I follow both Forbes and AOL Real Estate on Twitter. I have always viewed Forbes as the standard of excellence in financial journalism, but in my view, this morning they got schooled by AOL in responsible reporting. Both linked to recent stories on the real estate market on Twitter this morning, and both could not have reported things in a more polar opposite manner.According to Forbes,
After months of encouraging signs, the housing market is starting to lose steam. The National Association of Realtors said pending home sales, which track houses under contract, dropped 0.4% in June, after rising 6.7% in May.
Sales of new U.S. single-family homes vaulted to a five-year high in June, showing little signs of slowing in the face of higher mortgage rates.
The Commerce Department said Wednesdaysales increased 8.3 percent to a seasonally adjusted annual rate of 497,000 units, the highest level since May 2008.
Both reports are within a few business days of each other and address the June 2013 market. Why the different conclusions? More importantly, who is right?
I believe that Forbes dropped the ball. Real estate is a seasonally cyclical market. Any period is evaluated responsibly by comparing it to the same period the prior year. You don’t compare bathing suit sales, for example, from December to July. And you certainly don’t compare retail sales in February when returns are high to the crazy period in December around the holidays. You compare apples to apples.
Forbes was factually accurate in reporting that June sales were down less than half a percentage point in June 2013 from May 2013. But their conclusion, that the market is “losing steam,” is misleading, because the spring market always tails off as summer comes because of market cycles, just as retail sales peak in December and tail off in February.
AOL made the accurate call. In responsibly comparing June 2013 to June of 2012, they tell the real story: Sales are up almost 40% from the same time last year. That does not speak to a softening market in my opinion, it speaks to a market that is still undeterred from the rate hike and may in fact still be too hot.
I’m actually surprised that Forbes would blow it like that. Who compares May to June? I have spoken with my share of real estate reporters, and by and large they understand the market cycle and how statistics can be interpreted. Forbes, of all media outlets, should know better.
It is with great pride that we announce our newest associate to the firm, Emilia Csak. One of the great things about my life is the opportunity to work with people who bring things to the table that I do not possess. In the case of Emilia Csak, that is a pretty long list.
In her first 6 months in the industry (and at a time when the market was extremely weak), Emilia inked a transaction of over $4 million. Now a veteran of multi million dollar property closings, she has also earned the prestigious Certified Luxury Home Marketing Specialist (CLHMS) designation. Having known her for several years and watching her develop her career, I truly believe that there is no limit to what this talented, passionate and intuitive professional can achieve.
A native of Romania (and Hungarian herself (from Transylvania!)), Emilia first came to the United States in 1997 and began to build her business acumen. She completed her Bachelors degree at Mercy College, and gained valuable experience running her own company prior to making her entry into the real estate industry. Emilia is fluent in Hungarian, Romanian, and of course, English.
What has always struck me about Emilia is how comfortable she is in her own skin; I have never seen anything knock her off her focus. That focus, by the way, is why she’ll make an awesome fit in our business family: Emilia is a staunch advocate for her clients, living and dying with getting an outcome for them that is in their best interests. That has always punctuated out interactions, and she lives in the question of what more she can do, and how best to abide by her client. I love that. Lots of people have talent, but not enough people truly care. Emilia cares.
Emilia specializes in upscale properties all over Westchester County, and is currently marketing an exceptional home in Harrison for $3.75 million that will take your breath away. To reach Emilia, simply call (914) 960-1712 or email her at emilia@jphilip.com. You can also connect online at www.EmiliaCsak.com.
At first I was unsure how much of an “innovator” I really am, as I never invented a game changing tool or practice. I did always aspire to make what I did have better and to use what I had access to more effectively than my competition. However, innovation isn’t merely invention. It is adaptation, implementation, and most importantly, execution. In those departments, I will say that Ann and I have given it our all.
Westchester is a competitive, brand conscious market. From the beginning, I believed that the way for a small firm like mine to win in this environment was to do what Sam Houston did to beat Santa Ana: beat them in the place they weren’t waging battle. Houston advanced at night. The place I felt I would do the best to resonate with consumers was to put all my chips on creating a great online presence. Even in 2005, it was obvious to me that more and more people would start their real estate journey via the Internet. That’s where I put time, my focus on niches, my marketing, and my perspiration. Every night when I went to sleep (or woke up drooling on my keyboard) I wanted to ensure that if someone who never heard of me googled me that they’d like what they see.
I could write for hours on the niches I continue to work, the specializations I focused on, and the effort it took to do the uncomfortable. Approaching expired listings, who often weren’t happy with real estate agents, was one of those things. Putting myself out there in other under-served areas was a muscle developed daily. It wasn’t enough to be online, or just great online, I was all about going where other firms seldom or never went. Our goal wasn’t to be paperless or virtual. I simply de-emphasized brick and mortar and made house calls to my niches. I continue to do that, and in spite of being in a brutally competitive suburban New York market, the worst housing downturn since the Great Depression, and dealing since 2007 with our son Gregory’s autism, Ann and I have grown this thing from a one man operation to a vital, growing organization of over 30 agents.
Which brings me back to Joe Ferrara. In 2009, after the market had crashed and small firms like mine were going out of business in droves, I was experiencing severe fatigue. My production was down more than 30% since 2007, I had a new home and mortgage, and my fledgling blog efforts were sputtering. I knew Joe a little from the Lucky Striker Social Media Club but had respected him as a huge industry voice for years. He was a celebrity. We spent some time together at some industry events in 2009, and Joe told me that he thought I was funny, smart, and that I should keep blogging. He told me to be myself and break the rules. Don’t worry about offending people. It was not a lot of conversations, but it was like having the Oracle speak to me. At the time, I was blogging on the Active Rain network (I still do from time to time, and owe the platform a debt of gratitude as well), and I jumped back into blogging with renewed inspiration.
The results were rewarding. I got on ABC World News when a producer found me on Google. Agents began to join our firm. I became Vice president of my Multiple Listing Service in 2010. I am now in my 4th term in that position. I have been in the print media and quoted by news outlets. My firm is now a member of Westchester Real Estate Inc, the most prestigious consortium of independently owned brokerages in my market. I am on Zillow.com’s Agent Advisory Board. But none of that would matter if I didn’t have a good reputation. That was the holy grail, and punctuated my daily work. As I tell consumers, the feathers in my cap mean nothing if I cannot get them to the closing table with terms reflecting their best interests. That is all it has ever been about for me.
It is gratifying that the industry has noticed. Joe Ferrara was kind enough to reach out first, and if I actually win I will share the honor with him and his family.
Recently, in a real estate Tech Support Forum on Facebook, someone posted their opinion of Zillow’s latest TV commercial. Zillow is a powder keg for controversy in the real estate community as it is, but since the commercial didn’t make a prominent reference to a real estate agent (there was a broker sign in the yard) and was themed on a returning member of the military service, the discussion was particularly passionate. These debates always seem to have 2 camps: those who hate Zillow with an incredible, almost inexplicable vitriol, and those who tell them to get over it.
Now is about the time I disclose my relationship with Zillow. I have advertised on the site since 2006, been in their Premier Agent program since 2010, and for the past 10 months I have been a member of Zillow’s Agent Advisory Board. This does not mean that I have always been a zealous supporter of all that Zillow does; to the contrary, I always felt that my participation on the platform gave me license to offer, shall we say, feedback. I have been critical of some things they have done, and benefited greatly from others. Overall, the relationship has been overwhelmingly positive, and one could make the case that I am more emblematic of the good that can come of leveraging their systems than virtually any other agent in my market.
Back to the Facebook discussion: one particular agent took exception to my being a paying customer of Zillow. When I shared that my participation on the site has helped sustain my firm through the housing crash, this person stated that I was basically supporting a company that sought to put agents out of business, asked how I could sleep at night, and said that if “Zillow saved your business, you need to back to school (sic) and learn business.” He also called for agents to stop doing business with them , which wouldn’t be a smart thing to do on social media, as boycotting is an anathema to real estate practices.
Sadly, this person is not alone. There are three basic issues that real estate licensees have with Zillow. The Zestimate, or estimated home value they post for every property, the data accuracy issues that Zillow has in common with every other real estate syndication site (in other words, that is an industry problem more than it is a Zillow problem), and Zillow’s pay model, in which they accept payment from agents in exchange for advertising (wow, what a concept). I am not going to deconstruct those issues now because I have already written on the Zestimate and the other issues aren’t exclusive to one site. Suffice to say on the Zestimate, however, that both listing agents and homeowners can claim their property and make data corrections to revise the estimate. It is done with municipal assessed value in every market.
What should be addressed, however, is the abject hatred some licensees display about Zillow that not only undermines our professional body, but speaks to their inability to grasp what consumers want and how the industry is changing.
Webster’s Dictionary defines xenophobia as
an unreasonablefearor hatred of foreigners or strangers or of that which is foreign or strange.
I think this definition is apt for people like my Facebook discussion counterpart who demonized Zillow and it’s adapters with such passion.
The big conspiracy theory among the mouth breathing haters is that Zillow really wants to put brokers out of business via a sinister plan of disintermediation. In other words, they want to supplant brokers and be the sole conduit of real estate transactions. The evidence offered is that some Zillow executives used to work at a travel website, and the travel industry was dramatically changed by the Internet. I used to be a bartender; I guess that means I want everyone to have beer goggles. I don’t know which is more absurd.
I have been to Zillow headquarters in Seattle. There is only one thing that is sinister about Zillow. Their employee snack bar. If I had one of those I would gain 30 pounds in short order.
Real estate professionals need to understand that Zillow is not the enemy. We are, to a vast extent, our own worst enemy. We shoot ourselves in the foot when we don’t understand the change in consumer trends. The Internet has been mainstream for well over 15 years now. Brokers are no longer the gatekeepers of information. Our trade association’s Internet policy is in large part the same since 1996. And while our ability to adapt to a new generation of consumers dies in committee, there are thousands of other lean, profit motivated capitalists out there gauging exactly what consumers want and how to best deliver that. In other words, Zillow and companies like them aren’t the news. They are the messenger.
If you are an agent that pines for the “good old days” when your best source of clientele was people walking into the office off the street, you need to be on notice.
If you long for the days when a consumer wanting information on homes for sale had to go through you because of the cabal-like grip licensees had on the data, you are on notice.
If you are fearful of Internet companies because you are concerned that buying a home will be a point and click transaction like buying a book or booking a hotel room, you are on notice.
The real estate industry will never “take back their data” via a boycott of technology companies. Battle cries like that are an intellectual dunce cap because it isn’t what consumers want.
Here is what the xenophobes need to understand: adapt or become irrelevant. You will not be supplanted by Zillow or any other website, you’ll be overtaken by your competitors who get it. Learn what consumers want and deliver it. Understand that our value proposition to the public is not as the door to the data, but as the trusted adviser in the largest financial event in most people’s lives. Failure to live up to that will only solidify the stereotype of a glorified door unlocker in the minds of too many consumers who want professional guidance, not lists of homes emailed that they already downloaded themselves. Stop demonizing what you don’t understand and start learning. Zillow has made my firm money because I have learned how to use it.
Data companies and online advertising platforms like Zillow are not going away. They are the future. The sooner our trade organizations get that, the sooner they’ll regain the consumers lost to the better, faster stronger platforms unencumbered by outdated rules and committee bickering. In the meantime, change with the times or go in with your cousin on that corner cafe he’s been talking about.
This past Monday I was honored to moderate a panel of local industry leaders at the Women’s Council of Realtors breakfast entitled “Embracing the Change.” The panelists were Jason Wilson, manager at Julia B Fee Sotheby’s, Chris Meyer, president of Houlihan Lawrence, Leah Caro, broker at Bronxville Ley Real Estate, Gary Leogrande, past HGMLS president and principal at Keller Williams, the tremendous Laura Scott of Douglas Elliman, Marcene Hedayati, broker owner of William Raveis Legends Realty, Joseph Rand of Better Homes and Gardens Rand Realty, and Wayne LoFranco, manager at Coldwell Banker.
Now that’s a panel folks. And they did not disappoint. The subject matter covered the changing market we are experiencing how technology has affected our industry, market and consumer trends and how we can collectively raise the bar in the industry. The audience of 173 people were treated to some thought provoking, insightful messages from the panel, and it was an experience to behold.
I could actually write a book about the wide subject matter, but two things impacted me the most. Chris Meyer made a great point about how to best train the new agent. All too often, we as brokers and managers key in on generating clientele for new associates and not enough to have them understand their business, their market, and the process they must guide their clients through. I couldn’t agree more. What good is “lead generation” if you can’t help the clients you attract? And without knowing how to best help them, how are we best serving them?
Joe Rand also made a good point about consumer responsibility that I myself have written about recently as well. He asked the ladies in the audience if they would ever use the “up” person at the hair salon instead of their preferred stylist. Of course, no one would take that chance. Why then, he asked, do consumers trust the largest transaction of their life to the “up” person in the real estate office without serious research into how to get the best representation?
It was over an hour of real brain food. I was honored to preside, and hope the dialog will continue from this event.
I also hope that the next time they ask me to moderate something that they get a smaller podium.
That’s me on the right, barely peeking over the podium. Photo courtesy of Carol Dorado
While I am known as a guy who is never seen without a gizmo in my hand, I actually think better sketching my thoughts on a yellow legal pad. Typically, when meeting with people they’ll see my iPad, smart phone, and computer closely followed by that very old school pad and pen, and only then can I work as well as I know I can. Not long ago, I was caught almost naked in my very own office without my legal pad in my bag, and as my mouth went dry with worry, I started going through my desk and filing cabinet looking for something to write on. I found it in the bottom of the small filing cabinet behind my desk: an 89 cent notebook purchased at Big Al’s. It looked a few years old, but that didn’t matter. I needed to find some blank pages to use.
As soon as I opened it, I knew this was a rare find. You know that phrase “this isn’t your father’s ____?” Well, this was my father’s notebook.
From 1988. When he studied for his own real estate license at the age of 67. His notes (in pencil). His doodles. All in that filing cabinet drawer for 25 years, never found before. It had been in my office for 5 years, and at my house for 20 prior to that, and no one had ever cleaned out that bottom drawer.
I do recall that in the winter of 1988, when I was a junior in college and my father had been retired for 5 years, he went for his real estate license. He never did anything with it, but he also hated sitting still. That was something about my dad. He had long since earned his privilege to veg out, but he wanted no part of that. He worked his way through Fordham in the Great Depression. He served in the South Pacific in World War II and then earned a Bronze Star in Korea. He raised 4 sons with my mother, all of whom graduated college although I was still a year away from my BA. He had an MBA from NYU (GI Bill) and was an accountant for over 30 years before being forced to take early retirement at age 62. He still had gas in the tank and wanted to do more.
None of that was on my radar at the time in 1988. I was off at Villanova doing what college kids do, and it never occurred to me what it would mean decades later to find a piece of my father’s efforts. Youth is indeed wasted on the young.
And here I was at age 45, still a year younger than my father was when I was born, finding this notebook and looking at his notes. He was doodler, and I could tell when he was bored based on how he wrote things and what he drew in the margins. I could see what he underlined and emphasized as important for future reference. And in between the lines, I could still smell the aftershave of a 67 year old man who wanted no part of being put out to pasture. He pressed the pencil hard.
Dad never sold a house. It wasn’t for him, but like many he got his license just in case it was. Two short years later, my healthy father who never looked his age was diagnosed with a liver ailment (ironic; he never drank), and after almost three years of fighting like hell, he died a few months short of his 73rd birthday.
There are times in life when I wish I could still talk to my dad. I wish I could ask his advice. I wish I could share his grandchildren with him. And I’d love to show him that all the things he worried about me didn’t stop me from growing up and making something of myself. I can’t do those things, and as I get older and memories fade he slips further away. Things like this bring him back. I’m not too sensible to believe that these things are like a wink from the other side, to let me know he still watches, still cares, and will never stop being my dad.
Of all the things I could have found of his, something real estate related. Yes, I think that was my dad winking at me.
This is one of those posts that I write for strictly therapeutic purposes, so please indulge me. Unlike some agents who keep their cell phones a state secret, mine is not. As a matter of fact, when I hear a licensee talk about how they “value their privacy” and prefer that their mobile number not be public, I have to wonder why they are in the business. If you want a career with privacy, try calligraphy. In real estate, fortune does not favor those in hiding. We have to be reachable in real time.
I’ll take it a step further: when I tell someone that I am out and about all day and that the best way to reach me by far is my mobile number, it feels almost passive aggressive when they leave a message at my office, especially if it is accompanied by frustration that they can’t reach me. Baloney! Text me. Lower your eye an eighth of a millimeter on my card and there’s my cell number. Use it. You might get voicemail, true (I have been known to use the bathroom or attend the odd meeting), but I do return calls and texts.
Real estate is not a private career pursuit, nor it is one that is conducive to bankers hours. I’ll be the first to admit that many in our life take it too far and sacrifice too much of ourselves at the expense of family time, rest, and perhaps even sanity at times. That is curable. State secrets aren’t. Being reachable, communicative, and accessible are part of our value propositions to our clientele and public (you didn’t think it was access to listing data, did you?), and if it is more important to you to have time to yourself instead of answering my call to let you know that the key is no longer in your lockbox, you are pretty much obstructing me, my client, and your client from getting things done.
I have stood in the rain or snow with a client staring at a combination lock box when we were told to expect an electronic device. I have witnessed burst pipes, exploding toilets, freshly vandalized property, squatters, home inspections on a home we were told had no offers, and dozens of other scenarios where speaking with the listing agent was not just desired, it was urgent. This business requires agility and access. It would be nice if we could unplug more often, but that’s the job. Weekends are prime time, evenings are when clients are free, and we’ll never be Ward Cleaver. Moreover, Westchester and suburban NYC clientele can be demanding, and rightly so. They deserve fast answers in 2013. If I am trying to reach you, I am trying to help you earn money.
I will readily admit to being more hardcore than most, with a man purse containing two cell phones, a portable charger, spare batteries, an iPad mini and enough wires to jump start a Prius.
Unfortunately, as the market gains health and more properties will sell as a matter of course, more agents will start being secret agents because that’s what they are being told by their life coaches or business gurus. “Start running your business like a business” is one of those abused anthems we hear, justifying non real estate paradigms on a business that has some pretty immutable (ironic term huh?) principles of its own.
I run a company. I have 40+ listings of my own, 30 agents with the firm and growing, and more than my own share of pipe dreams about a day with no calls where it doesn’t cost me. I still have my mobile number out there so I can serve my clients and cooperate with my colleagues. If I can do it, you can do it. I just hope this doesn’t fall on too many deaf ears.
I have started to “vlog” or video blog, and this is something I recorded to day about an article in the Journal News on people trying to save money in real estate transactions by not using a broker. My comment on the article was as follows:
You can save quite a bit of money by performing your own vasectomy too. If you goof what is often the largest transaction of your life as the sale of real estate is for most people, there are no do-overs, and the cost of the mistake can be catastrophic.
99% of of the real estate problems I have seen in my practice come in the aftermath of the consumer either using no agent or a poorly qualified one. I have always been surprised at how consumers will research almost anything BUT getting the right agent: Schools, commute, local amenities, crime, demographics, WALK score, you name it, and then use their ne’er do well uncle or the first slob they meet at an open house to represent them in the transaction.
Choose your agent wisely, and you’ll end up ahead.
Birch Court in Ossining, the former grounds of Briar Crest Nursing Home.
I am one of those brokers who vocally opposes the practice of using appraisers who do not possess local knowledge of the area they work. I have seen too many sales scuttled by robotic, ill-informed appraisals which lack the context that local, more accurate information brings. Out of area appraisers often are less engaged, and are there by economic necessity than local expertise. It is a problem.
So you can imagine my consternation this afternoon when I met an appraiser at one of my listings when he told me that he came from 90 minutes away in Kingston, New York. That is closer to Albany than it is to Ossining.
It was too late for sour grapes, however, so I instead engaged him on the property and what it had under the hood. I had to focus on that, because otherwise I met get emotional. Not because I need the sale. The subdivision was built in 2007 and stood on the former grounds of Briar Crest Nursing home. I worked there the summer of 1986 after freshman year of college, and my father died in hospice care at Briar Crest on July 8, 1993. I can’t drive by the street and not think of him.
But I had no time to get into any of that before Peter, the appraiser, told me “there was a nursing home here, you know.” I knew, I said. And I then learned that Peter’s father was at the very same nursing home before passing away himself in 1991. The conversation of course, took a different direction at that point, and we shook hands in solidarity at losing those who mattered most to us literally yards away from where we now stood. Peter had never appraised a home in this development, but he always watched it. He knew it inside and out because of the obvious significance of where it was and what it meant.
Suffice to say, I have zero doubts about this appraiser’s knowledge of the locale. And I seriously doubt he’ll be robotic on this one. Sometimes these deals occur close to the heart, and you never know when the world will suddenly shrink to the seize of a few village lots.
One of the Facebook discussion groups on real estate I frequent is the aptly titled “Raise the Bar” forum where we discuss best practices and making the industry better. Because real estate is local and customs and laws vary by region, opinions often vary. Many themes resurface from time to time, among them the the question of whether a listing agent being present for showings helps or hurts their clients’ chances for sale.
Rob Hahn, a very respected voice in our industry, asked the question of lock boxes specifically; if their eradication would not be a good thing. Rob made the case that, as a seller, having his advocate there for showings would be a help. The listing agent, after all, knows the house best, can tell the home’s story, and feature it’s many features and benefits. The buyer agent may have never seen the property before and would therefor be at a disadvantage.
The counter to the argument was twofold: having the listing agent present for all showings would be inefficient, and that buyers prefer to not have the seller or their agent present for what should be a private tour of the property.
My opinion, as I have stated before, is that it is better for the buyer agent to have privacy with their client free from the background noise (or more intrusive, in some cases) of the listing agent.
The logical outcome of eliminating lockboxes would be one of two things: Forcing agents to pick up keys elsewhere, or forcing listing agents to accompany all showings. In both cases, it would be a logistical nightmare, with the latter having showing agents answer lots of questions with “I don’t know but will find out”.
There might be some anecdotal instances of the listing agent “selling” the place, but in general people don’t buy if it doesn’t feel like home, and nothing an agent says will create that feeling. Ask anyone why they bought their home, and the least-heard reason will start out with “the agent said…” Buying a home is a personal experience. Intensely so. I have often drawn the comparison of being in a clothier’s dressing room. It is you and the mirror. People want to be alone with their thoughts and their peeps, not have an outside voice telling them things that may or may not even be important.
Sales is identifying a need and filling it. Knowing the house is half the equation. Knowing the buyer is more crucial. Just because a listing agent knows the house doesn’t mean they can strike the necessary (and often intrusive) connection to the buyer to adapt the home to the buyer. The buyer agent knows the client better and what their needs are. They should be the ones conducting the showing, and if there is a story or unseen benefit of the home, it should be neatly typed on a piece of paper for them to use at the showing, alone with their clients.
There are no lock boxes used in Manhattan, just a half hour south of me, so I am keenly aware of how hyper-local the practices and protocols can be. And I fully recognize that in the cases of multi million dollar properties in Westchester, the listing agent will often accompany -although thatdoesn’t always work out too well.
I believe that lock boxes, especially the Sentrilock system we use which is all digital and far more secure than old-style combination lock boxes, work best for my clientele. For those that feel otherwise, they are free to conduct their practice as they best see fit. It is not a one size fits all industry.
Late last month, theNew York Department of State issued an interesting opinionthat effectivelyended the practice of brokerages giving corporate titlessuch as “Executive Vice President” and “Managing Director” to their licensees. It was a practice mainly done in Manhattan (and we did name a VP once in full disclosure), and became so prevalent that it almost lost its meaning; you’d walk into an office of 100 agents, and 50 would be vice presidents. From the letter:
If an agent advertises falsely that he or she holds a corporate title, it would be considered “dishonest” and “misleading” because doing so would lead the public to believe that the brokerage entity has appointed or elected the agent as an officer or to a comparable management position.
I can see how a consumer might be mislead by thinking that if they were working with a Vice President that they were working with an actual executive of the firm on a salary when in fact they were just a licensed salesperson with a 1099 independent contractor agreement.
Kind of.
I think most people know that a lady blowing up a balloon for an open house and or a guy crouching down to show a sink’s drain trap is not an actual member of the company’s managing board or possessed voting stock. It just became over done- it seemed like every 3rd licensee I ever dealt with in Manhattan was some sort of Vice President.
In my experience in sales in two industries, “Vice President” has always been more of a rank of management. And I have walked into many bank branches and dealt with a head teller on a paltry salary with “Vice President” on their card. I never believed for a second that guy in the bank sat on the actual board of the bank. If they didn’t, what were they doing counting my jar of quarters for? But my opinion doesn’t matter. We have to abide by what the DOS (Department of State) thinks, and the titles are all gone.
So what now? Does an industry that specializes in marketing and self promotion just embrace boring? Or will we see more creativity in titles, just of a non-corporate nature? I don’t doubt for a second that creative titles will embellish Licensed Salesperson and Associate Broker on business cards very soon. Ironically, as founder and owner of my firm I never used the title “President,” although I could. I could start to, just to press my new advantage, but I know my colleagues will get competitive in the title department somehow in the very near future.
A few suggestions:
Overlord
Potentate
Viceroy
Despot
Czar (or Tsar)
Nabob
Kaiser
Jedi
I even created a proposed card with a another idea or two. Think I should order 500?
Three times in the past two weeks, we have had listings go in bidding wars. Three times in the past two weeks, we have had buyer agents tell me that their buyer client did not believe me that they had competing bids. In each case, those buyers all lost the house. In my own company, we have also had buyer express doubt that there were other offers on a home they wanted to make an offer on, and in those cases too, they didn’t get the home.
Bidding War: Briarcliff Manor Bidding War: Yorktown Heights Bidding War: Ossining Multiple offers: Yonkers, Garrison, Carmel, Hopewell Junction, and probably a few others.
The assumption that a listing agent is lying or fibbing is rooted in the old stereotype that real estate agents are deceitful and will say or do anything to make a sale. The joke about being like used car salespeople often has the punchline of “hey, don’t insult used car salespeople.” The problem with that is that it is untrue. For every deceitful real estate agent you can show me, I’ll point you in the direction of 99 decent, honest and upstanding licensees. Liars don’t last, especially in the market we have seen the past 5 years.
Just think about it pragmatically. An agent lies that there are other offers. You call his bluff and don’t proceed. If he or she is lying, the home remains active and available. Who wants that kind of egg on their face? And what about the liability that might result? No thanks. Instead, what is happening lately is that the home goes to contract quickly, and the cynical buyer is back out there trying to find a home because they didn’t believe what they were told.
From my own point of view, lying would be suicide, if only for practical reasons. I have over 30 agents, the firm has over 60 listings, more than 20 transactions in process, and the permutations of interactions, messages and conversations with other agents, lenders, lawyers, appraisers and the like would mean that my frazzled, overworked and sleep deprived self would have to remember two versions of every conversation in order to protect a fib. I’m 45. I have a wife and 4 kids at home. Life is easier when you have one version of anything to recall. Inadvertently being caught in a lie would be a huge danger with all those moving parts. I don’t even know how I’d keep it all straight.
It is all out there in the media. The bust is gone. Loss of value is gone. Prices have stabilized and risen in some cases. If a listing agent claims to have other offers and you don’t believe them, I suppose you could verify with something in writing from their client or broker, but I would err on the side of trust. Things move quickly in a busy spring market, and the balance of leverage has shifted in many cases to the advantage of the sellers.
Inman News, the nominal online trade publication for the real estate industry, ran a contest last week for innovative marketing ideas on Twitter under the hashtag #MadRESkillz. It sounded like a bit of fun, and at the encouragement of Inman reporter Teke Wiggin, I offered a few of my own suggestions; I wrote about using a QR code to have consumers see a video of a listing on their cell phone right in their car without having to call or text anyone, and several others.
One idea, the concept of pricing property with a crooked number at the end instead of -900 and -000 was selected as a finalist.
The other finalist was a brokerage in New York City that stated that 36 of their agents had the firm’s logo tattooed on their body.
The body art won.
This week, I was encouraged to participate again, and I did, but was not selected as a finalist. The selections were a flirty yard sign and a photo of a presumably dead bare foot sticking out of a doorway. The screenshot is below.
“Tattoos are nice and fun on their own but within the real estate industry I’m not sure that send the right message or image out to potential clients — kinda like seeing your attorney with a tattoo of his/her firm on their arm,”wrote Ann Lee Faranda, co-owner of J. Philip Real Estate.
But Faranda is not exactly an unbiased source. Her husband Phil Faranda, the other co-owner of J. Philip Real Estate, was Rapid Realty’s opponent for this week’s #madREskillz. He submitted the marketing idea of pricing listings according to their area codes.
I seriously doubt that if I were a consumer that I would care about my agent having a tattoo of their brokerage on their body, and I’m pretty sure that I wouldn’t want a photo on my listing suggesting that someone is sleeping in the buff or demised in my bedroom. But I do appreciate that some brokers have some creative ideas for making their listings stand out, and it is clearer still that things have improved in the market enough for some of us to have some fun again. It has been a rough 5 years, and morale is up. And if the licensees are happy, I am sure their clientele is doing better as well.
Among the pitfalls of running a business with your spouse is the perception that the less gabby prominent or public half of the team is any less important or vital to the success of the organization. I am sure that this is the case in some businesses where the missus or hubby help on weekends and stuff some envelopes or file widget invoices. It is not the case in mine our firm. The Broker’s Wife in our company is one of the key reasons for our success, and her business chops are stellar.
The Broker’s Wife in our little enterprise has an undergraduate degree from Columbia University. She has an MBA. She has worked for huge multinational corporations. She has collaborated on the non profit side with Nobel Prize winning projects.
The first time The Broker’s Wife hosted an open house, she sold it to the eventual buyer. When she suspected that the buyer was trying to work around their buyer agent, she virtually did forensics to confirm her suspicion. Then, instead of trying to earn both ends of the commission on the back of an unfortunate colleague at another firm, she made sure that the other agent got their well-earned credit and broker fee. Our reputation, she stated, is more important than any monetary gain.
The Broker’s Wife seethed when snooty receptionists at other firms (it is ironic to be snooty when you are working banquet waiter hours on a weekend morning, by the way) acted dismissive, disrespectful, territorial or hostile when they hadn’t heard of her husband’s firm or treated us like interlopers. She seethed, but held her tongue (mostly) and worked on making sure they knew us the next time we crossed paths.
While she still has the odd male flirt with her in grocery lines, this isn’t the Broker’s Wife’s first trip to the rodeo. As a teen, she stood between an armed robber and a shopkeeper in New York City, winning a war of nerves until the coward gave up and left. Her organizational skills notwithstanding, her backbone is awe-inspiring.
The Broker’s Wife does the books and taxes for tens of millions of dollars in transactions brokered. She is the administrative genius that sees to it that the maelstrom of 60+ listings, 30+ agents, dozens of pending transactions, and thousands of details are attended to in an efficient, businesslike and professional manner. Her ability to do the details allows me, the broker, to focus on the big picture. She does see the big picture too. She made sure that the first dishonest agent we ever had was promptly terminated, stating clearly that this time they cheated us, but what if they cheated a client?
The Broker’s Wife is the Chief Operating Officer of the company. She is the reason the company has grown, she is the secret weapon, and nothing that the broker gets all the credit for could be done without her extraordinary abilities. We won’t get into the 18 hours days, the 5 languages she speaks, her piano playing, the four children, including one with autism she cares for like a champion, and the exponential factor of foibles that she puts up with in her husband and business partner. That’s not the focus here.
It has been weeks since I last updated this blog, and it isn’t writers block, indifference, or slow news days. I am busy.
I don’t mean active, or experiencing the typical cyclical upswing of the spring season.
I am busy. Really busy.
I started the firm in late 2005, and it took me 9 months to prime the pump with any significant number of clients. By mid 2006, I had clientele for sure, but the market was then going through what was then referred to as a “soft landing.” A year later, the sub prime crisis hit. The year after that, Wall Street’s sinkhole almost brought on a barter economy. I have never really participated in any exuberance, rational or otherwise, as a broker.
Until now.
I am in the midst of multiple bids on three listings as I type, several quick accepted offers on others, and inventory has shrunk to a level so low it is almost absurd. Consumer confidence has come roaring back, and I am seeing buyers drop inspection contingencies, mortgage contingencies, and doing as much as they can to get their offer accepted ahead of the competition.
There was a time when I would go over market activity with sellers to price out their home and the MLS would have a very long list of active, unsold properties and an all to short list of sold properties. That ratio has now flipped: there are as many sales as there are available properties, and in some case fewer available homes than the closed properties. Buyers have fewer options, and it is making them act. The leverage that buyers could exert just a short year ago has all but evaporated, and sellers have regained leverage with a vengeance.
I recall 2007 when banks severely curtailed their underwriting guidelines to minimize risk and remarking how quickly the pendulum had swung to the disadvantage of home sellers back then.
How quickly the pendulum has swung back.
This is not to say that overpriced homes will sell or that happy days are here again for good. Overpriced homes still get stale. But homes priced right, instead of inexplicably sitting lonely and unsold in the lean years of 2008-2011, are now selling briskly to eager buyers with some robust competition. Buyers no longer possess the leverage to hold the seller over a barrel anymore. Balance is back. Values have stabilized and in some cases, gained strength.
I have not had the time to post market stats locally, but I will soon. My observations are that of a guy out in the field, watching this all firsthand. It is a sight to behold. It isn’t “easier” for a variety of reasons, not the least of which is the return of neophyte agents who don’t know their job too well and the accompanying headaches, the consumption of time to handle multiple agents regarding the same property, and the endless work of quality control on higher volume. But consumer demand is back, sellers can sleep better at night now, and we no longer risk giving away the farm- literally- to consummate a sale. I am almost ready to say the R(ecovery)-word.
As I stated to a seller client who wondered aloud if we had under priced their home after a huge bidding war on their property, we are witnessing the transition to a new market where, finally, the wind is at our backs.
We had our monthly company meeting today and discussed, among other things, how best to best help buyers in the purchase of their home. In the group discourse on what is important to a real estate consumer in 2013, the matter of consumer research was looked at critically. There are some basic truths:
Brokers are no longer the gate keepers of information.
Brokers are no longer the gatekeepers of what home are available for sale.
Brokers are no longer the gatekeepers of aggregate data.
Brokers are still needed because our value proposition is not information, but of advocacy and guidance.
In my recent experience atHear it Direct, a solid 18 out of 18 consumers said their broker was worth their service fee (commission). Most, if not all, would use the same broker again, or at least use a broker in their next transaction.
So here is what is so funny that I pointed out to in our meeting. Consumers, who agree that brokers are necessary to their home purchase, research everything about their prospective home, such as schools, neighborhoods, crime, demographics, market stats, municipalities, local laws, and almost anything else you can think of.
EXCEPT their broker.
I can’t tell you how many times I have spoken with people who knew incredibly granular data about their community of choice, but then either dealt directly with a listing agent with no advocate of their own, acquiesced to dual agency, or just used some guy they met at an open house. Time and time again, especially in stories of less than positive experiences with agents, when I get to how the consumer chose their representative, they reveal that they didn’t really research or vet the person who would broker the largest financial event of their life.
That blows me away.
Yes, research. Learn about the community, the walk score, the schools, crime, and neighborhood amenities. But for God’s sake don’t trash all that hard work by using a sub par agent to represent you.
Roughly two thirds of our company listing inventory are homes that were listed with another brokerage that expired unsold before hiring us. Typically, their last agent was a family referral, social friend or neighbor, or casual acquaintance. Many of our buyer clients worked with other agents before engaging us as well. They didn’t interview multiple agents. They just figured that the Multiple List was the Multiple List, or that all buyer agents unlock doors the same way, and that their agent would do. And they lived to regret it.
I don’t blame these folks for researching everything carefully but their agent. I blame our collective industry for failing to educate the public. HOW you research an agent will be for another post, but suffice to say that a little thing known as Google, track records, personal references, and transparency go a long way. THAT you research an agent before hiring them, however, should be an absolute given necessity for any consumer. We are not all the same, and I’ll take it a step further and say that an agent who doesn’t sell a lot may be a better match for some than someone who closes lots of deals. The important thing is to find the right match, and when consumers know to do that the rising tide will carry all boats.
This past Wednesday I had the privilege of being one of the industry panelists at a unique real estate conference at the Papermill Playhouse in Millburn, New Jersey calledHear it Direct. The format had group discussions with six home buyers, six home sellers, and six Generation Y buyers & sellers to discuss their experience and insights in the marketplace dealing with agents. Tough questions were asked, and in many cases tough answers were given which, for many in our industry, were uncomfortable to hear. It was an unfiltered view of the consumer experience from their own mouths, the good, the bad, and the ugly. After each consumer panel the moderator would then discuss the session with a panel of industry professionals, and I was on the panel discussing the home sellers.
What got me interested in participating was a video I saw a few weeks ago from the west coast event, where the Gen-Y panel wasdownright harsh in their assessment of how their agents handled their cases. Just watching it made me cringe. We’ve all heard the stories, and in many cases, we have been on the other side of transactions where we had to deal with “that agent.”
Since the advent of the Internet in real estate, there has always been a sentiment among many that brokers would go the way of travel agents because of the consumer access to data. That has not been the case because youdon’t buy a house the same way you book a flightor buy a book online. However, the industry is changing, and professionals have been inundated with new shiny objects as well as tens of millions of consumers who have come of age since the downturn for whom technology is an afterthought. To them, having an email address or website doesn’t make an agent special or forward thinking.
Agents have responded by often becoming even more automated and technologically sophisticated. Technology on the wobbly shoulders of 90’s “look at me” image marketing (on the wobbly shoulder of decades of being the gatekeepers of information, which we aren’t) has created a disconnect with the consumer, even among the most well meaning licensees. We literally have to unlearn much of the way we were taught to transact business in order to reconnect with our clientele in a meaningful way.
That isn’t easy because there is no blueprint.
We can’t Google a simple solution the the challenges facing the industry.
So I expected a rough atmosphere at our event. It had its moments, but the takeaways, insights, AHA moments and reaffirmations of things I knew were incalculably valuable. The discussion of what consumers want from their agent in today’s world, what they hate in their agent, what they’ll do differently next time, and dozens of other things will impact how I model the architecture of my company going forward. I will write about my insights in future posts, becauseonearticle tonight will not do it justice. Suffice to say, what will make brokers survive and thrive in the 21st century will not be shiny objects or techy webby gizmos. It will be the same qualities that have have been archetypes of great organizations and societies since we started writing stuff down. How utterly simple, yet utterly counter intuitive.
Communication. Responsiveness. Caring.
Yeah. That stuff.
As I told the Hear it Direct co-founder, my friend Sue Adler,this experiencewill make me a better broker. The cynic will say we should already know this. Well, duh. We know it. It isn’t about understanding the idea. It is about implementing it the way we need to in order to get the right outcome. You can’t take it for granted. And you don’t know what you look like from the outside. We strive to do this stuff every day. Now we have game films. The good news, from the mouths of consumers themselves, is that when we deliver on what they truly need, we are worth every penny we are paid.
I am ALWAYS interested in being a better broker and building a superior, cutting edge brokerage. This may be a small distinction, but it is powerful: up until this week, I always built my firm to be a tech-forward firm that cares. Going forward, we will be the caring firm that is tech forward. It is a subtle shift, but powerful. Identify the real need, not what we think they need, then deliver. Simple. When was the last time our industry empirically identified the need?
Since I have recorded my commentary in this blog, I have had exactlytwoexperiencesthat I expressed certainty would elevate my game. I now have a third. As I said to Sue after the conference, Hear it Direct could well eclipse her amazing production accomplishments as her legacy to the industry. It is certainly going to help us. Consumers should know we are listening, and we will not accept status quo.
The National Association of REALTORS is the largest trade association in the country. Most member Realtors join their association because it means MLS access, and don’t quite get the benefits of membership. This isn’t to say that everything local, state and the National associations do is right; I have been a vocal critic of NAR at times, but this is not one of those times.
Recently, a Florida Realtor,Jeff Launiere, wassuedfor a fair housing infraction because someone found a home while searching on his website that contained verbiage that violated fair housing laws. The only problem was that this was not Jeff’s listing, he didn’t write the remark, and no human being can screen the thousands of listings on their Multiple Listing Service feed for that kind of nonsense.
The short version of the story is that he went to his brokerage for help, and corporate counsel apparently decided that settling was cheaper than fighting, He was asked to sign something that would not clear his name and “settle” despite an obviously case of mistaken identity, because, as I said, it wasn’t his listing or his fault. For several days, the Realtor community was abuzz about this madness and the unfortunate fate of our colleague who did nothing wrong.
Today, thanks in large part to intercession from NAR, the lawsuit was dismissed. As Jeff stated on his blog:
I just received word from Laurie Janik, Chief Legal Counsel at the National Association of Realtors that the Lawsuit has been dismissed.
In NAR’s Facebook group, Ms Janik cited the Communications Decency Act of 1996 as a law that protects publishers from liability for content provided by others. Bottom line: Mr Launiere was asked to sign a statement that would not clear his name in the interest of settling for legal expedience, and he pushed back. NAR helped to an unknown degree (and they told Jeff he the suit was dismissed), but it is clear that they interceded.
Madness did not prevail, and a good man got to clear his good name.
I could write more on dozens of other matters, but this is Jeff Launiere’s day. Add that to the list of things your association does for you.
Home inspections are so important that, unlike most markets, local attorneys will not draw up contracts until they are settled. They are never a contingency of the contract in Westchester. Today we had a home inspection on a property our clients had a recent offer accepted on, and it did not go well at all. Surprisingly, in spite of the many updates and renovations made by the current owner in the 8 or so years they have owned the place, such as a new kitchen, baths and furnace, problems found were so bad that our clients elected to not proceed with the transaction.
There was not one, not two, not even three, but four major issues discovered by the end of the inspection. First, we found termite damage in the garage, then the basement. Then, mold in the basement. After that, evidence of a fire in the home (!). To wrap it up, material that could contain asbestos was identified.
Termites, mold, fire, asbestos. A grand slam. Just one of these situations can hamper or kill a deal. Two of them typically kill a deal. Four? Forget it.
I work for the buyer; my first job is to be their advocate. Could we get the seller to address all the issues to their satisfaction? Perhaps, but am I supposed to twist their arm if they’ve lost that loving feeling? If they truly loved the house they could deal with curing the troubles and staying in the deal. They still may. But it would have to be their choice, not because I convinced them. There are still too many choices out there to do so, and as their agent I have to work for them, not my immediate commission. There is a 1% chance they could wake up in the morning and be willing to listen to the seller’s proposal to fix the issues. But the overwhelming odds are that we will find a home with fewer issues.
As cute as this place was, I have never sold a home that had that many major issues that wasn’t sold as a rehab project or fixer upper at a steep discount. This was a first. But that’s baseball, and clients spend far too much money to compromise on these things. The buyer is out several hundred dollars, but that is the cost of doing business to avoid more expensive issues down the road.
Sellers: Before you list your home, get it inspected. Then this will never happen.
Weekends are busy in real estate, so you can imagine the feeling when my head sank into the couch pillow at 6:20pm when I remembered that I had to drive to New Rochelle meet with a client I promised to see. My client is a retiree, and straight shooter as well, and our conversations are always unpredictable. Tonight, she did not disappoint.
“Yours is the hardest business I have ever seen. I can’t believe it. I was in business for many years. I have never seen anything like it. It never ends. I used to think it was glamorous, to see homes and how other people furnished and such, but that is not so. You are so patient. It is good that you are good at what you do, because it is so hard.”
I was glad she noticed. Forget the hours, vagaries of commission based compensation, rejection and everything else that goes with being self employed. Advocacy is no walk in the park. You have to do the worrying for people. You have to think 5 steps down the road and plan for contingencies if your counterparts zig, zag, or something else. You have to think about clients while you shave. You never leave work at work. Driving home, as I recalled the conversation with my wife, she reminded me that it is like being a surgeon as well- we are always on call.
That is just on the part of the work that centers on client needs. The other aspects of running a brokerage, such as the marketing, administration, sales, management of people, risk, liability and time, can all be taxing. But for those of us in this industry, it is a vocation, a lifestyle, and almost an obsession. We live, eat breathe and sleep real estate. How do I relax? I end my day by reading and writing about the industry on my own platform and in social media. It is the height of irony to unwind from a long day in real estate by immersing myself in…more real estate. But I am not alone.
There is another part to running a brokerage that isn’t part of marketing, management or servicing clients. It is keeping up with the changes in the industry. The new shiny toy in 1996 was a cell phone. In 2001, it was a real estate website. Three years ago, licensees were encouraged to get involved in social media, and boy did we ever. In those and many “THE” things to do, we do it and often not well. My social media news stream is flooded with the insufferable amount of agents who use Facebook as a self promotion machine with waves of posts about their new listings, open houses, and humble-brags about what they did that day.
And when the shiny object stops being effective, they’ll say it is passe. Lately, some agents have questioned whether websites, blogs, or home searches on their sites are worth having anymore because of diminished returns. This make me laugh. In 1996 my cell phone was a game changer. But why should it be a game changer now, when everyone has one?
So here was my last update on Facebook, directed toward my colleagues who blame their websites for no longer being effective:
Friendly reminder: Real estate is a tough, competitive business. Therefore, the things you were encouraged to do back in 2005 and 2008, like get a website and blog, are no longer cutting edge. There is always a better mousetrap. The same goes for the Twitter/Facebook thing. The new shiny objects are video and mobile. Mobile, by the way, is why ZTR and some smart brokers are getting your market share.
Caveat: In 2015, when a Youtube channel and mobile optimized search are no longer the flavor of the month, don’t say they don’t work. They do work. You just have to compliment them with the right new stuff. And you have to use them right, like not using Facebook to post about your open houses (seeTodd Carpenter).
Anyone who has ever said or thought “There. I now have a <shiny object>. I am going to make money,” needs to understand that such sentiments are the preamble to an epitaph. Blogpost coming soon…
Our latest efforts are making sure that all of our online content and property searches are fully optimized for mobile. Who knows what it will be next week. But that is the job, and knowing what is next, just like taking nice photos or writing nice copy, is my business. Hard to do? Yes. But do I love it?
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It is with great pride that we announce our newest associate to the firm, Emilia Csak. One of the great things about my life is the opportunity to work with people who bring things to the table that I do not possess. In the case of Emilia Csak, that is a pretty long list.
A Tale of Two Tweets: AOL Real Estate Schools Forbes
It was as if AOL was reporting about real estate in another planet:
Both reports are within a few business days of each other and address the June 2013 market. Why the different conclusions? More importantly, who is right?
I believe that Forbes dropped the ball. Real estate is a seasonally cyclical market. Any period is evaluated responsibly by comparing it to the same period the prior year. You don’t compare bathing suit sales, for example, from December to July. And you certainly don’t compare retail sales in February when returns are high to the crazy period in December around the holidays. You compare apples to apples.
Forbes was factually accurate in reporting that June sales were down less than half a percentage point in June 2013 from May 2013. But their conclusion, that the market is “losing steam,” is misleading, because the spring market always tails off as summer comes because of market cycles, just as retail sales peak in December and tail off in February.
AOL made the accurate call. In responsibly comparing June 2013 to June of 2012, they tell the real story: Sales are up almost 40% from the same time last year. That does not speak to a softening market in my opinion, it speaks to a market that is still undeterred from the rate hike and may in fact still be too hot.
I’m actually surprised that Forbes would blow it like that. Who compares May to June? I have spoken with my share of real estate reporters, and by and large they understand the market cycle and how statistics can be interpreted. Forbes, of all media outlets, should know better.
AOL Real Estate 1, Forbes 0.