Real Estate

I kind of like the new logo for our periodic market updates. We aren’t fighting crime, mind you. In fact I probably should have gone with more of a Dragnet theme (”Just the facts”), and the “man” part is a little misleading until I can shame Steve into making a cameo blog appearance, but I think it is snappy nonetheless.

We are running a little late due to the Labor Day weekend, but our housing sale statistics on the website are now up to date. We track six zip codes and the San Diego region as a whole, but I always pay special attention to Scripps Ranch (duh) where we have seen a dismal eighteen sales record since August 1st.

This is the kind of news that makes hyper-local agents shutter, given that there are enough licensed agents living and working in Scripps Ranch to fill the cheap seats at Qualcomm Stadium, which is why I eyed this morning’s news that City leaders are at least entertaining the idea of selling naming rights to our new City Hall as a potential opportunity. I suggested the “Kris & Steve Berg City of San Diego,” while Steve thought “City of San Diego Castles” dovetailed nicely with our brand. We are still brainstorming. Either way, I find the keyword potential very exciting.

And speaking of stats (which I sort of was at the beginning), here are a couple of year in review charts for Scripps Ranch and for our coastal cousin, Carmel Valley. This data is for detached homes and, as always, compliments of Altos Research.

And, so, we continue to chug along the bottom. As soon as the hoards of buyers I see floating around out there can start getting financing again, we just may start to turn the corner.

What fun that was for a Thursday!

I had to post something this morning just to get the picture of the ugly cat off the top of the page. It amused me for about ten minutes, and then I just found it annoying. So, here we go…

For me, today is New Year’s Day for me. The little soldiers of learning who are a part of the San Diego Unified School District (and this includes Scripps Ranch) are back to heavy books, sack lunches and social drama. I love the first day of school, and not for the reasons you might think. On the one hand, I find it a lot less stressful to have the short people home all day during the summer months than to be faced with an early morning deployment each school day. We have girls, so “getting ready” for school is reminiscent of the Battle of Waterloo. By the time I push them out the door, I am spent, a marathoner who has already run her race. Granted, I am down to one resident hormonal basket case, but thanks to the miracle of Skype, my oldest collegiate daughter can torment me from afar. (Just kidding, Becky. Call home soon!)

That’s the bad news. The good news is that my real estate year begins today. September is a time for planning and for getting back to full-throttle after an August where most civilians (and our would-be clients) have been mostly absentee. From a seasonal standpoint, the tempo starts to slowly build this month. We won’t see it in the numbers until January, but this is when parents everywhere begin to breathe a little easier. We all have the onslaught of holidays to conquer yet for many, the seed of moving is beginning to germinate, and they will be starting their investigative period over the next several months. And we have to be ready.

Each September, or as we like to call it, Third Quarter Estimated Tax Time, Steve and I begin the business planning thought process. It won’t materialize on paper until December, but this is the time we start stepping back to critically assess our business. We can always do better, and the minute we are finished trying, we are finished.

Every year, we reevaluate our efforts in the areas of marketing (for our listings and, yes, for ourselves), systems (this is not the sexy part, but it is necessary), and general practices. Some things I think we do very well. On the techie side, I am mostly if not entirely satisfied that we are offering more tools and superior reach than our counterparts. I have been on a one-woman mission to realize the perfect, paperless transaction and, while I am not there yet, I am closing in. We continue to promote our listings on as many on-line sites as possible. That has been the easy part. Making sure all roads lead back to us has been more challenging, and those challenges will continue.

As our business gets more complex, the systems become more important, and working on my organizational skills is high on my hit list. I believe we are extremely good with client communications and follow-up, but systems breed consistency, and I am the first to admit that you can’t exactly set your clock by our next marketing and market update. Yet.

Marketing ourselves is always the Big Kahauna of undertakings. This is because to eat, we must have business, and to have business, we must have clients. The idea of self-promotion tends to be as distasteful as the pasta I served last night, but for anyone (and I do mean “anyone”) in a service industry, it is a necessary evil. Until the majority of buyers and sellers are finding their representation from the 1-800-Psychic hotline, we must be visible. Satisfied past clients and their referrals are the life-blood of our business, but there are many more customers who will not already have a designated “agent for life” when it comes time to move. This is the tricky part, because to appeal to the uncommitted, you have to predict human behavior.

By virtue of a lot of blog reading, I am coming to the conclusion that we need to rethink our presentation. I could be wrong, but this will be the year Steve and I make a couple of bold moves. For one, we will be nuking our pictures from our “stuff.” I, for one, think we may be clinging to the old, prescribed marketing ways by rote and for no good reason. In fact, it just might be to our detriment. I suspect that home buyers and sellers don’t want to interview my summer of ‘96 likeness but an agent with experience, and just because everyone is doing it doesn’t necessarily mean it wreaks of professionalism. This will be a slow phase-out (baby steps), but a phase-out nonetheless. And, I have a lot of rocks to look under to effect this next change, but give me until year-end. At that point, if you ever see me using phrases like “Top Producer,” “Award-winning Agents,” or “Top (insert integer) Percent,” you have my permission to take me out back and slap me silly with my Chairman’s Circle plaque.

There’s more of course, some things we haven’t even thought of yet, but it’s a start.

I guess we are all back to school this morning. Happy New Year!

Now, where did I leave that camera?

Some days (most, lately), I just don’t get it. Here is the photo in the MLS for a home that was listed 22 days ago:

As I sit shaking my head in utter exasperation, my knee-jerk reaction is to blame the agent. After all, it is the agent who holds the marketing reins. But, I will give her the benefit of the doubt. Maybe she misplaced her camera. Maybe her computer is in the shop. Perhaps she ate a bad fish taco and is just now recovering. It could be that she had professional pictures taken, but the photographer forgot to remove the lens cap and they are rescheduling. Or, the agent might just be backed up with all of her other listings.

Twenty-two days. In twenty-two days I could have commissioned an artist’s rendering (using charcoal on canvas). In twenty-two days, I could have deconstructed the home, scanned each element, and produced a respectable Photoshopped likeness. In just five minutes, in fact, I was able to design this image using only the touch pad on my laptop, and I’m not even artistically inclined.

While it arguably lacks the pizzazz of the typical “professional” image, I think it is far better than this home’s current cover photo.

In contrast, we listed a home five days after this home made its impressive debut. In that time, we had the property professionally staged, professional photographs were taken (about forty of them), a virtual tour was produced, a single-property domain was secured, a custom rider was ordered and delivered displaying the domain location, 200 four-page brochures were designed and produced, the listing was syndicated to about a trillion or so on-line sites, and a print piece was mailed to about 4500 homes. These are just the CliffsNotes.

So I could be blaming the agent, but maybe I should be blaming the seller. After all, it was the seller who selected this agent. And, as a matter of full disclosure, this particular listing is one for which we interviewed. But this is not a case of sour grapes, and I sincerely mean this. The fact that we were not selected is not the point. We can’t win ‘em all; we never have, and we never will. Hire me; don’t hire me. But, if you don’t hire me, please hire someone as good or better. Hire someone worthy of your business. The agent controls the marketing, but you are in control of the selection process.

Unfortunately, we see these situations every day, and the bigger issue is that it is beyond me how, particularly in this market, anyone would think their interests are well-served by this level of effort. They knew they had choices. They knew what marketing opportunities were available to them. And, I know they knew that listing a home is a partnership, one in which ongoing cooperation is required, one in which the agent does not operate within a vacuum but instead communicates clearly and often about the measures they are taking on the seller’s behalf to find a buyer at the highest price. I know because we discussed these things.

Maybe it was about friendship. Maybe it was about money. Or, on second thought, maybe it isn’t the seller’s fault at all.

Perhaps the seller isn’t aware of how his home is being promoted. His computer could be in the shop. He might have eaten a bad fish taco and is just now recovering. It could be that, well, you get the idea. But, I have to wonder, didn’t he notice that no one with a camera has stopped by in the last three weeks?

photo credit: akaalias

Hellooooo! Is anybody there?

It has been so quiet over the past week, you can hear a call drop. And it is just so hard to be a blur of activity, a working machine, when the real estate world feels like it is operating under a cone of silence. It must be August.

This happens every year, and I am having to remind myself that a lot of the lethargy we are seeing now may in fact be seasonal and not market-driven. Our market is less than ideal; we have consensus on this point. Buyers are buried under a barrage of reports of the end of the world as we know it, fearful that a purchase today would cause their friends to lob taunts and jeers in their general direction. There are always those motivated few, the few with a sense of urgency, but absent a true “need” to move in August, most people tend to put any buying (and selling) “wants” temporarily on the back burner.

So what does this mean if your home is currently offered for sale? Patience. Every summer-end, I find myself repeating this little speech: From now through January, stuff is going on, stuff outside of real estate. If seasonal trends hold true, showings will be fewer, and open houses will not likely be festive beehives of activity. We all enjoy competing demands this time of year, from the back-to-school daze and the vacations, to the “What am I going to be?” costume decisions and and the social and gift-buying obligations. The people who do look at your home during the next several months, however, probably mean business. And, don’t forget that there are a whole bunch of busy would-be sellers out there who are putting off listing until the relatives leave, so your competition is arguably less.

My father-in-law used to say, “Don’t fight the feeling,” and this is particularly good advice right now. When someone decides to view your home during the next several months, they have probably done so because it is a priority, a higher priority than basting the turkey. Expect fewer showings, but know that the quality of your showings will be greater for awhile. It always is. Veteran agents know the season all too well and use this time to improve systems, attend to those “projects” which have been languishing since last August, and generally mobilize for the next seasonal wave. Sellers would be wise to use this time to enjoy the things their potential buyers are enjoying while they aren’t looking at homes.

Lately it has been all about the market, but sometimes it’s just August.

I had this amazingly thought-provoking post of the epic variety in the hopper this morning when I took a call from an agent on one of our listings. OK, fine. The other post wasn’t all that great, but I couldn’t let this one go.

The agent was phoning to arrange a showing. I dutifully told her, just in case she had missed it, that we reduced the price just last night. “Are they motivated?” she asked. “Well, yes,” I said. “They want to sell their home, which is why it is offered for sale.”

Motivated? I am just so fed up with the “Are they motivated” question. So, I will attempt to answer it once here, and the answer applies to all of our listings — past, present and future.

1. The seller has listed his home for sale because he wants to sell it. He has not done so because he is a showing and staging hobbyist who thrills at the opportunity to have a cavalcade of perfect strangers rummaging through his closets at the most inconvenient times.
2. Using logic, we can conclude that the corollary to #1 above is this: If the seller was not motivated to sell, his home wouldn’t be offered for sale.
3. See #1 above.

As a matter of disclosure, we do not represent home owners who have no true interest in selling, nor do we represent home owners who expect a price closer to the National Debt than to true market value. We can’t, because those homes will not sell, and we only make a living when homes sell.

Now, I recognize that my truisms do not always apply to every agent and to every agent’s  listings. We see homes every day where the prices suggest someone has been sniffing the Elmer’s. But, if you think the price is high, do not call and argue with me. The list price is not going to get any lower just because you wish it to be so or because it is more than your client’s can afford. It is going to get lower when market conditions demand it and the seller agrees to it. In the meantime, if your clients like the home, write an offer which reflects the buyer’s perception of value, and we can let our clients “talk about it.”

And, please, don’t ask me if the seller is “motivated.” What could you possibly hope that I would say? Giving an answer such as, “Why, yes, they are willing to sell for pennies on the dollar!” would justify stripping me of my license and thumping me upside my big fiduciary head with it for good measure.  Ask me where they are going, why they are going, and how soon they need to be there. If I am authorized to tell you, I will, and then you can deduce my client’s “motivation” all on your own.

Selling a home is time-consuming, it can be stressful, and it is always an intrusion. It is rarely a barrel of monkeys. Suggesting that the seller, my client, is just messing around is insulting to both of us. We would all have better things to do if that was the case.

“But,” she pushed on, “are they willing to take less because of all the short sales?”

Less than what? Good grief. I feel another post coming on.

photo credit: spaceodissey

I believe I have set a record. It has been a full seven days since I have posted here, and somewhere around day four of my sabbatical I stopped worrying about it. Circumstances were simply beyond my control, and a blog post last week simply wasn’t in the cards.

My father had an uncanny knack for ignoring the things he couldn’t do anything about. I think it’s a guy thing, and I hated him for this. I, on the other hand, am an obsesser. I tend to take a trip to crazy town every time I sense I am not driving the bus.

Me, worry?

The truth is, I’m a worrier by nature. I worry when I am too busy, and I worry when business is slow. And when things seem to be chugging along according to the divine plan, I worry that I don’t have anything to worry about. Now, in fact, I am worrying that I just ended a sentence with a preposition.

I am seeing a lot of people like me in this market. This morning’s requisite Chicken Little article in the San Diego Union Tribune is one fine example. “Housing prices sink,” trumpets the headline. Sure, sales for July were up 10.5% in San Diego County from last year, but where’s the fun in that? Prices are down, so fortunately we still have something to worry about.

Nearly 41% of the sales, they report, involved foreclosure sales. This is bad. Or is it good?  We know that the mortgage mess has left us with a legacy of distress sales, and these distress sales will be with us for awhile. The fact that the foreclosed homes are selling in great numbers should be welcomed; our market won’t reverse course until we complete the cleansing process, and this is going to take some time and additional price decline. We can worry about this, or we can acknowledge it and move on.

The F-word

“Foreclosure” has become the new f-bomb. New foreclosure listings are still outpacing foreclosure sales, says the article, and we are reminded that this should be cause for concern. I will argue that it is what it is, and focusing on the nature of the sale is a lot of wasted fretting at this point. We will work through the distress sales in time; we will work through them because they are a symptom of an epidemic, an epidemic of irresponsible lending practices, which has been isolated and quarantined.

This is mainly because getting a home loan today is as simple as threading a needle wearing a ski mask. The lending pendulum has swung too far in the other direction, and obtaining financing leaves today’s buyer feeling a little like Michael Phelps but without the endorsements. There are plenty of people who want to buy in today’s market, at today’s prices, but for whom the door has been closed due to tighter underwriting standards. This is bad, and it is good. It is a matter of perspective.

If we weren’t so busy using the f-word, we would be acknowledging that traditional listings are also outpacing traditional sales. Our market is equal opportunity. Market times in the I-15 corridor are generally running 60 to 80 days, depending on the community. This is bad if you are a seller and only remember 2003. On the other hand, if you had the pleasure of listing a home for sale in the mid-’90s, life is not too shabby. And the same goes for prices.

Time to unwind and rewind

Perhaps agents, sellers, buyers, the whole lot, should maybe stop worrying so much. We can fight our circumstances and obsess about our little paradigm shift, or we can deal. If we take a step back, this market is not fundamentally different from any other. There are people who want to buy homes for the lowest possible price, people who want to sell homes for the highest possible price, and agents who want to make a living assisting them in the transaction.

What is different is that our circumstances are forcing us all to push the rewind button on our thinking. Being a real estate agent, for all but the exceptional few, has not historically involved out-earning a Hollywood A-lister. The past half-decade, a time during which anyone who could find their way to the testing center and successfully fill in the bubbles on a Scantron was guaranteed a six-figure income, was an anomaly. Homes have not historically been our singular investment vehicles. To our parents and grandparents, their homes represented security and shelter, not a mega-lotto ticket. The fact that many saw their “investments” double in three years was an exception, not the rule. And home buyers have traditionally had to work and save toward this end and demonstrate that they could ultimately afford the American Dream, rather than having the dream handed out as freely as potsticker samples at Costco.

I couldn’t blog last week because this week I am one daughter short. In a few short days, I saw my own paradigm shift in a very big way. We pushed a personal rewind button of sorts. Operation Dorm Delivery was a success, but while we have spent the past 18 years preparing for this day, nothing can entirely prepare you for the reality. Life, like the real estate market, is cyclical. Now I have less laundry, less arguing (”Clean your room, and release that headlock on your sister!), and a smaller grocery bill. And I have more time to blog.

It’s good, and it’s bad.