Monthly Archives: February 2010

The Dance of the Realtors

If you want to witness an interesting phenomenon sometime, park yourself  in the corner of a busy broker’s open house. Become a fly on the wall  and watch a small slice of the real estate parade roll past. It won’t disappoint. The Dance of the Realtors is always entertaining.

After more than two decades,  I still get a kick out of  the little realty bites they gift wrap and deliver up.   Even in difficult times. the banter between colleagues, the stupid human tricks, the strange people tics, the fascinating mix of funny-weird, funny-haha and outright gallows humor is a life-affirming event for the cultural anthropologist in me.

It adds healthy fiber to the steady diet of doom and gloom I’ve been dining on lately – by virtue of knowing/working/talking with so many struggling through the comings and goings of difficult home transitions.  Nothing like a little real estate lite on occasion to  balance out the existential torture of it all.

I hardly have time to wrestle the beat up plastic sign out of my trunk and get the lock box open before three nosey-neighbors are already in the door and roaming like hyper-active children at the Mall.  There’s something about that sign going up.  It’s a beacon.  A gold-embossed invitation to anyone harboring any iota of curiosity about ‘the people down the street’.  It feels like the entire cul de sac has me surrounded.  They’ve been up since 5am peeking through Venetian blinds. They’ve got their Nike’s on.  Just waiting for that damned sign that says Open House.  They can’t help it.

One Seller, years back, was determined not to give his neighbors the satisfaction of a free-look-see into his private life. Of all the uncomfortable things Sellers put up with, that was the one thing that irked him the most.  I put a person at the front door and asked Agents to present their cards like tickets to a show. Wow! Some people really got angry when they were denied a chance to see how the other half lived. They even questioned the “legality” of  keeping non-brokers out of a broker’s open house, feeling their right to snoop was guaranteed by the constitution.

Here come the first few agents breezing through with their salvo of quips.  “Hey, it’s Brezsny in the flesh!  What are you doing working an open house? Don’t you have minions for this task?” My reply: “Elvis has to be in the building before he can leave it.”

“Hey, Brezsny where are the fresh croissants? Didn’t you get up early to bake?” Sorry, mon amis, it’s 2010 and as the other King (BB)  says: “The frill is gone.” No more free courier service from the title companies. No more free equity lines topping off those 100% liar’s loans. And no more free spreads to lure agents through places that are either going to sell or not sell themselves. The fancy catering gig was always more about impressing the Sellers anyway.  That gig/jig is up.

“Hey Brezsny, how come that listing in Aptos didn’t sell? That was a great house.” To explain that mystery, I can only invoke Dr. John, the Night Tripper: ” Musta’ been the right place. Musta’ been the wrong time.”,

Shhh. Here comes, what could be an actual buyer. (I’m not sure what they look like anymore! Given  all the beating of drums about this being a  perfect “buyers market’, they are conspicuously absent) She’s looking thoughtful.  She’s drinking it all in.   I can see her communing with the soulful ambiance of this old house offered at the low, low price of $500/sq ft…

She wanders over, makes direct eye contact and asks the one question that, for some reason, they all have to ask.  Is there a book  I don’t know about, that everyone else has read, that says, whatever else you do,  always ask:  “Why are they selling?”

The look in most people’s eyes when they ask this, is eerily expectant. Every time. Pregnant with pause. It’s hard to tell what answer they are really seeking.  “The teenager next door plays Twisted Sister at decibel level twelve all night long and the Sellers are slowly going insane from lack of rem sleep?”  “Black mold has infiltrated every pore of the home’s hideous wallpaper and six innocent people have already died?” “The divorce is so ugly that if they don’t sell, it might end worse than Michael Douglas and Kathleen Turner in War of the Roses? ”

How about…”They just want to move.”  It could be that simple you know. Or not.  And how about if we continue to caravan through a few more live open house, open mike moments next week…I’ve hot wired the webcams on about a dozen Agents’ laptops…so we can tune in and sneak alot more peeks.

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Touching the Elephant

Hey, it’s me. Want to shoot the bull about the real estate market? Want to find a few bearish real estate messengers to shoot? I’m game. I’m not going anywhere. I’ve got plenty of time on the horizon – just like the market does.

I know I can be a pain in the real estate butt at times. I often say things some of you would rather not hear. Mea Culpa. I can’t help it. It’s a dirty job but someone has to get out of their BMW’s, roll up the sleeves of their Armanis and just do it.

There is value in giving voice to those secret things our clients are entertaining, fearing, hoping but are afraid to talk openly about in polite company or even to themselves in private.  Nobody likes a nattering nabob of negativism, so very few of us want to volunteer to shine a flashlight into the dark closet of the marketplace, illuminate the scary shadows there and diminish the power of the bogeyman guarding the gates of the unknown.

Bringing things to the surface is good medicine. Like all good medicine sometimes it tastes bad. But real grown-ups know that if you want to get better you have to force yourself to swallow it.

So.what are we going to do with the 5,000 pound elephant that’s still standing over there in the corner? It is taking up a lot of room. I don’t think it’s going to leave any time soon. We have to keep feeding it something or it’s eventually going to swallow us.

Most of us know the story about the 3 blindfolded men asked to touch an elephant and describe their experience. Each touches the creature in a different place and comes away with a completely different conclusion about what they feel.

The message: reality depends on what your approach and perspective is and how your brain creates structure and logic out of the chaos of atoms that is swirling around out there as it comes in contact with your senses.

At the moment, we’ve got lots of blindfolded people moving around the real estate market. They are close to the elephant. They hear its breath. Sniff its proximity. And they are desperately reaching out to grab hold of something tangible. They are working hard to make up their minds about what the heck they really feel.

Depending on which part the market they happen to be in contact with there’s a veritable smorgasbord of conclusions they can come up with about it’s true nature.

Sellers have all kinds of realities going on. Some are frustrated about the lack of an offer. Others are confused because they didn’t get three or four offers the first week. Some are afraid the Bank-Owned listing down the street is going to undercut their value. Some are exhausted by too many days on market. Some are convinced that one special buyer will show up with a suitcase full of cash any day now. Some are noticing more “for sale” signs starting to pop up and getting worried.  Some think the market is in for a double dip.  Some think the market already hit bottom months ago and is on the way up.

Buyers are on the other side of the same elephant and just as scattered. Some feel like there is no need to hurry. Some think they better buy now before it is too late. Some are scared to death that if they buy today, their house will be worth less in six months. Some think all the bargains out there are a steal. Some lose hope every time the median price rises. Some don’t even know what the median price is.  Some can’t decide whether it is still a Buyer’s market or not. Some just want to own a home and don’t really care what the market is doing.

So fellow Realtors let’s gather around and huddle up. Is there anyone who hasn’t heard some variation of all of the above in the last few months.? Can it all be true? Can it all be false? Or is it all just indicative of the various realty tunnels we create?

Our job is to watch and listen and work with many different people who are touching the elephant in different places. In turn we can share the cumulative wisdom that comes from gathering all those different perspectives our clients have because in turn they are counting on us to help put the jigsaw pieces together – at least enough to  make a little sense out of the big picture.

Remove your blindfolds and embrace the elephant. Wrap your arms around it as wide as you can. We have all met the elephant. It is our clients and by extension, the elephant is us.

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ALL IT TAKE’S IS ONE BUYER….

Ok, so you are thinking about listing your house. If you are already listed and part of the growing ranks of the un-solds just pretend you are starting over. Like there was no yesterday. Because if you really want to , you can change your situation tomorrow.

This may sound like a dumb and dumber version of Real Estate for Dummies. I apologize in advance if I offend anyone’s sensibilities. But what I’m going to say applies to the vast majority of Sellers out there – whether they un-cup their hands from their ears and stop singing La La La La long enough to hear it or not.

There are two methodologies for pricing a home. One is market-based and the other is something akin to playing the lotto.

For months I’ve been badgering you with two mantras everyone should carry in their real estate repertoire. One more time? Ok. Here they are:  1) At the right price, everything sells. 2)  At the right price all objections disappear. Simple.

The market is a remarkably honest feedback mechanism. But the truth is, most people in a transitioning market (downward) don’t want to experience the pain of honesty. It doesn’t matter what they think their home is worth or what they feel they need to get for it. It doesn’t matter what their Agent thinks it is worth. A house is worth what the market will pay. Those of you still sitting without an offer in sight? You’ve got a definite objection that your price just isn’t disappearing.

I’m officially adding a third mantra to the list. Repeat it as many times as it takes to sink in.  “At the right price, there will be more than one buyer for your home.”

This is the premise of market-based pricing. It’s why so many people are running around collecting comps and trying to make sense of them. (Hard thing to do in eclectic SC County.) The value of any home stands in relationship to every other home. When buyers look – they look at more than one house. They compare what they can get for what it costs to get it. If you have something good for the right price, compared to what else is out there, buyers (plural) will want it.

If you are listing or selling your home and would rather toss market logic out the window then there’s always the lottery approach to fall back on.

The catchphrase that best captures the essence of lotto pricing is this: All it takes is one buyer. It’s also the most common rationale Sellers use when their houses aren’t selling. All it takes is one. You may be getting one lonely showing every couple of weeks but… all it takes is one. You may be going broke in the process but all it takes is one.

Pricing a home for that one right buyer that meshes so perfectly with it, they won’t care what it costs, is a pleasant thought. Imagine that one right person walking through the door, instantly smitten and ready to write an offer for any amount. And yes, they are eminently qualified to pay all cash, no contingencies, no appraisal worries. How soon do you want to close?

Possible? Sure, It’s possible. In the same way that we could meet tomorrow morning, buy lotto tickets at the mini-mart and win the big spin. The odds may be against us – but that doesn’t mean we won’t hit paydirt tomorrow. Or the next day.

Or perhaps twenty years from now, we’ll still be buying tickets convinced our odds are getting better as time goes by. We’ve spent thousands of dollars. We’ve invested all that time and hope. We can’t cut our losses and quit now. We have to win back all that money  we’ve spent trying to win.

All some of you Sellers need to do is continue those mortgage payments you’ve been paying on that empty house, while waiting for the perfect buyer to show up and you don’t have to meet me. You are already playing the lottery. As inventory increases, your odds of winning decrease. As days on the market increase – ditto. You aren’t getting closer. You are getting further away. And it’s costing you a bundle – financially, emotionally, psychically – trying to score that one fantasy buyer.

Keep it up long enough and you’ll chase the market down far enough, you’ll wish you’d given alot more thought to Gambler’s Anonymous sooner.

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When You Know That “This” is Really Happening

Selling your home?  Put your game face on. Get a firm grip. Gird your loins.  Make sure you are all buckled up and fully programmed on zen mode.  You might also want to rummage around in that junk pile you call a garage (there’s a secret hoarder stashed in all of us)  and see if you can find a makeshift crash helmet, in one of those old boxes of  football stuff or in that motley collection of pots and pans you’ve been saving for a rainy day –  just in case you need it.

If you are getting ready to sell, you are soon going to be venturing outside the private, gated universe of comfort and safety you’ve been living in, in blissful ignorance and relative isolation, for years.

You are about to take the plunge. A leap of faith that can resemble a header off the side of the abyss.  Sometimes it feels like the doors of both your home and your soul  are getting thrown open to the great unwashed masses of the marketplace – exposing you to a new strain of swine flu, genetically-altered to infect susceptible Sellers.

Most of the time we play with real estate like we are armchair quarterbacks in charge of our own Fantasy Football Team. Fantasy Real Estate is one of our favorite pastimes. We keep up with all the stats in the newspapers. We wander through open houses doing advanced scouting reports.  We download virtual tours of promising new talent from the websites.  And we love to peruse the glossy pictures in the magazines in search of potential draft choices for the future.

We imagine making all big time moves just like the pros do. Claiming that little desert condo  we’ve always wanted, on waivers. Getting a bank-owned beach bungalow for a song, because the mortgage exceeds the owner’s salary cap.   Making a blockbuster trade – like exchanging our  4,000 sq ft franchise home for a  mountain cabin,  10 acres of  pristine lakefront property and a duplex to be named later.

But sooner or later, all those life transitions we hear about and all those changes we know are coming, eventually do circle around to include us.  Suddenly it is our turn on the hot seat. Suddenly, real estate becomes a lot more real – when it is our  home and we are the Sellers.  It isn’t Fantasy Real Estate anymore. We have to buck up and shed the last vestiges of our Intention Deficit Disorder. We aren’t in a position to take six years to window shop and try on a million different scenarios for size or for a lark.

It’s always interesting to notice which things carry the most weight and trigger those crucial aha moments for Sellers as they journey down the road towards the realization that “this” is really happening.

Here’s my quick list of those edge points –  small quantum leaps along the way that both scare the hell  out of Sellers and help them come to terms with realty.

The first happens when the Realtor shows up and a few nosey neighbors recognize him getting out of the car. Suddenly there are a whole lot of questions and no real answers. It catches Sellers off guard. Throws them for a loop.

Then, after all the talk, the Seller just can’t put off signing the listing contract any longer. There is something about putting their John Hancock at the bottom of a formal document that makes them feel like they’ve just endorsed the antithesis of the Declaration of Independence.

A third  moment of truth comes when an Agent asks a Seller to de-clutter their house. Meaning: get rid of  stuff so that someone else can imagine their own stuff in its place.  It is strangely unnerving when someone tells someone else how to live in their own house for the first time.

Perhaps the defining moment for most Sellers is the day the sign goes up. There’s something so iconic about it that most of those last traces of denial that Sellers still hold in their hearts are vanquished.

And then of course, there’s injury to insult. Sellers often have inspections done before going on market. While it’s a great idea, it can sure feel disconcerting to pay a stranger to tell you everything that’s wrong with the home that has nurtured your life for many years. Ouch.

Selling your home. Love it. Hate it. Want it. But don’t want it.  Like I said, buckle up and get into zen mode – quickly.  Maybe it’s why Sellers are supposed to bury the statue of St Joseph upside down in their yards.  Sometimes it takes a while to get to the upside of the downside.

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