So - who owns this crazy real estate market? Sellers? Probably not, unless there are some very clear signals (such as an aggressive price) that puts a seller in control of his or her destiny. Buyers? Well, that's what we're hearing, but this is not a traditional buyers' market in any respect. Buyers who think they are calling the shots are generally in for a rude surprise. Banks? Well, they seem to think so, but a quick look at their balance sheets for the last 12 months or so certainly tells another story. And let me tell you: We Realtors are *certainly* not in control of the market in any respect.
One of the most important things I try to make clear to any client, be it a buyer or a seller, is that we have to be realistic. And that doesn't mean realistic about one particular property; it means we have to be realistic about the market in general. We all think that our home has elements that place it far above the others in competition. And we also think that if we are walking into a situation as a buyer with a wad of cash that we can call the shots.
Uh-uh. Not going to happen. These days there are too many things that have to happen along the way for anyone to think that they are going to be in control. A good real estate agent will be able to see the hurdles coming down the road, and will be able to prepare his or her client for the best way to get over (or under or around) them. There is always more than one way to approach a problem or an issue, and often more than solution if one knows how to look for them. It's more important than ever to have a clear vision of the road ahead, to have an agent who gets it, and to LISTEN to what he or she has to say.
Next: Short Sale / Long Journey
Thursday, April 23, 2009
Wednesday, April 22, 2009
Strapping In
This real estate market continues to baffle and perplex, yet some things definitely have moved from the "guess" category to the "fact" category. Basically, the market is still impaired, to put it mildly, and the degree of impairment depends on your location, your pricepoint, and your type of real estate. But in general, here are a few things that proven to be true.
Prices are down, sales are up. The Santa Rosa Press Democrat reports that March Sonoma county home sales increased 40% since March of last year (29% Bay Area-wide), significant by any view. Prices, of course, have dropped so deeply over the last couple years that they are now off 27% (at $320,000) from March of 2008. Not that it matters, but at their highest (2005) they were $619,000.
Of course, there are winners and losers. I have a client who closed escrow a couple weeks ago on a property that sold for $260,000. In 2004 the same property sold for $445,000. A definite winner. Ask me about the "losers" though - I'll tell you some really sad stories.
The real estate landscape has lots of different looking facets now. There's the whole thing about foreclosures, and how they play into the scene, affecting neighborhood values, how they affect the property tax base, and so on. Short sales are also something that have really come in to their own, and for buyers who can be REALLY patient, they offer some great opportunities as well. We'll talk more about these things soon...
Next: Reasonable Expectations
Prices are down, sales are up. The Santa Rosa Press Democrat reports that March Sonoma county home sales increased 40% since March of last year (29% Bay Area-wide), significant by any view. Prices, of course, have dropped so deeply over the last couple years that they are now off 27% (at $320,000) from March of 2008. Not that it matters, but at their highest (2005) they were $619,000.
Of course, there are winners and losers. I have a client who closed escrow a couple weeks ago on a property that sold for $260,000. In 2004 the same property sold for $445,000. A definite winner. Ask me about the "losers" though - I'll tell you some really sad stories.
The real estate landscape has lots of different looking facets now. There's the whole thing about foreclosures, and how they play into the scene, affecting neighborhood values, how they affect the property tax base, and so on. Short sales are also something that have really come in to their own, and for buyers who can be REALLY patient, they offer some great opportunities as well. We'll talk more about these things soon...
Next: Reasonable Expectations
Saturday, November 25, 2006
What is a "Professional"?
What exactly is a “professional”? I guess we could define it simply as someone who gets paid for what they are doing. But clearly, if I want to hire a professional for something, it had better be somebody who ACTS professionally if they want to earn my business. Some professions do require more stringent standards for their “members” (official or otherwise). Some would equate ethics with professional standards. But I think ethics is a different category altogether. To me, ethics are principles which guide how we behave and (should) treat each other as human beings (see the REALTOR Code of Ethics, for example), while “professional standards” are what set people in business a cut above the average.
The real estate business is relatively easy to get into – no degrees required, etc., though in most states licensing has become more stringent in recent years. But having a license to practice your business, once again, means nothing in terms of one’s professionalism. It gives you the legal right to practice certain things in certain states, but that’s it – not one iota farther.
For example, I recently came across a mortgage broker who was licensed and called himself a professional, but apparently had no idea how to behave professionally towards his clients. His lack of professionalism almost cost the clients (clients whom he and I shared) thousands of dollars, simply due to the fact that he gave inaccurate (if not dishonest) answers, said he did things that had not actually gotten done, and so on. I was furious that he could treat his (our) clients that way. Was he ethical? Well, I suppose one could argue that he might not have breached any ethics, that his intent was positive. But there is no valid argument that he was a professional. And it deeply disturbs me that other clients of his continue to put their trust in him.
I would suggest that a real estate professional should start with a professional designation (e.g. “REALTOR®”). But once again it should go much farther than that in terms of how well he or she communicates, negotiates, dedicates his/her time to their clients, etc. It might not be the easiest thing to define, but you sure know it when you see it, and you sure are aware of it when it’s missing.
Do yourself a favor: don’t affiliate yourself with a “professional” without asking for references or other recommendations. There’s no guarantee that you will have a similar experience as another client, but it could save you many headaches, and many more dollars.
Next week: Realistic Expectations
The real estate business is relatively easy to get into – no degrees required, etc., though in most states licensing has become more stringent in recent years. But having a license to practice your business, once again, means nothing in terms of one’s professionalism. It gives you the legal right to practice certain things in certain states, but that’s it – not one iota farther.
For example, I recently came across a mortgage broker who was licensed and called himself a professional, but apparently had no idea how to behave professionally towards his clients. His lack of professionalism almost cost the clients (clients whom he and I shared) thousands of dollars, simply due to the fact that he gave inaccurate (if not dishonest) answers, said he did things that had not actually gotten done, and so on. I was furious that he could treat his (our) clients that way. Was he ethical? Well, I suppose one could argue that he might not have breached any ethics, that his intent was positive. But there is no valid argument that he was a professional. And it deeply disturbs me that other clients of his continue to put their trust in him.
I would suggest that a real estate professional should start with a professional designation (e.g. “REALTOR®”). But once again it should go much farther than that in terms of how well he or she communicates, negotiates, dedicates his/her time to their clients, etc. It might not be the easiest thing to define, but you sure know it when you see it, and you sure are aware of it when it’s missing.
Do yourself a favor: don’t affiliate yourself with a “professional” without asking for references or other recommendations. There’s no guarantee that you will have a similar experience as another client, but it could save you many headaches, and many more dollars.
Next week: Realistic Expectations
Wednesday, November 15, 2006
Don't Try This At Home
In my previous life as an Air Traffic Controller, we used to have a saying: "Don't try this at home!"... for obvious reasons. These days we live more and more in a do-it-yourself society, and if you are anything like me, you would rather do everything for yourself rather than to have others mess it all up for you.
But there are definitely things that one is better off entrusting to others. Buying and selling real estate is one of them. Is it legal to represent yourself in a transaction? You bet it is. Is it a good idea? Well, you know what they say about a lawyer who represents himself in court, don't you? If not, ask me.
Much of what real estate really is nowadays is a lawsuit waiting to happen. There are so many ways that a transaction can go off the track and/or come back and bite you years later. And of course, with every lawsuit, a new form is often born, adding to what is already a mountain of paperwork.
But there are other things that are critical these days, especially if you are considering selling your property. How do you come up with a sale price? This is probably the biggest reason that a property does not sell - a seller is completely convinced that their property is worth more than the market says it is. I'm sorry, but I have to say this: a seller is probably the least accurate resource when it comes to pricing a property so it will sell. A seller can say what they think a property should be worth, or what they want it to be worth, but that is usually far from what it will sell for.
And then there is Marketing... Real Estate Marketing is something that a good real estate professional should be totally on top of - if an agent can't give you a detailed, strong, and highly diverse marketing plan, then you should probably be talking to another agent. Marketing is another item that is best left to those who do it for a living.
A good real estate agent will lead you through this maze. So whether you are buying and selling - be sure you are well represented, but seriously folks, "Don't try this at home..."
Next time: What IS a Professional?
What else would you like to see Mark write about? Tell us!
But there are definitely things that one is better off entrusting to others. Buying and selling real estate is one of them. Is it legal to represent yourself in a transaction? You bet it is. Is it a good idea? Well, you know what they say about a lawyer who represents himself in court, don't you? If not, ask me.
Much of what real estate really is nowadays is a lawsuit waiting to happen. There are so many ways that a transaction can go off the track and/or come back and bite you years later. And of course, with every lawsuit, a new form is often born, adding to what is already a mountain of paperwork.
But there are other things that are critical these days, especially if you are considering selling your property. How do you come up with a sale price? This is probably the biggest reason that a property does not sell - a seller is completely convinced that their property is worth more than the market says it is. I'm sorry, but I have to say this: a seller is probably the least accurate resource when it comes to pricing a property so it will sell. A seller can say what they think a property should be worth, or what they want it to be worth, but that is usually far from what it will sell for.
And then there is Marketing... Real Estate Marketing is something that a good real estate professional should be totally on top of - if an agent can't give you a detailed, strong, and highly diverse marketing plan, then you should probably be talking to another agent. Marketing is another item that is best left to those who do it for a living.
A good real estate agent will lead you through this maze. So whether you are buying and selling - be sure you are well represented, but seriously folks, "Don't try this at home..."
Next time: What IS a Professional?
What else would you like to see Mark write about? Tell us!
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