Jonathan's Phoenix Arizona Real Estate Blog

Busting the Dual Agency Myth

Jonathan Dalton (Thompson's Realty) — Tue, 08 May 2012 15:08:07 -0700

This morning brought the NAR-required quadrennial review of the Code of Ethics, a multi-page, multi-article creation that, at the end of the day, says we’re supposed to do right by our clients and play nicely with others.

This particular COE class was intertwined with a course on agency – the concept of real estate licensees and their relationship with the public at large, customers to a degree, and clients in general. And, inevitably, there was a shudder in the room when the concept of limited dual representation – wrongly labelled as dual agency – was raised.

In Arizona, all real estate representation begins at the broker level. Though you may think you’re listing your home for sale with me, in reality you’re listing your home with Thompson’s Realty and as such, all of the brokerage’s 30-odd agents are working on your behalf and honor bound to work in your best interest. And if you’re working with me to purchase a home again, in reality, you’re working with Thompson’s Realty and all of the brokerage’s agents are bound to work in your best interest.

Enter dual representation, which potentially can happen any time a buyer working with a Thompson’s Realty agent is looking at a property also listed for sale by Thompson’s Realty. That there may be two agents involved, one working with each side, is immaterial.

First off, dual representation cannot take place without both disclosure and informed consent on the part of both parties. So, as a buyer, if you’re not interested in any such situation, just tell me and we won’t look at any Thompson’s listings and, as a seller, tell me and we’ll keep our buyers away.

That’s fairly easy to do when you have 30-odd agents. I imagine that’s got to be more than a little bit of a nightmare for the brokerage in town that happens to have more than 2,000 agents following a merger a few years back, or even another brokerage that recently merged with the late John Hall & Associates. Because, you know, it’s not like there was a John Hall agent whose television ads run every morning and it’s not like he’s got a ton of listings.

Where was I … oh yes.

With limited dual representation, essentially all of the fiduciary duties an agent normally has to his or her client – confidentiality, obedience, accounting, loyalty, etc. – go out the window because it’s impossible to completely fulfill those fiduciary duties to both buyer and seller simultaneously. Which is perfectly fine, as long as both buyer and seller provide their informed consent.

Again, it bears repeating, this situation arises any time the buyer and seller are being represented by the same brokerage, even if its by two different agents.

I emphasize because there’s a substantial percentage of agents who abhor limited dual representation. My own then-broker and now-owner, while not prohibiting the practice by his agents, frowns upon such things because of the inherent conflict of interest involved.

It’s not at all uncommon to see agents claim to never “practice dual agency” or otherwise have to contend with limited dual representation because they only represent sellers and send all sign calls to other agents, or because they only represent buyers and send all potential listings to other agents.

Except … if those sign calls or potential listings are going to other agents within the same brokerage, in essence the agent has done nothing whatsoever to prevent a limited dual representation situation. It’s all little more than a pantomime, a sleight of hand designed to distract unknowing buyers and sellers from the reality of the situation – that limited dual representation can and does occur every day. Whether it’s single-agent or dual-agent limited representation is little more than semantics, as the rules are exactly the same in either case.

How can you possibly do this, you might ask. Isn’t it your job to get the highest dollar for your sellers?

In a word, not really. My job as a listing agent is both to get the house sold and to represent my sellers’ best interest. If two offers come in – a financed offer contingent upon an appraisal and the buyers’ ability to get the loan, and a cash offer for $5,000 less with no contingencies to speak of – acceptance of which offer is in my sellers’ best interest? (If unclear on the answer, please return to Whataburger for a crash course on the shake machine.)

Representing a buyer or seller is about more than just the dollars and cents. At the end of the day, it’s about getting the house sold for the seller and getting a house bought for the buyer in whatever manner is necessary to represent their best interests and (ideally) realize their real estate goals. In my experience, the only people who dispute those are those who see real estate as a zero-sum game – one side must win, one side must lose.

Horsecaca.

If there’s anything I wish to accomplish here, folks, it’s to help you see more clearly how real estate really operates once you peel away the pabulum and rote answers so many agents who never have considered what it is they do and how always seem to provide … we syndicate listings because all listings need to be uploaded wherever possible (which, technically, includes about 1.2 billion known websites), an agent can’t adequately represent a buyer and seller simultaneously, we’ve got to have that Open House because darn it, how else will potential buyers ever know you’re home is for sale …

If you personally aren’t okay with the concept of an agent representing both you and the other buyer, no worries. Might I suggest you not call listing agents and make sure whomever you’re working with is comfortable getting you referred to another brokerage if needed, just to play it safe.

I’ve got no issue with that. Where I do have issue is in agents who separate single-agent and dual-agent limited representation as if they’re two very different things when, in reality, the only difference is a handful of letters.

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Want to read more that Jonathan and Tobey have to say about Phoenix real estate and the industry in general? Check out his outside All Phoenix Real Estate.com blog or his Facebook Fan Page!

Listing on Zillow and the Art of Poor Marketing

Jonathan Dalton (Thompson's Realty) — Sat, 05 May 2012 12:51:14 -0700

One of themes that arose in discussions yesterday on Facebook was the ease with which data can be changed on Zillow to make the Zestimate more accurate.

Setting aside the sense that this is a form of blackmail – either tell us everything you can about your property or we’ll estimate it’s value incorrectly and hamper your ability to sell at market value – adjusting your listing doesn’t change the larger picture.

If you look above the “s” in Escuda, you’ll see a home carrying a $200,000 Zestimate; the new owners likely will be very happy about this, seeing as they just purchased the home a week ago for $195,000.

They’ll also be a damned sight happier than the seller would have been had I placed the listing on Zillow; until the closing, the Zestimate was in the low $180s. At no point did the value based on the comps change – Zillow was wrong.

Now turn your attention to the red dot at the top right corner of the screen. That home’s currently for sale and, while I’m not displaying it here out of respect to a listing agent who likely doesn’t know what’s being displayed, the Zestimate is about 10 percent or so below the list price.

Question 1 … since Zillow displays the list price instead of a Zestimate when a house is on the market, how would it look to potential buyers if someone posted a listing for $105,000 – next door? Before you give the knee-jerk answer – that buyers would research further – keep in mind most consumers believe the number they see and, even if they research further, still are going to have that value in the back of their heads?

Question 2 … using the current Zestimates (which, incidentally, are wrong for the entire block as they don’t take into account the presence of Beardsley Road behind the homes), what would be the reaction of a buyer staring at a $240k price tag when there are only two other homes in sight that begin with a 2?

Question 3 … if you’re the seller, wouldn’t you be more than a little concerned that on your listing at $240,000, potential buyers are being told the home is worth only 90 percent of that figure? Is that listing really working to your benefit whatsoever?

Taking the last question first, it’s conceivable that seller and/or listing agent can adjust the information Zillow has on the house to make the Zestimate match the list price.

But …

That does nothing whatsoever about the potential problems with Question 1 nor with the absolute problems with Question 2. Buyers aren’t going to see only the one home when they search on Zillow, they’re going to see Zestimates for everything around the house.

And as much as Zillow equivocates by saying the public understands the Zestimates only are starting places (plausible deniability, that) and as much as agents say that consumers will continue researching and/or listen to their agent, eight years of experience says that once a buyer sees what they perceive to be a too-high price, the game’s over.

Anyone who attempted to explain to a buyer that a short sale listed at 75 percent of market value was not the baseline by which all other homes should be valued should already know this lesson, though some seem to have forgotten.

And let’s go one step further …

Using an incredibly basic search – detached homes for sale by an agent – Zillow shows 166 homes for sale in ZIP code 85382. Unfortunately, as of the moment, there only are 80 homes truly for sale as listed in the Arizona Regional MLS.

Buyers using Zillow don’t know this and, believing there is twice as much supply as there really is, they may not have the same sense of urgency that they might have if they knew what the real supply was. Does any one home stand out more when it’s 1 of 166 than when it’s 1 out of 80?

The standard argument is we need to post our listings to Zillow and Trulia because that’s where consumers go to see what’s available. But that’s an untrue assumption. If consumers really wanted to see what was available, they wouldn’t go to a site where the data is so thoroughly in error; once a buyer calls on a couple of homes, the truth becomes apparent.

Could you imagine going to Amazon.Com only to discover 4 out of every 5 items you see, when you went to purchase them, really weren’t for sale? Would you ever return?

Buyers may start with Zillow or Trulia but eventually find their ways to where the homes really are, either by going to an agent or broker site powered by IDX or picking up the phone and making contact with an agent.

Searching through homes not for sale is an excellent way never to purchase a home. And call me crazy, but it strikes me that it’s in my sellers’ best interest to focus on buyers who are ready, willing and able to purchase.

Using ZTR can make one question the “willing” part of the equation as, again based on experience, the anxiety of calling a real estate agent disappears in most cases when someone’s really ready to buy.

To a degree, I feel like I’m repeating the same arguments but they bear repeating, if only to attempt to disabuse the real estate agent masses of the knee-jerk responses that come when Zillow, Trulia or Realtor.Com are discussed.

ARG Realty in San Diego is proving what other companies already have found – one doesn’t need to syndicate either to be successful or to sell a home. Deep down, most agents know this – we know what causes a home to sell.

The question is whether we have the courage to stand by what we know.

Be the Real Estate Professional

Jonathan Dalton (Thompson's Realty) — Wed, 02 May 2012 09:00:39 -0700

There was a telling moment on Mad Men two weeks ago, the kind of dialogue that should strike anyone who is in the real estate business (or any sales business, for that matter) ...

"Stop writing down what I want," said the client, "and tell me what I need."

We are the ones hired for our expertise yet on so many issues, particularly when trying to win a listing from a seller, we turn away from what we know and agree to what the client wants even if it's not productive.

As the listing syndication debate marches on, I've oft heard it said that sellers expect their listings to appear on sites such as Zillow, Trulia and Realtor.Com. Never mind how their listings appear, never mind that sending our listings to these sites only helps legitamize them while doing nothing for our sellers; "our sellers" expect it so that's what we have to do.

Shame on us.

Take a look at the below screen shot of listings on Zillow in Westbrook Village, a retirement community in Peoria, and tell me whether the sellers are going to be happy with how their home is positioned:

These listing agents aren't bad agents; they've simply never taken the time to see how their homes really look once they're uploaded to Zillow. And that's extremely unfortunate.

We as professionals know third-party sites such as Zillow, Trulia and Realtor.Com are nothing more than parasitic sales machines designed solely to sell advertising to us, using our own listings as bait.

Perhaps it's time to have the slightly more difficult conversation with our sellers, let them see for themselves the disadvantages of blind syndication, and in the process educate the public one person at a time.

Righting the Realtor.Com Mistake

Jonathan Dalton (Thompson's Realty) — Tue, 01 May 2012 15:11:30 -0700

Thomas Jefferson once said every generation needed a revolution. Real Estate 1.5 - the taking back of the online real estate space from the aggregators and advertisers can be, should be ours. Do you have the courage to join in? It's as easy as commenting, re-blogging, Tweeting (#pulltheplug) and letting those in charge know how the rank and file feel.

Using the REALTOR® Trademark
Revised: July 1, 2003 ~ Reviewed: May 2011

The term REALTOR® is a federally registered collective membership mark owned exclusively by the National Association of REALTORS® (“NAR”). The REALTOR® membership mark serves the singular function of identifying and distinguishing members of NAR. The mark is licensed for exclusive use by members as a means of indicating their membership status. Members are licensed to use the term REALTOR® only in forms that are likely to highlight the registered status, significance and special meaning of those MARKS in the eyes of the public and distinguish them from words of ordinary use and other marks or symbols.

Except, of course, when it comes to Realtor.Com, a one-time Realtor/MLS driven website that now is the property of Move Inc. Not that the public knows this. But anyone who has received the call to upgrade their listings through the showcase package know quite well about both Move Inc. and the extravagant fees charges to highlight listings on the site.

In railing against Zillow and Trulia these past months, I’ve largely left Realtor.com out of the equation out of respect to the trademark. But if NAR doesn’t have enough respect for the trademark to allow it to be used by Move on the site, there doesn’t seem to be any reason for me to hold back.

For while Realtor.com does have the most accurate listings of the three, pulling listings directly from the local multiple listing systems (with some exceptions), the site’s entire reason for being is to extract money from real estate agents. And the sums being asked for are far from insignificant.

And so the question to be asked is, what would happen if an MLS membership decided to direct its MLS to stop sending listings directly to Realtor.Com? It’s happened before, up in the Pacific Northwest, and the market there seems to have kept on moving just fine.

Wrote Marlow Harris at the time:

Apparently, there was some dissent from a minority of the Board, but the majority felt that it was an inappropriate use of copyrighted data.

Speaking to my friends at the Arizona Association of REALTORS and Arizona Regional MLS …

Removing local listings from Realtor.com en masse would not disadvantage any sellers because all would be in the same boat. It would not disadvantage any buyers because there literally are dozens and dozens of sites with IDX-powered home searches that are more accurate than anything on Realtor.com or elsewhere.

What it would do, however, is deprive a parasitical website the opportunity to glut itself on marketing cash while using the listings of the fourth largest regional MLS in the nation.

We have the leverage if only we have the courage to utilize it without cowing to the ill-informed arguments of protectionism and consumer choice that, once you dig past the surface, tend to have zero real substance.

And to my friends elsewhere, should you agree, plant the seeds with your local MLS. Every revolution begins with a whispered thought.

Lest I forget …

Realtor.com is not the extent of the trouble with Move Inc. You see, Move also owns Listhub and through Listhub home listings are being syndicated to multiple other sites including Zillow and Trulia. So not only is Move profiting from agent advertising, they also are syndicating our listings to other sites which then also profit from agent advertising.

There may not be honor among thieves, but there are some profitable business relationships.

At the end of the day, listings appearing on these sites is of dubious benefit to sellers and of serious detriment to buyers believing the data to be accurate. What better way to help the consumers and ourselves than to rid out industry of the parasites.

Illustration courtesy of the illustrious Russell Shaw

Facebook Groups: So Much Easier Than Working

Jonathan Dalton (Thompson's Realty) — Sat, 14 Apr 2012 18:11:35 -0700

To be honest, I'm writing this as a reminder to myself as much as anything else as I've found myself sucked down into the rabbit hole more than once this past month or so.

Listen to nearly any real estate trainer and he/she will tell you the value of connecting with your sphere, of connecting with the public in general. Elevator speeches, mayor's campaign speeches, you name it - all have the same goal of getting you out and talking to someone.

Facebook is a great way of connecting with your sphere in a quick and easy manner, especially if the people of your sphere are likewise plugged in.

Facebook also is a great way of spending far too much time talking/yelling/commiserating/whining/debating other real estate agents, time that could be spent doing just about anything else on earth. For instance, in the time it takes to write about how we've got to "raise the bar" because some agent didn't return our call, we could be lighting $50 bills on fire to represent the commissions we're not earning while we're whining about said agent.

Put another way, the best thing a real estate agent can do these days is shut up and sell. Leave the big thoughts to the thought leaders who don't rely on real estate sales to put food on their tables, shoes on their kids' feet.

Take it from someone who was starting blog wars before the term was invented and, who after more than 2,500 posts spread hither and yon the past six years, knows something of which he speaks.

Get away from as many Facebook Groups as you can, stop wasting your days talking to other agents, and go back to remembering the basics of prospecting.

It's really just that simple.

Another Brick in the Wall

Jonathan Dalton (Thompson's Realty) — Wed, 11 Apr 2012 14:50:04 -0700

At the risk of mixing musical metaphors, we have another sponsor the Reel Big Fish real estate concert as Duane Fouts, formerly of Dan Schwartz realty in Phoenix, joins Zillow as a director of "partner relations."

And by partner, fellow agents, Zillow means us. Even if the company doesn't bring any particular unique value to its side of the partnership outside of fantastical Zestimates and listings inaccuracies that serve as conversation starters when those of us who really sell homes talk to real buyers and sellers.

From the Zillow blog ...

I asked Duane to comment about his new relationship with Zillow:

I am truly excited to be joining the Zillow Partner Relations team. I look forward to working with brokers and industry leaders around the country in an effort to build strong, mutually beneficial relationships. Being able to share the new products and programs that Zillow has in development with brokers, agents, associations and MLSs, is exciting to me. I believe that in the end, if those products and programs make the job of the brokers and agents, who are serving the consumer, a little more efficient and a little easier… it is a win-win for brokers, agents and consumers.”

Except that it's not.

If Zillow really had the slightest interest in the real estate consumer, it would have figured out a way after all of these years to get its Zestimates somewhere close to estimate as opposed to a margin of error of roughly pi to the 23rd. And if Zillow really cared about the consumer, there would be tighter controls over the listings that are displayed on the site so that it wasn't so easy to find alread-sold homes as listed for sale. (Or, for that matter, to see previous marketing descriptions appear on new listings of the same house.)

Of course, if agents had a brain they wouldn't send their listings to Zillow in the first place under the little-known and rarely mentioned concept of "who exactly are you and who authorized you to be here?"

All Zillow really cares about, the extent of its interest in this "partnership", is its ability to separate real estate agents from their advertising dollars. It's much like the relationship between a client and the workers at the Mustang Ranch. One gets the cash, the other presumably gets what it wants and both probably ought to think about a long shower and some penicillin when it's over.

Pay the Borg to become a Premier member and you, too, can appear on a sidebar as a "neighborhood expert." It's the same pitch that was and has been made by Homes.Com, Realtor.Com and countless others. And it's Zillow's sole raison d'etre.

Not that I blame Duane, or former Arizona Regional MLS CEO and now blog-post writer Bob Bemis, or even my own soon-to-be-former-broker-and-only-half-owner, for taking the cash that Zillow's offering in exchange for his soul. All of us have a price and, as the old joke goes, now that we've established what you are we're only haggling about the money.

All I can hope is that my real estate brethren see the light and keep their credit cards in their pocket. If Zillow is to survive in a world without venture capital and keep money-whipping one-time leaders in the industry, the least the rest of us can do is make them develop a legitimate value proposition that doesn't center around taking the cash from short-sighted agents.

Always remember ... Zillow's not creating any more eyes for the online real estate space, it's simply diverting those eyes from other sites onto its own. It is and always shall be a remora.

Why I Don't Fear an Increase in Phoenix Real Estate Inventory

Jonathan Dalton (Thompson's Realty) — Fri, 06 Apr 2012 10:06:14 -0700

Jeff Brown, aka the Bawld Guy – one hell of a real estate investment guru, by the way – have been having a debate about the true state of the Phoenix real estate market.

We don’t always reach quite the same conclusion because we find ourselves each looking primarily at one side of the supply-demand equation. He maintains there is pent-up supply waiting to be unleashed upon the market; I don’t fear that supply because I see the demand that exists.

Our latest debate came yesterday over this article on ZeroCrunch that says there are another 9 million homes waiting to hit the market nationally.

Try as I might to get excited about that notion, assuming that someone using a movie character that existed as the figment of the imagination of a deranged mine and who can’t spell the word deferred has credibility, I just can’t seem to do it. I feel much like an Oklahoma or Texas farmer might have felt back in the mid-1930s when they were told there were thunderstorms on the horizon – by all means, bring on the rain.

There are 8,740 single-family detached homes for sale in Maricopa County, an area the size of New Jersey. (If you’re in the mood for fiction, Zillow shows 16,773 and Trulia shows 16,915 – more on this in a bit). In the past week, 7,870 such homes went under contract. Of those, just over 1,300 were on the market for 16 days are fewer (choosing 16 because on many bank-owned homes, investors are shut out until day 16.)

If you’re not on the ground, you may never realize just how parched this listings landscape is. You likely won’t see the dozen or more offers that are submitted on virtually all new listings that reach the market, and how the lack of new inventory is helping to clear the existing inventory as buyers seek anything they can get their hands on – within reason, of course. If a seller has their home priced well above market, they’re managing to find a way not to sell in a strong sellers’ market.

In the first three months of this year, 16,426 detached homes sold in Maricopa County according to the Arizona Regional MLS. Last year, the first quarter of what turned out to be a near-record year, 16,707 homes sold in the first quarter.

The demand for homes exists and, I believe it’s safe to argue, sales would be higher if inventory levels were closer to the 15,000 – 16,000 detached homes we saw a year ago than the 8,700 homes we have now. Which is why I say now, and have said to all who will listen, feel free to drop 8,000 to 9,000 homes on the market tomorrow. Like the first raindrops hitting the Panhandles, they’ll evaporate quickly.

Back to my favorite whipping boys, Trulia and Zillow … one place where they do have a bit of value is in displaying foreclosure properties according to RealtyTrac, homes where the Notice of Default have been sent by the bank and the foreclosure process is underway.

According to Trulia, there are just over 25,000 homes sitting in purgatory … will all of these hit the market? In theory, eventually. In reality, some will disappear if they are sold as a short sale. Others will not hit the market if they’re purchased at the actual trustee’s sale. And even if all do hit, they all aren’t going to hit at the same moment in time. Just a basic reality.

Again … the market can handle another eight to 10,000 homes tomorrow with little more than a hiccup. And that’s why, as the call for the second wave of foreclosures is sounded now as it has been since 2008 without an actual sighting taking place, I say there is little to fear.

Photo credit: NOAA George E. Marsh Album

If You Believe in The Real Estate Industry, Fight For It

Jonathan Dalton (Thompson's Realty) — Fri, 16 Mar 2012 08:54:43 -0700

Without rehashing in depth yesterday's news that Zillow hired Jay Thompson, the company's second significant hire in the last couple of weeks, there was a theme that appeared in the comment streams that should be of concern to anyone who sells real estate.

Paraphrasing, it is the idea if anyone can build a bridge between Zillow and the real estate community, it's Jay.

The problem is, we as the real estate industry shouldn't be seeking to build a bridge with third-party sites such as Zillow or Trulia (and you also can argue Realtor.Com.) We should be viewing them as the interlopers they are, have been and always will be.

Appeasement historically doesn't work and shouldn't be considered an option now.

Before reflexively saying that Zillow is part of the real estate space ask yourself this:

What is it Zillow brings to the table? What is Zillow's unique value proposition to real estate consumers?

In a word, Zestimates. Estimations of value which, for years, have been debunked by agents across the nation.

That's it.

The listings are ours. The advertising dollars Zillow collects are ours. We are feeding the machine that seeks to rewrite the real estate industry in its own image, a machine that fundamentally has no understanding of what the real estate business really is about.

The automatic argument is we're disadvantaging our sellers if we don't put their listings in as many places as possible; we've taken a line from our own listing presentations and turned it into accepted dogma.

Amazingly, homes sold before Zillow existed. They were advertised online successfully before Trulia was there.

We're willing victims of adverse possession (and, now that I remembered the term, who said real estate pre-licensing classes weren't useful.) We've allowed these companies to move into the real estate space and act as if they've always been there, as if they're essential.

Enough. Draw the line in the sand. Fight back.

It's not a question of protectionism. It's a question of protecting the public from shoddy data, poor online information on sponsored forums and companies who claim to care about the consumer when their only concern is the number of page views a real estate buyer or seller represents.

If you care about this industry, fight for it.

We've already surrendered miles of territory willingly. How much more are we willing to accept?

Solutions in Need of Problems and Big Real Estate Thoughts

Jonathan Dalton (Thompson's Realty) — Sun, 26 Feb 2012 08:11:24 -0800

Those in other markets may be familiar with a little outfit called Redfin. Okay, so it's not really a little outfit - when you suck down millions in venture capital to get rolling, you'd best not be all that little.

In keeping with this year's election-centric focus, Redfin is to real estate what third-party presidential challenges have been to politics: a new concept eventually ground into the pavement by the realities of the existing system. Or, put another way, a solution that was in need of a problem.

Once upon a time in the Northwest, Redfin put together a snappy real estate search portal and offered rebates to buyers who used a Redfin agent to purchase. The catch? Buyers would have do to pretty much all the legwork themselves - Redfin agents didn't search properties, didn't show properties and in fact wanted their "clients" to call the listing agent to arrange access to the homes (causing some minor procuring cause issues along the way.)

Then came the property tours, where Redfin would deign to show homes for a set time period before turning on the meter and having buyers pay for the privilege of looking at the inside of a home with "their agent."

Eventually, Redfin's brokerage model became much like many other brokerages with the lone exception being that their agents were paid a salary versus commission. It could be considered a significant difference - I worked for Charles Schwab, where we made the same argument. Of course in stock brokerage, the other choice was to have brokers cold calling to push stocks and transactions needed or not. In real estate, it's safe to believe someone calling about a house might really want to purchase a house - a small difference, no?

Redfin came to the Valley a couple of years back, first referring clients to a handful of worthy agents and then hiring a couple of agents themselves; their impact here, as predicted in this space since 2006, has been nil. Once in a while, I turn out to be right.

Anyway, now that I've wasted 300 words or so, let's fast forward to Redfin's latest "innovation" - having a single real estate agent work with a client rather than the prior service model where the client worked with whoever happened to be available at the time.

No less a real estate thought leader than Rob Hahn found this change incredibly brilliant:

The change from Redfin 2.0 to Redfin 3.0 raises the possibility that there is something about the homebuying and home selling process that is so uniquely psychological, so uniquely human, that a relationship with anyone or anything other than another individual human being is impossible. The implication is that no brokerage company, no real estate brand, can actually control the customer relationship because real estate is so emotional, so diverse, so unique as to require a single human point of contact/control.

That assumption has consequences. Real consequences, that are directly related to many of the hot topic issues of the day in the industry.

Since this got long, I’ll tackle the consequences in the next post.

But what say you? Am I overthinking this? Or am I onto something important here?

People want to work with people and not monoliths?

Of course it's important. It's as important - and as brutally obvious - as the sun rising in the east this morning. It's something anyone who has spent more than two weeks in the real estate business, and who hasn't sold their soul to lenders for an REO contract, always has known. People want to work with people.

Yes, Rob ... you're overthinking this. And you're still missing a major point ...

The change from Redfin 2.0 to Redfin 3.0 raises the possibility that there is something about the homebuying and home selling process that is so uniquely psychological, so uniquely human, that a relationship with anyone or anything other than another individual human being is impossible.

That's entirely incorrect, in as much as the desire for human relation isn't limited to real estate.

About a month ago I was livid about some things that had happened at BBVA Compass, where I kept getting the runaround from the customer service people in their cloistered call center. Then a funny thing happened - I walked into the branch, they took the time to find out who I was and look for solutions to my problem. I'm far from a macher but I'm treated like one when I walk in the door now.

The title company I recommend, aside from being wildly competent and service-focused, knows who I am and knows how to handle my clients without me saying. And that's why when I sold five homes in seven days last week, nearly every one of those escrows went to Lawyers Title.

At Stir Fry Paradise, there's a drink waiting for me when I walk in because the owner sees my car in the parking lot. At Sakana, the sushi chefs know my order by heart. At Brakes Plus, the manager knows how much business I've done there and treats me accordingly. Got a problem with an Old Republic home warranty? I've got an eight-year business relationship with the account rep and I can pull some strings.

Business ... no ... life revolves around the type of relationships that, apparently, both Rob and Redfin have discovered. It's not revolutionary. It's been there the entire time for anyone who wants to take the time to look at it. The problem is, if you're trying to be revolutionary or if you're not part of the industry on which you comment, you may not ever have noticed what was obvious to everybody else from the get-go.

Real estate remains a business where more good can come from a 25-cent hand-written personal note as from the most slick website known to man. Sure, you can search the MLS on this site via an IDX feed - just as you can on two dozen other sites (or more) in the Valley. But you know what? This is the only site where you get me, for better or worse.

My style isn't entirely like other agents; whether that is good or bad depends on the particular customer. One of my clients waves rhapsodic about the agent who showed them 25 homes in a day and it was the last home that turned out to be the right one. I tend to think I could have gotten to the same place in a half-dozen homes or less because more homes doesn't necessarily translate to better work effort but, hey, that's just me.

Something must be working. Past clients continue to refer me to friends and family rather than turn them loose on the mewling hoards of agents here in the Valley. Somewhere, the interpersonal relationship we formed gained value.

It's good to see Redfin finally has figured that out. Venture capital apparently can't buy you common sense.

Photo credit: Sean MacEntee via Flickr Creative Commons

Differentiating IDX and 3rd Party Listing Syndication

Jonathan Dalton (Thompson's Realty) — Wed, 01 Feb 2012 17:43:41 -0800

I’m going to carry the current internecine real estate debate about the syndication of listings to third-party sites such as Zillow and Trulia home to your door step. If you ever have used one of these sites to search for homes, or if you know anyone who ever has done so, you absolutely must make sure you read this.

That there are data errors throughout sites such as Zillow is evident – when there are two to three times as many homes listed for sale by agent as are showing for sale in the MLS, there’s a problem. But sometimes it’s hard to get a handle on the issue from 35,000 feet, as it were. So let’s drill down to one subdivision in the Phoenix area and see what we find.

Sonoran Mountain Ranch is a 1,476-home neighborhood located in northeastern Peoria, straight up 67th Avenue from the heart of Glendale itself. Like many subdivisions conceived and created in the early 2000s, values have taken a considerable hit there from the high point of 2005. And, like most of the rest of the Valley, there’s fairly little inventory available right now.

According to the Arizona Regional MLS, there are 26 homes for sale in Sonoran Mountain Ranch.

According to my own website’s listing feed for Sonoran Mountain Ranch via IDX (Internet Data eXchange), there are 27 – the discrepancy is the IDX hasn’t synced to ARMLS yet to see the one listing that was switched to “Temporarily Off Market” about four hours ago.

According to Zillow, filtering only by subdivision name and searching For Sale by Agent,there are 20 homes for sale in Sonoran Mountain Ranch.

Except …

6838 W Nadine, the first home listed, already is under contract.

So is 29576 N 68th.

30034 N 71st isn’t under contract; escrow closed on this property June 30, 2011 – seven months ago.

In fact, not a single one of the first 10 homes listed on Zillow’s search for Sonoran Mountain Ranch are active listings in the Arizona Regional MLS.

Not. A. Single. One.

Of the 20 homes Zillow lists for sale in Sonoran Mountain Ranch, exactly four – FOUR – of the 20 are active listings at this point in time.

I could tell you which four but that would defeat the point, because …

3rd Party Syndicators Hinder Buyers’ Ability to Find Homes

Anyone who has searched online for homes can understand the disappointment of sifting through listings, choosing the home that best fits your needs, the home that calls out to you when you look at the pictures, and then either find out it’s under contract or, if you have the chance to write an offer, to lose out to another bidder.

In my seven-plus years in the business, rare has been the buyer who doesn’t have one eye focused squarely on the rear-view mirror to see the home that got away.

When there only are four active listings out of 20 on a site such as Zillow, buyers are being subjected to the ultimate bait and switch. They are looking at homes long since under contract, in six of the cases long since closed escrow, only to learn later that the homes with which they fell in love are long gone.

Truzilia (Trulia and Zillow combined) can argue all they want about the front- and back-end checks that are in place to assure data quality – when there is a 15 percent accuracy rate as there is in Sonoran Mountain Ranch, the phrase “data quality” is little more than a punch line.

But it’s not just buyers who mistakenly use these sites who are getting a raw deal. It’s sellers as well. And it’s here where Jim Abbott’s decision to pull his brokerage’s listingsfrom Zillow and Trulia makes sense.

Poor Syndicated Data Disadvantages Sellers

Did you ever watch the game show Deal or No Deal? Each case had a different dollar amount and the goal for the contestant was to choose the case with the $1,000,000 in it – a 1-in-20 shot.

There are 25 models holding cases in the photograph to the left. Taking this argument to its most basic state, lets say each of those cases is a home listing.

Using the data for Sonoran Mountain Ranch as a baseline – 15 percent accuracy – 4 of those cases contain an active listing for a home for sale; the other 21 are empty (I even rounded up to give Truzilia the benefit of the doubt.)

Pick a case.

Is that home really for sale? No?

Pick another case. Empty again?

How many cases is a buyer going to open before he or she surrenders and either goes to another web site or, if he’s smart, finds a local real estate agent with access to the real list of homes for sale and gets some help.

You have your home for sale. Your agent tells you that it’s being marketed on Trulia and Zillow – the same thing that I tell my sellers, in the interest of disclosure. But really, how is your listing going to stand out from the bogus listings …

(Some real estate agents will interject now that they pay to have their homes featured on Truzilia – this isn’t so much solving the problem of miserable data quality as it is ignoring it and throwing money at it in the hopes that it goes away, though it won’t because Truzilia has won. It collected your cash.)

IDX and Listings Syndication Are NOT the Same

Abbott has been criticized in many corners, including the well-intentioned “Raise the Bar in Real Estate” Facebook group, for not syndicating his listings but continuing to use IDX on his brokerage’s site. He opened himself up for his by saying buyers should go to the source, presumably the listing agent, even though the point of an IDX feed is to help a buyers’ agent attract a buyer.

Taking the liberty of not interpreting Abbott’s message quite as literally, perhaps we ought to consider “the source” in this case to not be only listing agents but real estate professionals in general, those people who have access to the most accurate, most up-to-date information about homes for sale on the market.

IDX isn’t perfect; agents can opt-out of supplying their listings on an IDX feed and, as I showed above, there can be a lag between an update in the MLS and on IDX. As someone whose site features IDX prominently, I can live with a four-hour delay far easier than I can a seven-month lag in tagging a “home for sale” into a sold listing online.

Maybe refusing to send listings to Trulia and Zillow isn’t the answer. Given the data issues, it’s difficult for me to believe not sending listings there disadvantages the client a great deal more than not holding an open house or putting a sign on some random street corner; a lot of eyes will see the sign, but that doesn’t mean they’re going to distinguish the sign from the rest of the visual white noise and act.

We all talk about doing what’s right for the consumer – if we don’t demand better accountability of these third party syndication sites when it comes to data, if we blindly send our listings data there without any consideration of how it will be viewed and the quality of data which will surround it, we’re failing the very public who we claim to be so interested in protecting.

Syndicated Listings - Another Tempest in a Teapot?

Jonathan Dalton (Thompson's Realty) — Mon, 30 Jan 2012 10:39:13 -0800

This was originally posted January 29 at AllPhoenixRealEstate.com. If you're not subscribed to the RSS feed, why not?

Before you chalk this post up to so-called inside baseball, consider this. You or someone you love likely has used or will use Trulia, Zillow or Realtor.Com to search for homes in the belief you are getting an accurate view of the local real estate market.

Sadly, that’s not at all the case – not that any of those sites ever will admit it.

This should matter to you as a consumer; whether it does is your call. If you are the type who prefers to be dazzled by rainbows and ladybugs while ignoring what really does make things happen, this post likely isn’t for you. If you’d like a more realistic view of real estate that allows you to set a more reasonable set of expectations, particularly for those selling but for those buying as well, read on.

Here was a video posted by Jim Abbott of ARG Abbott Realty in San Diego:

Reaction came fast and furiously, both from Trulia and Zillow (henceforth known as TruZilia) in defense of their data and from agents who either have axes to grind against syndication or those who don’t tend to favor syndication.

Welcome to the latest real estate tempest in a teapot, a solar flare that has erupted and just as quickly will loop back to the surface of the sun never to be seen again.

As is his wont, real estate marketing consultant Rob Hahn has deemed this entire issue to be of the utmost importance, one that will turn the entire real estate industry on its ear:

The “syndication debate” will not end with smacking down TruZiltor. It will ultimately end up being a debate about buyer agency, the purpose of the MLS, the purpose of data-sharing. I’ve been predicting we’ll be doing that by NAR Annual in November. Maybe it’ll happen sooner than that.

Yawn.

The only people who seem to debate the purpose of the MLS are those who don’t use the MLS to sell homes. These folks invariably view the MLS from the position of the consumer, which is all well and good except the MLS isn’t designed for the consumer. It’s a marketing database through which real estate agents can not only advertise their listings but also provide a cooperative offer of compensation to any agent who happens to sell said listing, so long as they’re a member of the same MLS.

In other words, let’s elevate the debate to the bare level of reality and stop confusing the MLS with a mythical national clearinghouse of homes. And, actually, let’s stop saying “the MLS” because “the MLS” is not a singular entity but a vast array of local platforms.

If you’re going to argue that the public should have total access, fine. Also make sure consumers have access to every industry’s inventory database from your Best Buys to your Auto Zones to your car dealerships to the local pizza place that only makes a set number of slices for the lunch crowd.

As for debating the role of buyers’ agency … Please Go Back to 2005, Do Not Pass Go, Do Not Collect $200.

We now return you to the debate at hand. And that debate, as well as Jim’s video, easily could be centered about transparency in real estate sales. What works, what doesn’t work, and what serves merely as slight of hand and misdirection to deflect from the reality that in the vast majority of cases, listing a home in the local MLS is what sells the property.

Writes Kris Berg of San Diego Castles Realty on her San Diego Homes Blog:

You see, my client’s home does not really need to be on 400 national websites. That is just a myth we have propagated out of convenience and our desire to win listings. It is rhetoric we bought into, rhetoric delivered by those who are in the business of profiting from our business.

In all honesty, the rhetoric delivered by would-be listing agents goes far beyond internet marketing.

We easily can throw in the positively Paleozoic broker tour, during which agents who have signed up and have a listing of their own to pimp caravan from listing to listing. Those gunning for a listing promote these as exceptional ways of getting a home “out there” in front of agents, because it’s so much more likely that there will be an agent on tour who happens to have a buyer than there will be an agent sitting in front of his or her computer searching the MLS for homes that match their buyers’ criteria. (Sarcasm added.)

And we also can add the beloved Open House, in which a parade of neighbors and unqualified buyers walk in the front door of a home for sale without any real intent or ability to purchase the home in question. Again, we offer this service to sellers in an effort to show we’re working hard when, in reality, we’re hardly working or, worse yet, trolling for buyers using our listing as bait.

All of this will continue to work, of course, because sellers don’t care to know any better. The more points in a marketing plan, the better the marketing plan must be even though selling a home usually comes down to a couple of basic concepts:

Pricing it right
Entering it in the MLS
Taking photographs to entice agents and buyers alike (trust me on this – if there’s only one photo of the listing, it’s not being sent to my clients 9 times out of 10)
Putting a lockbox on it
… um … did I mention pricing it right?

Another direction this debate turned was ARG’s ultimate purpose behind the decision not to syndicate and whether it was less an effort to protect the consumer than to protect the supposedly coveted double dip.

Says my own broker, Jay Thompson, on the Phoenix Real Estate Guy:

At ARG we believe that when you hire a skilled, professional Realtor to represent your property that he or she is the best qualified and most logical person to respond to questions from buyers and buyer’s agents.

This is an argument I heard several times since the ARG announcement was made. It sure feels like what we’re talking about here is single-agent dual agency — where the same agent represents both the buyer and seller in the same transaction. We abhor single-agent dual agency, practice it only under very rare and extenuating circumstances and honestly wish it was outlawed.

It doesn’t happen often, but here is a situation where I disagree completely with my broker.

(Quick note: ~~if I get the boot and if you’re a local broker and you need a really good blogger and real estate agent, DM me~~. It’s a wonderful thing to work at a brokerage where one has the freedom to operate their own business their way.)

As the ludicrously high-producing Russell Shaw pointed out long ago on the local blog that shall not be named, we as real estate agents are hired by sellers to sell their house. Ourselves, if at all possible. While there are exceptions to the rule – and I certainly respect those owners who do not want the listing agent to also represent the buyer, even in a limited fashion – the vast majority of sellers could give a damn less who is buying the house – my client, or someone else’s.

Single agent dual agency, it is true, is inherently conflicted. And that’s why there’s a remarkably straight forward disclosure form both buyer and seller sign explaining that the agent’s fiduciary relationship becomes more limited in a dual agency situation. I’ve done them before. I’ll do them again. As long as all sides know what is going on, it’s not as evil as some would portray it to be.

Back to the larger point, I don’t believe the syndication debate has anything to do what dual agency. Again quoting Kris Berg,

Defenders of syndication say that an argument against syndication is an argument for dual agency. Nothing could be further from the truth. Much like you can opt out of syndication, you can opt out of dual agency. Take the call, answer the questions, and then send the buyer to the nearest competing brokerage to view the home and write the offer if that helps you sleep nights.

To my mind, the essence of this is trying to close Pandora’s box and pretend it never was opened. It’s likely a losing fight since, despite what many assert when blasting away at NAR, trying to get real estate agents all on the same page is similar to the cowboys’ work in this classic commercial.

Because agents felt there was a competitive advantage to be had posting listings to Zillow and Trulia, it was done. Even if thousands of agents stopped doing so, thousands of others would continue because it’s part of their seller marketing strategy. We can hope for better data, but when the sites themselves don’t give a damn about what they’re putting out there for the benefit of the public, improvement is unlikely.

Quantity is better than quality in the TruZilia world, even if that quantity is but a fraction of what really exists at any given moment in time.

Says Jay,

And lest we forget, every major syndication site has a way to correct inaccurate data. If you aren’t correcting bad data, that is just as much your own fault as it it is the syndicators.

Not really. I’m responsible for my own data; the fact I have to spend much of my time explaining to buyers who continue to use TruZilia for home searches until finally convinced the sites’ data is terrible shows there is a systemic problem on TruZilia’s side allowing for such large quantities of incorrect data to be entered into the system. There needs to be a better check and balance from the entry side, plain and simple.

And that doesn’t take into account faulty sales data that has nothing to do with agent entry; it’s the inability of TruZilia to distinguish types of recorded transactions, say the difference between an actual sale and a home that has reverted back to the bank after a failed trustee’s sale.

As I said at the beginning, all of this is a tempest in a teapot. While consultants and the like will continue on for a few days telling us how important an issue this really is, those of us who sell real estate to put food on the table – like me, for instance – will put our nose back to the grindstone in the morning and get back to work. TruZilia will remain letter more than an annoyance, a teaching opportunity in the making to help consumers learn what miserable sources of listings data (and, often, sales data) those sites are.

If you’re going to sell a house a week, you can’t spend more than a half hour on a Sunday night digesting all of the thoughts of our industry’s various and sundry thought leaders (as well as those of some by-God working agents and brokers.) There’s too much real work to be done.

Continuing Education for Bank Owned Listing Agents

Jonathan Dalton (Thompson's Realty) — Wed, 18 Jan 2012 10:27:03 -0800

Every two years, real estate agents in the state of Arizona are required to complete 24 hours of contining education. Most of these hours are separated into a variety of categories - Agency, Commissioner's Standards, Fair Housing, Legal Issues, Contract, etc. - and are designed to keep agents apprised of changes to the laws while also maintaining their knowledge in the general subjects.

That's well and good. But with bank owned inventories down to a mere trickle and traditional sales dominating the market, there should be a continuing education track for those agents who haven't practiced real estate over the past two to three years.

And by that, I mean the bank owned listing agents.

Sure, there still are some of these agents who have continued to sell non-bank owned homes over the past couple of years and therefore still are aware that real estate doesn't boil down to "the asset manager says." But sometimes the group must pay for the ills of the few (though the few truly are many); requiring anyone who has generated more than 25 percent of their business from listing bank owned homes to complete this course would be an excellent way of reintroducing them back into real estate:

CONTRACT LAW (3 HOURS): A comprehensive study of the Arizona Association of REALTORS Residential Resale Purchase Contract as written, unamended by any lender addenda. Special emphasis to be placed on the sections dealing with Seller Property Disclosure Statements, Insurance Claims Histories, Cure Periods and What All Those Financing Contingencies and deadlines really mean.

BASIC NEGOTIATIONS (3 HOURS): Agents will relearn the ability to negotiate an offer without entering basic data into a form and waiting to hear back from the Great and Glorious Oz asset manager. Agents will be required to run comparables for a subject property and speak to a live human being (further known as the seller) to discuss the pros and cons of countering, accepting or rejecting an offer.

BASIC EMPATHY (3 HOURS): A necessary trait when dealing with buyers and sellers, as the agent will discover in "Basic Negotiations" as real human beings allow emotions to influence their decisions as opposed to asset managers who can't understand why buyers don't act like automatons.

LOCKBOXES 101 (3 HOURS): Believe it or not, there are better ways to secure a property than with a $10 lockbox from the Home Depot using the same three codes as on three quarters of the other bank owned properties in the Phoenix real estate market. Learn what a SUPRA lockbox looks like - they've only been around for almost five years in their current iteration - and how to use that white thing with numbers, otherwise known as a lockbox key.

LOCKBOXES 201 (3 HOURS): For those who still aren't inclined to join the 21st Century, this class provides details on using the Mechanical Lockbox Code field in the MLS and how it really is just as secure as making an agent call to get a code, all so you can write down a five-digit MLS agent code than anyone with an IQ over 32 can make up on the spot. Because we all know, no one's looking these up in the MLS to make sure the person calling is who they say they are.

SMARTPHONES (3 HOURS): Learn the one function of a smartphone never utilized by bank owned listing agents - the ability to answer a phone call from someone calling for information.

INTERIOR PHOTOGRAPHY (3 HOURS): Believe it or not, most homebuyers want to see more than just the front of a house for sale - kitchens (assuming they aren't stripped of appliances), backyards (assuming the pool is neither drained nor green), living areas (assuming the past owner hasn't punched holes in the all trying to find 50 cents worth of a copper wire.) Learn how to set up your camera so that it takes more than one photo of a given property.

PROSPECTING 101 (3 HOURS): Now that the gravy train's run is at an end, how to make sure there's still sufficient income to pay the staff of dozens and still pay the bills.

There it is. A 24-hour continuing education course that will help re-program bank owned listing agents as they attempt to re-enter the real world of real estate.

Not that this will ever come to pass. But that's okay. The rest of us are used to having to walk other agents through the basics of a transaction anyway. It'll be just like normal for us.

Image: digitalart / FreeDigitalPhotos.net

Letting Go and Moving On

Jonathan Dalton (Thompson's Realty) — Mon, 16 Jan 2012 11:22:11 -0800

Do you have any idea how difficult it is to find roller skates?

Not roller blades. Roller skates. Four polyutherane wheels arranged in a rectangle, not a single line, topped with a metal frame and then a leather-ish boot?

Three years ago, the quest to find roller skates turned into an all-day epic adventure. And it all took place on the Princess' tenth birthday with her in tow. Six different stores from Surprise to Metrocenter, all to find a simple set of roller skates for my girl.

Finally, we found them and she wore them triumphantly at her birthday party at Great Skate that afternoon. Even as they started to get a little tighter she would wear them either to Great Skate or to skate around the block ... maybe not as often as I would have hoped given the Herculean task that was the purchase, but still.

I just watched those skates walk out the door.

All those overpriced Build-A-Bear animals and accessories (including the wheelchair she purchased in case any of her animals were injured)? Buh-bye.

The flamenco dress my wife and I bought her on our once-in-a-lifetime trip to Spain a few years ago? Adios.

Her first bed when I bought my first home after my divorce, the bed that was the centerpiece first of a room with jaguar wallpaper borders and then her current room with the horses (who also soon will be departing). Hasta la vista.

If I sound heartbroken it's only because I am. I just watched much of my daughter's childhood disappear in a van for Homeward Bound, a group that helps homeless and domestic violence-addled families with children get a new start.

So all of these items are disappearing to an excellent cause and to children who hopefully will find the same joy my daughter did from her stuffed animals, her bed ... and her roller skates.

Nevertheless it's extremely emotional, much as it's emotional when you decide to sell your home and, though you may still have equity, the figures aren't close to what they were a half-dozen years ago.

It's difficult letting go of that past so much so that it colors our decisions today.

We invest our lives in our homes - not just the financial investment, but the day-to-day raising of our children to the celebrations to the sorrows and everything in between. Here's where the kids first had their tree swing. There's where they opened their Christmas presents. Do you remember wrestling with the kids after playing the My Little Pony memory game in that spot?

And yet, at some point, the time comes to let go, to move on to a new place to create new memories and to allow another family to come into our current home and start building memories of their own.

It's not easy. Letting go never is. The emotions never go away. But logic sometimes dictates the change.

My daughter's horsie wallpaper border is coming down within the next week or so to be replaced by, well, who knows what. Six months ago it would have been Jack Skellington and now it's Alice in Wonderland.

There will be new memories coming shortly which will help me stop clinging to the old.

Eventually.

The Bachelor and Fair Housing

Jonathan Dalton (Thompson's Realty) — Wed, 04 Jan 2012 10:34:58 -0800

It’s the first Tuesday of the winter television season and you all know what that means … it’s time for the semi-annual The Bachelor/Bachelorette post here on All Phoenix Real Estate.com.

When my wife first dragged me into watching the show using various unfulfilled promises spoken and implied, I visibly cringed when the topic of the Bachelor/Bachelorette franchise came up. I remember quite well the sheer volume of abuse I and others heaped upon this poor soul who used to work for me and who’s then-girlfriend and now wife organized a Final Rose viewing party after the final season.

Now? Let’s just say I didn’t see much of the first three quarters of the Fiesta Bowl last night. And, oddly enough, I’m okay with it.

Maybe it’s because I enjoy the car crash aspect. Maybe it’s because I get inexplicable pleasure out of seeing these idiots decide after just a handful of alcohol-fueled hours in a house filled with other women that they are staring at the man of their dreams. Or maybe it’s because, stressful as three kids (including a teenage boy who emerged from his room for the first time yesterday since Christmas break began and apparently is more than a full inch taller) and four beagles can be, it beats the hell out of being single again.

Much of the fun comes in the first episode when we, along with our intrepid Bachelor, get to size up the women vying to own a Neil Lane diamond ring for a short period of time. (Did anyone else watch those Neil Lane commercials for Kay Jewelers and think it has to be the jewelry product with the most liberal return policy in the history of man?) Of course it’s shallow and mean-spirited (read: funny) but that’s really the entire point of the show.

Last night, our producers decided to change the musical score when this year’s designated crazy person came out of the limo. Like we really needed anything so lacking in subtlety to arrive at this conclusion. It was clear from the get go that dear Jenna is neurotic to the point where she probably shouldn’t be watching reality television much less participating on a reality show.

And here’s the most amazing part … Ben, our intrepid Bachelor, gave the last rose to Jenna even as she stood their trying to hold back tears (and quite possibly not spontaneously combust on the spot) at the prospect of not finding love (and or a disease of some sort) with someone she had met a handful of hours before.

He must have had his eyes closed because there’s no way someone looking around couldn’t see that this just was a disaster in the making.

I thought of that moment this morning as I was driving around the Valley. Much is made about the difference between “south” Phoenix and the rest of town, often without those so speaking having any idea what might be in either place. You want so-called dicey areas? I can find them anywhere because they are everywhere.

The thing is, Fair Housing Act aside, it’s not really for me to determine what someone’s tolerances are for a given area. I’ve seen homes I’d never purchase happily bought by buyers for whom they were a perfect match; I’ve seen buyers look at homes I think are gorgeous and look like one of the Bachelor contestants on her way to the limousine of rejection.

Everything comes down to personal perception … and, quite frankly, your eyes are going to tell you what looks like it might be a match for you.

Some people will get turned off by billboards written in Spanish, others could care less. I only care as far as having to see the face of Guillermo Ochoa, goaltender for the Mexican national soccer team, during World Cup qualifying while I’m supporting Sam’s Army and our beloved Yanks.

The point is, it’s not my decision to make. And, at the same time, as a buyer for a particular area the fault lies with you if you end up somewhere that absolutely does not match what you want in a neighborhood or a home.

You have your own set of eyes. You have your own spidey-sense.

Unless you have a producer pointing a small-caliber weapon at the back of your head telling you that you will give the last rose of the night to the obviously crazy chick, you have no one to blame but yourself if you either ignore the obvious signs or simply choose not to look.

(Like what you see? Read more on AllPhoenixRealEstate.com!)

Reading Non-Existent Clauses into the Purchase Contract

Jonathan Dalton (Thompson's Realty) — Mon, 19 Dec 2011 12:29:42 -0800

There was a rather interesting thread this past week on Trulia Voices, all revolving around the concept of the earnest deposit.

In theory, once a contract is accepted, the buyer (or their agent) opens escrow and deposits a check as the earnest deposit - essentially a good-faith deposit representing the buyers' intent to purchase the home.

Amazingly enough, though, the Arizona Association of REALTORS Residential Resale Purchase Contract is extremely vague as to when the earnest deposit needs to be deposited into escrow.

Some agents on the thread argued that there's a 48-hour rule, or that 48 hours is the accepted practice. I can handle that except, when push comes to shove as seems to be happening for this seller, there's nothing in the contract that says the buyer had to make the deposit within 48 hours.

In fact, there's no timeframe at all. Guidance from the state real estate department also is vague, saying that the deposit must be made promptly. And on wording like that, attorneys are retiring to the Bahamas.

What was most interesting, at least to me, was the broker wading into the fray:

In Arizona the contract is clear, Earnest money has to be deposited as soon as possible, failure to deposit the money can mean there is no Contract.

As a matter of fact, the contract is so clear in this respect that the phrase "as soon as possible" cannot be found - no timeframe at all is given in any of the paragraphs in which the earnest deposit is referenced. As for the idea that not making the earnest deposit "can mean there is no Contract," again, there is no wording anywhere in the AAR contract to that effect.

My guess is this broker, who specializes in bank owned homes, is confusing the AAR Purchase Contract with the Fannie Mae addendum that voids the contract if the earnest deposit isn't made within a set time period. Fortunately for us, the Fannie Mae addendum doesn't apply to all real estate transactions here in the great State of Arizona and the ability to negotiate rather than be given marching orders by a ~~data entry drone~~ asset manager still exists.

All of this does make me wonder what will happen when the foreclosures finally disappear and these agents who only know what Fannie Mae tells them are forced to (gasp) re-learn the Arizona contract. It might come as quite a shock to learn that what seems so black and white instead blends into nine pages of gray.

Photo credit: Blatantworld via Flickr Creative Commons

Pricing Your Home to Sell Versus Pricing Your Home to Sit

Jonathan Dalton (Thompson's Realty) — Thu, 08 Dec 2011 14:43:41 -0800

Back when I worked in Charles Schwab’s Active Trader division, I had access to Level II NASDAQ quotes.

What you see on CNBC on the crawler are the sales and, essentially, the Level I quotes – the lowest amount at which someone is willing to sell and the highest amount at which someone is willing to buy. (When these two meet, buyer and seller are matched electronically and a sale of stock takes place.)

Level II not only would show the current market price as defined by Level I, but also the full depth and breadth of the market as expressed by open orders entered into the system by a NASDAQ market maker.

On any given day, there were buyers and sellers looking at the realistic prices and trading either at those levels or in the same ballpark. And on any given day there would be orders for a stock like Apple, currently trading at $393 and change, such as someone looking to be 1,000 shares for $1 or someone looking to sell 1,000 shares at $1,000.

Going out on a limb, neither offer is likely to be executed today – neither the ludicrous low-ball purchase or the equally ludicrous high-ball sale.

Real estate’s MLS can be viewed as something similar to Level II quotes, at least on the seller side of the book. Various websites have attempted to create a buyer’s side of the book but it’s never gained any sort of traction (likely because any buyer who has a seller agree to what they have set forth almost certainly will either think they can purchase for even less or there’s just something wrong about the whole thing.)

If you were so inclined, you could take the active listings for a given size house in a given neighborhood and list them like you see in the Level II quote screen above. And what you would see is that the homes most likely to sell are those at the top, much like the people selling Apple stock within a percent or two of the current price.

As you get further away from the top, the less likely a sale is going to happen – and you don’t want to be the hopeless schlep trying to get $1,000 for a $300 stock or $300,000 for a $200,000 house.

Active listings can and should be used to find a price point to sell, however, they need to be used in the context of competition, not a baseline setting. Just because one idiot wants to sell Apple at $1,000 doesn’t mean you, as someone who legitimately wants to sell, should follow his lead.

Pending listings are helpful in determining what price attracted a buyer but they do nothing to tell you what price the seller and buyer actually agreed upon.

When trying to price a home, you as a seller have got to start with the sold listings – the last trade, using the stock analogy. You don’t have to match that last price but you need to start with the neighborhood averages as your baseline and then find a comfortable spot in the Active listings where you’re likely to attract a buyer.

That often is lower than what else is on the market; in these market conditions, it also can be higher if there is a dearth of competition. I proved this last summer when I listed and sold a house priced five figures above the last sale because it still was the best-priced home with a pool on the market in that area. And it took all of 10 days to do it.

There is so much information available to buyers and sellers these days … listings on this site and Realtor.Com, listings on Trulia and Zillow (some of which actually are for sale), Zestimates and the like. But not all of it is particularly helpful and much can be detrimental to those serious about buying or selling.

It may not take a rocket scientist to price a home to sell but it does take someone who understands how markets work and what prices you see really matter.

President Obama's HARP Finally Will Play in Phoenix

Jonathan Dalton (Thompson's Realty) — Mon, 24 Oct 2011 14:01:32 -0700

Let's jump into the Wayback Machine to February 2009, when President Obama visited my alma mater, Dobson High School in Mesa, and unveiled the Home Affordable Refinance Program.

At the time I wrote:

The overall goal is to modify loans in manners that allow homeowners to remain in ther homes rather than face foreclosure. Eligibility is limited to mortgages on primary homes (no second, vacation or investment properties) and appears to be limited to situations where the first mortgage is no more than 105% of the value of the home.

You don’t need to be behind on your payments to be eligible.

Unless I’m reading it wrong, this leaves out buyers in the Phoenix real estate market’s hardest hit markets as homes there have decreased far more significantly.

Come back to the present day, and the President will be announcing a revised version of HARP that would allow homeowners who owe more than 125 percent of their home's value to refinance their home.

A home sector analyst said the change likely will impact few homeowners as they need to be current on their payments; I'm not so certain, though it could cause some who have stopped paying to kick themselves in the head and wish the program had been expanded much earlier than this.

In the Phoenix area, there still are a large number of owners making payments (and often wondering why) who may benefit from the revised plan. Time will tell.

Also of note from the CNN/Money article:

Fannie and Freddie will also reduce the fees they have charged in the past in order to enable borrowers to better afford the new loans. Among the fees that will be reduced or eliminated are those for appraisals, title insurance and closing costs.

Fees will also be waived for some underwater borrowers who refinance into 20-year or other, shorter-term loans. By doing so, it could help homeowners get above water faster.

A homeowner who has a $200,000 balance on their 30-year mortgage with a 6.5% rate and a home value of $160,000, for example, currently makes payments of $1,264 a month.

If they refinance into a 20-year fixed-rate loan at 4.25%, it will reduce their monthly payments to $1,238 and slash their loan balance to $160,000 in just five-and-a-half years. If they refinance to a 30-year loan at 4.5%, their monthly payments will be quite a lot lower, $1,013, but it will take 10 years to reach $160,000.

Getting back above the waterline on a home in Phoenix ... imagine that.

An Appraisal Tale

Jonathan Dalton (Thompson's Realty) — Thu, 15 Sep 2011 14:04:54 -0700

This article originally appeared September 14 on All Phoenix Real Estate.com.

So what does an appraisal really mean?

Buyers usually view the appraisal as a declaration of a property’s value. Lenders view an appraisal as a benchmark for risk assessment. Real estate agents view appraisals and, more to the point, appraisers, as the bane of our existence.

Cached amidst the flowery legalistic language, disclaimers and overly long and complicated appraisal forms, the agents see what few others realize – the appraisal only is one person’s opinion of value. Nothing more. Nothing less.

It’s not even a pure opinion. Appraisers start the process with the purchase contract in hand. Since market value by definition is where buyer and seller meet on price, appraisers already know the home’s market value when they start. All that’s left to do is price out the quality of the home and find the comparable sales needed to either declare that the home “appraises” or “doesn’t appraise” at market value.

In that respect, appraisals are like the geometry proofs we all were tortured with back in high school. Pythagorus already gave us the answer. We only need to “prove” that the answer is correct.

How does this play out in real life?

Let’s take a house under contract for $496,000. And let’s say the appraiser, in filling out the paperwork, enters the contract sales price at $465,000 by mistake.

Amazingly enough (note sarcasm), when the home was “listed” as $465,000 by the appraiser, the appraised value was given at $470,000.

Notified of the error, the appraiser changed the list price to the correct value – $496,000 – changed one comp and provided a new appraised value of $497,000.

The reality of this situation? In the appraiser’s unofficial opinion, the home likely was worth more than even the $497,000 but no appraiser is going to provide an appraised value well above the agreed upon purchase price. Underwriters would scoff, sellers would feel they were taken advantage of, buyers would be bragging at every cocktail party they attended for the next five years.

So the appraiser artificially limited the appraised value to a more acceptable, politically correct if you will, value only slightly above the sales price.

In so doing, the appraiser also caused a two-plus week delay on the closing of the sale, but that’s another story for another day.

Appraisals are yet another of the many examples where real estate transactions are made far more complicated and seemingly more complex than they really ought to be. One person’s opinion of value isn’t even their true opinion of value; it’s the value they’re able to assign without catching hell from everyone else involved in the transaction.

I’m sure the state appraisal board will disagree with me but hey, what’s a little bit of transparency between friends, right?

The Successful Earnest Deposit Battle that Shouldn't Have Been

Jonathan Dalton (Thompson's Realty) — Sat, 03 Sep 2011 16:58:22 -0700

Thanks to the prevalence of bank owned homes in the Phoenix real estate market, the rules are getting rewritten on a daily basis. And nearly all of these rewrites are to the detriment of the consumer.

Take the case of the hijacked earnest deposit, which I'd written about previously here.

The short version is my buyer at the beginning of august cancelled a purchase contract on a bank-owned home in accordance to the terms of the contract and requested the earnest deposit be returned to him.

This should have been cut and dried but it wasn't. The asset manager working on behalf of the bank decided to contest the earnest deposit based on the bank's addendum to the contract. Here was the paragraph in question:

6. Mortgage Contingency. Purchaser’s obligation to purchase the Property under the Agreement (check one): (_X_) IS (___) IS NOT contingent on Purchaser obtaining financing for the purchase of the Property. In the event this contract is subject to the Purchaser obtaining a mortgage then the Purchaser shall obtain a firm written commitment on or before June 27, 2011.

If said firm commitment is not obtained by said date, this Contract shall be null and void and neither party shall have any further rights or obligations or liabilities to the other by reason of this contract, except that the earnest money shall be promptly refunded, provided however that the purchaser has made a mortgage application within three (3) days of the receipt of a fully executed contract, has acted in good faith and has otherwise complied with the terms and conditions of the contract. Notwithstanding the foregoing, the seller, in writing only, at its sole and absolute discretion, which may be arbitrary, may extend the date for obtaining a firm written commitment. Purchasers agrees that the party holding escrow monies will release said funds once provided with a declination letter by from purchaser’s lender, without any further action or consent from purchaser.

It's the second paragraph that really is the issue as it both declares the contract null and void if a firm mortgage commitment isn't given by a certain date in one sentence with the earnest deposit going to the buyer and also says the seller gets the earnest deposit if the buyer is declined for a loan.

Symantically, the sentence dances on the head of a pin. If the buyer doesn't have a firm mortgage commitment by the lender but hasn't been declined for the loan by the date set, the earnest deposit goes to the buyer. Otherwise it goes to the seller.

In this instance, the buyer didn't have a firm mortgage commitment from the lender which would have rendered the contract null and void. The contract would still be alive if the seller had provided an extension in writing; none was given in this case, though all parties were continuing on as if it had happened.

Here's where the contract gets fun ... all's well unless things aren't. The seller had no interest in declaring the contract null and void. The seller also neglected to pay attention to its own addendum and boxed itself into a corner because of that neglect.

Enter the folks at Commerce Title, the hand-selected escrow company of the seller and the asset manager.

The purchase contract is incredibly clear on the role of the title company in the event of a dispute. In signing the contract, both buyer and seller authorize the escrow company to determine at its sole and absolute discretion who receives the earnest deposit.

On August 3, the area vice president for Commerce Title did just that, ruling that the seller had no valid claim and that the earnest deposit was to be returned to the buyer.

Except the money wasn't returned. The legal eagles for Commerce Title, based in Arizona and apparently ignorant of Arizona law and the purchase contract, decided that the escrow company had no authority to decide the issue even though both sides had granted the escrow company that power.

Commerce Title's new position was that it was only an instruction taker, an allegedly neutral third party, and it was up to the buyer and seller to figure out who gets the earnest deposit.

It was a ludicrous position. Both sides already had claimed the earnest deposit. Under what possibly logic would it be expected that one side or the other would change their mind?

The purchase contract is meant to protect both parties and provide guidelines for the transactions. The escrow company is meant to protect both sides by being the neutral arbiter of the earnest deposit in the event of a dispute. It is supposed to protect one side from unreasonable and/or invalid claims from the other.

Commerce Title failed to do so.

Under the logic used by Commerce, the seller could have claimed the earnest deposit because it was cloudy outside and, since the instructions were in writing, the claim would then become valid regardless of the terms and conditions of the contract.

Commerce Title's legal department essentially determined that unilateral cancellations are not possible in an Arizona real estate transaction, even though the legally binding executed contract provides the buyer a handful of opportunity for unilateral cancellation.

In acting as an alleged "neutral third party," attorneys in California working for an escrow company that is a subsidiary of Auction.com reinterpreted the real estate contract to the detriment of the buyer, the consumer.

Sadly, this isn't an uncommon occurrence.

Which begs the question, if the purpose of the Attorney General and the Arizona Department of Financial Institutions are here to enforce regulations in theory for the protection of the public, where are they when these things are happening?

In this instance, the listing agent also saw the invalidity of his client's claim and was able to get the asset manager to sign off on a mutual cancellation. My client should receive his earnest deposit today, some 32 days after the contract was cancelled.

If he hadn't, the buyer's only option would have been small claims court or other legal recourse, which would have been lengthy and expensive, even if at the end the seller would certainly have lost and then been responsible for the attorney's fees.

But the onus should never have been on the buyer. Responsibility rested with Commerce Title, the escrow company selected by the seller without input from the buyer. And the company failed in this responsibility to be a truly neutral third party.

Editor's note: It's been suggested that real estate agents are a dime a dozen. After spending a month battling the escrow company and its legal department, and having this company threaten to file a complaint about me with the Arizona Department of Real Estate because I dared to suggest I might contact DFI if the escrow company continued to ignore its responsibility, and doing all of this for zero compensation since the transaction didn't go through ... I think not all of us are cut from the same cloth.

Image: worradmu / FreeDigitalPhotos.net

Bridezillas and Fannie Mae

Jonathan Dalton (Thompson's Realty) — Thu, 25 Aug 2011 14:17:38 -0700

As I write this, my eldest is watching Bridezillas.

It's hard to explain just how ridiculously painful this show is, primarily because as these lunatic brides stomp around, yell and curse at everyone around them and essentially act is the world revolves around them, not a single person has the guts to tell them to shut up and grow up.

Everyone goes on camera with the producers to say how they're not going to stand for the way they're being treated, yet no one does what they really ought to do - stand up, flip the bride off, and walk out the door.

And don't even get me started on the emasculated men that these lunatics are marrying. (Like the poor fella who's in the military and is stationed elsewhere while his lovely bride complains that he's not around to plan the wedding he wanted and she didn't.)

All in all, these bridezillas remind me greatly of the "bankzillas" that we get to deal with on an everyday basis.

Take, for instance, Fannie Mae. Two weeks ago, one of my buyers withdrew an offer she had made before she had received Fannie's purchase addendum. In Arizona, the buyer can do that ... the contract's not executed, so a buyer still can walk away.

But that's not how Fannie Mae sees it and because they don't see it that way, the Arizona purchase contract doesn't matter. Neither does common sense.

Fannie Mae won't cancel the contract in its system, allowing the listing agent to submit new offers, until the buyer signs a form terminating her offer that already had been withdrawn before it formally was accepted.

Since my buyer hasn't been available to sign, I sent the termination form this morning. Except I dared to use electronic signatures, which Fannie Mae won't accept - even on a form that is being submitted solely for their own sake, as my buyer already withdrew her offer, never opened escrow, never made an earnest deposit, etc.

Now ... there's part of me that's tempted to tell the listing agent that Fannie Mae can pound sand if they don't want to accept electronic signatures on a form we don't need to submit. If Fannie Mae's own system prevents it from selling this house, that's really not my problem.

If this home sits empty and on Fannie Mae's books until the end of time, that's fine by me. Since they make nothing easy for the rest of us, why run around to make things easier for them?

But, sadly, there's another real estate agent involved and I don't have the hard to do that to him. (If it were one of the agents on my "list", however, I'd be far more willing to sit on the form until hell froze over.)

And maybe that's the reason none of the people on Bridezillas ever tell the woman to go screw themselves - because, at the end of the day, they realize the wedding isn't just about the bride and no one else. These things don't happen in a vacuum.

Still, it's nice to dream ...

Summertime and the Scammers are Lazy

Jonathan Dalton (Thompson's Realty) — Tue, 23 Aug 2011 12:49:48 -0700

I received this e-mail last night ...

Is this property owned or still for sale? The reason I'm asking is because I got a funny email from someone that had listed this property for rent for $700-mo and a $500 deposit, all utilities included 18:: a-c. They said they were leaving for 8 yrs to Africa, him and his wife and they needed someone to care for their house. It sounds really weird. So, I'm just like I said, curious as to if this property is still on the market. If it is these people are contacting people, requesting applications w- people's info, etc and in return giving bogess info back that's a problem.

Needless to say, the e-mail this person received was a scam. The home in question is listed for sale (and also for rent at a higher price than this, utilities not included) and it doesn't seem like anyone from the LLC is going to Africa anytime soon.

Not that I want to give con artists any advice but I think it's safe to point this out without being guilty of aiding and abetting. If you're going to be try and scam someone, you might want to come up with something other than a) going to Africa, b) being an African general or c) being a peace missionary in Africa.

While we as a collective may be frighteningly clueless (such as the person the other day who asserted to me that not all states that joined the Confederacy were in fact states where slavery was legal), most people have figured out "Africa" in this context tends to be synonymous with "crook."

Just sayin'.

Image: m_bartosch / FreeDigitalPhotos.net

Glendale Arizona One of Money Magazine's Most Affordable Cities

Jonathan Dalton (Thompson's Realty) — Mon, 22 Aug 2011 16:52:53 -0700

Imagine that ... some good real estate news coming out of the Northwest Valley. Money Magazine has named Glendale Arizona one the top 25 most affordable cities in the country.

The city of a quarter-million has long played second fiddle to nearby Phoenix. Now, however, it boasts two major league sports teams, the NFL's Cardinals and the NHL's Coyotes. These local arenas also host big-name concerts like Paul McCartney and Taylor Swift.

One more thing the city has over Phoenix: affordability.

For years I've told any buyer who will listen to look in Scottsdale and I can find them the same thing in the Hedgpeth Hills for a quarter-million less, simply by changing the ZIP code from 85254 to 85308.

Glad to see the national media's now agreeing!

Agent-to-Agent Referrals – I'll Be Your Huckleberry

Jonathan Dalton (Thompson's Realty) — Sun, 21 Aug 2011 17:35:26 -0700

If you don't want to take referrals, I can understand. But frankly, referrals are the name of the game in this business - from other agents, from clients, etc.

There are few things better than having a buyer or seller who's already been vetted and is well known by an agent or another person before they're sent over. And the fact they're comfortable enough with me to refer them only can reflect postitively on my business.

Via Pamela Seley, REALTOR® Temecula Valley California Homes (REALTY EXECUTIVES):

Agent-to-Agent Referrals – I Won’t Be Your Huckleberry

For the past year I’ve spent much time thinking about agent referrals. Actually, I have come to detest agent referrals, and not for the obvious reason you may think.

It’s Always About the Money, Right? Or Is It?

I’ve found the relationship I have with my clients is vastly different from the relationship I have with customers from agent referrals.

Perhaps it’s because my clients are mine exclusively. I’ve invested time, energy and money in prospecting for customers who I can turn to clients. Because of this high investment, customers are like gold to me, and I work diligently to earn their trust.

“You’re Not Special” Just Because I Gave YOU a Referral, Says the Referring Agent

Agent referrals are batched out. It appears agents will give their clients more than one agent name. Here is where it appears the referring agent is out for the referral fee and not necessarily interested in finding a competent agent to refer their clients.

In one of my former offices, the managing broker gave the same leads to different agents in the office. I guess it’s whoever makes the killing sale first, wins.

Agents in an agent referral agreement may not even know the other; much less have any kind of professional relationship. Some agent referrals may come from adjunct offices in other cities, or states. Because two agents work for the same “brand” doesn’t mean they know each other, or the other’s competency level.

The customer may have gotten the agent’s name from an agent who is their cousin, or from a former agent in another state where they used to live.

Agent referrals may come from a simple source, such as “google.”

The truth is agent referrals are handed on a silver platter. There hasn’t been the same investment in time, energy and money. Likewise, it’s more difficult to earn the referral customer’s trust.

A Sense of Entitlement, Agent’s Are Dispensable and Dis-respected

From agent referrals I’ve observed some interesting behaviors on the part of the customers.

Sense of entitlement. Maybe it’s because the client-agent relationship is too familiar from the start. After all so and so (agent) gave me your name.

The agent is dispensable. The game plan on the part of the customer is if you don’t do what I want, the way I want, when I want it, then I’ll tell the referring agent, who can refer me to someone else. The customer doesn’t have to say a word to convey this message. Their actions speak loud and clear: I don’t need you.

The agent is not respected. For some, depending on their personality, and if they really dislike real estate agents, it’s an opportunity to bully and abuse agents. The sentiment is agents will do anything for a buck and should be treated as such. This leads to resentment on the part of the referred agent. At this stage there can never be a healthy client-agent relationship built on mutual trust and respect.

Agent Referrals are Legally Problematic

As explained to me, once the referred agent agrees to accept a referral agreement, they must follow through to the end. There’s no changing later, or mid-stream while in escrow. The referring agent broker is entitled to the referral fee after close of escrow that was agreed upon between the referred and referring agents. If the referred agent does not comply with the initial agreement, they could risk losing their real estate license.

The other point that is not discussed much is if there is a dispute later between the client and the referred agent. The referring agent could be held as responsible and accountable since they were the ones who “referred” the bad agent. I guess it may be wise before referring an agent to know them well.

The other point that has been made is other professionals, such as doctors and lawyers, do not take a “referral fee” for referring patients or clients. Why then do agents take “referral fees”?

Did I Hear You Say RESPA Violation?

I’ve often wondered if agent referrals could be a RESPA violation. Paying a referral fee to a non-licensed person outside of escrow definitely is. What is bothersome to me is referral fees are not disclosed on the HUD statement, nor are they usually discussed with the client, or the other brokering agent of the real estate transaction.

In California, commissions between the selling agent and listing agent are disclosed on the escrow instructions for all to read. Both buyer and seller sign these escrow instructions. However, neither buyer nor seller would be aware if there were a referral fee involved after close of escrow. Hmmm, sounds a little shady to me.

Raising the Bar - Opting Out of Agent Referrals, Just Say No

There’s been much discussion over raising the bar for real estate agents. Instead of focusing on making it harder for those to enter our profession, why not consider treating our profession as it deserves to be. If agents refused agent referrals that would raise the bar and begin to change the low opinion many consumers have of real estate agents, which is pretty much we will do anything for a buck.

Well, not this agent. I won’t be your huckleberry.

Pamela Seley, REALTOR®
Short Sale Resource | CA DRE lic # 01824145
www.temeculavalleyhome.com | Dir 951.491.4063 | Email pamelaseley@gmail.com

Serving Southwest Riverside County California| Temecula, Murrieta, Menifee, Winchester, Lake Elsinore, Canyon Lake, Corona, Wildomar

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Agent-to-Agent Referrals – I Won’t Be Your Huckleberry

All information deemed reliable, but not guaranteed. Copyright © 2009-2011 by Pamela Seley, REALTOR®

Inside Verrado's Main Street Area

Jonathan Dalton (Thompson's Realty) — Sun, 21 Aug 2011 17:30:36 -0700

Yesterday, the wife and I spent the day in Verrado helping friends move in the triple-digit heat. This, incidentally, is not the way to see Verrado, a subdivision in Buckeye on the north side of I-10 a couple of miles east of Highway 85 (aka the road to San Diego via Gila Bend).

Rather than moving vans, I’d rather link something like this to Verrado:

That’s the CVS Pharmacy along Verrado’s main street. Across the way is a Bashas’ supermarket, a local chain whose store looks from the outside like a small-town, mom-and-pop grocery.

Small town is the theme and the developers in Verrado pulled it off quite well.

And did I mention the towels? Play the Raven Golf Club in Verrado and you’ll discover the most wonderful thing ever for this climate … ice cold, mango-scented towels. Awesome. Even if you’re a duffer, the towels are immune to your slice.

Like most places built in the early- to mid-2000′s, Verrado has ridden the real estate value roller coaster. And like most of the Valley, inventory’s pretty thin right now. Unlike most places, there still are new builds available among the short sales and bank-owned homes.

Want more information about Verrado or any of the homes listed below? Drop me a line and I’ll be happy to help. Just don’t ask me to move your furniture. I’m still cooked.

Showing properties 1 - 25 of 58. See more Verrado community real estate.
(all data current as of 8/21/2011)

$365,000 : 3929 N Vickery Circle, Buckeye

4 beds, 3.50 baths

Home size: 5,000 sq ft

Lot size: 12,998 sq ft
$390,285 : 20990 W Cora Vista Street, Buckeye

5 beds, 3.50 baths

Home size: 3,717 sq ft

Lot size: 13,151 sq ft
$159,900 : 21123 W Prospector Way, Buckeye

3 beds, 2.50 baths

Home size: 2,565 sq ft

Lot size: 6,126 sq ft
$160,000 : 21117 W Glen Street, Buckeye

4 beds, 2.50 baths

Home size: 2,090 sq ft

Lot size: 5,008 sq ft
$219,900 : 20929 W Prospector Way, Buckeye

4 beds, 3.50 baths

Home size: 2,739 sq ft

Lot size: 9,488 sq ft
$389,000 : 20610 W Canyon Drive, Buckeye

5 beds, 4.00 baths

Home size: 4,021 sq ft

Lot size: 13,372 sq ft
$185,000 : 3977 N Kibbey Court, Buckeye

4 beds, 3.00 baths

Home size: 2,768 sq ft

Lot size: 14,986 sq ft
$245,000 : 20998 W Edith Way, Buckeye

4 beds, 2.50 baths

Home size: 2,465 sq ft

Lot size: 4,568 sq ft
$220,000 : 21072 W Sage Hill Road, Buckeye

5 beds, 3.50 baths

Home size: 3,542 sq ft

Lot size: 8,665 sq ft
$162,839 : 20650 W Hamilton Street, Buckeye

2 beds, 2.00 baths

Home size: 1,887 sq ft

Lot size: 5,139 sq ft
$167,255 : 20680 W Hamilton Street, Buckeye

2 beds, 2.00 baths

Home size: 1,887 sq ft

Lot size: 5,223 sq ft
$189,900 : 20906 W Ridge Road, Buckeye

2 beds, 2.00 baths

Home size: 1,915 sq ft

Lot size: 6,117 sq ft
$279,799 : 20997 W Eastview Way, Buckeye

4 beds, 4.50 baths

Home size: 3,528 sq ft

Lot size: 6,600 sq ft
$221,252 : 20938 W Wycliff Court, Buckeye

3 beds, 3.00 baths

Home size: 2,234 sq ft

Lot size: 7,440 sq ft
$329,900 : 3882 N Park Street, Buckeye

5 beds, 3.50 baths

Home size: 4,663 sq ft

Lot size: 13,260 sq ft
$290,900 : 20560 W Summit Place, Buckeye

4 beds, 2.50 baths

Home size: 3,468 sq ft

Lot size: 13,812 sq ft
$199,000 : 3835 N Springfield Street, Buckeye

4 beds, 3.50 baths

Home size: 2,739 sq ft

Lot size: 9,963 sq ft
$895,000 : 21703 W Calderwood Way, Buckeye

4 beds, 3.50 baths

Home size: 3,700 sq ft

Lot size: 21,873 sq ft
$230,311 : 2576 N Saide Lane, Buckeye

4 beds, 2.50 baths

Home size: 2,650 sq ft

Lot size: 7,200 sq ft
$231,082 : 20782 W Eastview Way, Buckeye

4 beds, 2.00 baths

Home size: 1,902 sq ft

Lot size: 10,412 sq ft
$205,000 : 21104 W Glen Street, Buckeye

3 beds, 2.00 baths

Home size: 1,934 sq ft

Lot size: 5,580 sq ft
$285,000 : 20930 W Cora Vista --, Buckeye

4 beds, 3.00 baths

Home size: 3,054 sq ft

Lot size: 11,531 sq ft
$256,094 : 20465 W Hamilton Street, Buckeye

3 beds, 2.00 baths

Home size: 2,727 sq ft

Lot size: 9,327 sq ft
$408,600 : 21248 W Sunrise Lane, Buckeye

3 beds, 3.50 baths

Home size: 3,014 sq ft

Lot size: 27,103 sq ft
$234,882 : 3028 N Wycliff Court, Buckeye

5 beds, 3.50 baths

Home size: 2,886 sq ft

Lot size: 6,600 sq ft

Listing information deemed reliable but not guaranteed. Read full disclaimer.

Don't Panic! About the Cycle of Fear

Jonathan Dalton (Thompson's Realty) — Sun, 14 Aug 2011 13:10:38 -0700

"The only thing we have to fear is fear itself." - Franklin Delano Roosevelt

Several years ago, about the time of the near-demise of the American and worldwide economy following the collapse of Lehman Brothers, near-collapse of Merrill Lynch and the forced bailout of AIG, I made the conscious decision to wean myself off the news.

This wasn't the result of someone preferring the life of an ostrich, head buried firmly in the ground, or of a mushroom (in the dark and up to his neck with, well, stuff) ... in the days the Dow Jones Industrial Average was swinging wildly I alternated between Fox News and CNN on my Sirius satellite radio, figuring if I listened to each side blame the other I might be able to glean the truth.

It wasn't a question of whether the topics of the day interested me. Check out my profile on GetGlue (which I use mostly to start conversations about different books on Facebook without having to work too hard for the links) and you'll see among this year's four dozen books to date (not all compiled there) several tomes about what happened in September 2008 on Wall Street and elsewhere.

Mostly I stopped because I found the news was affecting my attitude and leading to a series of self-fulfilling prophecies. Of course no one, given the uncertainty on Wall Street and the subsequent credit crunch, would be purchasing homes. Yet Q4 2008 was the strongest final quarter of a year I'd posted to date, largely because I found when I stopped assuming no one would purchase because of fear, I discovered folks who would.

In short, the issues on Wall Street weren't really impacting me directly but they were causing in me a blossoming, inexorably creeping and damaging sense of fear.

"Courage is not the lack of fear but the ability to face it." - Lt. John B. Putnam Jr.

Fear unquestionably has been the driving force on Wall Street for the past week. Down 1,000 points between Monday and Wednesday. Up nearly the same 1,000 points when you add together the other three days. All noise and fury signifying nothing, a violent, frightening roller coaster ride that whips people from side to side, flips them upside down and then returns them to the station essentially at their original starting place.

Some emerge from these rides feeling the rush of adrenaline, the thrill of survival though there's little fear that the journey, no matter how harrowing, would be fatal. Others are so overwhelmed by the fear that they miss the entire survival message and instead focus on the sheer terror of the drop, regardless of the rise just around the bend.

"In politics, what begins in fear usually ends in folly." - Samuel Taylor Coleridge

Yes, there was what was regarded as a concrete cause for the initial and secondary drop - S&P's decision to downgrade the U.S. debt - though how concrete the cause truly is can be left for debate. If you're not someone who's invested in the market, would you have felt the rumble of the downgrade? Did it really change anything you did last week? Didn't think so.

And even if you are someone who's invested in the market, by the time the week ended you were on average right back to where you started from; at least, the larger market was about back to where it had been before the gyrations began.

What really happened, other than S&P pulling down the collective pants of our nation's political "leadership", a group of individuals far more concerned with scoring points for their own particular intractable ideology than in actually working together on some sort of reasonable solution?

There is no leadership right now. There are no ideas. There are no solutions. And few seem interested in searching for them, not when there are political chits to be accumulated. That is, unless you consider inviting your fellow governors for a weekend of prayer to help heal the nation's wounds to be a viable solution.

Yet, for all that ... we continue moving on in our lives. We wake up. We go to work. We send our kids to school. We cook and eat our meals. We watch Bachelor Pad and in the process help keep alcohol-related businesses flourishing since it's impossible to watch this show without a healthy buzz.

In the real estate markets, some continue to buy while others wait, fearful of a further drop in home values. When inventory was higher, many would try to protect themselves from said drops by offering and sometimes purchasing a home for well below market value. Except ... those low sales soon became the comps so, instead of anticipating the gentle decline and getting ahead of it, the purchases hastened the drop causing a plummet akin to an elevator whose cables have been cut.

While some right now rightly are worrying about their jobs, their retirement, their 401(k)s, others are taking advantage of low prices and low interest rates to purchase. Fear exists, I'm certain, but not to such a degree as to discourage forward movement.

This week on Wall Street, the only true losers from this week's travails are those who may have sold on Wednesday during the second plummet in three days rather than wait until the gyrations stopped and the market found a level. Our local paper said the week was driven by a combination of fear and hope; I can assure you, fear dominated that matchup. It always does. Without question. Without debate.

In our core, human beings are creatures of fear. Television stations know this and prey upon those fears, reporting stories in such a manner that a viewer would seem to be uncaring of anything in life not to drop everything to learn about "the latest danger confronting our teens" or a "new scam preying upon the elderly" or whatever other sort of sweeps week melodrama is created in the newsroom.

When the real estate market is flying out of control, the local newspaper would write about those poor buyers who couldn't get an offer accepted. When values dropped, no one wrote about the buyers anymore; the story now was sellers who were having to adjust their own judgment as to the values of their property.

Either way, the angle taken dealt with the perceived victim. Because that's what sells. And because that's what we as human beings generally perceive ourselves - victims of fate, victims of circumstance, unable to control any part of our own destiny.

Shutting off the news doesn't change that basic nature but it limits the opportunity for outside forces to prey upon that instinct to our own detriment. It doesn't give you an excuse for ignorance (except for possibly not realizing the lead singer of Warrant had died) but it allows you the freedom to not allow fear to dominate your existence.

None of us know what tomorrow will bring ... literally, no one knows what direction the stock market may go tomorrow. Panic selling - and make no mistake, it's panic selling - could win the day or investors will settle in a bit after the past week. Confidence in Washington would help but, at least from this seat, I'm not sure how it possibly will come given the current cast of characters in the executive and legislative branches alike.

Nor am I overly optimistic about those who would seek what has to be the least-sought after job in the world; it almost seems like anyone with the sense necessary to take that job are smart enough not to do it.

These can be scary times, no question. But that doesn't mean we need either to be scared or to proactively feed our fears.

"We gain strength, and courage, and confidence by each experience in which we really stop to look fear in the face... we must do that which we think we cannot." - Eleanor Roosevelt

Photo credit: MSVG via Flickr Creative Commons