Real estate
The Market is Hot, Hot, Hot!
The spring market is in full swing. This past weekend I was with an agent and they had 3 contracts on 3 different listings that went on the market the previous Thursday. One of them had multiple offers. In addition, we put a house back on the market last week that was on the market previously for about five months with no activity and got a contract on it over the weekend. So there are a lot of buyers out their looking, inventory levels seemed to have increased, but only slightly, interest rates remain low, days on market and months’ supply continue to stay relatively low as well. So if you are looking to sell, now is a great time. The trees are in bloom and the market is hot just like the weather! Let us know what we can do for you this Spring!
Are you the 20%?
Have fun and make a difference! That was the premise of the speech I heard today from Doug Smith, compliments of Leslie Wish, McLean Mortgage Group. If you’re not having fun at your job, then why are you doing it? That was his lead into discussing the Paredo Principle and how we, as Realtors, fit into the rule.
The Paredo Principle is the rule of 80/20. Twenty percent of the Realtors are doing 80% of the work. The 20% are defined as professionally persistent and instinctively insistent. We’ve heard it all before, but asked us what was the difference between those that are in the 20%? What are the 20% of Realtors doing that the 80% Realtors aren’t doing? And once you figure out what those tasks are, how can you do more of them to make your days more productive?
Doug has put those differences into his 5 C’s for Success and differentiation from the rest of the pack. These are the things that the 80% lack and the 20% excel at…
1. Confidence: How do you answer the question “how’s the market?” What do you do when you walk into a room of people you don’t know? Confidence is an ability that many of us lack, simply because we are afraid of making mistakes and looking bad. Instead of saying that the market is great and that the numbers are this and that, say “It’s remarkable, I’ve never seen anything like it!”
2. Contacts: The opposite of contact is reluctance. Reluctance can be to pick up the phone and make that call. The more contacts you have in your sphere, the more contracts you will write. So who’s in your contact zone? Business partners, family, friends, transaction partners such as home inspectors, etc. Don’t be afraid to tell your friends and family that they have a friend in real estate. Many agents think they shouldn’t reach out to their friends in case the transaction goes bad and results in losing that friendship. That all goes back to a lack of confidence.
3. Control: Control of your business, your time, your career, your clients. Agents who have a plan, a written plan, have more control over their business. Those that take it a step further by having a plan each day, a to-do list; have even more control over their business. Agents who control or “drive” the conversation when speaking with clients, maintain more control of the transaction and get the job done! Doug spoke about Sales Speak. Here’s an example of Sales Speak presented by those in the 80% and those in the 20%…
80%: Did you think you might want to see a few houses this weekend?
20%: Let’s go see 3 or 4 houses this weekend. What day is better for you, Saturday or Sunday?
Or
80%: So, you like the house? Ok, great, do you think that maybe you might want to make an offer on it?
20%: What do you think? You like it, great. Let’s make an offer.
The difference in the two shows that the 20% agent is steering the client to move forward with the transaction because that’s what they hired the agent for. They didn’t hire the agent to make their own decisions. They hired him/her to help them make the best decision based upon the needs/requirements they expressed to the agent for their new home. Think about that next time you are on the phone with a client. You might just find out that all this time you’ve been using speech associated with the 80% and it might be time for a change.
4. Consistency: Extraordinary people are not truly extraordinary; they just do it with ridiculous consistency! Those who are consistent see more results than those that do things from time to time. Doug mentioned 3 things you can do daily to generate 13-15 sales per year and add 1,440 contacts to your database per year and those are (1) handing out 1 business card a day, (2) use some form of correspondence 2 times per day either through email or snail mail, and (3) make 3 calls per day to anyone…past clients, lender, agent, friend, etc. The more you do things consistently, the more it becomes a habit and you will find yourself doing them instinctively while receiving more business.
5. Courage: Courage hides behind the things we fear the most. Courage is acting in the presence of fear. In cases such as these, we need to change our focus, take responsibility for ourselves and expect more of ourselves. We can do it and should remind ourselves everyday either through affirmations or changing your focus and mindset. It takes courage to do a lot of things, but once you start to do those things the easier they will become.
Doug ended the session with a great quote by Mary Kay-Ash, “Most people truly have no idea what they are capable of. It’s so much more than we think.” This rings true with the 20%. They have the 5 C’s, they have more sales, they know more people, they make more phone calls, and they work more hours than those in the 80%. Implementing the 5 C’s in your life will help you move (if you’re there) in to the 20%. Based upon the number of agents in the United States (965,000) and the projected number of transactions that will take place this year (4,400,000), agents in the 20% will average 18-19 sales this year. Wouldn’t you like to be in that top 20% of all Realtors in the United States? Stick to the 5 C’s and best of luck! Now go sell something!
The Power of 5
When it comes to social media, remember the power of 5…
1. Become a member of 5 social networks. Don’t worry about being a member of them all! Concentrate on the basics, twitter, facebook, linkedin, youtube, and a blog. Keep it simple, link them together for more efficiency and be active on them.
2. Post 5 times per day on any of your social media sites. Valuable content can be found in newspapers, friend’s posts, blog feeds, etc. Find something to post just 5 times a day. Use a program like hootsuite to schedule your posts. 10 mins in the morning and you’re done with your posts throughout the day.
3. Read 5 articles or blogs a day. Getting into the habit of reading will give you the knowledge you need to speak with others about the market, post on sites about it and might even inspire a blog post. You know you can post articles that you read on your blog…write a brief comment about it and link it back to the article’s source…it can be that easy.
4. Upload 5 videos per week. These videos can be ones that you take personally or videos that you “favorite” on youtube. Subscribe to video channels, simply click on the favorite button if you like a video and it will appear on your channel. Share it with Facebook and you’re done! Videos should be quick and informative, so interview your sellers, your buyers, your fellow agents, etc. Get creative and post it!
5. Post 5 blogs a month. Blogging can be intimidating where you think it takes a long time to put it together. It doesn’t have to be a long article. It could be a quick 2 paragraph post discussing something you heard today. Don’t stress yourself by feeling that you have to write a very meaningful and motivational piece. Simply write in your own voice…your readers will appreciate that. They want to hear from you and are interested in what you have to say. So let them hear it!
So this is what Deja Vu feels like!
The real estate market reminds me of the Bill Murray movie Ground Hog’s Day because I continue to say very similar things each month. We have very low inventory of houses, fewer than 4,800 in all of Northern Virginia. It has been this low for over 5 weeks and we haven’t seen inventory levels this consistently low since 2005. Interest rates remain at historic lows and it appears as if they are going to stay this low through 2014 unless something unforeseen happens in the economy. Lastly, we continue to see a drastic decrease in distressed property inventory in Northern Virginia and the onslaught of foreclosures will not happen locally. We have just 592 short sales and 290 foreclosures on the market and Notice of Trustee sales are only averaging 2 pages per day. Short sales and Notice of Trustee sales lead to foreclosures and if we don’t have them, we won’t see them.
The one thing that we typically don’t see this time of year is the number of attendees at open houses we are currently seeing. It is more typical than not to hear our agents having 20-40 people attend an open house and receiving multiple contracts as a result. This type of activity is more likely to happen in the spring but warm weather and consumer confidence building has helped spur this activity. As I have said in the past, if sellers properly price their properties, have it in prime condition and have it staged, they are receiving multiple offers because buyers are buying.
What are we reading in the news about the rest of the country and the market that will indirectly affect us? While delinquencies and defaults slowly improve in the housing economy as a whole, FHA’s portfolio has not had the same good fortune. The woes of FHA are creating increased pressure on the agency to reduce risk and increase costs to its borrowers, most of whom are first time buyers. In December, about one of every 10 FHA mortgages or 9.73 percent, were seriously delinquent, or more than 90 days past due. Compare that to all mortgages, whose seriously delinquent rate fell to 7.3% in December from 7.8 a year earlier. For nine straight months, FHA delinquencies have risen while mortgages in general have improved. We will keep an eye on this for you and let you know when the costs increase. On a positive note for those going through short sales and loan modifications, President Obama Proposes Extending Tax Waiver on Mortgage Debt Forgiveness that is due to expire at the end of this year. The Act ensures that homeowners who received principal reductions or other forms of debt forgiveness on their primary residence do not have to pay taxes on the amount forgiven. In addition to this, some banks are paying people to aid in their short sales. JP Morgan Chase went national with short-sale incentive offers last year, paying up to $35,000 in some cases. Bank of America is testing incentives from $5,000 to $25,000 in Florida to see if they should be expanding to more states. Wells Fargo’s incentive offers range of less than $3,000 to $20,000. Short sales, even with incentive payments to borrowers, can save lenders money compared with the expenses involved in completing foreclosures. Let us know if you need our assistance with either of these scenarios.
If you have questions about your personal situation, please feel free to call us. We are here to help you with all of your real estate needs.
Is the spring market coming?
In Northern Virginia our inventory levels of active resale homes for sale continues to decline. We are down to just over 4,600 homes on the market and we have a 1.8 month supply of homes. Houses that went under contract the last 7 days hit a 6 month high this past week. In a nutshell, houses are selling. Why is this happening? Interest rates hit another record low, we are creating jobs here, rental rates are increasing and our population is growing putting more demand on housing.
Last week I was asked when will we see the spring market or in other words, when will more houses be coming on the market? Some people say when the banks start releasing foreclosures, some say mid-March, and some say when their price rise. Let’s analyze each of these responses.
So far we have not seen the foreclosures hit the market and as a matter of record, the inventory has actually decreased to a 6 month low with only 311 currently for sale. In addition, “Notice of Trustee sales” published have actually remained very low as well averaging only 3 pages per day versus substantially higher numbers in 2008-2010. Lastly, I started tracking short sale inventory just over 2 years ago and we are at an all-time low in this area as well – only 651 are for sale in Northern Virginia.
As far as the inventory levels increasing in mid-March, only time will tell but several agents have indicated they have houses in the process of being prepared to go on the market around this timeframe. If they are not only preparing them for sale but are going to price them accordingly, they will sell. Two properties we listed on Friday received multiple offers because they were price properly and in the right condition. And now for the statement, “when my price increases, I will sell” is a tougher one to answer for many people. Rise compared to what? When they were purchased? Compared to 2004-2007 prices? Compared with the last sale in their neighborhood? Until these questions can be answered, we can’t help them.
We continue to have one of the best real estate markets in the country and it will be this way for the foreseeable future. Please feel free to contact us to learn more about how this market affects you and your situation.
Got a plan?
As you start to think about business planning this year I put together a few thoughts for you to review before our session begins. Imagine starting a business – which you all have done by becoming independent contractors – with only a vague idea of what kind of product or service you would sell or provide to clients. You meet with potential investors and you say, we may sell IPad skins in Europe or set up a mobile dog washing service in the Mid-West, and let’s just see what happens. How would they respond? Not very favorably is my thought, how about you? You should never start a business without a clearly defined business plan, set of goals, a plan of action to accomplish the goals, and numbers for you to track to keep you on target to get you where you need to go. This is our objective today. Help you assemble the framework to get you down the right road to the success you desire.
As we work through today, think about the following questions:
- What are your goals as a Realtor? Is it money? Is it the number of satisfied clients you want to have by the end of the year? Is it starting a team to get you more balance in life? Whatever the goals are yours but they must be written out, reviewed and then acted upon.
- Do you have what it takes to reach the goals you have set for yourself? Do you have the knowledge, expertise, sphere of influence, time and/or desire? Think hard before you write them – just don’t write something down because it looks good or you think it could happen. Be realistic.
- How will your goals be achieved? What is your plan of action? How will your day be structured to achieve these goals? Are you in the right frame of mind to make it happen? Your attitude is extremely important in this endeavor. As Zig Ziglar says, stinkin’ thinkin’ doesn’t work.
- Are you willing to be held accountable to tracking your KPI’s (Key Performance Indicators)? Will you participate in Jason’s monthly review classes? Will you meet with me one on one to review your progress?
- Are you willing to put together a Gap Analysis being honest about where you are today, where you want to be next year this same time and what it will take to get you there? As you do this, don’t compare yourself to others, compare yourself to you and who you are.
- Are you willing to make adjustments to make your goals a reality? As we all know, the market changes, financing changes, regulations change – will you adjust your original plan to adapt? Be open to constructive criticism about your plan? And, be open to change?
- As you go through today, think strategically. Stephen Covey says, you must begin with the end in mind. Write down you goals, then work backwards to make it happen. Think of the people, tasks, time, and the number of communications it will take to make your goal a reality. Then put it on paper to solidify it in your mind.
Are you ready to be all you can be and stop making excuses? Then let’s get started!
Now, if you aren’t ready, perhaps you should consider a different career or continue to do the same things you have always done and continue to get the same results. Get it? Got it? Good!
Now, go sell something!
Got to love great real estate minds….
Wow, what Platinum Group today. Agents are feisty, fed up and frustrated with lenders. Issues were flying across the conference room fast and furious. The question was asked – How’s the market? Here is what came about – Financing problems are prevalent. Some owner problems by not disclosing full details – not telling agent about businesses, tax situations or other properties owned. But most seem to be lender problems – mainly, not telling the truth. One lender didn’t tell the agent the Visa expired, said application was in all paperwork submitted and nothing was turned in – contract and lender letter said conventional then switched to FHA at appraisal time. Lending guidelines are too strict, lenders are too ambiguous and regulations need to be relaxed to make well qualified, legitimate buyers home owners. We are held accountable to performing at a higher standard and the lenders are not – it is a huge problem! Lenders need to adhere to a business standard – develop one, make them sign it and if the lender doesn’t, don’t use them. They have no skin in the game, no accountability and no repercussions.
Agents have buyers coming out of their ears. Listings are being shown but there doesn’t seem to be any sense of urgency from the buyers. Move up buyers seem to be lurking out in the market as well.
What prices are selling? The lower price points are selling – mid price points are coming down and languishing on the market. Prices are up year over year but are dropping month to month since July. Keep an eye on this trend through the winter. Prepare sellers to price competitively from the beginning or the house may not sell or you will end up chasing the market.
Are foreclosures coming? Agents are not doing BPO’s, short sales are down, and notice of trustee sales in the papers is down so the answer is not now. Asset managers don’t have any idea of what is coming down the road either.
How are short sales progressing? One has been in process 2.5 years – has had 6 contracts and still not approved – it is a Bank of America deal…no surprise. We had one agent had 3 short sales drop out last week. Another one has 10 under contract and they are languishing on the market.
Is the loan limit reduction hurting your business? It has had only a limited effect on the agents in the group. Only one deal has had an impact with 10 agents and multiple transactions in process.
Agent’s years are about the same as last year. Their volume is up but units are down but overall, income will be the same – we will see how the loan limit reduction will affect us next year. How will 2012 be for you? Spring is going to be strong.
All the agents agreed that this was one of the best meetings we have had which is great. The energy was high, there was lots of passion and everyone left with enthusiasm.
Now, go sell something.
How will your year end?
As we move forward into the second half of the year fast and furious take the time to look at your business and determine what you need to do to have a successful year end.
The first area to review would be your contacts. How many do you have? How often are you communicating with them? What are you communicating to them? Are you picking up the phone and speaking with them? As I meet with agents regularly to conduct performance consulting with them – the most successful agents today are the ones making the calls to their database regularly and are meeting face to face with them. Virtual contacts through Facebook, email, texts, etc. are good but you need to pick up the phone and get in front of people to get the best results.
Are you growing your database? Are you involved in networking groups? Are you holding open houses? Are you involved in community outreach programs? Are you involved in charitable endeavors? You need to be actively growing your contacts in order to expand and grow your business. You can’t send our postcards, post on social media sites or advertise in print publications and expect business to come in to you – you have to go out and find it to be successful today.
Are you educating yourself? If so, how? What are you reading? How often are you reading? Do you have designations and are they applicable to today’s market? Do you attend seminars? Do you attend office trainings to further your education? In order to grow, you must take the time to learn. If you want to earn more you need to learn more – bottom line.
Are you effective on line? Are you blogging? Are you utilizing Google+? What is the content you are providing on your other social media sites that engages people to read your posts and view you as a trusted resource and provider of information? It is not the end all be all to obtaining business but it is a spoke in the wheel of your success that should not be overlooked.
You have to be better than your competition to be successful today. You need to communicate better, you need to have better sales skills, better negotiating skills, better people skills, bottom line – you have to improve every day. What are you going to do today to become better? Pick a skill set and work on it!
These tips are critical to your success not only for the second half of the year but going forward as well. Get it? Got it? Good!
Now, go sell something!
