New York is an attorney state, and in our area they also prepare contracts. Having a good attorney is crucial, for many reasons, not the least of which is obvious: the other guys have one, and you don’t bring a knife to a gunfight. Lawyers examine title, advocate, and draw up addenda, pre possession and rent back agreements, and in general partner with the brokers to shepherd the transaction to a closing. Like them or not, they are inextricable to the sale of a home. If I refer an attorney, I like and trust them. 

All too often, I’ll see people who shopped around for a good mortgage and hired the best agent suddenly decide that it is better to save $500 on their attorney and risk peril because they think they are being smart.

Famous last words: I’ll use my cousin the patent lawyer. What could go wrong?

Answer: Plenty.  

In Westchester County, the median sales price of a home in 2010 was $630,000. The mean? $827,900. A typical attorney fee is $1200. 

In my book, that is one of the best bargains going considering the copious work that closing a transaction in 2011 takes. Just today, a lawyer I know told me she preferred divorce work, because it is about the same amount of work for far better fees. Amazing, but she’s right. Making deals happen these days is hard! And buying a home being on par with a divorce would be unthinkable in years past. 

There was a time when real estate was far easier than divorces. But with the layers of caution from the lenders, the ever-increasing demands from buyers and the overall freaked out nature of many sellers, those days are gone. Yet the model of fees for New York lawyers is still based on an era when real estate closings were, relative to today, a rubber stamp. 

If I were buying or selling a house today with the gigantic money changing hands, I’d find the best lawyer I could and offer them TWICE their quoted rate, just to make sure I was given white glove treatment. If you think that’s crazy, consider the fact that $1200 is really just a speck of change with the enormity of home prices we pay in New York. Of course, you don’t have to be me, but you also have a choice about trading a few hundred dollars for inferior representation. 

At the very least, I would avoid a lawyer that came gratis through my union or advertised a cut rate, because I have never, in 14 years and 300+ transaction seen those lawyers be the zealous advocate that consumers need in this market. And oh, how I dislike working with inept or unresponsive attorneys! Yet there are people who trust the largest business transaction of their life to a guy who advertises a low rate, never returns calls or even addresses the crisis de jour. It is a big deal. There are no “do-overs” in real estate. Retain a specialist. 

I cannot believe I am saying it, but it’s true: real estate lawyers in New York are vastly underpaid. Quibbling over their fee in light of the high stakes is the epitome of being penny wise and pound foolish. 

Hamburger fees get you hamburger representation. I want my clients to get filet mignon advocacy, and I’ll be the first to say that it is worth every penny. 

I got an email from a client who was dismayed that his property taxes were raised. It bugged him, and I don’t blame him one bit. The home is a ranch with a finished basement, and I advised him that the finished basement needed a CO (Certificate of Occupancy) from the city to satisfy a buyer’s lender. So, motivated seller that he is, he got it. 

And they raised his taxes. 

And he can’t advertise the extra space he’s paying taxes on as part of his square footage, which is irksome. He wondered aloud why we couldn’t include the finished basement in the published square footage. It seemed only fair. 

I agree, but after a long discussion we came to the conclusion together that the criteria the city uses to assess taxes and the standards by which real estate buyers and agents view legitimate square footage are apples and oranges. As I have blogged before, if a 1500 square foot ranch with a finished basement is marketed as a 3000 square foot structure, it will lead to blowback from buyers and their agents. In Westchester and the surrounding areas, we do not include the below grade portion of the home-the basement- as the official square footage of the structure. The only exception in raised ranches, or, as they are also called across the river, bi levels. 

The reason for this is simple- everyone has to quantify square footage by the same standard or you have anarchy. A 2000 square foot ranch with a basement cannot be compared to a ranch with a true 4000 square foot footprint. People looking for a “true” 4000 square foot ranch will feel mislead and angry if they drive out to see a 2000 square foot house. So, we leave the basement out in the “official” square footage and mention the additional finished area in the remarks. 

I know there are places where even mentioning square footage is a no-no. That isn’t the case in Westchester, and if you are going to do it, it should be done right. Square footage measures the above grade finished living area. That’s the standard, and if we abide by it as we all should, the public and our colleagues can hang their hat on the veracity of what we say with no unpleasant surprises. 

What can you buy in Peekskill for $335,000? It will buy you a pretty arts and crafts colonial with a rocking chair porch, 2 car garage, updated kitchen, and beautiful woodwork like the one our clients just closed on last week. This home has 4 bedrooms, a formal dining room, a woodburning fireplace, lovely landscaping, stained glass windows, a patio, walkup attic, and a dry, full basement. The location is also fantastic, just a 3 minute drive to the Peekskill train station. 

I love homes from the 1920’s especially when the restoration job allows the original character to remain intact. 

We wish our clients many happy healthy years in their new home! 

The 2011 Intel Science Semifinalists have been announced, and 18 students from Westchester County qualified. Of the 18, eight were from Ossining High school. This ties Ossining with the renowned Bronx High School for Science as the school with the most qualified students. In all, only 300 students nationwide are chosen as semifinalists, and a mere 40 go on to be finalists. 

A few years ago, Ossining sent 4 seniors to Harvard, an number that astounded people across Westchester. 

Local semifinalists also hailed from Yorktown, White Plains, Mamaroneck, Scarsdale, Byram Hills, Edgemont, Horace Greeley and Riverdale Country school. 

A hearty congratulations to all, and a big hat tip to the students and faculty at Ossining High School. You should be proud of your accomplishment! 

A few events lately have me asking why agents defer their professional opinions to the client when the reason lies squarely on their income and no other fact germane to the negotiations. I’ll explain: On more than one transaction, a buyer agent has punctuated their latest negotiation with the remark “and my client is a doctor too” or “she’s an analyst on Wall Street, got it?” I get it. But how does one have anything to do with the other? Understanding the quarterly profit of a tech stock or how to remove a gall bladder does not make you an expert in real estate transactions. 

Doctors are often happy to observe this. My older brother, a financial consultant with a number of physican clients, confirms it. Knowing how to read an X-Ray is far different from understanding how to manage one’s finances or construcingt a real estate transaction. The same goes for computer programmers, actors, big-time publishers, and Wall Street types. I have clients who lost money with Bernard Madoff and other scam artists. Were they unskilled wage earners? No! they were an attorney and an endocrinologist. 

I think that it boils down to the idea that some agents get a little intimidated by prestige or income rather than trusting their own professional skills. A true professional client should appreciate some give and take, input, advice, and even the odd uncomfortable message. They shouldn’t want a “yes agent.” We don’t have to debate. We simply owe them a heads up when we see them veer. A plumber wouldn’t fix a toilet the homeowner’s way to just pacify them- who wants a sewage backup? Why then do agents let their clients wag the dog? 

Professional skill sets can translate to other fields, but I wouldn’t bet a transaction on it. I am no more qualified to remove a kidney than a nephrologist is to negotiate a short sale. Rather than be a deer in the headlights with high-earning clients who, though confident, are out of their area of expertise, we owe clients better: advice, the downside of their idea, clear communication, and respectful disagreement where it is merited. From that position we can manage expectations better and affect a better outcome. 

We are not lower on the food chain when it comes to our profession. More agents need to understand this, and consumers shouldn’t be mislead by their paycheck either.  

As an agent with over 40 listings at any given time I understand the seller’s need to know how showings go. I do too. Stakes are high and clients want feedback. My listings have an automated system that sends two emails to all showing agents, but about 2/3 of showings do not get a response. That in and of itself is feedback: dead end. I am not exactly batting 1.000 on giving feedback from my own buyers, but one automated survey yesterday took the cake. It was like an exam with multiple choice questions followed by a written section. I kid you not- just look at the screenshot. 

You might notice the error box at the top right. It popped up every time I tried to submit my perfectly clear feedback because I had to answer each of the 5 questions with a 6-choice drop box, asking both my and the buyer’s thoughts. For price, the choices ranged from “very underpriced” (who would ever say that?) to “very overpriced.” For how the property showed, the choices were more nuanced. And I can’t submit it without answering everything! 

This is a bit much. 

Feedback, which has always more or less been a courtesy to tell the listing agent and seller what they may not know, has evolved into a debriefing session. And if an agent shows 15-20 homes per week it can get pretty time consuming. Most feedback is not really helpful anyway. People know if they have a small back yard or that the bathroom is from 1970. They know the leftover Yak Fondue on the counter smells like sour milk in a gym locker. And there is no Rotweiller-scented pot pourri for a very good reason. Making the feedback look like the Archdiocese high school entry exam is overkill for conveying such banalities. 

But beyond that, the courtesy (yes, that is what it is- I am not obligated to divulge my client’s thoughts, and as a matter of fact I’d prefer not to) of feedback is being taken too far with these sorts of tactics. Many buyer agents are poker faced, which is actually smart in business. And I have gotten phone calls from fellow listing agents arguing with me over my feedback as if that would make the home appealing to my people. It won’t. Showing agents have one obligation on homes they show, and that is to leave the house as they found it. The seller is owed nothing beyond that- I wish it were different, but it is true. The seller is not the buyer agent’s client. They have different rules. 

Sellers should understand a few things. 

• Feedback is a courtesy that agents are not obligated to give.
• Showing agents are also not obligated to tell what a house is worth or give the listing agent advice.
• Buyer agents don’t work for the seller. They often keep the buyer’s thoughts private.

I get that seller clients want follow up on all showings and questions answered thoroughly. But that’s not business; if you do that to a girl who doesn’t agree to a second date, it makes you a stalker.  Sellers should be at peace with 2/3 of the feedback being a silent declination, because that is 100% accurate. It is best to not dwell on those who aren’t responding, because the reasons are typically personal and seldom enlightening. A listing agent’s time is better spent finding another buyer who is interested enough to respond with an offer. 

I seldom see this discussed among real estate professionals, but it is worth addressing as more people consider putting their home on the market. There are some exceptions, such as an acrimonious divorce or estate with multiple heirs, but overall it is a rule I run my business by. When I am brought over to be interviewed to possibly list a house, I need all the decision makers present. Typically, that is a husband and wife, but it can be siblings, partners or parents and children. But when there are two people on the title in a “traditional” scenario, I can’t speak with just one owner- in the business, we call this a “one legged” meeting, and they are often time-wasters.  

The reason for this is pretty simple: The person who isn’t present and doesn’t meet with me doesn’t get a feel for me, my marketing plan, how I do business, or look me in the eye. They just see my recommended price and commission from their spouse or partner, and that isn’t enough to make an informed decision. Invariably, the one person present can’t make a decision, needs to discuss it with their spouse or partner, and then I end up chasing them around for days or weeks, only to see them list the home with a compromise candidate. 

Like anyone else, my time is extremely valuable. My clients expect me to follow up with other agents who showed their house, mortgage loan officers, lawyers, home inspectors, appraisers and all the other vagaries that go into selling and closing on my transactions. They don’t want me chasing you around to see if you had a chance to speak with your spouse or mother. Neither would you if I were your agent. If I am going to meet with you, I need that time to count. 

I’m not the sort of guy who pressures people into a decision when we meet the first time. Some of my clients call me days or even months after we meet. It’s really fine by me- people have a decision making process that must be respected. But what I am a stickler about is personally giving every decision maker the information they need to make that decision. I know this isn’t always easy. More people are travelling, working long hours, or even taking out of town jobs to make things work in this economy. That’s fine; I can wait. Given the stakes and what goes into getting property sold these days, it is worth working together so our schedules can match, and everyone can meet with me once, so we are all on the same page going forward. 

So, to all the good folks considering selling their home and bringing Phil, or anyone else for that matter, over to your home to interview as the listing agent, please understand the importance of having all the principals in the same room when we meet. Information is power, and I want all of my clients to be right there with me as we work as a team to get you sold, packed, closed and moved. 

Like many of us, I followed yesterday’s news of the shooting in Arizona with sorrow and revulsion at the events. Thus far, half a dozen people, including a 9-year old child and a federal judge have perished and congresswoman Gabrielle Giffords is in critical condition after being shot in the head. 

I posted on Twitter last night that thanks to social media, I knew more in 20 minutes about the shooter, Jared Loughner, than I cared to the rest of my life. The cyber-world is still going bananas about this, and unfortunately many are politicizing this. She was on Sarah Palin’s “target list.” The shooter is a right wing gun nut. The shooter is a lefty anarchist lunatic. Very sad stuff. 

I also came across the Twitter account of Caitie Parker, who has already been on the news by the time you read this, and was a high school classmate of Jared’s. She was understandably distressed by the events and the attention that one tweet garnered her, especially from some kooky people who had time on their hands to antagonize her. One of the people interacting with her piqued my interest (if you can call it that). The guy has a relatively new Twitter account, and in the past 12 hours has posted dozens of things asserting what the Arizona shooter’s political background is. And no unsourced, nut job link is off limits.

Here’s where it gets ironic. Our Mad Tweeter, a recent college graduate, is in the job market. He went back to school later in life and just got his degree, and has posted, among other things, his graduate thesis and resume. I found all this stuff in 10 minutes. The earnest, thoughtful graduate seeking a job has a (literally) radically different voice online from the ranting political screecher on Twitter and Facebook. 

Employers see this. Prospective associates see this. Google indexes social media. The guy is shooting himself in the foot. When you are a married 40-something going for a job against 20-somethings who’ll work for less, one thing you have to your advantage is maturity and good judgement. But not this guy. 

It isn’t just the one dude in the tin foil hat who is sabotaging himself; legions of people – agents, job applicants, single people in the mate market, you name it- are harming their image with what they post online. I have passed on applicants to my company because their Facebook profiles were filled with drunken, unsavory pictures. I have passed on possible clients as well- it goes both ways! Often, it isn’t that what is posted that is so objectionable, but rather the judgement in posting it is questioned. For example, 23-year olds drink and party. But smart 23-year olds don’t post pictures. 43 year olds can harbor strong political or religious views. But smart 43 year olds don’t broadcast them when they are in the job market. 

“Judgement” is going to be a big buzzword as the online social world grows. If you participate in social media, make sure you use judgement of the good variety. 

I’m not a big gambler but I’ve always had a muse about what I would do with windfall money. Like many, the fantasy of setting up close friends and family, a comfortable lifestyle, and a few toys always comes up when the guy on the radio is hawking lottery tickets. Since big numbers like $300+ million come along only so often, I thought I’d indulge. The list is extremely partial, and presupposes that I would put family first in my largess. 

• I’d still operate my company. How I’d operate would change in some ways. With more capital I’d buy and restore a vacant building I have my eye on, make some struggling indie firms an offer they couldn’t refuse, and outsource much of the grunt work I currently do so I could work more on the big picture portion of my business.
• I would start the best real estate instruction school known to man. I love the RETT concept down in Phoenix, but it would have licensure class available, continuing education, and leverage the best real estate minds here in New York and anyone who could travel here. 
• I would start a charitable foundation in my late brother’s name. It would have divisions for the eradication of juvenile diabetes, kidney health, and preservation of home ownership for at risk folks affected by the downturn.
• I might sue the living $%^& out of about 3-5 mean people who have it coming. 
• I would buy Holly Hill, the late Brooke Astor’s 65 acre estate, which is walking distance from my home and operate it as a gentleman’s farm. 
• I would acquire controlling interest in a successfully operating company in the housing industry. Day to day operations would be kept with those that run it, so Washburn and Stewart are safe. 😉
• I would start a Real Estate Investment Trust (REIT). 
• I would spend more time immersed in my kids.
• I would write a fat each check to Villanova University and John F. Kennedy Catholic High School, both my alma mater.  

What I wouldn’t do:

• I wouldn’t stop blogging. 
• I wouldn’t take a cruise around the world. 
• I wouldn’t just live off the interest. 
• I wouldn’t be arrested at a strip club. You have to know where the back door is to these places.