgment, I decided to email this individual. I politely said that if he was comment spamming my blog, I’d appreciate it if he would stop. His response was terse but hopeful: “I’ve deleted your blog from the base. Sorry.”

That email came through about ten minutes ago (and prompted me to write this post!). Since then, I’ve already received 75 spam comments from his domain.

Part of my frustration is that I recently received another message from my host that I will need to upgrade my account because I’m using too much CPU. I’m convinced that the massive amount of spam (including the stuff that gets stopped by Akismet) is the main reason that I keep having to pay more in bandwidth costs every few months.

Moral: The select group of people who get a kick out of making life miserable for others can make hosting a blog a frustrating experience!

Interview with Marlow Harris of the 360 Digest

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I feel very lucky that for my final interview of the season, one of my favorite bloggers in the world has agreed to answer my questions. One of my Seattle real estate blogging failures has been that I’ve never managed to convince her to start blogging on Rain City Guide and instead she’s gone off and done wonderful things on many other blog platforms. 🙂

What inspired you to start blogging?

I have several websites, including SeattleDreamHomes and SeattleNeighborhoodGuide, but I was unable to have a conversation there so I began the blog 360Digest which has since morphed into a personal and real estate-oriented blog. I’ve also created another site, Unusual Life, where I’m having fun sharing information about unusual homes and architecture and selling books that interest me via Amazon.

I also contribute to several other blogs, including the Seattle Post-Intelligencer’s Real Estate Professionals and Inman News and a few others like Realty Blogging and My House Key.

I have actually started and discontinued at least a half-dozen other sites over the years, adding and taking away those that didn’t work or that were ineffective. Expect a culling of these sites too, over 2007. This is still a relatively young field, so some editing and natural selection is inevitable.

I think we’re all watching to see where this new medium will take us.

Are there any special topics or issues that you enjoy covering?

Well, I like to be around and work with creative people. Therefore, I enjoy writing about creative people, their homes and creative approaches to real estate, art and popular culture. You can’t really write about your listings, that’s boring. And there aren’t that many “stars” in real estate. You’re left with dry prognostications or dull mathematical calculations. Or you can try to make connections between real estate and other endeavors. For me, that’s art and popular culture. My favorite magazine is Juxtapoz and the word “juxtapose” sums up what I like about making connections between the relationships of art, real estate and popular culture. It’s the intersections, random connections and juxtapositions that I find the most fascinating. One’s home is often a reflection of self, ones values and desires, and I love to see the choices people make.

What have you done to personalize your blog?

I write like you and I were sitting in the same room having a chat. I write about things that interest me. And I hope it will interest others.

Do you have any favorite posts?

Well, I think it’s funny to try to see how often I can mention Elvis in conjunction with real estate. It’s just so stupid, a bad joke that’s got out of hand. It’s absurd and it makes me laugh.

And one post that’s on my mind this week was the time I was asked by a movie location scout to find a place to film the true story of the local guy who, uhmmm… uh… loved horses. The film just debuted at Sundance this week and the reviewers fell all over themselves praising the aesthetic v.s. salacious approach to the film. I love the local angle of the story, it’s bizarre, strange and perverse….. all the things I love.

What are some of your favorite blogs (real estate or otherwise)?

Oh, you mean besides Rain City Guide (smile) and all of these? I like Grow-a-Brain, Boing Boing, Fark and Unique Daily.

What do you think real estate blogging will look like 3 years from now?

There are very few people who have anything remotely interesting to say, let alone write. Perhaps everyone will be blogging and instead of a couple of dozen really good blogs, there will be tens of thousands of mediocre blogs out there that no one reads. (Actually, I think that’s already happened.)

I think for many writers, the blog is just a big energy suck and a huge waste of time.

It’s fine that blogging is getting all this attention, but I’m concerned about the predictions of the end of traditional journalism and newspapers. Not many bloggers are going to attend school board meetings, city council meetings, and other important (and, perhaps boring) community meetings and events. Without paid reporters, there could be a huge hole that unpaid bloggers will never begin to fill. We need paid reporters — who’s going to follow those political candidates around, attend labor meetings, and report on local and national news if newspapers cease to exist and paid journalists disappear? Volunteer bloggers cannot possibly fill the void left by newspaper and professional journalists and they both serve different purposes. Professional journalists at least strive to be impartial, even if they are not always successful.

Blogging is an interesting endeavor, but I think it’s important for bloggers to keep what they’re doing in perspective. It’s usually marketing or ego gratification. It’s rarely journalism.

Thanks again Marlow for the wonderful insights!

Lots more to pick up via osmosis from these real estate bloggers:

As this is my last interview of the season, I figure it is only fair that I let others know that my interview from last year where Andy Kaufman subjected me to the same questions is still live on his blog.

Your Private Information is For Sale

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This subject totally irks me…it is just so completely wrong. The three major credit bureaus are selling personal information to hundreds of mortgage companies throughout the country as soon as a credit report is pulled from a mortgage lender. You visit your preferred lender to get preapproved for a mortgage, and whammo…within hours you may start getting calls from other unscrupulous lenders who will even go so far as to pretend to be working with the preferred lender. You’ll also start noticing mailers appearing in your mailbox offering special rates and programs, too. You’re going to feel very popular and probably very annoyed.
Private information is being sold without your consent or knowledge. These mortgage companies buying these trigger list (also referred to as prescreening) are generally “fly by night