I am not sure if you have ever taken a class in "Statistical Analysis", but I have taken several and always get a kick out people trying to defend their values or estimates with little true basis!
What I mean by that is that with bad statistical analysis I can prove almost anything if you let me select the sample. If I wanted my analysis to show the number of children per average home should I sample the one bedroom condos or the five bedroom homes to illustrate the answer I wanted?
I have yet to see a real estate class taught that covers statistical analysis (other than what can be done in Excel or Access type programs). They should require sampling strategies, bell curve analysis, standard deviations from the norm, percent confidence levels, etc. In a "Bell Curve" your average (one standard deviation from the norm) only covers 68% of the entire sample. If you go out two, you at least cover nearly 96% of the population. In the chart below which illustrates the Bell Curve for IQ distribution, you will see that if your IQ is over 145, (4 standard deviations from the norm) you are truly smarter than 99.8% of the people and will be extremely frustrated with a world based on "normal" being at 100!
Too many real estate valuation models are based on easier methods like Price Per Sq. Ft. Some extreme examples of other industries in which that doesn't make sense include:
Automobile - do you buy your car by the pound? Cost per pound of a Harley Davidson vs a Hummer H2 vs a Honda?
Restaurants - Does Caviar cost more or less per pound than regular eggs? If it is all just "beef" why does prime rib cost more than hamburger?
Art - why does a gold necklace cost more than the value of the gold alone?
Clothing - Does Victoria's Secret charge extra or less for their skimpy little outfits?
There is a huge attempt to treat real estate like a commodity. Companies like Zillow admits their numbers are off (varies by market) at first it doesn't sound bad if the number is give or take 10% but that is 10% on either end so their range is really 20%. For example, a $200,000 home could be $180K-$220K! If the true value was $220K and the price they sold for themselves without a Realtor is the low end (since they thought they saved money) is $180K, they left $40K on the table! That equates to selling at an 18% discount yet they "saved" about 6%. They could have hired five Realtors for that with non exclusive contracts since only one would end up receiving the offer (5x3%=15% +3% =18%). Obviously, that is a weird example, but I wanted to prove my point on "bad math"!
Just for fun, the next time you do a CMA, compare the following:
Average price per sq. ft.;
Average sales price;
Median Sales price;
Median Sales Price;
Mode Sales Price;
If the average home in your market sells for 97% of list price, do you list your home at the "average" or do you jump down to 97% to be where the buyers are ending up?
Figures don't lie, but liars figure, while others are just plain ignorant and speak the loudest!
Microsoft announced today at the Professional Developers Conference that they are unveiling the public beta of Office 2010, SharePoint Server 2010, Project 2010, Visio 2010, Office Web Apps for businesses and Office Mobile 2010 effective today!
I would love to try the Windows Mobile 2010 but my Treo 800W only has Windows 6.1 mobile and not the required 6.5 mobile.
The feedback they get from this trial will be used to tweak the programs before their anticpated releases in mid 2010.
One new feature that might be pretty interesting to those of us using blogs and social media will probably be "Social Connector". Kurt DelBene, Sr. Vice President of the Office Business Productivity Group, Microsoft was quoted in the Microsoft Press Pass today as saying "Social Connector lets them connect with people faster, without switching programs or changing their routine. Essentially, with this new capability, people can collaborate and work better together. The Outlook experience customers are familiar with and use on a daily basis becomes the hub of their social networking experience. Outlook Social Connector brings their communications history, business and social networking feeds directly into Outlook to help them keep track of conversations and stay up to date with co-workers, friends and family."
I know I will be downloading a number of these new programs. As an EPRO Instructor, I am always looking for new things to share with my fellow Realtors, so don't hesitate to share your ideas as well directly with me and I will be sure to give you credit if you are the first one to bring things like this to may attention!
The Best of NAR 2009 Expo - Real Estate Technology
NAR each year is always packed with great sessions, speakers, topics and presenters. There's no way to see and do it all! One of my favorite parts of the Convention is walking around, meeting people in the hallways, hugging old friends and shaking hands with new ones. This year, William Shatner was one of the special guests at NAR, but unfortunately, I didn't get the chance to sign him up on ActiveRain.
My absolute favorite is "cruisin" the EXPO and seeing all the "NEW" stuff that's being displayed. Many of the tools and services presented will have an affect and impact on the ways business will get done now, and in the future.
To See the more than 375 Booths and vendors that were there, here's an interactive floor-plan you can visit.
NAR always brings back some of the same vendors you see year after year, but I still like to stop by and see them, and how their products have changed or improved. Then there's all the new technology stuff I haven't seen or heard of yet. When I found a booth or vendor with a name I didn't recognize, or if they that had something I hadn't heard of, I'd ask them, "In a sentence, tell me who you are, what you do, and what does your company provide?"
So if you were unable to make it to NAR 2009 in San Diego this year, I hope you'll take a moment to let me be your eyes, your ears, and your feet at NAR, and enjoy this condensed version of "A Day with Brad at the NAR EXPO" and see a few of the "highlights" that I thought were some of the "Best of the NAR Expo."
We collected Business Cards and had a drawing at NAR for 2 RainCamp tickets and $100.00 American Express Card and the winner was....drumroll...Tamara Dorris from Sacramento, CA. Congratulations Tamara, we're looking forward to seeing you at RainCamp.
"RainMaker" Special - Signup Here and Get New Member Discount
When looking to buy or sell a home, it is very important to know the inventory! You can see that in September, we had an average of 6.7 months of inventory but that figure varied drastically by price range.
When the average income in Ada County substantiates about a $250,000 home, it is no surprise to me that it will take 28 months to absorb the inventory of $1 million plus homes!
With our lot prices dropping to less than development costs alone, it is a great time selectively start looking at the affordable price ranges and niches and consider building again. I have learned that I can effectively compete with short sale prices in our area by building a home on a lot that can now be bought for $40K instead of the $100K two years ago; therefore, competing directly with short sales without the fear that in 3 months your offer would get turned down from the bank or that the seller decided to declare bankruptcy and stay in the home for another six months instead!
I just learned that NAR has just acquired some of the pieces of the puzzle to finally produce the national database they have been talking about for quite some time. It should have parcel information on nearly 150 million properties!
This project has been referred to in the past as:
Gateway
Real Estate Channel
Library/Archive
Currently, it being referred to as the Realtor Property Resource (RPR) and is a wholly owned subsidiary of NAR.
It will be interesting to see what NAR discloses in San Diego later this week!
I love this time of year since all the major vendors are rushing to get their upgrades working to show them off at the National Association of Realtor's Convention!
I look forward to learning more about this and other great new tools that I can bring back to Idaho to better serve my clients and continuously improve my company!
If you are frustrated by the the human race today, consider the evolution in teaching since you were starting school. Is it any surprise that looking at this one example, why our society has issues?
1. Teaching Math In 1950's A logger sells a truckload of lumber for $100. His cost of production is 4/5 of the price. What is his profit ? 2. Teaching Math In 1960's A logger sells a truckload of lumber for $100 His cost of production is 4/5 of the price, or $80. What is his profit? 3. Teaching Math In 1970's A logger sells a truckload of lumber for $100. His cost of production is $80. Did he make a profit? 4. Teaching Math In 1980's A logger sells a truckload of lumber for $100. His cost of production is $80 and his profit is $20. Your assignment: Underline the number 20. 5. Teaching Math In 1990's A logger cuts down a beautiful forest because he is selfish and inconsiderate and cares nothing for the habitat of animals or the preservation of our woodlands. He does this so he can make a profit of $20. What do you think of this way of making a living? Topic for class participation after answering the question: How did the birds and squirrels feel as the logger cut down their homes? (There are no wrong answers, and if you feel like crying, it's ok. ) 6. Teaching Math In 2009 Un hachero vende una carretada de madera para $100. El costo de la producciones es $80. Cuanto dinero ha hecho el hachero?
Here are some of the key points that should be of interest to Realtors and Mortgage professionals:
This Act may be cited as the `Worker, Homeownership, and Business Assistance Act of 2009'
You need to look specifically at "SEC. 10. 0.2 PERCENT FUTA SURTAX"
SEC. 11. EXTENSION AND MODIFICATION OF FIRST-TIME HOMEBUYER TAX CREDIT
EXCEPTION IN CASE OF BINDING CONTRACT- In the case of any taxpayer who enters into a written binding contract before May 1, 2010, to close on the purchase of a principal residence before July 1, 2010, paragraph (1) shall be applied by substituting `July 1, 2010' for `May 1, 2010'.'
Special Rule for Long-time Residents of Same Principal Residence- Subsection (c) of section 36 of the Internal Revenue Code of 1986 is amended by adding at the end the following new paragraph:
(6) EXCEPTION FOR LONG-TIME RESIDENTS OF SAME PRINCIPAL RESIDENCE- In the case of an individual (and, if married, such individual's spouse) who has owned and used the same residence as such individual's principal residence for any 5-consecutive-year period during the 8-year period ending on the date of the purchase of a subsequent principal residence, such individual shall be treated as a first-time homebuyer for purposes of this section with respect to the purchase of such subsequent residence.'.
(D) SPECIAL RULE FOR LONG-TIME RESIDENTS OF SAME PRINCIPAL RESIDENCE- In the case of a taxpayer to whom a credit under subsection (a) is allowed by reason of subsection (c)(6), subparagraphs (A), (B), and (C) shall be applied by substituting `$6,500' for `$8,000' and `$3,250' for `$4,000'.'.
INCOME LIMITATION- Subsection (b)(2)(A)(i)(II) of section 36 of such Code is amended by striking `$75,000 ($150,000) and inserting `$125,000 ($225,000)'.
LIMITATION BASED ON PURCHASE PRICE- No credit shall be allowed under subsection (a) for the purchase of any residence if the purchase price of such residence exceeds $800,000.
If you are working with our armed forces personnel, make sure to read up on the "SPECIAL RULE FOR MEMBERS OF THE ARMED FORCES"
Except as otherwise provided in this subsection, the amendments made by this section shall apply to purchases after the date of the enactment of this Act. (which as of the time of this blog, have not yet been signed by President Obama). I will amend this blog if another amendment occurs prior to his signature and/or upon his signature!
One thing is becoming increasingly clear to me - the American consumer is finally getting worried about the amount of this countries debt. They are thinking about our ability to pay it back and realizing that the repayment will eventually come from us, the taxpayer!
My proposal is to extend the First Time Homebuyer Tax Credit and expand it for upper end buyers too since that market appears to need a lot more help than the first time homebuyers! Wait, didn't I just say that we were adding too much debt and now I am proposing adding even more? Yahbut!
Yeah, but, I propose making this credit a silent second on your mortgage so that the person directly benefiting from the tax credit has to eventually pay it back themselves! I would prefer that the interest acrue at a below market rate but not be due and payable until the home is resold, but would agree to a no interest loan since the additional impact on our economy would offset the interest and still provide an economic stimulous. I believe NAR's economists stated that the economic impact of the $8,000 tax credit was $65,000!
I recognize that there will be some default on the seconds; however isn't a 1% payoff even better than the 0% today?
I am not sure why so many people believe our government has to give stuff away for free (i.e. swine flu vacines). If they are turning people away since supply does not exceed demand, generally private enterprise raises the price, they don't keep giving stuff away! Why not give away the vouchers for the shot to the people that could justify spending 8 hours in line and allow them to sell it to the highest bidder on Ebay as a way of creating additional income for the homeless and underemployed willing to stand in line?
At some point we have to recognize that we have to stop feeding the pig. We need to realize that when the piggy bank breaks, maybe we will need to consider making bacon, ham and hot dogs to feed our population instead of just printing more money and giving it out as quick as Bernie Madoff can take it!
I had to adjust it a bit to get it to fit on my Faceboook page.
First Time Homebuyer Tax Credit update! Tentative tax credit agreement of yesterday has changed. A new agreement on extending and expanding the tax credit has now been introduced as a separate, stand alone bill. It could be voted upon separately from the Unemployment bill. Or not. The timing of the votes is still up in the air, but the good news is that they are still working on it!
This has been a major effort by NAR so you dues are working for you!
I have attended well over a dozen NAR conferences in my 18 years of real estate. They are fantastic and I always learn new things there each year.This year’s conference is in San Diego from November 11th to the 16th. (actual dates vary depending on courses you want to take and volunteer work prior to conference).It is a relatively cheap place to fly to and there is lots of competition for hotels so if you are on a budget, shop around. Your travel agent may even have some “vacation package” deal.
Tips:
1.Make up special business cards with a new conference email account and bring about 500 of them to pass out. This way, you can track the leads you get back to this conference and you won't feel bad about dropping your card in all the vendor booths for their prizes knowing they will probably have already called your office or emailed you before you get back home.
2.Allow two full days to visit the Expo! They have over 400 exhibitors this year. Several years I have gone and only bought the expo pass for $25 instead of paying $330 for the entire conference. http://www.realtor.org/convention.nsf/pages/exp
3.Lodging is most convenient at the host hotels however you pay a premium for convenience. Sometimes I have gotten rooms nearby for 1/2 the price and still can use all the same shuttles to different events. I think Manchester owns both the Hilton and the Marriott so you probably have to go further to get much price variance this year.
4.Review the agenda and when you have conflicts of which event to go to, choose to visit the vendors at their booth instead of taking a class and attend the class that may not have a booth. Wouldn't you rather talk one on one with the instructor anyway? Use their event planner online.
5.Make sure to look for specialty functions associated with any designations you may have: (i.e CRS Day, ABR receptions, WCR functions, etc.)
6.Learn immediately where you can get access to WIFI and determine if you need to bring your tablet (laptop) everywhere or not. I have a special laptop case with wheels so I have no problem lugging it everywhere and it makes a great place to stuff all the give away items at the convention.
7.Make a list of companies you want to follow up with. Instead of dragging a suit case home with pamphlets you hope to read later, just write down the business category, their website and the person you talked to.Maybe just write these notes on the back of their card.The pamplet they hand you typically is not as comprehensive as their website.
8.Wear something that people can associate with your area. For example, I will probably go to the Idaho Potato Commission and see if they can spare a few hundred "Idaho Potato Pins" for me to hand out. Sure beats being from Wisconsin and having to wear a cheese hat since that stands out way too much for me (grin).
9.Network, network, network! What a great way to meet top agents from all around the country personally to build your referral network.
10.Post to your blog that you will be attending and invite your readers to meet you there.
11.Don't physically plan to do any work the day you get back home. There will be enough "surprises" and messages to return without having to fill them in between your prescheduled appointments.
12.Change your email and voice mail to let people know you are investing in your customer service level by attending a national Realtor conference to help better serve your them and the best way for them to reach you while you are out of town.
13.Many of the vendors will have special “show pricing” and “free delivery” or “no set up fees” so it is a good place to buy supplies for 2010
14.Have a great time writing off the business expenses and mix in a mini-vacation while you are there!
Boise Idaho real estate, Eagle Idaho homes for sale, Meridian real estate. Jim Paulson is the current President Elect of the Ada County Association of Realtors. I try to use this experience coupled with my 18 years being a licensed Realtor to help bring you relevant information and hopefully an occasional thought provoking idea or two. I am a member of the Greater Boise Chamber of Commerce and and Accredited business with the Better Business Bureau. I can help with Idaho Foreclosures, Boise Idaho Short Sales, building a new home, or even using First time home buyer tax credits to buy or strategically sell homes. I am here for your real estate marketing needs!
http://www.IdahoMLStours.com
Disclaimer: ActiveRain Corp. does not necessarily endorse the real estate agents, loan officers and brokers listed on this site. These real estate profiles, blogs and blog entries are provided here as a courtesy to our visitors to help them make an informed decision when buying or selling a house. ActiveRain Corp. takes no responsibility for the content in these profiles, that are written by the members of this community.
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The Best of NAR 2009 Expo - Real Estate Technology
This has been a major effort by NAR so you dues are working for you!
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