Tag Archives: agents

ASBESTOS – Buyer Beware!!

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[photopress:inspectors.jpg,thumb,alignright]I am just beside myself on the topic of home inspectors and asbestos. I don’t care how many inspectors want to tell me why inspectors aren’t “obligated” to call asbestos in the inspection, I will still keep saying: “You have GOT to be KIDDING me!!

I’ve seen more asbestos in homes in the Seattle area than in my entire career to date around the Country.

“Well Ardell, I know we both “think” that’s asbestos were looking at there, but we really can’t say it’s asbestos unless we send it out to a lab and have it tested. So we just have this disclaimer in our contract saying we are not responsible for calling asbestos in the inspection…and that is sufficient for US” US being the home inspectors!!

Yesterday I literally took a razor tool from the inspector and cut open some paneling held together by duct tape in a basement and forced an inspector to look behind it before he wrote “inaccessible area” on the report! I said if you don’t lend me something to do this with, I’m going to use my bare hands!

How come I can get 10 average Joe’s to stand around the asbestos wrapped pipes, who will all say “Yep, dats asbestis alright”, but I can’t get one inspector to note asbestos in a home inspection report?

Oh, and here’s the agent’s lovely comment (I represent the seller and she represents the buyer) “Not my problem. The buyer chose their inspector and if the inspector doesn’t tell him what he needs to know…that’s not my problem, is it?”

In PA inspectors included “testing for radon” by setting canisters in the house and sending them to the lab. They couldn’t see radon or taste it or smell it, but they didn’t put a disclaimer in their contract saying “Duh, Don’t Know”.

Here’s a clue, Risk Reduction equals every buyer KNOWING WHAT the heck they are buying!!, not 25 disclaimer and disclosure forms covering everyone’s butts in the industry! And they have the nerve to tell me that they don’t want me at the inspection because I make them look bad…Oh WELL!!

And if you stick that pointy metal thing and chunk away at the mortar between the bricks of my seller’s house one more time in some silly act of macho bravado, I’m going to take it out of your and and stick it where you don’t want it stuck.

Some days I want to be a waitress…

To Stephane, this entire post should be in bold AND all caps! I am heeding your advice. But if you tell me to stop using !!exclamation points!!, we’ll have to agree to disagree 🙂

Why I like Zillow and Redfin by ARDELL

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[photopress:3ofhearts.jpg,thumb,alignright]I’m still scratching my head as to why agents around the country hate Zillow so much that they want to call it “Z”. Theory is that if they even whisper the name Zillow, they are spreading “the word” and helping it to become even more popular.

Zillow is a system of mathematical calculations, a tool that is easy and fun to use. So isn’t hating Zillow like hating your calculator?

I like Zillow because before they came along, all of the lead generators were about buyers. Buyers went there to look at houses and hit the big flashing “Find an Agent” button and were taken off to never-never-land where the lead generator collected a toll. Buying buyer leads has always been a joke. I can hardly go anywhere without hearing someone talking about buying a house. Every coffee shop, restaurant, the lady in line in front of you at the bank, at least 20% of the people at a barbecue…really. If you need to buy a buyer lead you need to look in the mirror and figure out why you need to trick people into hitting a big flashing button and pay for one. Time to hone up your skills and get a personality.

The innovation of Zillow is that every lead generator has asked that question: “How do we attract SELLER leads?” Even House Values knows that they cannot get enough seller leads, and they can sell them as fast as they can get them. There are more agents willing to buy seller leads from House Values in prime areas, then there are seller leads to go around. There’s a waiting list…I know…I’ve been on it for over a year. Every time they email or call me I ask…you have a seller lead spot available for 98033 or 98034. Answer is always no, but they are trying to sell me something else. Because attracting sellers rather than buyers is something the lead generator industry has been very lax at doing well.

And then comes Zillow. I don’t know what they are selling, but they clearly have the seller’s attention. Did Zillow get an Inman award for that? If not…Zillow now has the ARDELL award for innovation in lead generating sites. Don’t be waiting for the trophy, I haven’t gotten out shopping for Greg and Sharon yet, and you’re behind them.

Kudos to Zillow. Don’t know where you’re running with that ball, but kudos for putting a seller oriented site in play.

I like Redfin, because…

a lot of my past clients who came to me from blogging,

tried them first 🙂

Trying to Force the Seller’s Hand

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[photopress:hand.jpg,thumb,alignright] If you are playing the game of “trying to force the seller’s hand”, you have to know how to play it right. It is not easy to force a seller to…anything. Regardless of who is right and who is wrong, if you can say there is a right and wrong to the situation, reality is what it is. If you want the house, and you are not the only one who wants the house, you have to stay “in PLAY”.

Two buyers have been “circling the wagon” for weeks. Offers have been presented to the seller, counters have gone back to the buyers. Back and forth, back and forth. Buyer Agent saying, “Did the seller look at the comps I gave you showing why the seller should?” “Well of course the seller has to fix this and fix that, remove this and add that”. Meanwhile the seller is just going about their business, day in and day out, waiting for the buyers to agree to their price and conditions.

Then along comes buyer number three. Buyer number one and buyer number two, who have had offers back and forth, know what the seller wants. So it seems only fair to tell buyer number three what the seller wants. Meanwhile buyer number two wants to submit an offer again, third time, for something less than they know the seller wants. I say, well you have two choices. You can bring an offer meeting the seller’s counter to you of a couple of weeks ago and beat buyer number three to the punch, OR you can hang back and wait to see what buyer number three does.

Buyer number two’s agent doesn’t want to bring an offer matching what the seller wants NOR wait until buyer number three makes their move on Saturday, so she brings an offer that she knows is LESS than what the seller wants and Tries To Force the Seller’s Hand”, by giving a very short response time. Bad move. You bring the seller an unacceptable offer and put a response time that is hours before buyer number three is scheduled to see the house. What happens. By trying to force the seller’s hand and make him respond before buyer number three sees the house, you are left out in the cold. Your offer is expired before the seller is going to respond. Buyer number three’s offer is accepted and your offer is a non-offer, because it expired before the seller was willing to look at it.

If you tell the seller they only have x amount of time to respond, and that timeframe does not match the seller’s schedule for some reason, your offer becomes invalid. Agent says “You COULD HAVE countered and just changed the date…” But why? Why would the seller risk countering an expired offer, when they have an acceptable and valid offer on the table? (agent’s answer is because she has worked long and hard and deserves…anytime the agent’s answer includes the agent in the picture…wrong answer – wrong thinking.)

If you are trying to force the seller’s hand by giving him a short wick, and putting a response time that is less than acceptable, you have to revise your offer and extend that date the second your response time passes. You have to keep your offer “in play”. By trying to force the seller’s hand…you can put yourself out of the game altogether, if you do not keep your dates running forward by submitting a new response time.

Buyers often think that the seller MUST respond, MUST counter. Not the case. No answer IS an answer. If you have no answer by the time your offer time expires…you have your answer. The answer is NO…try again.

When I was a teenager, my parents often didn’t want me to go to parties. So when I asked to go to a party, I didn’t demand an answer on the spot. I made my case for why I thought they should say yes, and then I left the room to give them time to talk it over and think about it. The fast answer was often no…I went to lots of parties 🙂

When you give the seller what he wants, you can try to demand a quick response. When you want the house for less than acceptable terms, you have to be willing to hang back, and you have to be willing to lose it, if the seller doesn’t meet your terms. You can’t bang your fist on the table and demand that you get the house for less. Presenting an unacceptable offer, and demanding a quick response, is like a kid throwing a tantrum…rarely works out for the best. And almost never works out for the best, when you know there are other interested buyers.

Time to get into 1st backup position.

My Favorite Real Estate Story

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imagesA seller receives 23 offers on his property. All of the buyer agents want to present their offers in person and introduce the buyers to the seller.

There are 23 buyer agents and their buyer clients seated on folding chairs in a big room. Picture 50 or more people sitting on folding chairs with Offers to Purchase in their hands.

In a little conference room sits a seller and the seller’s agent preparing to review these 23 offers. The seller is not happy. All he wants is one, good and acceptable offer. He is overwhelmed by the prospect of having to review 23 offers and send 22 people home “empty handed”.

One by one the buyers and their agents “present their offer to the seller”. After about 8 of these “presentations”, the seller is totally confused and beside himself, as all of the offers seem about the same to him.

Along comes buyer number 9 and his agent. The savvy buyer’s agent can sense that the seller is completely fried and wants this over with. So he makes the seller an offer he can’t refuse, and the seller says to his agent “I’m going to take this one, get everyone else out of here.”

So the totally embarrassed seller’s agent goes out to the big room of many people in folding chairs and announces that the seller is DONE! He thanks them all for coming, but the seller is going to take offer #9 and they should all leave now.

AND THEN, AND THEN….ALONG COMES HANNAH!!! She jumps up from her chair, runs past the seller’s agent, kicks open the door to the little conference room, points at the buyer and buyer’s agent in the room and says “Whatever these guys have offered…we’ll go $100,000 over THAT!!

The seller’s eyes get as big as saucers. He realizes that it may be in his best interest to let everyone compete with one another and so he tells his agent to proceed as originally planned and “the game” proceeds until all 23 agents and their buyers have given their “Final and Best” offer.

I just love the picture in my mind of Hannah jumping from her chair, TACKLING THE LISTING AGENT, kicking down the door and refusing to be eradicated! I wonder why no one has ever made a movie of her valiant move! Her client must have been stunned, the whole room must have gasped in awe! I totally LOVE this story.

End result: Hannah’s client did NOT get the house. In fact Buyer #9 did, in the end, get the house for $400,000 more than his first acceptable offer. Buyer #9 got the house AND he sued Hannah’s company for making him have to pay $400,000 more for the house, as Hannah and Buyer #9’s agent worked for the same company. The suit was settled out of court and we now have “the Hannah clause” in all Buyer Agency contracts stating that the buyer is aware that the company may have other buyers under contract competing for the same house.

So Hannah’s efforts have become legendary…but only in the archives of lawyers and new stock clauses.

Hannah deserves much better…she at least deserves this article on a blog. So here’s to you Hannah! You are my idol!

The Best Online Real Estate Marketing Time Can Buy

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Jim over at the Real Estate Tomato has an interesting post about the type of content that real estate agents should produce on their blog. The question of content really boils down to how to do the best possible search engine optimization (SEO). So, here are my two cents…

The type of content you write about is almost irrelevant.

Really! I’ll repeat that…

The type of content you write about is almost irrelevant.

There is no “perfect” content or “magic bullet” that will get you to the top of the search engines and thrust you to internet lead nirvana.

Here’s the reality: It is far more important to be interesting in a real estate kinda way (hence the “almost”) than to worry about creating the “right” content.

I sincerely doubt that Hanin Levin set out to be the #1 result on any search for real estate information in Laguna Niguel. He got there because Google has a lot of trust for his site with regards to real estate and at one point he happen to mention Laguna Niguel in one of his blog posts. This is the the long tail in action, which also helps explains why Rain City Guide shows up #2 on that list.

Why does Google have a lot of trust around Hanan’s site with regards to real estate?
Because a lot of real estate sites (mainly bloggers) have linked to him. That back-and-forth of linking between related sites blows away all other factors.

Why do other real estate bloggers link to him?
Because he is interesting!

Maybe after you’ve created a real estate blog that does well in Google, you’ll decide that you’re missing a few keywords, but more likely your readers will do that for you. An recent example occurred when a reader pointed out that we didn’t have any good houseboat information. A simple post three days ago on houseboat financing has already put Rain City Guide at the top of a useful Google search.

[photopress:williams_at_christmas.jpg,thumb,alignright]The important thing to remember is the “perfect” content will only work if others are linking to you and the content is good enough to keep readers coming back for more. My guess is that people begin searching the internet for real estate information months before they are ready to talk with an agent. As an agent, you want to write content that will keep them coming back long after they’ve forgotten about their initial google search!

You could try to be interesting like Lockhart with lots of NYC real estate gossip, like Hanan by posting fascinating links on a daily basis, or like Joel by being on top of real estate technology, but more likely, you’re going to need to write about something that hits a little closer to your interests. Blogging done right is similar to all other human endeavors done right… Success will be a reflection of your personality.

Finally, Jim, it would be wrong to write this whole article without giving you the link you’ve earned by being interesting… So, here’s my link to a great marketing article from the juiciest real estate tomato in northern california! 🙂

The MLS and Creative Sales

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It’s amazing the stories I hear about the self-policing that occurs on the MLS (some of it seems more like snitching, in my opinion). One of the big no-no’s is listing any reference to an open house in a listing’s marketing remarks. The reason for this rule seems clear enough; with so many of the big guys subscribing to feeds of all the listings, the MLS doesn’t want to bite the hand that feeds it. The Windermeres and John L Scott’s don’t want prospective clients to go to open houses on their own, they want their agents to represent these prospects.

On the more creative side, an agent I know had her hand slapped after she tried to emulate an auction situation, using her MLS listing to attract buyers. She is also an investor, having bought the home in question on a lease-option. The previous owner did a beautiful rehab job, but ran out of money and needed out fast. She stepped in, leasing the place (the lease payment covering holding costs for the owner), with a year option to buy for what was owed by the seller. She also took a chance and put another $15K into the home to finish it out (a risk since she didn’t own the home). With her large equity position given the market value of the home, she decided to test the waters, and create a situation that would attract more offers.

First, she offered a buyer’s agent commission of 4%. Then, in her creativity, she made her first mistake. In the agent-only remarks, she explained that the 4% would be added to the highest bid price. This was also clearly stated in the auction rules posted at the property during the open houses, available to all potential buyers. Her thinking was to put walk-in buyers on the same footing as buyers with agents (there were two open houses over the course of a weekend, then bids were accepted – no time for lockbox enabled agent visits), thereby creating an apples-to-apples comparison when reviewing competing offers. In other words, the final bid price would be the net (of commission) price. If a buyer with an agent offered the highest bid at (for example) $100,000, then price would be grossed up to $104,000, with the investor/agent/seller paying out the $4000 commission to the agent at closing. If a walk-in buyer offered the highest bid, then no commission is necessary (since she is the owner of the house, there’s no need to pay herself a commission…she’s getting all the profits anyhow). I can understand why she got in trouble for this. The MLS is for agents, not joe consumer. Agents would naturally prefer that the buyer’s agent commission is included in the final cost of the property. With this gross-up method, savvy buyers (even dumb buyers) would realize that they would have saved $4000 had they gone directly to the open house without an agent.

The other creative step she took was to include the word ‘auction’ in the agent remarks. She listed the home at her acquisition cost, knowing that it’s true market value would grab the attention of agents. Her objective was not to deceive, thus the reference to an auction (all bids would be reviewed at the end of the second open house).

However, on both counts, other agents snitched her out. I think each of her creative marketing ideas went against the traditional thinking of the industry.

In trying to offer a grossed up commission (and super-sized at that!), she was bringing the bright light of transparency to the transaction. Though her intent was not to ‘out’ agents who don’t discuss compensation with their clients, this is clearly the first thing many agents thought about. The agents would publicly claim that ‘it isn’t fair’ to raise the price 4% after a final bid has been made. On the contrary, as long as the this is known from the beginning, there should be no problem. If buyer’s agents openly discussed compensation with their clients, then clients would have a better chance of understanding that grossing up the offer to capture commission is not a big deal.

As for trying to market an auction, I think agents didn’t understand what the investor/agent/seller was trying to accomplish, or they were thinking of a Sotheby’s style of auction, which would be uncomfortable for agents and buyers alike. In either case, it was just strange enough to be deemed out of place on the MLS.

I’m guessing that some agents reading this are thinking, “yeah, this seller/agent should burn in hell for what she tried”. However, being an investor myself, I applaud her creative approach to trying to maximize the price she can fetch for her property, and for trying to structure the commission so that agent represented buyers and walk-ins are treated equally.

Once in a Blue Moon

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[photopress:blue_moon.jpg,thumb,alignright]Once on a Blue Moon, I need to insist that a buyer, if I am going to work with them, sign a buyer agency agreement.

1) When assisting them in their home search requires that I go inside every property to ascertain if the property has what they need.

Example: must have first floor bedroom that is NOT the master bedroom, but is large enough for two people to be comfortable and have it’s own bath and be on the same floor as the washer and dryer. This is a common request for multigeneraltional families whose parents live with them and do their wash 🙂 I can’t tell all of this from mls data and have to preview lots of homes quickly and all new on market homes to make sure the first floor bedroom is not tiny and to make sure it is in reasonable proximity to the washer and dryer.

2) When I am asked to find property that is not for sale.

Example: Must live on the SE corner of the Newmark Blding on any floor higher than the 12th floor. When someone wants something that is so very specific that it requires that I contact all owners of those properties. Waiting for this to come on market is not in the best interest of the buyer, unless they are willing to wait five years to buy something (which sometimes is the case, and that’s OK). If they won’t buy anything else until they realize they can’t have what they really want, and they need a place within 6 months, then I have to contact every owner of that “commodity” and ascertain if it is a dead end and no one is thinking of moving this year. P.S. I rarely negotiate a lower commission for this type of home search. I need a written Buyer Agency contract to establish for the seller’s benefit, that I do NOT work for them, but the buyer, and so need a written contract saying that.

There are a few other examples, but I think you get the picture.

A very wise Broker once told me that once you have the meeting of the minds with a client that the relationship is exclusive…you don’t need a written contract. So as soon as someone is WILLING to sign one, you simply shake hands and acknowledge the meeting of the minds and don’t insult the client by requiring a contract.

Until there is a meeting of the minds, the contract is inappropriate, since a contract is putting on paper that meeting of the minds.

So either way, I do not need a written contract by and large, with some exceptions.

My$.02…YMMV

Here’s a question only the Governor can answer

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[photopress:gregoirepicture2.jpg,thumb,alignright] Why does the law say “a licensee who works with a BUYER represents that BUYER unless…”

Aren’t SELLER constituents deemed worthy of “equal protections under the law”? Why doesn’t the law say “consumer” generically, so that unrepresented sellers have the same protections, and not just a consumer when a BUYER? Why doesn’t it cover a little old lady owner when a licensee knocks on the door trying to buy the place, for less than fair market value? Why isn’t she represented at first contact?

Here’s a little FSBO trivia. Did you know that agents who bring For Sale By Owners a contract on an mls form, when representing a buyer, are breaching mls rules? Did you know that there is no place in that contract for an agent NOT to represent a seller in some capacity? Only two options: Agent represents the seller or agent represents both the buyer and the seller (dual agent). There is NO place in the contract for the seller to be NOT reperesented as in No For Sale By Owners allowed. A completely different contract must be drafted by an attorney if an agent wants to write an offer on a For Sale By Owner.

Lots of things need to be changed that are leftover loose ends from the days when every agent represented sellers. I’m hoping all of these new business models are going to force all of the trains that are off the track to finally get so derailed that someone has to fix them. Train 1. State Laws of Agency Train 2. MLS Rules Train 3. NAR and Code of Ethics They all need to fit tomorrow’s reality for the new business models to function properly. Tomorrow’s reality is happening as we speak, as these new business models come up and as For Sale By Owner companies spring up. Someone needs to “get on the stick” pretty fast to catch up, because “the times they are achangin'”.

The Law of Real Estate Agency needs to clearly define all of these new business models, so that the consumers, including the For Sale By Owners, are aware of when they are NOT represented, and when they are being offered “limited reperesentation” and what that means to them. That is part of the DOJ “stuff”, at least with regard to Exclusive Buyer Agency. Hopefully with regard to For Sale By Owner companies as well, though I haven’t read anything yet to suggest that is the case.

Where’s that “Food for Fodder” tag? Lots to chew on today.

What is more dangerous: censorship or self-censorship?

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At yesterday’s seminar, the issue of liability came up (as it always does) with many agents worried that they could get in legal danger for content that they write on a blog. My summary of what Russ is able to say quite eloquently is that the type of content that is legally appropriate for an email or other correspondence is the same for a blog. In other words, if you’re not allowed to call a neighborhood “family-friendly” to a client in person or in an email, then you can’t do it in a blog. The take home lesson is that blogging is like all other business endeavors in that an agent needs to use common-sense when blogging.

While liability is interesting, I find the concept of censorship to be a much bigger danger for the real estate community. To give an example, yesterday someone requested that I take down a set of comments he had written (over a month ago) on RCG because the powers that be (most likely his broker) did not want him blogging. Considering his comments were part of a long dialog that was already read and commented upon by hundreds of people, the request seemed hopelessly short-sighted on the part of his broker. Nonetheless, I did make the changes he requested. But this got me thinking… There really are two types of censorships that are common in the way that the real estate industry operates online:

  • Censorship: When agents are censored by their brokers/industry
  • Self-censorship: When agents simply refuse to take part in an online community because they are afraid that the “powers that be” might not approve of their comments

Personally, I think self-censorship is the real danger in that agents don’t even take the chance to push the limits of what it means to create an online community. If the censorship is overt, the conversations over and an agent can either live with the consequences of not having an online “voice” or move to a new broker. But when the censorship is self-imposed based on a climate of uncertainty, I think agents will have a much harder time demonstrating the expertise that they can provide to their potential clients. It seems obvious to me that agents need to have a high level of freedom if they are going to differentiate and successfully market themselves online.