My wife Wendy and I got back from a Real Estate Educators Convention in Portland, Oregon. It was held in Portland because the title for the conference was "Going Green." Portland is reported to be the Greenest large city in the US of A. It truly has the most LEED Certified Buildings of any major city and the public transportation could be the envy of any metropolitan area. Most of the central city transport was street cars running on electricity and free. To go on longer trips to the suburbs it only costs about $4.50 both ways. All of that was pretty impressive until we learned the sun really did not come out till mid May and we never saw it for the week we were there until around 4:30 PM and some times from 6:30 AM until 7 AM. However, there were Solar Collectors on some of the roofs.
It is always interesting to get outside of one's area and find out what the rest of the country is doing. As for sustainability, the West is really into it. There was recycling everywhere, the produce in the local Farmers Market was almost all Organically Grown, and we went to a Winery that was almost completely solar. Nine months of the year (except for the Crush) they actually put electric power into the grid and the electric utility paid them for it.
The Midwest was wrestling with a multitude of empty houses. 15% of the homes unoccupied, 9% of the homes built since 2000 unoccupied, homes over $500K are just as likely to be vacant as homes under $100K. Michigan, Illinois, Ohio and Indiana were not expected to turn around till 2015 or beyond. Thankfully Arkansas, Texas, Tennessee and Oklahoma were predicted to come out of recession this year.
Another phenomenon that was explored was Social Networking. We learned that Twitter was like an on-going Cocktail Party with a lot of chit-chat similar to what would occur at a party. It was useful to some in keeping clients informed about the purchase and selling process, but only if they appreciated Tweets, more helpful, it seemed, in the big cities. Face Book seemed the most productive for Realtors, again mostly in the larger cities. But I do see some of my FBF (Face Book Friends) that are using the medium effectively in NWA. It depends quite a lot on the audience. I notice a good many fellow Realtors wanting to be friends, but don't hear much from them after the initial Hookup. A good Real Estate site is "Active Rain" with helpful information on the daily blogs. There was a mention of Plaxo and LinkedIn as a good way to connect with other professions and may be even to find jobs.
All total, to a country boy, it seems that once again things happen other places and finally get here, and certain thing work a whole lot better where there is a large concentration of people. In regard to "Hard Times," we are a whole lot better off than most
I have a lot of random thoughts and a Tweet only gives you 140 characters. Not being sure how many characters each of my random thoughts would use, I decided to distribute those thoughts on good old e-mail (with emphasis on old.)
The Government is sure borrowing a lot of money. Interest rates will surely rise. I remember the last time, when Carter was President. The fear is that some deserving folks will get left out.
Inflation is good for the Real Estate business but bad for the economy as a whole. Saving is good for the individual but bad for the economy as a whole. What an interesting time we live in!
Did you notice what HUD (government) has done about the $8,000 tax rebate? First it could be clamed with a re-filing of an individual's tax return. Then it could be clamed at the closing table. That second option lasted less than a day, as some wise person figured it would lead the housing market right down a path we had just left. Some banks were loaning the money in return for the assignment of the tax credit, but that mess up the borrower's ratios. Now some financial intuitions are making a kind of Bridge Loan to help "First timers" buy a house.
I noticed a superior court ruling in Alabama that declared the Broker Service Fee was a violation of RESPA, deciding it was an unearned fee. When that paragraph was first placed in our ARA forms, Andy Schaus warned Brokers to clearly define the specific service that the Broker Service Fee covered. It was not the paper work or the closing of the transaction.
Your closings may take longer than in past times. In order to assist the borrower in understanding the mortgage transaction and to prevent loan originators from pressuring appraisers about values, originators and appraisers have a fire wall between them now. A third party now selects the appraiser, and the buyers should get a copy of the appraisal to approve three to ten days before closing, depending on the lender's guidelines.
I know some loan originators that have a hard time understanding the appraisal forms. Will there be classes for home buyers on how to judge the validly of the collateral they are using for the mortgage? Add ten days to your projected closing time.
On a personnel note: I went to two CE classes this month. Yes, CE Instructors must do CE too. The first was sponsored by the Arkansas CRS Chapter. It was an excellent presentation on the anatomy of a Short Sale and dealing with REO (foreclosed) Property. We must thank those Realtors that tackle that tough part of the market. The faster those properties get out of the market, the quicker we will return to a semblance of order.
The second class was presented by Paul Bynum. It was the most carefully researched presentation on the causes of the Mortgage/Credit Crisis I have seen or read. He may present it again in this market area. It is worth a day's time. Get ready for information overload. I am still wondering what a Credit Default Swap was ever concocted to accomplish.
Speaking of CE, Tina Daniel and I will be presenting a six hour CE class the first Friday of every month at the Metro Board of Realtors and the first Tuesday, Wednesday and Thursday at our Lowell classroom on AR Hwy. 264 West, 3.6 miles west of the Lowell exit off I-540. We will be presenting weekend classes on the second and third weekends in July. Call me for start times. You may register at the door.
A couple of weeks ago, Wendy and I got to go to Cancun, Mexico; not to lie on the beach, but to give away Wheelchairs for Rotary and The Wheelchair Foundation. I was impressed by the extent to which the area had gone in order to reduce their energy use in the hotels and commercial buildings. Everywhere the lighting was fluorescent. In the hotel, all of the lights were compact fluorescents and the power turned off when you left the room.
It occurred to me that in that area of Mexico, they were far ahead of us in Arkansas in the "Green Revolution."
While we were gone, tax day and the "Tea Parties" happened as well as Earth Day. From the pictures I saw in the papers, the participants in the Tea Parties were a whole generation apart from the participants in Earth Day. It seemed the older generation (Boomers and Silents) were complaining because the Federal Government deficit was so high that it will be passed on to the next generation and beyond. The people involved in Earth Day were calling for Greener Earth, a reduction in greenhouse gasses and reducing the depletion of our natural recourses.
The newspapers also reported that eleven of eleven "Land Farmers" were polluting central Arkansas streams and the water table with the waste water and chemicals left over from drilling for gas in the Fayetteville Shale. What a contrast - the older generation worried about the national debt which is only money and the younger generation worried about the health of planet earth and its air, water, and recourses. I kind of think I am on the younger generation's team. I hope we in Arkansas can become Greener and continue the good life for our children and grandchildren. Air and water are critically important. We can always print more money.
Almost every one knows the Golden Rule. In a large part it is the basis for our Realtor Ethics and is quoted in the Preamble to the Code. The Platinum Rule challenges us to look beyond ourselves - not to treat others as we like, but as to their preference of treatment. The only way we will know how to treat them or communicate with them is to ask and observe. Many great observations come from the NAR "Profile of Buyers and Sellers" published each year. Knowing that the median age of first time home buyers in 2008 was 30 and the median age of repeat buyers was 41, should give a Realtor evidence that a newer, younger generation is becoming our Client/Customer. They perhaps do not desire to be treated nor communicated with the same way as the Boomer generation, of which most of us are a part.
Look at the wealth of information that can be gleaned from the Internet. Look at the length of time buyers spend looking before contacting a Realtor. (Nearly one year!) 94% of the buyers find the internet a "most helpful tool." Today's buyer did, most of the time, eventually purchase the home with the assistance of a Realtor. They did, however, narrow their search and almost 50% of the time find that Realtor looking on the Internet first.
Think hard about your presence on the World Wide Web: Is it all it could be? Do you have a whole bunch of pictures? Are they professionally done? Is your information correct, and how many sites does it appear on? Did you know there are web sites that are free and world wide in exposure in a language for a specific country?
In order to get with the buyers of now and in the future, we must communicate with them in the way that they want to communicate.
Some "Green Things" about the President's Economic stimulus Package: Lower interest rates if home owners to retrofit their homes, 5 Billion for weatherization of residential homes, 3 Billion for retro-fitting buildings in the private sector, 11 Billion for a "Smart Electrical Grid," 6.3 Billion for state-level grants for energy efficiency.
According to www.greenandsave.com the return on a residential programmable thermostat is 156.5%. That represents a return on investment in a little over six months. Installing an energy-efficient residential hot water heater can provide a 32% return; money back in an average of three years.
One of the bright spots in the job market is weatherizing homes.
New job description: According to Stefan Swanepoel in the book, "Trends Report 2009," the job description of today's real estate professional is being characterized as an interpreter of information and a process facilitator.
If you are a member of REBAC, you received a couple of great articles on "NEGOTIATING." When does negotiation begin in the transaction? You might be surprised at the answer. Alex Hagerty, ABR,ABRM,CRB,e-PRO,SRES points out the most overlooked negotiating opportunity is the Buyer Agent making the offer presentation to the seller. (MLS Policy Statement 7.73, Rights of Cooperating Brokers in Presentation of Offers)
If you are not yet an Accredited Buyer Agent you will have a chance to take the two day required course on March 19th and 20th in Lowell at the AIRE Campus on Hwy 264. Register now at www.AIRE.us . This also counts for your CE 2010 in Arkansas.
When I attended the NAR annual meeting in Florida in November of last year (which was to celebrate the 100th Anniversary of the Realtor organization,) one of the first speakers was an Economist that spoke about the fall and rise of the market (not pretty.) The next speaker talked about the public perception of our profession and that was not pretty either. When Realtors were ranked among other professionals we were very close to the bottom. Most of that perception was blamed on the bad real estate market. The Gallup Polling Organization has just released a study of 21 Top Professionals with regards to the public rating of Honesty and Ethics. The top four (in order) were Nurses, Pharmacists, High School Teachers, and Medical Doctors. All of these professionals were rated by two thirds of the public as having very high Honesty and Ethics and very little or no negativity. Nurses were rated Very High by 84% of the public (12% average) with Medical Doctors at 65% Very High (32% average and 3% low.) We as Realtors were ranked in the middle (not the bottom!) We were ranked along with (in order) Journalists, Bankers, and Building Contractors. According to the Gallup Poll we were rated by the public at 17% very high, 52% average, and 25% low to very low. Our ratings were considered "average" in Integrity and a neutrally rated profession for Honesty and Ethics. Although this poll is not pretty, it is sure not at the bottom along with Lobbyists, Telemarketers, Car Salesmen, Congressmen, Stockbrokers, Advertising Practitioners, Business Executives and Lawyers (listed from #21 to #14.) The poll has a sample error of 3% plus or minus.*
If you, like me, are not pleased with the public perception of your profession, there are things you can do about it. Keep in mind that over two-thirds of the home buyers today are born after 1965 (Gen"X"ers.) These buyers appreciate facts, honesty, and know a great deal about the real estate market by searching on the internet. This group expects the Realtor to help guide them through the process of buying or selling. They appreciate professionalism. The Realtors that excel have used education rather than the "School of Hard Knocks" to obtain a high level of professionalism. There will be many opportunities to get the required CE as well as work toward a recognized NAR designation.
The ABR Designation can be obtained in this calendar year and one half of the GRI designation can also be earned by taking courses in Northwest Arkansas. ABR required course March 19th at the AIRE Classroom on Hwy 264 W, 3.6 miles west of the Lowell Exit on I-540 GRI 201 "Environmental Issues" July 8th & 9th at the JBU Classroom in Rogers, south of the new Target GRI 302 "At Home with Diversity" August 3rd JBU GRI 301 "Ethics and Professionalism" September 3rd JBU GRI 202 "Unauthorized Practice of Law" Sept 29th JBU All Realtors need these educational designations because they are a Badge of the Profession and distinguish one licensee from another.
*Data taken from an article written by Lydia Saad about the Gallup Poll of Nov. 7-9.2008
Paul Bynum has put out some charts that represent the market last year. "Fun to Ponder" they will be better next year. If you would like that 2008 data or the advantages of an ABR Designation wright me at www.Chad@ChadKumpe.com
Our property inventory is still way too high. The market values have slipped another 5%. This is along with a 4% decline in the median price from '07 to '08; all total down from the high by a compound 9%. The total homes in inventory in the MLS are 5750 which is down by 20% from the 2007 high. We still have a 17.1 months supply of houses on the market. This data comes from Paul Bynum of Mount Data. You can check his analysis of the MLS at my web site www.ChadKumpe.com. Please do us all a service and recheck your listings to see if they are priced correctly for this market. We can collectively help this over-supply by removing listings that are over priced. Buyers are looking for bargains.
Donna Schoby of Ready, Set, Stage has pointed out another trend in our market place. Buyers are not looking for "Fixer Uppers" any more. A house has to be in "Move In" condition to be considered by a serious buyer. Look at your listings with a critical eye. If it needs a little paint, get it painted. If it needs carpet stretched, cleaned or replaced, get it done. This may mean the difference in a property shown or not even considered. If the seller cannot get the property into first class condition, consider giving up the listing.
Now that January is almost over, it is time to start planning for your education requirements for the year. The Rogers Board has four GRI Classes and one ABR Class scheduled:
ABR "E-Buyer," March 10th,
ABR "Required two day Course" follows on March 19th at the AIRE classroom in Lowell/Cave Springs Hwy. 264 E
GRI 201 "Environmental Issues" July 8th & 9th,
GRI 302 "At Home with Diversity" August 3rd,
GRI 301 "Ethics and Professionalism" Sept. 3rd, and
GRI 202 "Unauthorized Practice of Law" Sept. 29th.
It will be possible to complete most of the classes for the GRI designation and all of the Classroom work for the ABR designation in this calendar year.
I bet you got a whole lot of wishes for a much better 2009, I sure did too. Nothing tells the story of last year like the "Book of Lists" 8th addition by the "Northwest Arkansas Business Journal." The top twenty firms saw their volume shrink by 21.19%. The top twenty-five agents saw increases in their business in only seven cases. It is beginning to appear that we won't be back to normal till 2010, but things should start looking better by the second quarter of 2009. Don't look for a "Bail Out" for NWA. We are a whole lot better off than a great deal of the total US market.
We have too much inventory!! We could be like Chrysler and stop producing inventory till the market balances out, but we have very little control of production. There is something we can do to help the situation. Take a look at your listings, when the general market conditions drop from 2.5% to 17% (Arkansas Democrat Gazette 12/31/08) like it has in NWA. Many of the existing listings have become overpriced. Take a look at your listings; do a new CMA; if the seller will not or cannot come down on the asking price; drop that listing from the MLS. If a seller feels they cannot come down on their price due to owing more than the property is worth, have them contact their lender about a short sale right away, and take the property out of MLS until the conditions of the short sale can be worked out. If the property is truly worth what it is listed for, take it out of the MLS and let it rest until spring. Keep in mind, "A property that no one will buy is worth nothing." (Dr. Jeff Colllins, Street Smart.) We can be part of the solution to a market in balance.
I just finished the book "The World is Flat" by Thomas L. Friedman. It is well worth reading because the future is here. In it he suggests that in toady's marketplace you CQ (Curiosity Quotient) may be more valuable than your IQ. As we are all becoming more and more connected via technology, we must do things in new ways. Try new things, learn new things, and take new courses of learning in new ways. Get a new professional designation, proof of knowledge causes trust. The Real Estate Profession needs a whole lot of help in that area of trust.
If you have not tried it, get on "Face Book." Try the social network www.Plaxo.com, and start a blog on www.Activerain.com. It is a new way to farm, and it takes time, but it's a lot easier than "knocking on doors."
The Realtors interested in education here in NWA are planning a good schedule of courses for next year - take advantage. Superior education courses are the key to superior results in a Real Estate Career. Our job, in addition to being marketers, is to be Educators.
For current market conditions in NWA click on the web site www.ChadKumpe.com.
You know, when you buy a new car, all of a sudden you see a lot of them on the road. There has been just as many as before, but now because you have one, you began to notice others.
In early November I took the new National Association of Realtors "Green Course." It was two days from 8:30 AM till 5:00 PM both days with an 80 question test at the end of the second day. (Passing was 80%) The course started slow for me as I already recycled and used those funny florescent lights and turned down the HV/AC during the day when no one was home. But I soon discovered "Green" was a whole lot more than that. I had never heard of "Green Washing" I soon discovered it is a lot like "White Washing." It seems there is a lot of that going on in our industry.
Now when I look around I see some things that I really did not notice before. The Clinton Foundation has teamed with our state to retrofit state buildings and adopt energy-efficient practices. (The Morning News 12-14-08) The former President form Arkansas said "This is the countries greatest opportunity to rejuvenate the economy and create a safer, cleaner world." It starts here in Arkansas.
I read in the same paper (12-15-08) a group of statistics showing the increase in world temperature by 0.44 degrees from Ronald Reagan's term in office to George W. Bush's. Sea ice has dropped by one million square miles and CO2 emissions have increased by 3.63 billion tons in the same time. Yes, global warming is hard to ignore.
We are Realtors are stewards of the land. Just look to the Preamble to our Code of Ethics. I have always though of this challenge to be more local or no further than national in scope, but as our saying goes "there not making any more of it." What happens when it is all gone?
Soon you will have an opportunity to take a "Green Elective" course on Residential Housing. There will be other electives on Commercial and Property Management that may be taken on line just click on www.realtor.org .
It is our opportunity as Realtors to lead the way in this rescue of our planet, our Dirt. Here are a couple of web sites that may be of interest to you: To calculate your own Carbon Footprint www.earthlab.com and for those who missed it here is a great short video "The Story of Stuff" www.storyofstuff.com.
The Real estate profession has taken a terrible beating in the public eye; here is a way to start our redemption. THINK GREEN!
Our friends at DesignWorks have created a website that has the most complete and up-to-date events and happenings in Northwest Arkansas. This could be a good addition to your relocation packages as sending sites like this to your out of state prospective clients gives them more reason to move here. Go to www.NWAEventsOnline.com and browse the site. Be sure to sign up for their weekly events newsletter too!
I was in Hot Springs yesterday. The front page story on the "Sentinel Record" was about a large home under construction. There were no utilities connected to the house but it burned. I think this is another effect of the foreclosure problem. This may yet effect the builders or owners credit rating.
It is a beautiful day in the Ozarks. I will be out on Beaver Lake this afternoon.
A view of Real Estate Activity in NWA. Comments on market trends. Up dates on Real Estate Law & regulations. Some times Rumor and Gossip. Alerts on Legislation effecting Real Estate.
Disclaimer: ActiveRain Corp. does not necessarily endorse the real estate agents, loan officers and brokers listed on this site. These real estate profiles, blogs and blog entries are provided here as a courtesy to our visitors to help them make an informed decision when buying or selling a house. ActiveRain Corp. takes no responsibility for the content in these profiles, that are written by the members of this community.
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