Community NewsCompany NewsIndustry News December 31, 2014

State of J Philip Real Estate 2014 Edition

If you’ve noticed the conspicuous absence of updates here let me assure you that the reasons are all good. I am fine, the company is fine, and we have been busy. I have lots of good news to report.

First, after our best year in 2013, I wrote a year ago that I could foresee us growing from one office and just over 40 agents to 4 branch offices and 100 agents. We came close. The firm has indeed expanded to 4 offices, and we are approaching close to 70 fantastic professionals who have chosen to associate with our brand.

In October, we had the grand opening for our Pelham, NY office, followed by the November ribbon cutting for the Mahopac center, which houses both J. Philip Commercial Group and our residential division. Jenn Maher not only manages the residential division there, but is my managing partner (broker in charge) of J. Philip Commercial Group, and she is building something very, very special there. I can’t say enough good things about her- she got plenty of recognition herself, including Hudson Valley Magazine’s Top Women in Business Award. In December we welcomed Buffalo, NY to the family with the amazing Colleen Kulikowski joining as the trailblazer to that new market.

Mahopac opening Pelham Ribbon

The firm broke all prior production records with almost $34 million in closed sales and well over 100 closings.  The most agents we ever had in production was 17 in 2013; in 2014 we had 28, with 7 associates closing $1 million or more and another coming within an eyelash. Out of nearly 1000 firms in our market, our firm was ranked 50th in closed residential transactions according to HGMLS data.

Colleen and Mary

At our December holiday banquet at Finalmente in Sleepy Hollow, I was proud to recognize the following company associates for achievements and distinctions:

Top Innovator: Tom Ricapito
Top Recruiter: Janie Blanks
Top Contributor to Firm Expansion: Donna Materasso
Top Blogger: Barbara Bartell

Annual Awards

Top Producer: Cristina Gameiro not only had the highest number of transactions, she closed the highest dollar volume.

Comeback of the Year: Lorei Velazco. A multi million dollar producer with her prior firm in 2012, Lorei joined us earlier this year after spending the bulk of 2013 recovering from illness.
An agent with the best improvement. This year’s comeback s special, overcoming a year out for medical reasons, never losing a winning, determined attitude, and ferocity, commitment, and a willingness to invest in her business. She could very well be the top producer in 2015.

Rookie of the Year: Peaches Herron Drummond. Peaches came within an eyelash of $1 million in closings since February, and is actually poised to close over 10 transactions in the first quarter of 2015 alone.
As I stated at the banquet: Peaches joined our firm early in 2014, and was exemplary in her learning like a sponge as well as a willingness to invest in her marketing. She was a tiger in her follow up with inquiries, and was smart to ask me for help when needed. It all added up to a December with 10 transactions in contract and another 7 accepted offers pending from her prolific efforts. Another big contender for top producer in 2015

Leadership Award: Gloria Hernandez.
A leader walks the talk, coaches and is coachable. They don’t preach. They lead by example. As the adage says, They often speak softly, but carrying a big stick. This year’s leader was selfless in her willingness to help other agents, would follow up on project from me at the drop of a hat, and had the upbeat, selfless attitude of a leader that I personally admire.

Person of the Year: Mary KingsleyMary and Me
The person of the year embodies the company ethos of teamwork, collaboration, hard work, ethics, humor, and eagerness to learn. This year’s person of the year was someone I could count on the step in for me when needed, often with little or no notice, was vocal in her opinions to support me personally and professionally, fed me, literally, along with solid sales production in the wake of a tough 2013. She volunteered for more work just to forward the enterprise, and was an absolute evangelist for our brand. She is of my very dear friends as well.

Every one of the awardees is someone I would trust implicitly to take care of me as a client. I couldn’t be more proud.

On a personal note, I completed my term as Hudson Gateway MLS President for 2014, I served as Tech Chair for the NY State Association of Realtors, I served on Zillow.com’s Agent Advisory Board for a 3rd year, and I actually did get some writing done as a contributor to Inman News. The Women’s Council of Realtors gave me the Entrepreneur of the Year Award, which was a very flattering surprise. I lost 45 pounds through better eating habits and exercise, and I enter 2015 feeling better than I did 20 years ago.

MLSPresident WCR award

It is gratifying that all the growth and expansion did not come at the expense of the client experience- our feedback and online ratings remain stellar, referrals are at an all-time high, and the buzz about the company is undeniable. Much of that is owed to super support staff helping me keep my eye on the ball, with head admin Ronnie DeMeo and “Q Branch” technology chief Angela Johnson. With Nancy Green being added to the team in Mahopac, we are positioned well.

Looking forward, I see 2015 as  year to solidify all the expansion we have undertaken, to give our agents the best tools possible to serve their clients, to advance training dramatically, and to eclipse 100 associates, 200 sales, and make a hell of a run at $100 million in closed transactions.

But beyond the numbers, one thing will remain constant: the quality of character that our associates display, day in and day out, will remain at the top of the heap.

 

Real Estate TipsSelling January 26, 2014

Preparing a Home to Sell: 2014 Westchester Spring Real Estate Market

“De-cluttering” is so 2008. 

As I advise new clients listing their homes on the market to sell this spring, I am surprised to see how their jaws drop when I start the pre-sale preparations not with tidying up, curb appeal or repairs, but with fighting the battle online. 

Here’s what I mean: Before the 2014 consumer visits a home, they research it online in ways that weren’t even common when most home sellers were buying 5 or more years ago. Yes, it goes without saying that you patch the water damage from that time the tub overflowed and you remove the wall paper from Grandma’s old room. But that only addresses things after prospective buyers choose to look at your home. What about the information about your home they access online beforehand? The people you want to influence are not just those looking, but those who would check your home off their short list because of something they found on the Internet that they didn’t like. 

Here is a list of things to prepare your home for sale in the 2014 information age, which is going to have a dramatic effect on who gets top dollar fast for their home this spring and who has to reduce their price in the summer because they remain unsold.  

  • Grieve your taxes. Property taxes in Westchester County are the highest in the USA. I’ll repeat that: Our fair county has the highest property taxes of any county in the United States of America. In the feeding frenzy of spiking home values of a decade ago, municipalities made sure they got every dime they could justify. Did they adjust down with equal zeal after the crash? Hardly. If your home is assessed for $990,000 and it is on the market for $899,000, you shouldn’t even have to ask if you should grieve the taxes, you should just do it. Buyers love to hear that the seller is in action on lowering the taxes. It is one less thing for them to do and assures them that the current sticker price of property tax is going to be reduced. 
  • Google your address. You wouldn’t believe what people find when they do this. There are newspaper articles with incorrect addresses, websites with inaccurate information, and a ton of other websites that, perhaps worse, have no information on your home that should have a minimum of details. Get your Walkscore. Check your Zillow Zestimate. A broker like myself can show you how to fix inaccurate information before you go on the market so you don’t have to play catch up with a savvy buyer looking for a reason to make a lower offer or not see your home at all. 
  • Run your title report. This is another proactive way of avoiding problems which can kill a deal after months of time dealing with buyers, offers, contracts and inspections.
    • Make sure an old mortgage is discharged.
    • Make sure an old judgement from a 1997 divorce is satisfied.
    • Deal with that easement you forgot about or the encroachment of the neighbor’s fence that slowed down your purchase 15 years ago -forget that one too? 
  • Check the sex offender registry. I learned this one the hard way. Obviously, you can’t make a sex offender move out of your neighborhood. But forewarned is forearmed, and you can find out if that sex offender is a quadriplegic,  a 90 year old defrocked priest, or a married 35 year old with 3 kids who was in a Romeo and Juliet situation when he was 18. Check that registry

Of course, there are still a ton of things to do physically to the house, and often those are also things influenced heavily by the Internet. 

  • Go to the Building Department. Is that bathroom in the basement legal? Do you want to scramble at the last minute and spend top dollar to salvage a closing because you forgot it wasn’t? What about other improvements that may not have a certificate of occupancy? That rear deck?  The upgraded electrical system you had done 3 years ago? If your paperwork isn’t in order before you go on the market, later on a buyer might walk and the town will make you pay dearly at the 11th hour. I have, at different times in my career, dug out deck footings in the rain, demolished sheds, and filled in holes myself to make a deal work. I’d rather go the the gym. 
  • Get the home inspected. You want two kinds of inspections: a regular home inspection, and an environmental audit. Regular home inspections address things that a buyer’s inspection would discover and help avoid stress later. It simply makes no sense to dwell in ignorance about the chimney lining and 100 other things you don’t think about that the buyer will scrutinize closely once they choose your house. An ounce of prevention is worth a ton of cure in these cases.
  • The environmental audit should be a comprehensive assessment of air quality, mold, radon, testing submerged oil tanks, asbestos, pest infestation,and other concerns that are at the height of 2014 buyers’ consciousness. I can’t tell you how many times I have seen my buyers frown when the other side says things like “My client thought that might be asbestos, but they’ve lived there for XX years with no problem.” Absence of cancer is not exactly a high bar of assurance to people who want to raise their children in a home. Not addressing environmental concerns now can cost tens of thousands later in lost deals and price reductions, to say nothing of the actual remediation costs. 
  • Hire a stager. To me, the argument about whether or not a home stager can maximize the sale price and minimize the time on market was settled years ago when Marie Graham helped me get some listings sold in a very rough market. Stagers do not simply help you de-clutter and decorate with better appeal. They understand buyer perceptions. They know how to deal with pet odor, smoker’s homes, and many other things that the homeowner does not really have at the top of their mind after years living in their home. Staged homes sell faster, and they sell have a far higher likelihood of maximizing market value than a home that was not staged. 

Of course, perhaps the most important thing to preparing home home is choosing the right agent. A good agent will help you get everything done I have described, and our firm actually offers all the inspections as part of our service. The client pays nothing except to make the corrections once they are discovered. A good agent will also have a killer marketing plan that is tailored to the property, an excellent web presence, mega references, a solid track record, and a Rolodex (Wow…I am dating myself)  of resources to handle everything in this article. 

A good agent will also “profile” the most likely buyer for your home and make a marketing plan centered on that model. For example, in Westchester County, many of our buyers are in New York City and looking to relocate to the suburbs. Having a reach into tapping the city dweller market can make the difference in both time and money to an eager seller. You should also understand that the typical home buyer for a Westchester County home is typically very, very savvy and has done their research. They are spending a lot of money, and also bitterly resent even the appearance of anything intentionally hidden or glossed over. Handing the matters on this list will make a huge difference in doing business with that mentality. 

All of this occurs before the sign goes into the ground, before the professional photos and video are shot, and prior to entry into the MLS. It all makes a huge difference in time, money and reduction of stress. As my old high school wrestling coach Bill Carney often said, “it is not the will to win. It is the will to prepare to win.” I like my clients to win. 

 

 

 

Industry News January 19, 2014

On Being Hudson Gateway MLS President

Oath of officeAfter 4 years as Vice President of the Multiple Listing Service, this past Thursday I was sworn in as 2014 MLS President. I have to admit that it was a proud moment, but I also feel very strongly that there is quite a bit of work to do. Our association has merged with 3 other boards in the past few years, and the last merger resulted in the union of two MLS systems running on different platforms. In 2014, both databases, the old Empire Access MLS and Greater Hudson Valley MLS will now not only be the unified Hudson Gateway MLS in name, but also in fact on the Matrix system. To the public this may sound like a bunch of gobbledy- techno-gook, but to fellow Realtors this is monumental and presents the challenges of change to over 9000 agents on both sides of the Hudson. 

I foresee few issues with the transition. Our neighbors in Connecticut switched to Matrix last year and it was very smooth. 

The bigger issue I see is that of data policy. The real asset that any MLS has is its data. We have over 15 years of market activity in our archives, and of course the MLS is to the real estate market very much what the stock exchange is to securities. We currently provide the inventory of homes for sale to Realtor.com, every real estate website with an Internet Data Exchange (IDX) and use a 3rd party to import our listings to dozens of “syndication” sites like Zillow and Trulia. When I first started my company brokers who wanted their listings syndicated opted in through their own means or vendors. We then adapted our current policy, and there are some systems that provide some syndication sites with a direct (“RETS”) feed. 

There are complications and pitfalls with each model. Syndication sites (disclosure: I am a member of the Zillow Agent Advisory Board) have fostered some suspicion from licensees over how they have monetized their business models, and there have always been data accuracy issues. The cure for one compounds the other. I will be forming an advisory group to review our data policy from the ground up to determine how best to provide data to outside sources in service to our participants and consumers with a long term outlook. It sounds easier than it is. But I live for this stuff. 

It will be great to work alongside newly-installed Hudson Gateway Association President Diane Cummins on the executive board. When I first met Diane years ago she was rocking a Motorola Xoom tablet computer and she has always been a pleasure to collaborate with on association matters. She also gets my sense of humor. Also serving as Vice President of the Association will be none other than our own Jenn Maher, my partner in J Philip Commercial group and manager for the residential firm. I could write a month of posts just on Jenn’s exploits-she is an asset to the firm and the association. 

This is a volunteer position that will be undertaken outside of running my brokerage. I will be busy. I am also extremely honored, and as I have promised many before, I will say it again here: I will give it my all. 

Commentary January 5, 2014

On Being Household Name-or Not.

Name recognition is something all business enterprises aspire to have. A good reputation, a book of business, “getting your name out,” is the goal of every company. In a brand conscious place like Westchester County, it is the holy grail. That being said, industry specific circumstances often make that aspiration a constantly moving target. For example:

Name a great proctologist you would swear by in Armonk.
Who is the best architect in Dobbs Ferry? Or the top 3?
Off the top of your head, who is the “go to” interior decorator in Harrison?
If your car were totaled, who would you call to buy a new vehicle that you absolutely know would be honest to a fault and take awesome care of you?
You need a wedding planner. Who do you know would make the magic day magic?
You need a child psychologist. Who do you entrust your son or daughter to?

The chances are that you’d ask your sphere of influence for input. And the chances are high that the names of the proctologist, decorator or wedding planner are names you have never heard before. And I’ll bet that doesn’t factor in, because these are things that you don’t do every day.

Briarcliff Home sold by J PhilipNow let me ask you this: How often do you buy or sell a home? Once in your life? Three times? Five? For most people, the answer is “not often.” And many times, when I am referred to someone who wants to buy or sell property, the person referring me tells me that their friend/relative/co worker said they never heard of me. Now, this doesn’t bother me. There is no J. Philip Blimp (yet). But it bothers the associate or past client who is recommending me. I have to laugh, because as well as they may know me from past dealings, unless a person is connected to real estate, they have no reason to know me or any other agent for that matter.

Real estate is a specialized field in that it is a transaction that seldom occurs. It is no sin to not have the same name recognition in real estate as a soft drink, automobile maker or chain restaurant. As a matter of fact, real estate is the one field where being a big box name, for some people has the exact opposite meaning to the public as other industries.

Here’s what I mean- take a wedding for example:
Would you want your wedding catered by a well known hamburger franchise?
Would you buy a wedding dress at a department store with an automotive department a few aisles down?
What about the photos? After the ceremony would you head down to the strip mall and have your wedding portrait taken at the photography kiosk next to the  half-off DVD bin?
What about the flowers? Wouldn’t the supermarket be more cost effective than a florist?

Most would agree that it would be absurd to have any mass produced servicer for something as special and rare as a wedding. Yet I speak with literally hundreds of people a year who entrusted the rare, special and largest financial event of their life to someone because they saw their company’s signs all over the place or their ads in the margins of their online newspaper. And they regretted it.

There is no Proctologist Hut.
I know of no Child Psychologists- R- Us
Architect-Mart wouldn’t catch on.

Name recognition is equally dubious in real estate in most cases. The idea that if a company or agent spends a ton of money on marketing then they must be good is fallacious in my 17 years of experience. National brands are meaningless in something as expensive, rare and high stakes as real estate. Buyers don’t care who a house is listed with, they care if it suits their needs. And as far as big box firms having more “tools” and exposure than smaller independents, why is my little firm outperforming the market by well over 50%? Why are over half of my sold listings the ex clients of franchises and “market leaders?” Consumers learn fast to do more due diligence on their broker than buy the marketing pitches.

Here is what I tell my frustrated friends and colleagues to say when they are told by a prospective referral that they never heard of me or my firm:

Now you have.

 

Company NewsPimpage December 31, 2013

State of J. Philip Real Estate 2013 Edition

New LogoI am happy to share that 2013 was perhaps the best year in the company’s history. Not only did we crush our 2012 numbers, but J. Philip Real Estate exceeded some lofty goals I had set a year ago. 

2013 was the first year that the firm closed over 100 transactions. That was my most ambitious pipe dream back in the first quarter, and we finished so strongly that we actually blew past 100 all the way to 116 deals. This very nearly doubled last year’s production. While the market improved overall, it didn’t double, so we beat the trend soundly. I am very proud of my team for doing so. 

Sold in OssiningTransaction total was not the only piece of good news. Overall dollar volume was also nearly double that of 2012, as the combined volume exceeded $30 million for the year. In 2012 we closed just under $16 million. 

Another wonderful breakthrough was the number of agents who sold more than $1 million grew to seven (7) outside of myself. The best we ever did in the past was four (4) Million Dollar plus producers. This was consistent with my stated goal the past 2 years to have my own share of company production shrink while the company grew. That did happen. I did close 30 deals for $10 million, but I was less than 25% of the brokerage’s transactions. My goal last year was to be less than one third. I therefore wish to extend hearty congratulations to the following associates:

  • Jenn Maher
  • Tom Ricapito
  • Cristina Gameiro
  • Barbara Bartell
  • Melanie Bell-Kirk
  • Linda Polay
  • Ellise DiRoma

Overall, in an MLS of about 900 companies, our firm ranked 42nd in closed deals, putting the company in the top 5% of our market. 

Christmas Party Cake2013 had more to smile about than just closings. In July I was nominated as a finalist by Inman News, the industry news source, for Innovator of the Year. I completed my fourth term as Hudson Gateway Multiple Listing Service Vice President. I was the New York State Association of Realtors Vice Chair for Technology. The firm benefited from its continued membership in Westchester Real Estate, Inc. I also served in my second year as a member of Zillow.com’s Agent Advisory Board. 

There is more good news as we go into 2014. We have a healthy pipeline of pending transactions under contract. Our membership has swollen to over 40 licensees with another dozen primed to join us in the first quarter of 2014. After 4 years as MLS VP, I will be the Hudson Gateway MLS President starting in January. I will also be the Chair of the NY State Association of Realtors Tech Forum. A property management division is in the plans, and our rental division will be official in another week or two when 914rentals.com goes live. NYMetroRentals.com is not far behind. Overall, our web presence, especially our mobile capability, is flourishing. More tech tools for our agents to make them even better equipped to help clients are on the way as well. 

The company is continuing to grow and diversify. Jenn Maher and I have formed J. Philip Commercial Group, a separate brokerage company devoted solely to Jenn’s expertise in commercial real estate. The firm will open its doors in Mahopac, New York in the first quarter of 2014 with Jenn as the Managing Partner. The location will also serve as a branch office for our residential division, dedicated  to serving the needs of Putnam County home buyers and sellers. We are also in discussions on a southern Westchester branch in 2014. 

Christmas party

Jenn has been a rock star. She’s been integral in the expansion of the firm’s YouTube channel collaborating with me on a number of industry related videos, she has done yeoman work on bringing more licensees aboard our company, orchestrated team meetings and training, and was my conciliere of sorts on many occasions.  If the firm gave out an MVP award, Jenn would be the recipient. 

In short, we are no longer a mom and pop firm. We are a strong, growing concern that worked lean and mean through the housing crash and has come into the recovery primed to make a strong mark. I am incredibly gratified to work with this team of professionals, and as crazy as it sounds, I am confident that at the end of 2014 we could well have 100 agents and 4 branch offices with production more than doubled again. It goes without saying, but I’ll say it anyway, that I am forever grateful to Ann Faranda for her hard work, her patience, and her support. 

 

BuyingCommentaryMarket November 25, 2013

The Most Compelling Economic Indicator for Real Estate on Earth

Sold 1 BirchAs the real estate market cycles into a recovery, talking heads are discussing what index will be the most accurate predictor of the 2014 market. Will it be new housing starts? Employment? The DOW? 

I beg to differ. In 2014, we’ll be busier than any year since 2005 due in the largest part to one index they never talk about but is more compelling than any other:

The Uterus. 

Pent up demand from 5 and 6 years of putting off their lives will have more families out looking for a new nest than any year since I started my firm 8 years ago. It won’t matter if interests rise or fall, or if the economy is growing, or if the Middle East triples its tensions. People aren’t going to delay their lives, putting down roots, or going to new digs for growing the family any longer. 

In 2007, when the first sub prime domino fell, millions of would-be home buyers transitioned overnight from irrational exuberance to incredible caution. By 2009, I saw dozens of examples in my own practice where perfectly qualified buyers held off on making a buying decision due to lack of confidence in the future (I know; don’t get me started. The future is happening no matter what). 

But you can only live with your parents for so long. 
There’s a limit to your tolerance of staying in that cramped apartment one more year. 
Your wife will agree to hold off on having a baby for a finite period of time before she says “enough.”
People want to get their lives in gear. 
No more waiting. 

The public now understands that the sky isn’t falling, and that it is time to start living their lives again. No more delaying, no more putting off, no more waiting and seeing. The time is now. Millions of people who would have already otherwise acted in 2009, 2010, 2011, and 2012 are now ready-more than ready, eager– to put down roots. 

Interest rates were 18% 20 or more years ago and people still bought a home because they wanted to participate in the American Dream. People have bought homes through past recessons, world wars, and other trying, challenging times. The Great Recession is over. “It is now our time” is a thought echoed by more people now than ever. 

“She’s not waiting any longer” are words uttered to me in private by husbands quite a bit lately. Their wives want to start the family. It was OK to hold off a few years ago. But they aren’t delaying things anymore. The writing is on the wall, and the indices I am seeing aren’t published in the Wall Street Journal or Bloomberg. 

More young families have had enough with waiting and are poised to act no matter what the circumstances. 

By the first quarter of 2014 we’ll have over 40 dynamic licencees ready to serve their needs in acquiring a new home for the next chapter in our clients’ lives. 

And believe me, nothing is going to get in the buyers’ way. It is time to stop waiting and start living. 

Company News November 11, 2013

My Return From Blogging Hiatus

New LogoWhile I never intended to take a formal break from writing, one day a guy wakes up and sees that he hasn’t posted an update since August. It wasn’t planned; nothing bad happened to me. I have just always felt that I would never “force it,” and I had nothing to say for a while. More accurately, if I did have something to say, I jotted a few notes for the day when I’d actually have the time to do it justice. And so here I am, hunting and pecking again.

While I took off from writing, Lord knows I didn’t take time off from working. Quite the contrary- things have progressed such that my return post tonight will get you up to speed on all the news around here. I have been busy.

First things first: Business is up. Year to date, transactions total is up 41% over the same period in 2012. Dollar volume closed is up 83%. You read that right- we have closed nearly double the dollar volume in 2013 that we closed last year for the same period. That keeps a broker busy.

The team is growing, in more ways than one. Entering 2013, we had about 32 licensed agents with the brokerage. A handful hung up their licenses, but we’ll hit 40 associates by the end of the year because we have more than replaced them with some excellent, talented professionals who have joined the firm.

J. Philip Commercial Group, LLC is born. My partner in crime, associate broker Jenn Maher, is a commercial specialist. In looking at the landscape of the local market, we felt that there was an opportunity to do more than just take on some commercial business. We saw an opening for a stand alone brokerage we can run together that does commercial business exclusively. And that’s just what we did. J. Philip Commercial Group will open in Mahopac on January 4, 2014. You don’t start a new company lightly. We saw a confluence of opportunity and our own resources, planned thoroughly, and we expect good things.

We have an REO division. Associate broker Michael Fradianni is our new REO manager, in charge of the sale of Bank owned forecosures. This is an exciting development. Michael is a great guy and has tremendous experience in this very specialized field. 

914Rentals.com is almost out of beta.  We have some agents in the firm who have asked to start a rental division, and work has begun in earnest. It will be up and running by the end of the fourth quarter of this year.

2014 MLS President. After 4 years of serving as Vice President of the Hudson Gateway Multiple Listing Service, I have been confirmed as 2014 President. I look forward to serving my colleagues in this capacity, and I hope to make a difference in what is a changing industry.

Other good things are in the pipeline and until they are solidified I will refrain from making any formal announcement. Suffice to say that much of our growth is fueled by good talent joining the firm, and we have been approached by some great people about expansion in the form of branch offices and even a property management company. You don’t dive into these things without good planning, so until arrangements are made concrete I’ll leave you with that teaser.

So yeah, I’ve been busy, and haven’t had much time or inclination to write as I have worked on these things. However, I was inspired to write tonight, and I expect to do so again very soon.

 

Pampage August 28, 2013

Greg Fischer on Moving

I seldom “curate” content of other blogs but this is too thought provoking and insightful to not share. Greg Fischer, a pretty profound real estate broker in Fort Worth, Texas penned an outstanding piece on moving entitled Moving the feelings|Sometimes boxes are the easiest things to pack.

VERY good stuff, and while you are there (why are you still reading this?) consider that a really good licensee knows all too well that the hardest part of moving is often not the physical labor.

 

Buying August 23, 2013

Why You Can’t Steal a Co-op

While the real estate market here in Westchester and the Hudson Valley is certainly on the mend, one vestige of the old buyer’s market, the would be-buyer with the low ball offer, is still with us. Typically, the justification for the low offer is one of two things: the property is unsold, or the property needs work. In cases where the home is unsold, well, duh. If it were sold you wouldn’t be considering it for purchase. In cases where the place needs work, the agent population has done a poor job of educating the public on the adjustments for improvements needed. For example, while a new kitchen might certainly cost $20,000 or more, it is not always valid to make a $20,000 adjustment. Why? Because the current kitchen is not worth $0, that’s why.

Still, lowball offers do persist, mostly on the wishful thinking speculation of lookers playing the numbers game and hoping they can catch lightening in a bottle. One sector of the market where such a practice is more futile is the cooperative apartment. While a low offer might have a 1 in 50 or 1 in 100 shot in the case of a single family home or condo, with co-ops the odds are almost impossible, even if the seller were to agree. The reason is simple: the co-op board can reject the purchase on the grounds of the price.

From the New York Times last October:

Co-op boards are rejecting sales outright if they deem the price of the apartment to be too low.

Some boards are so determined to hold the line on prices that they are unswayed by buyers’ offers to place years of maintenance fees in escrow, to increase the down payment and even to pay in cash.

Co-op purchases are subject to co-op board approval. The board can reject a perfectly qualified buyer with no reason given, and they can also reject a sale for being too low. In technical terms, they are doing so to preserve the share prices of the complex. In a co-op transaction, the purchase is not really of real property, but of stock in a corporation, and instead of a deed, the new owner (still often referred to by many co-ops as a lessee) get a proprietary lease.

Now I certainly understand how someone from Ohio or Nebraska would read this and shake their head. I have often said that if co ops were introduced in 2013 as a new form of home ownership they would be dismissed as a scam.  They are whacked. But they are also very common in New York, and not just Manhattan. Westchester has long regarded co-ops as the “starter home of Westchester” because there really isn’t any other type of home you could commonly  buy -and live in- for under $150,000 and often under 100k. But low offers persist for a variety of reasons.

Co-op board have one mission: to preserve, protect and defend the share prices. They therefore evaluate the financial qualifications of the prospective buyer closely to ensure they can pay their common charges and be a responsible member of their cooperative with great scrutiny. But it doesn’t stop there. They can, and do, evaluate the purchase based on the price. many sales have died because of this, but many of those contracts should never have been submitted. Forewarned is forearmed. If you are in the market to buy a co-op, do understand this fact: many boards will not approve a price if it is too low.

Industry News August 19, 2013

ZtreetEasy: Zillow Buys StreetEasy

The casual consumer may not find this subject terribly interesting. Market watchers and industry people will be talking about it all day.

Earlier this month, President Obama was interviewed by Zillow CEO Spencer Rascoff on the state of housing in the United States. The National Association of Realtors, feeling snubbed perhaps (although they shouldn’t. The White House is reaching out to private industry, and NAR is a trade organization with an active Political Action Committee, RPAC), issued an embarrassing statement referring to Zillow as a “housing entertainment website.” NAR members like myself were  not too happy with NAR’s response, considering it far below the largest trade organization in North America and the voice of real estate.

Well, that “entertainment website” just bought StreetEasy.com, and the acquisition presents a tectonic shift in the largest real estate market in the USA one half  hour south of my kitchen table, Manhattan. Ironically, Manhattan is the one place in the USA where NAR’s presence is all but irrelevant, as the area is dominated by the Real Estate Board of New York or REBNY. REBNY split off from NAR in the mid 1990’s. With some clear market overlap with Westchester and the suburbs, this affects me and many of my colleagues. The ripple effect with New York has always been clear.

What does it all mean?

Zillow and StreetEasy come from opposite ends of the real estate world. Seattle based Zillow has been fighting hard for years to make sure their data accuracy is improved. Given that Zillow now ranks ahead of Realtor.com as top site in consumer traffic, it is a priority. As a Zillow Agent Advisory Board member myself, I know this firsthand. Zillow gets their data from many different sources, mostly 3rd party systems, and that has posed a challenge and caused tension with the brokerage community.

Complicating matters for Zillow is the fact that Manhattan has no MLS the way most markets know a Multiple Listing Service. REBNY does have their own database, known as the RLS, but it is not on any uniform platform. The Manhattan Association of Realtors operates an MLS, but its market share is small. There are therefore few, comprehensive “go-to” sources for Zillow to draw Manhattan housing data.

Manhattan-based StreetEasy, however, is considered the defacto MLS for Manhattan, supplanting REBNY’s own public portals and the long-revered NY Times as the conduit of choice for consumers. I do some business in the very northern part of Manhattan toward Inwood and Tryon Park, and StreetEasy has served us well. Manhattan brokers swear by it. It is the toast of the town.

A move like this is, arguably, a bigger coup than the President Obama interview in terms of impact on the New York market. They have leapfrogged to the apex of both broker and  consumer choice for online home search in a very unique, peerless market. Last year Zillow purchased Buyfolio (now known as Agentfolio), a very good home search interface for brokers and their clients, so this is not Zillow’s first effort to beef up their involvement in the New York City market. It does put them on top convincingly.

So, what Zillow has basically done is purchase Babe Ruth. And every New Yorker knows what that means.