Patrick's Blog

Cooler, or Heater?

Patrick Harfst, CRS (Realty Executives) — Sat, 26 Sep 2009 15:37:41 -0500

Remember the movie The Cooler? In that film, a down-on-his-luck type is hired by a casino to "cool off" a hot gambler, simply by standing near the guy at the tables... In a reverse-cooler sense, I have had the odd fortune this week of writing not one, but two offers on homes (different homes, different buyers) that had been on the market for a long time. In both cases, another offer came in between the time we looked at the home and the time we submitted the offer. Not competing offers per se, just the odd timing that comes with a buyer looking favorably at a home... then a day or so later submitting an offer, only to find that another offer had been submitted (and accepted) by the sellers just a day earlier... If this happens a third time in the next few days, I'm buying a lottery ticket!

The Market Recovery Is Coming....

Patrick Harfst, CRS (Realty Executives) — Thu, 19 Mar 2009 00:39:03 -0500

We just don't know how far away it is.

Yeah, that bit of info helps a lot, right? I see it all the time - articles that someone, somewhere, typed out into a news story, an article in a weekly magazine, or on some website. I've been seeing these rosy little missives for years now. So, where is this miraculous recovery? Next quarter? Next year? Where?? When?? Keep reading...

Being raised by an engineer has its good points. It made me want to go get a technical science degree, although I seldom use it. Made me analytical, tho, and I love to juggle data. Here is some of that data...

18-Mar-09
	All Metro area	Gilbert	85234	85297	85298	V V L
ALL Active Homes	48953	1991	368	313	323	55
Actives that are REPOS	21683	1087	216	155	132	15
	44%	55%	59%	50%	41%	27%

ALL Pending Homes	12366	682	111	118	82	9
Pendings that are REPOS	9701	526	86	93	59	8
	78%	77%	77%	79%	72%	89%

Repos are: all homes that are in some stage of the foreclosure process.
Data comes from the ARMLS database.

Notice the percentages... The bulk of all the sales that are happening, involve distressed properties. Many of these are short sales, and will not close as they are currently set - the home will still end up as a full bank repo, but ultimately, will be sold. What this data tells me is that there ARE in fact buyers out there, and to have a good chance of selling, a seller should change their name to "BANK" or "Short Sale". I'm kidding, sort of. The MLS data further shows that the great majority of these sales are taking place in the "under-200" price range. In some areas, homes are selling for $50 per sq ft.

So, when is this recovery coming? When the backlog of distressed properties gets a whole lot smaller. Until then, we are going to see more of this. My bet is later this year. We are in the darkest part of the market... All uphill from here, hopefully. If you are a seller, I'm here to help. The data cannot be ignored. If you are a buyer, same answer. You, the buyer, get to take advantage of a beautiful market. Dig in!

Patrick Harfst, CRS

www.ArizonaHomeLocator.com

Homebuilder Raises Price On Buyer Under Contract

Patrick Harfst, CRS (Realty Executives) — Tue, 10 Feb 2009 22:27:45 -0600

Proving that the earth is flat, and hell has frozen over, a local homebuilder recently (January 09) called a buyer who was about ready to close on his new home, and asked him to re-sign papers, as they'd had a price increase, and wanted him to pay the new higher price. Incredible? You bet... Except it did not happen quite that way...

In reality, the homebuilder had lowered the price they were offering new customers, and were asking the buyer already under contract to sign papers to reflect the lower price... And this happened AFTER the final walk-thru, AFTER the loan docs were signed, AFTER the buyer had his funds deposited, and just a day or two before the keys were to be delivered... This price change was $13,500 on a $240,000 sales price...

Could the homebuilder have just kept quiet? Sure... There was $13,500 in it for them to do nothing. Was taking this action the right thing to do? Probably... Buyers talk, at the pool, the mailbox, etc., and word gets around...

Take home lesson? In challenging times, some find it easy to compromise their ethics. Here was a builder who chose to do the right thing, seemingly without even looking for publicity. They have not asked me to promote them, but I will. When so many builders operate without a shred of conscience, hiding behind bankruptcy laws when it suits them, re-emerging with a slightly changed name, ready to have their way with the next group of buyers, it is a pleasure to find a builder who stands tall, takes responsibility for their actions, and does the right thing... Oh yes... the builder? K Hovnanian Homes, one of the largest builders in the country. They get it...

Top 10 Ways for Realtors to Spend Money Wisely (under $100 version)

Patrick Harfst, CRS (Realty Executives) — Sun, 21 Oct 2007 15:16:21 -0500

10. A clean car... Carwashes are what, $10? No excuse for a dirty car.

9. A printed map of your area... It will come in handy when you least expect.

8. Supply of movie passes to enclose with Thank You notes.

7. Subscription to Real Estate Professional magazine. Best $33 ever spent.

6. Spiral binding machine for presentations. No more handing out stacks of paper...

5. Professional business cards. Amazingly, many agents use generic cards. Still. In 2007

4. Read a minimum of one good book per month. Preferably business related.

3. Subscription to Zipforms (or whatever is used in your area).

2. Wireless aircard for your computer. Work from wherever you are.

And the #1 Way For Realtors to Spend Money Wisely...

1. BlueTooth earpiece for your cell phone. Two hands on the wheel, please!

Top 10 Ways for Realtors to Spend Money Wisely (over $100 version)

Patrick Harfst, CRS (Realty Executives) — Sun, 21 Oct 2007 15:14:08 -0500

10. Color laser printer. Prices have come WAY down...

9. Wireless office phone. No more crooked necks.

8. Wardrobe of logo'ed shirts. Use before-tax $$ to buy your threads...

7. A website that works. No shortage of reasons why... Just Do It!

6. Quality flier making program... SharperAgent, MS Publisher, etc.

5. CRS Designation. CRS agents earn many, many thousands more. Enough said.

4. Quality scanner with AutoDocumentFeeder. Stores files as pdf's on a DVD

3. Mastermind group. There's a synergy to these, and everybody gains.

2. Tablet computer - take signatures right on the screen. Invaluable!

And the Top Way for Realtors to Spend Money Wisely...

1. A cell phone that receives your e-mail. SmartPhone, Blackberry, iPhone, whatever flavor you like, the technology is available. Use it, and watch your productivity grow!

Top 10 Worst Things Realtors Spend Money On

Patrick Harfst, CRS (Realty Executives) — Sat, 13 Oct 2007 00:56:28 -0500

10. Shopping cart advertising. Who ever renews these contracts?

9. Muerta del toro lead generators. Again, who continues with these guys?

8. Glamour shot photography. The word is out on this... Time to stop!

7. SEO "guaranteed placement" claims. We can't ALL be in the first position!

6. Image advertising that is "all about the agent"... Consumers could care less.

5. e-mailing flier services - poor use of advertising dollars - looks like spam

4. High pressure sales seminars - where you can learn to Always Be Closing.

3. Meals with other Realtors - why not take a client out?

2. Newspaper advertising - worked in the 70's & 80's... past tense.

And the #1 Thing that Realtors Waste Money On is:

1. Over-priced listings. Nothing bleeds money faster. Career killers.

Top 10 Tools That Make You Money

Patrick Harfst, CRS (Realty Executives) — Sat, 13 Oct 2007 00:24:08 -0500

This is the first of two lists I'm putting together... The other is the Top 10 Worst Things Realtors Spend Money On. Again, this is the GOOD list.

10. Lockbox key - for obvious reasons.

9. Tablet computer - gather signatures wherever you are.

8. Interactive web site. Needs no explanation.

7. Contact manager software.

6. SmartPhone. Send/Receive e-mail on the fly.

5. pdf generator for your computer. Saves paper & time.

4. BlueTooth earpiece for your phone.

3. Professional quality photograph. Image counts!

2. Branded e-mail address. Promote your own brand - not aol's!

And the best tool that Realtors can use to make money is:

1. Healthy positive attitude. No one likes a buzz-kill.

Attention Chicago Cubs Fans...

Patrick Harfst, CRS (Realty Executives) — Tue, 02 Oct 2007 20:06:35 -0500

Greetings faithful Cubs Fans! All hail to the Bartman! In Lou We Trust! Blah Blah Blah...

Take a good look at the attached picture. Not the little girl - my daughter has enough people looking at her... Zoom in on the score board. This photo was taken just after the second game played recently between the D'Backs & the Cubs... Notice anything? The winning pitcher? Doug Davis. The losing pitcher? Ted Lilly. Hey, I'm not Nostradamus, but I've heard that history repeats itself... So, guess who the starting pitchers are for the second game this week?

Just thought ya'll would want to know... (it does).

D'Backs in 4.

If I Were the Commissioner

Patrick Harfst, CRS (Realty Executives) — Sun, 26 Aug 2007 12:33:07 -0500

If I were to awaken tomorrow as the commissioner of real estate - all of it - what would I change? Lots of things... For starters, I want a new set of rules.

Raise the entry gate. No, I'm not engaging in the "pull up the ladder now that I'm on board" tactic. I've been licensed 22 years. But I DO see way too many agents who are under-educated about what is required to actually be a GOOD agent. Quantity is too high, and education too low, so I'll require licensees to have at least a 2 year degree in a business discipline, PLUS attend specific classes related to the actual operation of a real estate business. Enough of the "how many acres in a quarter section?" questions. The effect of this new rule will be fewer agents, and much better prepared & educated agents. The consumers will benefit, our profession will benefit, and the world will still turn.
Raise the renewal requirements. This follows on Rule #1 in that agents will now have to continue to stay on top of the changes sweeping over the industry. Many do this now, but many more do just the minimum hours per year to stay fresh. Please do not tell me that 1 hour per month of continuing education is sufficient! New Rule #2 - Back To School for at least 3 hours per month. 36 hours per year is not going to wear anyone out.
Do some business, or get out! We have agents who do 1 or 2 sales per year. Throw in 1 or 2 listings per year, and these folks are barely getting by. Like a triage unit, the New Rule #3 will mandate a minimum level of closed sales. This can be measured both in quantity or dollar volume. For those that fail to make the cut, or for those who primarily are self-dealers, there will be a safety net. Just as we now have Brokers Licenses & Agents Licenses, new rule #3 creates a Temporary License. It can be renewed, but would serve to alert the public that the agent they are dealing with is either a self-dealer or a part-timer. The public needs to know these things!
Mandatory apprenticeship. Not for years, but for at least 6 months. All new agents must spend some time learning along side the veterans. This is not a new concept, as almost every other true profession utilizes the apprentice program. Let's also require any document prepared by these new agents to be reviewed and initialed by the veteran agent and/or the managing broker. So many simple mistakes are made that are clearly avoidable by simple review. Again, the consumers benefit.

These are rules that a commissioner has control over, and while changes often require legislative action, these would be on my Action List as commissioner. The future of the industry is in the balance these days, and these new rules are long over due.

Tomorrow I'll tackle the archaic Multiple Listing Systems we are stuck with.

Time to go play golf.

Top 10 Ways You Know The Market Has Changed

Patrick Harfst, CRS (Realty Executives) — Tue, 20 Feb 2007 05:55:07 -0600

Top 10 Ways You Know The Market Has Changed

10. No lines in front of builder sales trailers.

9. Listing agents call for feedback after you show their listing.

8. Escrow officers answer your phone calls - even at the end of the month.

7. Open house signs clog every corner on weekends.

6. Two Words: Price reductions!

5. Builders offering Realtor luncheons.

4. Discount broker crowd is lonelier than the Maytag Man.

3. Licensing exam no longer held at Sun Devil Stadium.

2. Part-time agents leaving the business in droves (oops - that's just a dream!)

And, the Number One Way You Know The Market Has Changed...

1. FSBO's are cold-calling Realtors!

Teachers make great Realtors! Great Realtors are Teachers!

Patrick Harfst, CRS (Realty Executives) — Sun, 18 Feb 2007 22:46:19 -0600

Teachers make great Realtors! Great Realtors are Teachers!

I use a very personalized Buyer Book, and wrote this piece for the newer agents in our firm...

After using my booklet for about 2 years now, I have had numerous offers to sell them. The idea, while appealing to my accountant, is not practical. Why? Well, who would buy it? Other agents? So they could collect dust on a bookshelf along side un-opened training manuals & CD series... No, that won't work. I have a better idea. I'll give the formula away, and any agent that wishes to make their own, can do so. In creating a manual, rather than copying someone else's, the "extra ingredient", the personality of the agent will come thru. That is what will make them unique...

My booklet is about 50 pages. Sounds like a lot, but it's a roadmap for buyers to get an overview of the process, and there is not really a way to make it smaller.

First is the cover...

Mine is titled

How to Buy A Home in Phoenix Arizona...

Without Going Crazy

and the subtitle is

An Analytical Approach to An Emotional Subject

I have a 3" graphic in the middle that I found in Microsoft Publisher... below that, I have my website name, and lastly, my name along with my wife's, who is also an agent with me. Use whatever title you'd like, but DO make it catchy. Think of the booklet as something you'd want your buyers to leave out on a coffee table, and have it be picked up by visitors to the place. You never know where the next buyers are coming from, but referrals are the single best way to grow your business. Spend some time on the cover! Use cover stock, and print at a higher resolution. Refine it as you go along - don't wait until it is perfect - it is a work in progress.

Inside, I have a single page Mission Statement, on letterhead, and signed. This is a statement for the readers (buyers, in this case) to see early on, to get an idea of who you are, and what you are about. Stephen Covey, and others, have written extensively on the topic of Mission Statements. Suffice to say, you are better for having gone thru the process of writing one. Put it in here!

Next are the pages that are hardest to write, and almost useless to copy from someone else. These are the pages where you will explain, in your words, what the process of buying a home entails. You will explain terms, the roles of the various parties to a sale, costs involved, fiduciary duties, agency, and as many of the other "things" that go on in a sale. When you are new, this can be a wonderful learning exercise. The buyers want to learn too, and you are their teacher. Gotta know the material! My book ended up with about 18 pages of text - I call it Part One.

After Part One, I have another cover stock page, which I have titled The Forms

Here, I list, in "chronological" order, the myriad of forms that a buyer will come in contact with during the process. My own order is CLA, Buyer Broker Agreement, Consent to Limited Dual Agency, Agency (shorter form), Buyer Advisory (from AAR), an Active Market Report (comps for a sample area), Detailed Listing Sheet (MLS printout), NetValue Central report, Parcel maps (both plano & aerial - from county website), Purchase contract (filled out from Zipform with fictitious names), SPDS, Insurance & Mold addendums, a BINSR (with sample info), a walk-thru form, and finally, my own Resale Guarantee. If size in no limitation, you could also add a summary page from an inspection - put it right before the BINSR. You could add a sample net sheet, or a HUD-1 from a closed escrow. Mortgage cost comparisons are a possibility - if you are skilled at explaining them. I've left these out as my binding machine spines hold about 50 pages, and I'm up to 50 already. If you use an IBICO type binder, you have more room. Just beware of making it look too big, like a textbook, or too cheap, like your 13 year old made it.

This I call Part Two, and it is actually quite easy to come up with - you already have it - in the ZipForm program. This Part Two is where the procedures that you (and the industry) operate by are laid out in print. We all know that the printed word is given greater credibility than the spoken word... use that rule to help your buyers understand what is ahead of them. Also, information that reaches the brain via the eyes is retained better than information received via the ears. With this booklet in hand, buyers can "look ahead" on the sequence, and see what events are next.

Many of your buyers are going to be getting advice from relatives. This type of booklet builds credibility with them. It also serves an outline to follow when you are at that highly charged moment where you are drafting and explaining a purchase contract to them. I can assure you that if buyers are seeing a purchase contract for the first time when you are putting a pen in their hand, there will be an awkward hesitation while they gasp for comfort - comfort that comes only after they have knowledge and understanding. Have I beaten this point up too much? You are the teacher! They are (in a sense) taking a test. If you have taught them well, they pass. They get the keys to a home. You get paid. They fail, and...

I present my booklets to buyers at first meeting, and have it in a translucent plastic envelope. There is room for a CD that I burn news stories, virtual tours, and Power Point slide shows to, and also room for a few home warranty & home inspection brochures. The booklet is the centerpiece, however. The book also makes it much easier to obtain buyer loyalty, and get a signed Buyer Broker Agreement...

That's it! The recipe for a simple tool. You can make this "tool" any number of ways, and it will serve you well for years. From a 22 year veteran - my gift to you.

Created by Patrick Harfst CRS http://www.arizonahomelocator.com