Something I read on Facebook earlier made me just a little sad. Chris Somers asked for opinions on the banks’ role in the downturn versus the borrowers, and one of the comments was just callous. This isn’t the first time I’ve heard it. I just wish it were the last. Rather than get into a flame war on Chris’s Facebook, I thought I’d take the classier safer route and preach from my own soap box. 

If you are fortunate enough to not be in financial difficulty, are current on your mortgage, and view the recession from the sidelines, it is incredibly unflattering to say things like “man up and admit you bit off more than you could chew” or “nobody held a gun to your head and made you sign for that mortgage.” I suppose that when the initial sub prime crisis hit in 2007, the majority of borrowers in default may have been irresponsible or naive. The loans were, after all, terrible products. 

But today? People I deal with today literally did nothing wrong except lose their job. They bought within their means, got fully documented legitimate conforming mortgages, and, in short, did everything people in this country have done for generations. 

Except lose their job. That wasn’t in the plans. And they didn’t lose their jobs because they were bad workers, they got downsized because of the recession. Oh, and the banks played more than a passive role in the recession, as we all know. If you’ve ever been called by a banking rep from overseas you’ll understand. 

Almost half of my company’s listings are short sales. Here is a partial list of the reasons for the short sale status:

• Unemployment. 
• Cancer and illness. 
• Sick relative forced relocation when they were  current on their payments but under water. 
• A few were victims of predatory lending. 

To the guy who thinks it is clever to inquire on one of my listings as if he were an interested buyer, only to pitch me  that he is an Internet search firm and can improve my search engine rankings:

I will never, ever do business with you. 

I really get pinched by the false alarm you cause when an entire admin staff puts what they are doing on hold, goes into service mode to answer an inquiry, determines which agent will take care of the potential buyer or seller, only to slide to the bottom of the pole and see your crass solicitation. That is SO not cool. Is is disruptive. 

I get solicited all the time. The Police Conference of New York called earlier, and the guy’s pitch was to stop child abuse, as if I wasn’t already against it. I’m the broker and owner of the company. I get approached by people selling leads, copy toner, advertising, web pages, payroll services (what regular agent deals with them?), business consulting,  and dozens of other offerings. 

But even the scam telemarketers promising me the sun moon and stars if I buy their product don’t have the temerity to masquerade as a phantom buyer to get my attention. Even the guy who knocks on my office door selling knock off perfume out of a cardboard box doesn’t pretend he’s a buyer for one of my listings. This wasn’t a blog comment. This was a consumer inquiry. 

Do you sell to cops by pretending there was a crime? 
Do you sell to EMS workers pretending that an octogenarian fell and broke a hip?
Do you walk up to rectories asking for a confession only to pull out your snake oil?

No, you just figure that I’ll pay more attention with the vague promise of a commission. You try and use my mission against me. 

For Pete’s sake, you are supposed to be good at getting found. If you have to resort to subterfuge, maybe the SEO business isn’t for you. 

I have written before on real estate investor mistakes, and one of them is worth expanding on. It is little discussed, but if an investor buys a property for rehab and resale, there is more than a simple margin to be focused on. The investor should also be guided by a realistic timetable. 

All too often, I see amateur investors holding out for a price no matter how long in takes. This is a huge mistake for 2 main reasons: the cost of carrying the property, and the opportunity cost of not turning the property over in a timely fashion. 

Carrying costs kill profit margin. The property taxes in Westchester are the highest in the nation. A medium home worth $500,000 can have property taxes of $15,000 or more. Holding that property for 6 months is $7500 in taxes. Holding that property for a year-far too long-can eat 3% of the value. Taxes aren’t the only incemental cost- utilities, maintenance and snow removal not only cost the checkbook, they can ad stress as well. 

Opportunity cost is by far the silent killer. There are two types of opportunity costs I see that neophytes seldom consider. They are the cost of money, and the cost of lost deals if you hold on too long. 

The cost of money is often simplified into the interest on borrowed money, but it can also be interest lost when the investor pays cash. If you put $400,000 cash into a house, you are taking it from an interest-bearing instrument like a money market or cash account and put it into real estate, which pays no interest. If that fund pays 3%, interest lost on a price of $400,000 over a year is $12,000. If you borrow $400,000, interest can be double or triple that amount, making that hour glass a real source of angst if you don’t move the property. 

The cost of a lost deal is another casualty of hubris. I recently interviewed an investor flipping their first house. When I told them what I thought the home would sell for, their emotion at the quote was palpable. I wasn’t hired. They still haven’t sold, and appear to now be chasing the market. Even if they get lucky and sell at the end of the year for an amount higher than I quoted them, they still lose. Why? Because the incremental amount they held out for is dwarfed by the money they’ll never make had they turned the property over in a timely fashion and parlayed it into another opportunity. 

All too often, newer investors make the fatal mistake of holding out  too long for a home run on every deal, when a good solid double in a shorter timeframe would keep them profitable and healthy. That can be disasterous. Remember, with the gigantic numbers we are throwing around in Westchester and the New York area, mistakes cost a king’s ransom. Tens of thousands, sometimes 6 figures. 

Time is money. You can make money back with prudent future transactional strategy if you don’t hit a home run on a deal. But you can never, ever get time back. 

I’ll never say never, but this evening I had to explain to a seller client why I was unwilling to take a listing for only 90 days. I fully understand the reason why sellers want to hold their agent’s feet to the fire and ensure that they aren’t stuck in a long term contract with a brokerage that isn’t working hard to get their home sold. However, even if I sold the house in less than 30 days, a 90 day listing is almost always too short. 

It often takes a good solid 60 days for deals to close in Westchester and the surrounding areas these days. That may seem like an eternity to those in other markets, but remember that we can lose a month just getting a home under contract. 

I never want to commit what I consider vast resources and tools, to say nothing of my own time, effort and cash, to a client that will wander after such a short time, especially if they don’t list at the price I recommend. Average time on market in Westchester is over 6 months, and even that is misleading because that doesn’t take prior broker contracts into account. 90 days is a bathroom break, and when you consider that we can’t do single property websites, google ad campaigns, professional photography, Youtube walking tours and pre list inspection all done in the first 48 hours, the time get s squeezed even more. It can take a good week to have all the marketing set up and the listing properly imported to all the 50 syndication sites we use.

This is, of course, inspired by events today where a seller had second thoughts about the 180 day agreement he already signed. It was actually an extension to a VERY short initial contract period at a higher price than I advised, and my agent who was working with the guy busted his tail for the client. The place was vacant, so he kept it clean himself, emptied the dehumidifier, and mother henned the heck out of the place. 

A DO understand a seller’s fear of being tied up with a firm that is just waiting for another firm to bring the buyer. I get it. I have seen listings horribly neglected that were tied up with a brokerage for a year.  But that is’t us. We are as aggressive as you can get, and if you doubt it, google the address of one of my listings and tell me what you find. I know you’ll find extraordinary exposure, and that should have our clients resting easy that they are in good hands, and that we are in it for the long haul. 

By the way, I never say never. I would take a listing for 90 days under the right circumstances. I once took a 30 day listing, and it closed 36 days later. But that is a blog for another time. The takeway for consumers is that you want a broker that is committed and eager, but not one who is deperate. Desperate doesn’t sell. 

Growing up in Ossining, even though I went to Catholic schools after 1st grade, I always got the connection between the local history and the high school mascot, the Ossining Indian. We were told of the Sint Sinck heritage, stone on stone, and how the high school teams were emblematic of that history. That changed in 2002, when social and political pressure convinced the district to retire the Indian mascot. OHS grad Dana Goldstein, quite an accomplished scholar herself, has written a complex commentary on the change and aftermath.

Of course, the community is now a decade into mascot limbo, and with all due respect for the folks with the Ossining Indians Forever bumper stickers, I see less of an issue with the loss of the Indian as the lack of a suitable replacement.  They have tried and trashed the fictitious “Riverhawk,” then simply “O,” and now I see tacit references in the press to the “Pride,” as if those ex -jocks among us don’t already know that the term is as common as “athletic supporter.” The only official announcement of Pride is on a student blog I found from a senior, Trevor Gill, who graduated last year.

I wouldn’t have a horse in this race if I did not still reside in the district. My alma mater, John F Kennedy Catholic in Somers, is represented by the Gaels, another ethnic character, only of the Irish variety. I won’t go past mentioning that Notre Dame’s mascot, the fighting Irish, is literally a drunk leprechaun. And I couldn’t root for the Washington Redskins. But the reason for retiring the Indian was not mere political correctness. Tomahawk chops, caricatured logos and costumed buffoons would be reason enough for me if the mist of genocide and suffering did not linger. And as much as I’d like to cross my heart and promise to go back to the Indian if we could do it respectfully and without chicanery and stereotypes, I don’t think we can unring the mascot bell.

What I would like to see is a mascot that the entire community can get behind that isn’t a vowel or part-time adjective. The reason the Indian still remains in our consciousness is because they haven’t devoted the effort to a suitable replacement that matched the campaign to retire the Indian. The world has changed. No one is changing their mascot from Wildcat or Bear to Indian. It is the other way around.  I think it is time for Ossining to adapt, because you cannot rewind. The best thing to do is for the district to put an earnest effort in finding a new identity that resonates with both sides of the argument once and for all.  

A brief rant on agent Feedback, which, as I have said before, is often an excercise in futility. If an agent is kind enough to email back feedback on on of my listings, “call me” is not an option. Our Feedback system is online and my clients get cc’d on all submissions. I don’t need my client getting jacked up thinking an offer is imminent when the agent only wanted to tell me that they couldn’t get the AC to turn on or the top bolt lock to click. 

We’ve recently had a number of agents leave the feedback such as “Please call me- I need to speak with you.” My sellers, quite understandably, break their necks to reach me and make sure I get the “important” message. I did, of course. When I do speak with the agent, the important issue is often simply a benign question or observation. Nothing to get excited about. Offers? Look, if an agent is about to make a sale they aren’t subtle about it, they’ll move mountains to get it in front of me-nobody is coy about making a sale. 

Check this one out:

I called the person. Nothing urgent, just a simple question they could have emailed instead of a cryptic message. Thanks, that really helps…NOT. I have no written feedback to convey to my client, and my time was just wasted. Worse, my client suffered angst over a meaningless conversation. If it were an isolated case that would be one thing. But it isn’t.  

Back in the 1970’s there were some books published by Robert Ringer and Michael Korda entitled Winning Through Intimidation and Power, respectively. They were typical Me Decade-era self help jobs which centered on putting yourself first, posturing, and office/boardroom manipulation to get ahead. One of Korda’s principles was that he who has to make the call loses- in other words, it is the subordinate who has to dial. The superior sends a memo or a message “call me.” It is like a message to go to the principal’s office or call your boss. 

I don’t think this is what is going on, but it is still silly. Why add the extra step? I certainly have no objection to dialing a colleague, but the use of feedback, which is by nature a non-urgent medium, to convey a message when a simple call would do, is misguided. You can call me, text me or email me. There is no need to use feedback to request a call.  It’s like sending me a letter when you are already standing next to me. And it isn’t feedback! 

I have read with some interest on the recent blogging debate on how much we should cross polinate business with our personal lives. On one side you have people who feel it inappropriate to be very forthcoming about family and personal matters in a professional relationship, and then there are folks who see being open as an asset in building rapport and trust. 

Is there a hard and fast rule? No. There are two rules:

I recall, as a consumer looking for a rental in Hoboken, New Jersey in 1995 being put off by a rental agent who was an impersonal robot. But I also hate waiters who try and get me to like them when all I want is for them to shoo and bring back my order. Which brings me to a few lessons I learned back when I was a bartender in 2000-2001.

We were trained to never discuss religion or politics. Beyond that and mixing drinks fast and well, the job was to listen. I believe that it is the same thing in real estate. The old adage goes that we have two ears and one mouth. Identify the clients needs, listen, and get them what they seek. They don’t care about you unless they know you care. When bartending, I witnessed, firsthand, waiters who worked hard to get their customers to like them in an effort to maximize their tip. It didn’t work. What worked was hustling to get their food to them as fast as possible. We can chat over dessert or coffee. Agents should never make it about themselves. 

However, people DO want to know who they are doing business with. Building rapport is pretty crucial. And real estate is a relationship business. But how one shares oneself, and when it is time to discuss anything of a personal nature are important judgments to make. My rule of thumb is that I mention my background or kids as it relates to filling a need or answering a question for the client. If a prospective client in Somers or Katonah is worried that I as a Briarcliff Manor -based agent don’t know their area well, I’ll let them know I went to JFK High School in Somers. If a dog or child is disruptive, I’ll reassure them that I have a 80 pound German Shepherd and 4 kids of my own. When the time is right, that helps. It makes me a real guy. 

And I have had many a client tell me that I was hired because they knew I was working for my dinner, not spending money. 

By the time I was married September 29, 2001 I was tending bar only part time. I had a fairly large crowd of regulars, and they knew me pretty well at that point. I got quite a few good wishes from my customers, and to this day if I run into one they’ll ask me about my family. But we only got to that point because I already knew about them. 

I advise my agents to go with their gut about what they share with clients, but to always put the clients as the focal point of the discourse. The proof that the plan works shows in the progress of the company and our growth. People vary, and the only way to know what to say is to listen first and foremost. And no matter where you stand in this debate, I think we can agree that listening is always the best foundation to serving a client well. 

How can a kid that cute make that much…

Given my work schedule, sometimes we kill two birds with one stone: we pile all 4 kids into the car with a sign and a lockbox, and drive out to a new listing so Dad can put up the sign and install the lockbox. Then we go to Carvel or McDonald’s to thank the kids for behaving. It is work time, but it is also family time. 

Two things made today different:

• Catherine gets car sick sometimes.
• I had to drive on a long windy road. 

The joke among many in my area is that many forms of networking are called “notworking.” I could attend a networking event almost every day, nurse a cocktail, wear a nametag, and converse with fellow agents about life, the universe, and everything, but that doesn’t necessarily mean it generates business or helps me sell one of my listings. On the other side of the spectrum, there are networking groups that people would die to get into- a good BNI group, for example, could yield enormous referral opportunities because of the exclusivity of professions. 

I don’t belong to a BNI group. However, I am fortunate to belong to small, select professional networking group as the exclusive real estate broker known as PNW, or Professional Networkers of Westchester. This morning at 7:45, while most of the world was still home yawning, I was at a meeting of this group of accomplished Westchester-based professionals, discussing how we can get our respective businesses to the next level. It is brain food, a think tank, and an extraordinary source of business that my own clientele should feel good about. 

PNW has one of just about everything- a banker, architect, painter, CPA, chiropractor, property insurance broker, and over 20 other professionals, and we exchange referrals and ideas every other week and meet one on one often in between. It keeps me engaged, and, perhaps more importantly, gets me in front of tremendous sources for referrals so I can get buyers for my listings and listings for my buyers. So, every other Friday (and for a few hours a month in between) I am in front of a my fellow members by 8am, working to get the next breakthrough.

There are no weak links- just about every member is accomplished, full time, and at the top of their profession. And while it isn’t easy to get out early and meet before the start of business, it is worth the effort.   

Success is not a 9-5 thing.