There's an old saying that goes something like, "There's lies...damn lies...and statictics!"  That pretty much sums up my  blog post on real estate market stats....thanks for reading.  In actuality there is some measure of truth to real estate stats.  The fun starts with where the stats are sourced and how they are broken down. 

Many agents use the local Multiple Listing Service (MLS) to source their stats.  Not a bad place to get data as it is usually local, current, and detailed.  But it's also based on what the agents input in to the system...so it can be, "Garbage in garbage out."  In other words, it's only as good as the agent putting it in.  Were they detailed?  Did they leave important info like if the seller made concessions out?  Is the sales price accurate?  The market time?  Were there price reductions along the way so we know what the list to sale price ratio really is?  You know, stuff like that.

The most important aspect to consider is, "Just where are these properties located?"  Keep in mind that when you read an article on local real estate, the data is not always local.  It may be county or even state-wide information.  To get an accurate look at your local market, start by analyzing your specific zip code.  Remember, nearly every city has multiple zip codes, so even if you are looking at market data in your city, it may not really reflect your zip code or even your neighborhood.  This is where a top-notch REALTOR can come in handy as they know where to pull that exact data.  *HINT* It's not always available on Zillow!

Which brings me to my next point.  Just because it's on the Internet that doesn't make it true!  I know the web is a great place to do research and kick the tires on real estate data.  But depending on the source, you could be in for a big surprise.  Many web sites are days or even weeks behind.  And real estate stats change daily, if not hourly.  If I come to talk to you about selling your house and I leave a Market Analysis behind, the minute I walk out that door it could be outdated!  Things change quickly and one sale could affect the value of your entire neighborhood.  That being said there are some good online resources you can use to get a glimpse of what is happening.  I have what I have found to be the best right here on my blog.  You can also go here  for details on every area in S. California.

Lastly I will let you in on a little secret.  One that is the ultimate measuring stick of how well your market is doing.  Do what I do everyday as I am driving around my neighborhood.  Pay attention to how many "For Sale" signs are posted...and how many of them say, "SOLD"!  That is the true measure of what is happening in your neighborhood.  If you have very few signs, then not much is happening.  If you have lots of signs but none say sold, then your area has not yet corrected.  If you see lots of signs that say sold, then things are moving and you should go introduce yourself to your new neighbors.  If a move is in your future, ask who their REALTOR was and get that agents perspective on your area.

  So I'm a month into the new gig and I must say I am so pleased with this decision.  Even though I have had a knack for making smart choices about my career, there is always a bit of trepidation when a new journey starts...sort of like that first day of school.  You lay out all your clothes the night before, shine up those shoes, get a haircut and shave, and maybe have some hesitation on the way out the door.  And then you realize, "Hey I've been here before" and get on with the business at hand.

  Speaking of business at hand, what a tremendous project I have become a part of!  Over the past few years I have been the main driver and while I certainly had great support and assistance, ultimately I made the decisions.  More recently I was basically alone at the wheel and forgot how wonderful it is to be part a team and work in a more unified environment.  Not having to solve the worlds problem...at least in my little world...has freed me up to see a bigger picture that had gotten blurry over the past six months.

  A big reason for this is the fact that I have been welcomed and made to feel like a valuable part of a great company.  The energy and vibe has rekindled a spark that gets me up and ready for the challenges of the day.  Even my wife Kathy mentioned how much my aura has changed since early January.  Heck, I even enjoyed the rains we had and hope for more!  One thing I do notice is it's not so much the name on the door, but the people behind that name.  The people that are pulling toward the goal of making sure everyone of our customers has a great experience.  After all that's what it's all about...GREAT EXPERIENCES!

After attending Inman in San Francisco in August, I was not quite sure what to expect in the way of "new content" at Inman NYC.  I learned very quickly that six months is a lifetime when it comes to technology in real estate...New start ups being launched, the RPR discussion, the idea of "real time real estate" and of course how mobile will affect us in the coming year were all topics of great debate in NYC.  If I learned anything...on multiple levels...it was that real estate is populated with tremendously bright people who have ideas that just two or three years ago seemed destined to fail.  Now they thrive.  Here's my take on what transpired in NYC.

MOBILE 

• We all know how much mobility has grown and that if you do not have a smart phone you are probably not really in the game.  Mobile applications for iPhone and Blackberry, and now the Android operating system, are proliferating at an amazing rate.  Real estate applications from Redfin, Realtor.com, Zillow, Better Homes & Gardens, etc, have created new ways to access listing data, see values, get details on comminties, and most importantly changed how and when customers communicate with us.  From the agent side, having the ability to work/play/live anywhere, anytime will be a game changer for those that captialize on the technology.

RPR...Realtors Property Resource

• The National Associations play into the datasphere has been widely publicized.  The idea is to create a single source property database that Realtors can access.  This strategy, while on the surface seems quite right, has become the debate of the industry.  Detractors say our intellecutaul property is being used without our permission and we should be compensated.  MLS's fear NAR will now be competing with them and offering Realtors better/cheaper products and services.  NAR's stance is they will sign non-compete agreements so MLS's have nothing to fear.  And there is the idea of a national MLS being tossed around.  All in all a lively debate and one that I'm sure will continue throughout 2010...so stay tuned!

REAL TIME REALTY

• This is the idea that intiques me the most.  Why?  Well simply put it gives brokers and agents that embrace mobile the opportunity to really differenciate themselves from the competition.  It's not only real time realty...it's real time communication.  The ability for a customer to access things like sold data, values, open house schedules, and be able to schedule showings or see agent rankings, will have a tremendous effect on how we work with clients.  The communication part...the ability to connect in real time no matter where the customer originates...and our ability to have the requested information at our fingertips no matter where we are...will set us apart.  

The best part of Inman Connect is the opportunity to see innovation at it's best.  Ideas are born here, partnerships are formed, companies are launched, and friendships are developed.  That is the heart and soul of this conference...to Connect.  I want to thank those I connected with...Brian, Marc and Joel from 1000 Watt Consulting.  Ashfaq Munshi from Terabitz.  And of course my broker David Romero and our Orange County VP and GM, Martha Burgoon, from Century 21 Award.  It was a great week and I look forward to seeing you all in San Francisco! 

Just when you least expect it...change is in the air.  After spending the past 4 months of 2009 focussed on finishing strong and hitting goals, I was forced to make a tough decision.  As a previous post mentioned, change is going to happen and what matters most is how we anticipate and react to it.

That said, I am delighted to announce that effective January 4th, 2010, I will be the Director of Interactive Business Development for the #1 Century 21 franchise in the world, Century 21 Award.  With 15 offices in S. California, Century 21 Award is an outstanding company with a history of providing superior customer service to it's clients and more than 1000 real estate agents.

In this position I will be responsible for building a new division that brings all of the company lead generation activities under one umbrella.  With a focus on relocation and Internet lead generation, this division will be home to an elite group of hand-picked agents with one goal in mind...service our customers at the highest level possible while helping them to achieve their real estate goals.  That means we need agents with advanced levels of experience in technology, negotiations, contracts and service.  If that describes you then I encourage you to contact me to discuss opportunities with Century 21 Award.

Here's to an exciting new year in real estate and Let's Win in 2010!

Let me start by saying the views expressed in this blog are mine alone and in no way reflects the beliefs or opinions of my company or any others.  The two quotes I mention below are just two of several I have seen recently that offer a similar opinion on the tax credits and their effect on the real estate market.  Let me also say that my view may be skewed a bit as well, due to the fact that much of the work we do is representing first time buyers.  This post is a reflection of what I experience daily and what our clients tell us.  

In my previous post I pointed out some good news on the real estate front, among them the first time home buyer tax credit extension and expansion.  A few recent quotes around this issue include, "I am not applying the recent home-price rebound to the tax credit," said Cameron Findlay, chief economist at LendingTree, in a recent interview. "I don't think the tax credit makes as big an impact as people make it out to be, although it certainly motivates first-time buyers," he said. "If it expires, I don't think it would shake the housing market as much as some have predicted." And in a recent interview, Fox-Pitt Kelton analyst Robert Stevenson said the Senate's proposal for extending the $8,000 tax credit for new homebuyers will have a "limited impact" on home sales. Ok, so what do these analysts attribute to the fact that for 8 consecutive months (according to the National Association of REALTORS) housing sales have spiked?  If not the tax credit, then what is it?  Look, I know this is not all we need to continue the recovery, but from the perspective of someone on the street these measures absolutely make an impact!  Here's what NAR has to say:

Pending home sales rose again, marking eight consecutive monthly gains - the longest streak since measurement began in 2001, according to the National Association of Realtors®. Lawrence Yun, NAR chief economist, said the momentum is understandable. "What we're witnessing is a rush of first-time buyers trying to beat the expiration of the tax credit at the end of this month," he said. "Home values will stabilize sooner rather than over-correcting. That, in turn, will mean wealth stabilization for the vast number of middle-class families and lay the foundation for a durable economic recovery."

We can argue the merits of tax credits all day, but the reality is 40% of first time buyers have said they only bought a home because of the credit!  40%!  If that does not say it all then what does?  Our recent experience tells me that with the looming deadline of the first time buyer tax credit has caused buyers to stop their search as they now understand they could not beat the deadline.  By extending it we will see a spike in activity as these buyers get back in the game and drive volume into 2010.  The proposed extension that will include a $6500 credit for move up buyers will also have an impact.  By including language that the move up buyer has had to have owned the home for at least 5 years, that effectively limits the number of potential buyers...and sellers...that are upside down.  Don't overlook what I said...sellers!  This credit will help drive fresh inventory that we desperately need to the market and create not one but two transaction sides.  This was a bold move by Congress...and a smart one.  I have blogged about this in the past, we have huge need for new inventory.  Most homes have multiple offers or are in the long process of getting short sale approval from the banks, so it has limited what buyers can select from.  Add in that more cash buyers are flooding the market and it makes it even more difficult for FHA and VA buyers to get offers accepted.  This is the reality of the market and varies drastically from what is reported.  You want the straight truth?  Talk to a busy REALTOR who is out in the trenches all day.

To say it's been a tough few years in real estate would be a huge understatement.  However in every market there is opportunity to be found and believe it or not people make money in every real estate market.  As an example, real estate brokers that handle foreclosure property are experiencing the best years of their careers.  Same with brokers that handle short sales.  Now, it's a lot more work and it's tough, but nonetheless they are busy.  While thinking about these types of things I started to wonder, "What is the good news in real estate?"  Here's what I came up with.

Conforming loan limits extended through 2010.   The California Association of REALTORS noted the U.S. Congress late yesterday passed a congressional resolution extending through 2010 the current conforming loan limits of $417,000 for most areas in the U.S. and $729,750 for high-cost areas, including many in California. President Obama is expected to sign the resolution today or tomorrow as part of a broader piece of budgetary legislation that will prevent a government shutdown. "There is no doubt that higher loan limits and the federal tax credit for first-time home buyers have helped stabilize California's housing market over the last year," said C.A.R. President James Liptak. "C.A.R. applauds our congressional representatives for their actions to extend the higher loan limits through 2010. They now should focus on making higher loan limits permanent."

C.A.R. calls for extension of federal tax credit.  The proposed extension AND expansion of this tax credit includes language that extends the closing deadline for first time buyers from November 30, 2009 to June 30th 2010. A buyer must be under contract by April 30th 2010 and close by June 30, 2010.  The new bill also includes a tax credit of up to $6500 for move up buyers that have been in their homes for at least 5 consecutive years over the past 8 years. According to The California Asscociation of REALTORS, nearly 40 percent of first-time buyers said they would not have purchased a home if the federal tax credit for first-time home buyers was not offered. This underscores the significance of the federal tax credit to the housing market's recovery in California.

 September sales rise...Median price declines.  The California Association of REALTORS reported that September sales were up 2.1 percent to a seasonally adjusted rate of 530,520 units on an annualized basis. The Unsold Inventory Index fell to 4.2 months in September, compared with 6.5 months in September 2008. The index estimates how long it would take to sell off the existing inventory. Fewer listings typically equates to more sales happening faster. The median price of an existing, single-family detached home in California during September 2009 was $296,090, a 7.3 percent decrease from the revised $319,310 median for September 2008, C.A.R. reported. The September 2009 median price rose 1.1 percent compared with August's $292,960 median price. 

 Economy up, interest rates down.  In a recent statement, the Federal Reserve said that financial markets have improved, home sales have increased, household spending seems to be stabilizing and businesses have continued to make progress toward aligning inventory levels with sales. The Fed also said it will keep the benchmark federal funds rate at just zero to 0.25 percent and continue other policies that have helped to support mortgage lending and home sales. "Economic conditions are likely to warrant exceptionally low levels of the federal funds rate for an extended period," the Fed said. A recent loan quote on LendingTree.com listed a 30 year fixed FHA loan of $272,500 at an interest rate of 4.88%, an APR of 5.19%, and a monthly payment of $1556.  Good news for borrowers looking at historic rates and terms!

As real estate professionals we know very well that we wear a lot of hats.  The average real estate customer sees it as, "Sheesh...all you do is put up a sign and wait for a buyer!"  They don't see the marketing hat, or the showing hat, or the qualifying hat we all have to put on just to get a buyer through the door!  I have often said you could train a monkey to stick a sign in a yard with a toll free number on it, a buyer can call it and say, "I'll take it!"  But the monkey could not handle the details of closing that deal.

So you have the buyer on the hook and it's time to change hats...you are now...The Negotiator!  So Capone may not be the best example, but let's be honest...in this market you need leverage!  Heck, you may have to get downright heavy handed to even get a return phone call.  The fine art of negotiation has changed in this environment and you may find yourself getting down and dirty just to get the right person on the phone.  The point is you have to, "Go to the mattresses" to put your client's offer in the best position to win the deal!

At this point in the game it may come down to the fine art of seduction.  If the heavy handed approach is not working we need to try a little finesse.  You know, smooth things over, make some small talk, a little wink of the eye may go a long way.  Hey, we work on commission and I gotta do what I gotta do!

At times we may be confused as to just exactly what hat we should be wearing.  So we might have to try them all on at once and see what fits.  Am I the therapist, the babysitter, the mother?  We may be all of them at once.  Look, we know buyers get cold feet and we have to help them understand the next step.  So our job is to smooth things over, help them understand the big picture.  Everyone has doubts so we need to reassure them and maybe even coddle them a bit.  Hey, if the hat fits wear it!

Now we are talking!  This is a hat I love to put on.  It's all about the fun we get to have as we get to know our new client and maybe even become friends.  And that is one of the great benefits of real estate...we work with people and get to enjoy some great times and adventures with them.  It may not quite be like this: Elwood: It's 106 miles to Chicago, we got a full tank of gas, half a pack of cigarettes, it's dark, and we're wearing sunglasses. Jake: Hit it.  But we can certainly enjoy the ride!

Which brings me to the Stingy Brim.  My favorite hat of all.  Why?  Well it let's me be me and just have fun and celebrate the small things in life.  Like meeting a new client, or enjoying my sons soccer game, or signing a nice commission check for an agent that just closed a big deal.  For more on that you can check out my video blog on The Many Hats We Wear here:  http://www.twitvid.com/ACCD4

New rules targeted primarily at mortgage lenders making higher-cost loans take effect Thursday, more than a year after they were finalized by the Federal Reserve. On Oct. 1, new rules adopted by the Federal Reserve will go into effect, requiring greater diligence on the part of mortgage lenders and brokers who make so-called high cost loans for borrowers with weak credit. The interest rates on these loans are at least 1.5 percentage points higher than the average prime mortgage rate.

The regulations - finalized in July 2008 but only now being put into effect - bar lenders from making a high-cost mortgage without verifying that a borrower could repay the loan in the conventional way, and not simply through a foreclosure sale. During the home lending boom from 2003 to 2006, subprime lenders would often offer loans without requiring borrowers to prove that they could make the monthly payments. With stated-income loans - or as some called them, "liar loans" - borrowers could easily fabricate annual income figures and even buy a home without a down payment.

The final rule adds four key protections for a newly defined category of "higher-priced mortgage loans" secured by a consumer's principal dwelling. For loans in this category, these protections will:

· Prohibit a lender from making a loan without regard to borrowers' ability to repay the loan from income and assets other than the home's value. A lender complies, in part, by assessing repayment ability based on the highest scheduled payment in the first seven years of the loan. To show that a lender violated this prohibition, a borrower does not need to demonstrate that it is part of a "pattern or practice."

· Require creditors to verify the income and assets they rely upon to determine repayment ability.

· Ban any prepayment penalty if the payment can change in the initial four years. For other higher-priced loans, a prepayment penalty period cannot last for more than two years. This rule is substantially more restrictive than originally proposed.

• Require creditors to establish escrow accounts for property taxes and homeowner's insurance for all first-lien mortgage loans.

Now we are getting somewhere!  After several weeks of the dreaded, "Getting ready to do something" stage, we are now moving into the actual doing!  I love it when a plan comes together...sorry George Pepard aka John "Hannibal" Smith.  So what does one do when it's a buyers market and you have no inventory to sell?  We keep hearing about the suppossed release of thousands of new foreclosures and that the banks are trying to do the right thing...but how does that help The Smith Family that wants a new home now, has made 15 offers, and just can't get what they NEED...not want...but NEED?  You get proactive and go out and find the inventory...and that is exactly what we are doing.

I have met with the top agents in my company and we have brainstormed, discussed, thought out, and created a plan of attack that is not only working...but working fast!  I laid out an agressive plan to add 500 new listings to our books by the end of the year and we are out of the gate fast. The first week we have had nearly double digit listings, three great meetings with short sale negotiators, and a meeting with a solid contact for REO listings.  The best part is we can feel the momentum building.  Like I said, "I love it when a plan comes together!"

The cool things is that because we have some fantastic agents, with so much experience, it was just a matter of time before we broke out. But it's the enthusiasm, and responsibility for their own future and business that really excites me.  Whenever a group gets together to talk about issues and challenges, well having 50 heads is better than one, right?  The synergy and teamwork that has been created is just awesome and I can't wait to see what the 4th quarter holds for these exceptional people.  Going back to my first post on change, I mentioned that transparency and keeping our eye on the goal was a key factor in making this work.  I could not be more convinced of this now!  Just the simple act of putting it out there, the good and the bad, and then having an honest discussion about what needed to happen and asking these true professionals for their best ideas and help to bring it all together has been THE driving force behind making these changes not only possible, but DRAMATIC!

So, I have decided to end this series and focus on making sure we keep the ship headed in the right direction.  I would challenge any of you facing challenges and/or change to embrace the opportunity.  At the end of the day it's about doing what you love and seeing others be successful...and we all have it in us to make that change a reality!     

After posting part one of the Dramatic Changes series I did not realize exactly what I had gotten myself into!  So I apologize for taking so long to post Part 2.  Work first and all that!  At any rate, what a great couple of weeks it has been.  I have spent time with my staff, some of our other market leaders, and several of my agents here in California.  Truely an eye opening process and I want to thank all of you for sharing ideas and expressing your feelings and ideas.  With that said let's examine some of the changes and plans.

1.  First on the list was taking a hard look at our agent roster.  It is critical we have the right mix, sufficient coverage for our lead system, but most importantly is making sure the agents we have hired are really on borad with what we are trying to do.  The market and economy has taken a toll on the real estate industry and so we wanted to find out who was really here and who was not.  So we went through our roster, agent by agent, and made contact with everyone.  Sounds easy, but the reality is we had 300 agents spread out from San Diego to San Jose!  The end result is a leaner and meaner RealEstate.com in California.  Along with that are stricter hiring guidelines to insure we have the highest caliber agent.  So far so good, but is always hard to change the make up of an organization.   

2.  Next up is growing our listing inventory.  We have primarily represented buyers, and certainly a large portion of our company lead generation is on the buyer side.  We need to have more listings and so we set an agressive goal to add 500 listings by the end of the year...100 in each of our five main counties.  We scheduled a series of meetings and invited our top agents to attend and explore ideas around this.  What a great group and I'm blown away by the work ethic, team work and comittment to this project!  We have now targeted several areas to go after and we are already seeing some results wirth a few new listings in this week alone.  Stay tuned and be on the lookout for all those cool RealEstate.com signs!

3.  The last big change was getting everyone to feel ok with the changes!  I'm big on transparency and feel if everyone knows what the goals and expectations are, then we can all work toward a common end result.  So breaking down why these changes were happening and getting everyone to see that they are changes that will have a positive impact on all of us and our organization.  We will continue meeting with our top agents and exposing our new agents to what these great agents do each and everday to provide the highest level of service to our clients!  Stay tuned for more as we progress toward meeting these goals...it should be a fun and wild ride!