After putting a short sale into contract just a few weeks ago, I was pleased to get a call for the broker price opinion just yesterday. For the uninitiated, a broker price opinion is part of the short sale approval process and I have waited months in some cases for one to be ordered. It is the banks way of ensuring that they are getting fair market value for the home in exchange for a lower payoff than the mortgage balance. 

Good news, right? 

The agent doing the BPO had a familiar name, so after meeting her, I looked her up. She lists a fair number of bank-owned foreclosures. And yes, she lists foreclosures for the lender we are negotiating our short sale with. Am I cynical to wonder why she’d do an honest BPO when she has the power to tank our sale and get the listing herself at foreclosure? 

Fifty bucks, or a foreclosure listing. Hmmm. Am I being paranoid? 

This market report is for single family home activity in the Ossining school district for October of 2010. All information is derived from the Empire Access (formerly Westchester-Putnam) Multiple Listing Service. 

After a poor September, Ossining rebounded nicely with 11 closed sales at a swollen median price of $535,000. Volume was actually down from October 2009, however, so it appears that the place is accustomed to strong Octobers.  

While not as robust as the prvious October transaction-total-wise, 27 pending sales are very healthy (up from 22 last month), and the available inventory of 144 homes offers prospective home buyers lots of choice. 

Overall a very solid month given the economy. 

Previous postings on Ossining.  

You can search for a home in Ossining by getting yourself a free Listingbook account. 

Governor-elect Cuomo, Senators Schumer and Gillibrand, Representative Lowey, State Senator Oppenheimer, and Assemblywoman Galef: Congratulations on your election and re-elections today. I didn’t vote for any of you. With the exception of Mr. Cuomo, it was on your watch that I have watched this great republic brought to its knees. I voted for Jimmy McMillan for governor, Mr. Cuomo, because I found it necessary to lodge a protest vote. I voted to unseat every incumbent. As a matter of fact, the only sitting official I supported, Mayor Bill Hanauer of Ossining, I couldn’t vote for because I live 100 yards outside the village. 

But- you all got elected anyway. 

So here’s the deal. I am watching you. Every one of you. And I have an idea of what needs to be done to improve the quality of life of New Yorkers. I want to know what you are going to do to solve the foreclosure crisis. I want to know what you are going to do to help people not lose their homes to foreclosure. I want to know what you are going to do to help people in red tape hell trying to modify their mortgage or do a short sale and are getting hammered by the banks you voted to bail out. 

If the answer is not satisfactory, and you’ll just do what you need to do to get re elected, I’ll remember. And I won’t be so quiet in 2012. 

Yet again, I find myself nodding in agreement with the latest New York Times editorial on the mortgage mess. This has me wondering if I am becoming like so many other NY Times readers, some sort of limousine liberal, anti-business, anti-free market, pro government intervention, lefty. I was always a laissez fair kind of entrepreneur, against government regulation and supportive of the Adam Smith, Invisible Hand notion that market forces will stabilize even the most troubled of times. 

What happened? Why am I agreeing with the Times? I have even agreed with Paul Krugman’s last two columns! Paul Krugman!! Has the world turned upside down? Am I um, changing? Hell, 31 readers  have “liked” my last comment on the editorial! I used to get about three. And my friend Pam told me that I was echoing some things said by Ariana Huffington. 

Now that I ponder it, I see two forces at work. 

1. The problems and injustice I see is so pervasive that both conservative and liberal sensibilities have common ground. The recognition of the problems and need for action is bi-partisan. 
2. I have always viewed the government’s role as that of a referee who should not interfere with the game, but ensure that the rules are followed. I am pissed because the ref is not whistling a foul. We just had a mugging on the field, facemask, pass interference, balk, travelling, high sticking, offsides, and no whistle. 

Well, it’s Halloween, so why not a report on Sleepy Hollow? Yes, there is a Sleepy Hollow, and yes, Washington Irving is buried here. There is an Old Dutch Church, a Sleepy Hollow Bridge, and the high school’s mascot is the Headless Horsemen. Old Sleepy Hollow road is VERY spooky at night, winding along covered by trees which almost create a corridor as you drive down the road at night. A few times in high school we’d turn off the car headlights to magnify the effect. 

But is Sleepy Hollow a haunted, scary place? Residents laugh at the notion. It is a charming river village on the banks of the Hudson, and thanks to the location of Phelps Hospital, it is also where I was born. Of course, back then it was known as the more benign North Tarrytown. The village changed its name to Sleepy Hollow in deference to history in 1996. They do an outstanding job of observing Halloween every year, but beyond that there aren’t many spooky things to speak of. 

The Tarrytown school district serves Sleepy Hollow and the village of Tarrytown as well, and the high school is known as Sleepy Hollow High School. The village is nestled between Mt Pleasant and Pocantico to the north and east, and Tarrytown to the south. Briarcliff Manor is just a stone’s throw to the north. 

5 single family homes sold in the school district in October of 2010 at a median price of $575,000. 

7 single family homes are under contract as a median asking price of $645,000.

42 single homes are available and active on the market, and the median asking price is $674,500.

The area also has a significant amount of multiple family dwellings, co ops, and condominiums. The first sale my company ever closed on in 2005 was a condo in nearby Tarrytown by the Tappan Zee Bridge. 

If you want to check out available homes in Sleepy Hollow and Tarrytown, get yourself a free Listingbook account. 

On this Halloween 2010, I’ll depart from the typical scary stuff (lawyers, in-laws) and expound on a few lesser spoken of scary things in my beloved industry. 

• Measurer terror (AKA Time Vampires). The folks who ask to walk through a place two weeks before closing so they can measure every room as I wait for an hour. This isn’t high priority, so it has to be shoe horned into off times, like Sunday mornings. I get to watch and listen as they meander through each room, discussing every permutation of their lives and how it relates to the dimensions of the room. I check my email on my Droid and wonder why they can’t do this after they close, since we often know they aren’t moving right in. Extra demonic chills to anyone who brings up Feng Shui as I stare out the window at a squirrel. 
• The eponymous, ubiquitous anonymous. The EUA call from blocked phone numbers and quiz me on my listings with bizarre specificity, then hang up without telling me who they are, or why they are calling. “Has anyone ever died in the house?””Are the taxes accurate (no, I roll dice and write whatever comes up.)?” “was it ever a peanut farm?” They call again the next week with another battery of questions, again, in stealth. 
• Invisible Men (and women). These are the clients, buyers and sellers alike, that work their agent like a rented mule, then disappear without apology, explanation or acknowledgement. They re-order photos, kvetch over marketing verbiage, ask where the buyers are, and then, when you have two showing requests for a Saturday needing confirmation from the seller, vanish. 
• Fountains of Fortuitous Fertility. The dreaded FFF. This is a unique seller who devotes 60 square feet of available wall space to be a monument to their prodigious ability to procreate, with, of course, a wedding photo at one end. Then, baby photos, bathtub photos, first communion, confirmation, prom, and every other rite of passage for every one of their uterine issue. After the buyer’s jaws drop, they can’t focus on the house, but do wonder aloud if cable is available in the neighborhood. 
• Renters rendering wrecks. The occasional renter who is more focused on the physical condition of the house than most people who are actually buying. These people actually shake the downspouts to make sure they are OK. 
• Obnoxious Lock Box Oxen. There are two types of OLBOs: Listing agents who cleverly place the lockbox on a lawnmower handle or other exotic, out of the way spot without telling you, and buyer agents, who call the office irate that the lockbox will not open. It does, of course, but why ruin their shrill rant. 

Ossining has always had its share of problems through the years, and among them, since I was young, was always the blighted downtown area. The story goes that Ossining always had a vibrant, prosperous downtown until the early 1960’s, when Arcadian Gardens shopping center was opened on the south side of the village, and all the commerce abandoned Main Street. By the time I was a kid in the 1970’s Main Street was a crumbling mess. Village governments came and went, but no one ever seemed to be able to bring sustainable development. In the late 70’s federal money underwrote a large urban renewal project, which gave many of the old buildings a facelift and needed restoration, but it brought no real change beyond the cosmetic. 

The Ossining Post office was moved in the 90’s from South Highland Avenue to the corner of Spring Street and Main, once the mecca of downtown, but it would be years before anything developed beyond that. Prior to that, the only improvement downtown ever had was the demolition of blighted structures, leaving vacant lots and piles of rubble. I would post photos, but there are few to find online. The book Ossining Remembered jarred my memory, with quite a few photos of the downtown I remember as a youngster. 

I cannot give an accurate timeline as to when the tipping point of downtown’s resurgence was, nor can I tell when it truly turned the corner. The facts is this: downtown Ossining is in better shape now than it has at any point in my lifetime. Main Street is down to one lonely boarded up edifice (the old AL Meyers Furniture, which ironically, was one of the few occupied stores when I was young); the rest are occupied, alive, and, added up, make a pretty sight. As I said, the genesis of the resurrection of downtown may predate Mayor Hanauer significantly. Well, so does the decision on some of my clients to sell their homes. And three agents later, when they hire me, they sell. The same way, one mayor or 5 mayors later, Bill Hanauer presided over the comeback of downtown Ossining, and he therefore has “scoreboard.” For that reason alone (although there are many more), I am departing from my apolitical policy on this blog and supporting the re-election of Bill Hanauer for mayor of Ossining. 

Bill Hanauer is the guy I want to deal with the progressing development of the waterfront when that project becomes viable again, as well as whatever else comes onto the scene. Just the fact that we can say “development” and “progress” in the same sentence as “Ossining” speaks volumes. 

 Apparently I have missed the latest celebrity news about Charlie Sheen’s recent drug-induced binge where he was found in his hotel room with a porn actress and cocaine, but not his clothes. While the guy on the radio wondered aloud about Sheen’s crazed excesses, it was brought up that he paid the porn chick $12,000 to be his, um, companion while Elliot Spitzer spend a mere $4,000. How could it be, the host went on to ask, how a private sector guy would pay so much for a hooker but the governor of New York so much less? Shouldn’t it be the other way around, since private parties are more efficient than the government? The answer offered by one of the callers made a good point. Spitzer was not spending public money on the lovely Ashley Dupree, he was spending his own. People are far more likely to spend other people’s money more lavishly than their own. 

Other people’s money was the answer to that question, and many more. 

It is easy for us to spend other people’s dollars. I have sellers to want me to splurge on an expensive print ad, even though I have told them the results are not worth it. But it’s not their money, so they keep asking! Of course, the shoe is often on the other foot, when agents are so quick to tell a seller to lower their price, often to compensate for their crummy photos, typo-laden write up and poorly targeted marketing. If it were their house, the photos might be plentiful and crisp, and the remarks packed with a powerful, eloquent message.

So, regardless of what side of the closing table you might be on, the next time you are met with resistance, ask yourself the question: “who’s money am I spending with this idea?” The answer might surprise you. And that might make you come up with some more resourceful answers yourself. 

Contrary to what some may think, an owner is not obligated to submit every offer to the lender for approval in order to do a short sale. As a matter of fact, there are offers that an owner should never submit to the lender. That is the owner’s right, as they still hold title and ownership of the property, and the bank’s decision in a short payoff is simply the amount they’ll take to release the lien and settle the debt.

In Westchester and the surrounding areas of New York, offers are not submitted to the lender for approval, contracts of sale are. And those contracts are between buyer and seller, not the bank. The contracts are conditioned upon bank approval, but they are binding contracts none the less. And it can take every bit of 3-6 months for the lender to render a decision, all while the foreclosure wheel turns. If the owner goes to contract with an offer that is less than a realistic expectation of value, they can be six months closer to foreclosure when the bank issues their denial of the short sale.

Sellers are therefore looking for realistic offers, not for their own pockets, but to ensure the bank accepts the short payoff. If an offer can be judged favorably by3 recent (i.e., 6 months or less) closed and 3 active comparables, the offer bodes well. Buyers who submit speculatively low offers, unsupported by 3 sold and 3 active,  are doing something ill advised; if their amount is not close to what comparable sales for similar properties are getting on the market, they could waste months waiting for the inevitable “no.” And that “no” could cost the owners their house.

We have a enough offers in multiple bid situations meeting resistance to the banks; lowball offers invite peril to the seller and frustration to the buyer. And it is ultimately the sellers decision as to whom they’ll go to contract with. A short sale sellers surrenders proceeds. But no owner surrenders their rights. While the bank makes the final decision on amount, it is the owner, on advice and market data from their agent, who determine what to submit to the bank for that decision.

Originally posted on the New York Short Sale Blog. 

<phone rings>

This is Phil Faranda, can I help you? 

Yes. I am looking at a house. 

OK. How can I help you? 

I want to know more about the house. 

Are you in front of the house now? Are you at a computer? 

Computer. It doesn’t give an address. 

What web page are you on? Can you email me a link? 

No email, it says solid house on quiet street…

What web page ?

Google. No address. 

Does it sat a city? Or a price? 

Yes, it does. Yonkers, multi family, $300,000. Near Yonkers Avenue. 

OH! Ok, that is 55 Chestnut. It is a 4-family. 

OK, where is it? 

55 Chestnut, Yonkers. 

Where is that? 

55 Chestnut Yonkers, off Yonkers Avenue. I can’t get more specific than that. 

Yes, but what’s it near? I want to make sure the area is OK. 

Why don’t you drive by? Does your car have a GPS you can put that dress into? 

I don’t drive. 

(10, 9,8,7,6,5,4,3…)

Hello? 

Can I call you later when I’m in front of my computer? I can look at the map and give you more specifics and what bus stops it is near. 

Would you do that? That would help so much. 

Yes, I will. 

My name is Susan and my number is (914) 555-1212. 

I’ll call you tonight Susan. Good bye. 

Thanks! Good bye!

Rather than post a REALLY long comment on Broker Bryant’s post on the subject, I thought I’d write my own post on Flat Fee MLS listings. Ann and I ran a flat fee MLS company for 4 years in tandem with our company, and I know a ton about the Flat Fee niche. Essentially, for a flat initial fee of $200-$400 typically, you enter a listing onto the MLS under an exclusive agency agreement, where the sellers are their own defacto representative. If they find their own buyer they are exempt from commission, and if a buyer comes through their MLS presence they pay a commission to the buyer agent only. Clever idea. 

It might seem attractive to some. You pocket a few hundred dollars just for some data entry. What’s not to like? The answer is plenty. Be careful. Consider all sides of the issue from someone that saw it all and got out.  

First, the upside:

• You get exposure. Those are your signs and your sales all over town. 
• You make a few hundred dollars quickly. As BB alluded to, $300 for an hour’s work. 
• They might use you to buy their next home. Why wouldn’t they? 
• They might bump up to full service. If they decide they really do need a pro, there you are ready to help!

Here’s the downside: 

• Everything they do sticks to you. Even if you are in an MLS which has no minimum service requirements or liability for entry only listings, what they do reflects on you. You aren’t going to take photos, you’ll upload their photos. And if their photos suck, those are your listing’s photos that suck. And when offers come in they’ll screw up 2/3 of offers that would close if you were negotiating on their behalf. So you either work for free or watch helplessly as they boot it, while the other agents watch and shake their heads about how you operate. Buyer agent hate dealing with someone who they view as another broker’s client, so you either have to step in or have your brand be in the hands of a FSBO. 
• They can wreck your stats. We had overpriced listings on the market for years while the owners speculated with a silly price. We didn’t care until they skewed our days on market numbers. 
• They can harm your reputation. Remember, they are For Sale by Owners. FSBO. They march to a different drummer, and if they do or say something stupid, it is your banner they are sailing under. We’ve had flat fee clients get into arguments with buyer agents, ask buyers embarrassing questions, and hinder showings with their meddling. That makes you look like you have an out of control client. Hint: you do. If they have a FSBO sign on their lawn, agents will give you grief about it. If your solution is to operate under a separate company, you now have two firms to run, and 2 sets of overhead. Double MLS dues is only a start. You need signs. You need a website. You need other phone numbers. And before you know it, you need 3-4 flat fees a month just to pay for your overhead. 
• Other firms will solicit them once they find out they are flat fee. Not a big deal until they assume all of your listings are flat fee, then it becomes a dance between confused sellers and agents poaching your client base. Do you want that headache for $300? We put a stop to it once it happened, but we first had to find out it happened- the hard way. 
• They can waste your time. Ann has probably spent 1000 hours pacifying these supposedly entry-only people with incessant photo re-ordering, paranoid proofreading, endless status changes, chasing sellers down for appointments, and clingy, repeated requests for pro bono help and advice. 
• They do things they would fire you for doing. We had a guy who never answered calls for showings from agents. So we put him on CSS. CSS couldn’t get a return call. So who gets called? Me, that’s who. And I have to chase the guy down to get an appointment set up. If I pulled a disappearing act like that my clients would be livid! 
• They are mercenary. They are trying to save money no matter what. We’ve had a number of flat fee sellers who were ostensibly going to buy with me after they sold, and most of them ended up buying a FSBO or using another broker. Why? Because it’s all about them, that’s why. In four years we had one flat fee client use us to buy. The rest bailed. After working me like a rented mule in some cases. 
• If they “bump up” they typically jump ship. The thought was that many people would grow tired of going it alone and bump up to full service. And they did. The problem was that they wanted to use another broker. We’d be told that they wanted a real broker. The problem is that if you take a flat fee listing, you actually aren’t a real broker in their eyes. So you aren’t a viable alternative when they do decide to list with a full service shop. You prime the pump for your competition. 

I posted this on Facebook a day or two ago: 

Let’s review: Link to me on Linked In, solicit me, then count backwards from 20 while I de-link us.

I got a few comments and “likes.”

There are two recent examples of annoying behavior which are the cyber equivelant of stuffing your business card into people’s pockets at a cocktail party.

• Ms. High Beams. This isn’t XXX spam- it is a real legit person. Ms. High Beams friends me on Facebook. We have 7 friends in common, all men. Ms. High Beams doesn’t have an over the top racy photo of herself, but suffice to say that she is making sure that we know that she’s, um, blessed. So, with 7 friends in common, I click accept. She lives and works in my market area and while none of her photos are outrageous, it is clear that she never met a tight or low cut shirt she didn’t like. After we link on Facebook, she solicits me for her home improvement business. This is not a wise move. I’ve been played. She’s twirling her hair at a few guys to get a toehold at harvesting contact information. It is subterfuge. That’s not cool on Facebook. 

• Mr. Thank You. Mr. Thank You is a 2nd or 3rd degree connection on LinkedIn. He adds me to his network, and seeing that he is in my extended sphere and a fellow agent out of state, I accept. He sends me a “Thank You” message via LinkedIn: “Thanks for connecting! How’s business?” I answer out of politeness, and I get a hard sell response that if I really want to succeed in real estate, not just locally, but nationally, check out this hyperlink!” This is more subterfuge. First, the guy has gall to assume that he’s got the answers I need. He probably doesn’t, and as a matter of fact he should probably be asking me for a few answers. People that recruit like this are throwing mud on the wall. 

I read two quotes that resonated with me on the danger of banks if given too much deference and power. 

1. I sincerely believe, with you, that banking establishments are more dangerous than standing armies; and that the principle of spending money to be paid by posterity, under the name of funding, is but swindling futurity on a large scale.
2. The system of banking we have both equally and ever reprobated. I contemplate it as a blot left in all our constitutions, which, if not covered, will end in their destruction, which is already hit by the gamblers in corruption, and is sweeping away in its progress the fortunes and morals of our citizens.

You want to modify your loan? Stop paying us. Then we’ll put you through red tape hell before we foreclose. 

Does this happen to you? 

I swore that today was Saturday. Ann had to show me a calender to prove it was Sunday. Given all the weekends we work in this business, the days sort of blend together. If you are working 12 hours, does it really matter if it’s a weekend? I think not. The only difference between a weekday and a weekend now is getting the kids ready for school (uh-oh. I missed Mass.). 

Am I alone in this thought? If you steal a weekday off in real estate, doesn’t that count as your weekend? 

What does $168,000 buy in White Plains these days? That will get a very nice 900 square foot unit at the Gaylord cooperative in White Plains, such as the one we just closed this past week. This apartment  is a very spacious Junior 4 with brand new kitchen, granite breakfast area & windows. The Gaylord is a luxury doorman building with beautiful deck courtyard. The bathroom has separate tub & stall shower. The apartment has hardwood floors & many closets. Another great plus is that the modern laundry in house! As with most Junior 4’s, the dining area can also be used as office or extra bedroom. Another wonderful thing is the building’s close proximity to downtown White Plains- walking distance! Talk about convenience! This one is gone, but we’ll have others. 

2 Overlook Road, S-1, Sold by J. Philip Real Estate

Effective tomorrow, October 25, 2010, the Westchester-Putnam MLS will officially be known as the Empire Access MLS. Nothing else changes but the name. The entity, leadership, rules, members, phone numbers, staff and service will remain unchanged. The intention of the name change is to better reflect our serving 4 counties (Bronx, Westchester, Putnam and Dutchess) and not just the two in our old name. 

As it is, most brokerages based in the Bronx have already joined the system, and the vast majority of listed properties in the Bronx are in our MLS. We have extensive involvement in Dutchess County as well. It took almost 2 years to decide on a name that resonated with the commonality of our different counties, and we took our name from the Empire State of New York. 

I am very proud to have the EAMLS as my home MLS, and prouder still to serve as an officer. 

While I do not actively recruit (too busy), the company has experienced organic, solid growth since its inception and our team has grown bigger and better with each passing year in spite of the economy. I am sure there are agents out there that are considering changing scenery, and J. Philip Real Estate might be a good fit. We can offer different things to different people. Many agents require autonomy and work well independently. Others need more support in a variety of ways. We can do both.  

If you want to improve your income and professional acumen, we might be a match. If you seek

• More Income 
• Growth
• Administrative support

I recall about 10 years ago that Warren Buffet was asked why he did not own more than a token amount of stock in Microsoft. His answer: I don’t know that business well enough to invest in it. Buffet knew insurance, soda, candy, razors, and other blue chips, but didn’t pretend to know software. My understanding is that he owns more stock in Microsoft now, but the lesson is that good investors put their money in a vehicle they know and understand. 

I work with some real estate investors who might be considered to have deep pockets; it is all a matter of perspective, however, because real estate is not a penny stock. Real estate is expensive, and is considered high risk/high reward. An investor’s fund for procuring and rehabbing properties might be enough for some to retire on to be sure, but it depends on your point of view. 

Sometimes, I am approached by people who figure out that if I know people who can write a six figure check for property that they would be great sources of capital for a great idea they have. I have been approached about water springs, sports complexes, stocks, and probably dozens of ideas for businesses that the person pitching thought my investors would be great partners for. 

They aren’t. Real estate investors often take a long time to build their funds, and they can lose it quickly if they go off the reservation into an expensive project they don’t understand. They know this, and they seldom stray off their path. We’ve even lost money on projects we were certain would have a healthy margin, and take it from me, real estate mistakes are expensive-really expensive. 

I have seen investors lose huge money firsthand in some properties that sounded good, but did not pan out. There is a joke my brother told me a while back that goes something like “Anyone can have a million bucks running their own restaurant. Just start out with two million.” And so it goes. 

So to those whom I have had to politely decline, I just want you to understand. It isn’t that I would prohibit anyone from running an idea past me or the investors I represent, but I do want you to know why we can’t say yes at this time. We have to be stewards of resources that we cannot gamble with. Risk- yes, gamble- no.