Dave's Real Estate Recital

Which Wolf Are You Feeding?

2008-10-06T21:53:46Z

A story is told that one evening, an old Cherokee chief told his grandson about a battle that goes on inside people.

He said, “My son, the battle is between two wolves. One is Evil. It is anger, envy, sorrow, regret, greed, arrogance, self-pity, guilt, resentment, inferiority, lies, false pride, superiority and ego.

The other is Good. It is joy, peace, love, hope, serenity, humility, kindness, benevolence, empathy, generosity, truth, compassion and faith.”

The grandson thought about it for a minute and then asked, “Grandfather, which wolf wins?” The old Cherokee chief simply replied, “The one you feed.”

Now, I didn't write this little story, and I don't know who did, or I certainly give him or her the credit they are abundantly due. But, with all the worrisome stuff in the news of late, I thought a cautionary reminder for us all might be in order -- Let's take care to feed the right "Wolf".

Here's wishing us all the very best of faith, hope, courage and success despite the storm!

I'm New ( and Persistent) -- Please Help on Property Management

2008-10-02T11:14:10Z

I don't know if I'm supposed to do this, but if not, hopefully everyone will forgive me. I posted this yesterday, but I think I didn't send it to the right groups or something, because I didn't get enough help. So, here it is again:
Ok, folks, we're looking for some experienced property management types out there. We're thinking that property management will help level the economic highs and lows, and so my company is adding that to our list of services. One of the questions we are trying to find more satisfactory answers to, is:
"What are the most effective ways to canvas or advertise for clients who need our management services?"
Here's what we've come up with so far:
-Market to local brokerages that don't do property management, offering referral fees.
-Advertise in classified ad sections of local newspapers.
-Advertise on Rentals.com.
-Advertise on Craigslist.
Advertise on our two main websites, www.PrescottHomeInfo.com and www.ExitLegacy.com
-Mail to absentee owners in neighborhoods we believe are likely to have the lowest vacancy rates.
And that's where we're running out of ideas. We think we may not be the only ones out in the rain who could benefit from the expertise of the more seasoned souls among us. Any help out there?

The Value of Gratitude

2008-09-29T22:12:09Z

Been thinking about all the good things I have -- counting Life's blessings you might say.
My Wife,
My Daughters,
Their Health,
My Health,
Our Freedom,
Those Willing Souls Who Sacrificed Much if Not All So We Could Have It,
Our Good Friends,
A Cool-in-Summer, Warm-in-the-Winter, Dry Place to Sleep,
A Lush, Green Summer Garden,
A Tasty and Bountiful Fall Harvest,
A Wagging, Grinning Golden Retriever that Watches My Every Move and Follows Wherever I go,
Living in a Land of Relative Peace,
The Ability to Think, -- To Plan -- To Dream,
The Opportunity to Work -- to Realize the Dreams,
The Privilege of Doing That in the Calling(s) of My Choosing, And . . .
Coming Home at the End of Any Day to the Loving Embraces of my Wife & Our Girls.
There is oh, so much more. But, I think you get the idea.
In a world so full of trouble, trial, and things that strike fear to the heart, (seen my share of that) I've come to believe that there is always something to be thankful for.
And, I've become convinced that reflecting on those things heals the heart and restores the soul, making us ready again for tomorrow's rewarding battle.
Just a few thoughts that brighten my way, and I commend them to you all in the midst of all the trouble & gloom in the media these days. May they brighten yours as well.

How Are You Spending Your Time?

2008-09-27T22:24:03Z

We've all heard and said it: "Yup, time sure does get by fast." A cogent observation indeed. Time is probably the single greatest gift and resource any of us have and yet how often to we loose track of it, and look around wondering where it went.
I propose that a better question to ask is, "How did I spend it?" Wouldn't it be great, at the beginning of every day, to always have a clear & firm idea of what you are going to accomplish that day? And, at the end of each one, to be able to look back and KNOW that you spent it well?
Time management is nothing more than event control. Control your events, and you've managed your time. I know -- stuff happens -- unexpected stuff. And that can and does disrupt the best-laid plans. But, you'd be surprised how much of that you can eliminate by simply habitually making, scheduling, and working a plan. So, in that vein, here are few thoughts:
First, I urge the diligent use of some type of scheduling tool, whether it be a PDA, a Daytimer, (or Franklin Planner, if you prefer) or even a simple pocket calendar like one of my best (and most technologically inhibited) friends who's been in real estate going on 30 years, still uses and keeps tucked in his hip pocket to this very day. It doesn't really matter, as long as you have and USE something.
Then, using that tool, build a Categorized Daily Schedule. Ideally this schedule will be built around your business plan. We all have one of those -- right? It will include categories like Income-Producing Activities (you know, prospecting, door knocking, listing appointments, contract writing and the like), Communications Activities (playing phone tag, answering emails, sending cards & letters to clients, prospects, suspects, etc.), Maintenance Activities ( updating files and other such paper work) and so forth and so on.
Next, there's another thing I think just about every REALTOR on the planet has, and that's a "To Do List." Some of us keep them in our PDA's or our computers. Others scribble them on scraps of paper and struggle to keep track of the paper. Still others just try to carry them around in our heads. And, if you're anything like me when I operate in that mode, the list just tends to get longer and longer, while relatively little of it gets done.
However you keep that list, here's what you must do with it in order to become an effective time manager: Simply put your To Do List . . . IN your newly-created and categorized Daily Schedule. That's right, take each one of those little "to do" items and place them firmly within an appropriate category and time slot IN your schedule. See, that pins the occurrence of that particular event to a specific time, and voila! It gets done.
Now that all segues nicely into the last point I want to make here this evening. That is: Become a Do-It-Now person! (If you haven't already, that is.) What I mean by that is, when it's time to do something -- whatever it is -- do it and do it right now!
Doing it right now is the opposite of procrastination. Procrastination steals energy -- emotional energy -- and thereby diminishes momentum. We all know what it's like to have those little (or big) half-done or undone chores nagging away at us, disrupting our peace of mind and just plain making us tired. I once heard a lady say that nagging is very much like being nibbled TO DEATH by a duck. And, I do believe she nailed it.
So, in closing, may I simply summarize with the following:
1. Time Management = Event Control
2. Develop a Daily schedule designed around your business plan.
3. Commit to your schedule!
4. Be Task Oriented - put each item on your “To Do” list IN your schedule.
5 .Schedule Breaks and Down Time.
6. Track how you spend your time – task by task.
7. Analyze how you spend your time.
8. Adust your schedule so that at least half of it is focused on income-producing activities.
9. Procrastination steals emotional energy.
10. Become a Do-It-Now person.

We Commit to Do No Harm!

2008-09-26T13:16:33Z

I responded to Bryant Tudas' post "Looking at the Past to Predict the Future" this morning, which is re-post of one he wrote back in '06 expressing some concern about the wisdom of perhaps being a bit too aggressive in our sales efforts, and thereby contributing to future problems for clients who turn out to be unable to handle the debt they contracted for.
Actually, although it was an excellent post, my response was really to one of the commentators on the post, and as sometimes happens, I got so involved in commenting, that what I ended up doing was writing what turned out to be most of a post of my own.
First let me give you my comment (or most of it):
"Yes we want folks to be able to buy homes (that's our business). And if they've got some skin in the game, that's ideal. But the most important criterion has zero to do with whether or not they are deserving. It has only to do with whether they are likely to be able to pay the debt they incur.
Like Bryant, in '05 and '06, I saw this train wreck coming because [some] lenders were giving mortgages to people based primarily (apparently) upon the fact that they could fog a mirror.
Certainly consumers bear primary responsibility for their choices, but the Professional -- the one with education, training, experience and DUTY to protect the client (that includes the mortgage loan officers, too) should have as [their] primary concern, assuring that the borrowers are purchasing a product that will meet their needs and with which they will be happy over the long term.
If we sell things to people that don't meet these criteria, and with which they are ultimately unhappy, we have, in fact, harmed them, and even if they don't end up in foreclosure or doing a short sale, they'll still have a nasty taste in their mouths over the whole deal and will be very unlikely to come back, or refer business, to us in the future. Hence, we've harmed ourselves as well.
Finally, with regard to the success of ARMs, I would simply point out that popularity is not necessarily equivalent to success, for all the reasons I just enumerated."
The main reason I wanted to turn this into a post -- and I'm sorta passionate about it -- is that we as professional real estate agents, have a moral and ethical (not just fiduciary) duty to serve our clients and protect their interests. And I think it's a thing we should all reflect on more frequently.
We all know that this can be a very hazardous business. If that's true for us -- who have tremendous amounts of time and energy devoted to education, training and front-line experience -- it is doubly true for those wonderful people who place their faith and trust in us. They have a right to expect that we will unequivocally place their interests ahead of our next paycheck, every time.
This duty absolutely includes the weighty responsibility to warn them if our training and experience shows us that they may be headed into harm's way, even if it means this deal doesn't get done this time -- or at all!
Physicians take an oath, before being allowed to bear responsibility for our lives and health, that they will "Do No Harm". Maybe we don't actually or officially take that oath, but implicitly, I think we do.
So, let this post be my challenge and admonition to all of us who have the privilege of calling ourselves REALTORS, to take a few minutes to reflect upon, and consciously renew that oath and commitment -- today and every working day in the future!

Don't Open It -- It's a Virus!

2008-09-25T10:55:17Z

Just wanted to pass along a warning for all my fellow AR types out there. Recently I was going through my emails and found one alleging it was from CNN proclaiming "Nicolas Cage Dies in Freak Accident". Well, he being one of my favorite actors, and absolutely without thinking, I clicked on the link to see what the heck happened.
Now, all you Cage fans out there relax, because he's alright. But let me tell you, when I clicked that link, I stepped in the biggest mess of techno-doo-doo I've ever seen.
Instead of news on Nick, what came up was a screen telling me that I'd been infected with a virus and it was therefore imperative that I immediately download Antivirus XP 2008 to get rid of it. The problem is that ANTIVIRUS XP 2008 is not antivirus software. It's the virus itself.
Now don't everybody jump up at once to chastise me. I did NOT download AntiVirus XP 2008. The thing actually gets into your computer when you click the original link. I repeat, it's not in the email itself and that, apparently is one reason the fully updated and active MacAfee AntiVirus software I had running didn't even slow this thing down.
This bug is in the link, or on the site the link is attached to -- I don't actually know. I'm just trying to repeat what my $50 per hour tech-guy, Bob, told me while he was cleaning up my mess.
Bottom line is that first I Googled Antivirus XP 2008 and after a little research, tried several different free anti-spyware/anti-virus downloads in an effort to get the little bugger off my computer. But none of them worked.
AVXP08 apparently embeds itself in, among other places, the part of the computer that controls the screen saver. So, along with whatever other mean and nasty stuff it's perpetrating on my machine, I got these literally non-stop popups, online or off, proclaiming the non-existent wonders of AntiVirus XP 2008.
$150, a lot frustration, and several days later, Bob finally got it all squared away, and my laptop was back to normal.
I just wanted to warn you all about this thing. Bob said it apparently comes in emails alleging that they are from CNN, or MSN, or other well-recognized news outlets, w/ headlines designed to arouse curiosity or alarm and take us off guard. He said, and (bonehead me) I already new this: "If you want news, just go online to a news site. Never, ever, open an email you don't recognize"

One Really Good Way to Avoid a "COMMISSIONECTOMY"

2008-09-24T22:14:32Z

Is it just me in Prescott, Arizona or have any of you folks out there had it "up to here" with finding the phrase "to be determined in escrow" in the Property Identification section of a purchase contract? Let me tell you another story.
Several years ago, a friend of mine who was a pretty new agent at the time, listed a property in one of our outlying areas. The seller had a total of 20 acres whereon stood his personal residence. He listed only 10 of those acres for sale -- decidedly NOT the ones with his house on them.
In fairly short order, an agent from another company brought a buyer to the table with an acceptable offer. This agent was also new. Since the property being purchased had not yet been split from the mother parcel by survey when the offer was being prepared, there was no new address assigned, no new assessor's parcel I.D. number assigned, and, of course, no legal description.
As a result, here is how Property I.D. section of the contract read:
Address: 6854 XYZ Street (Not the real address of the ENTIRE property)
Assessor's Parcel I.D. Number: 555-55-555 (Not the real APN of the ENTIRE property)
Legal Description: To Be Determined in Escrow
(Anybody smell a perfect storm brewing here?)
Because this had become something of a tradition in our area over many years, (this is the wild, wild west ya know) neither broker objected to this ugly picture and it went unhindered into escrow. (Oh, did I mention that this agreement had been written on a standard VACANT LAND contract form? In AZ this is a distinctly different form than the Residential Resale Purchase Contract form. You'da thunk the escrow officer might have noticed that minor detail -- NOT)
As one would expect, a survey was performed during the inspection period, (even thought the contract itself failed to mention the fact) to specifically identify the newly created parcel. But, of course, each agent assumed that somebody else had copied escrow with the survey. (Y'all remember what happens when you ASSUME -- right?)
Long (scary) story short, not having the survey or any other indicator (talk about yer failure to communicate) that this was a land split, the escrow officer recorded on the legal description that was attached to the seller's warranty deed.
Now, that could probably have been fixed fairly readily had there not been one sizeable complication: Turns out the buyer was a tad on the shady side. And, before you ask, yes, we know from subsequent involvement of legal counsel, that he AND his agent, new exactly what the real original intent was.
Anyway, several days after close of escrow, the buyer shows up on the seller's doorstep asking, "So, when are you moving out of my house?" It got even spookier when the buyer's broker, in a later phone call with the seller's broker, said, "You can just get used to it -- my client owns your client's house and all his land!"
And, thereupon followed, as naturally as the sunrise, a whole load of smelly stuff I don't need to elaborate on. You get the picture. Bottom line is that the buyer and his broker calmed right on down and ate some crow right after the seller's broker's attorney sent them a crisply worded letter that mentioned something about an absence of a few little items like, a meeting of the minds, good faith, and the like. And so there was a happy ending: Crooked Buyer went skidding down the road on his backside, Relieved Seller got to keep his house, NOBODY got sued, and everybody learned a thing or two.
The main thing I wanted to point out with this little horror story, is that specificity is a wonderful thing. I wonder what might (or might not) have happened if, AT LEAST the legal description blank on that contract had contained something like this:
"The southern half of the property described in the attached 'Exhibit A' [which was the legal description attached to the existing warranty deed] comprising approximately ten acres, the new legal description for which, shall be determined by a survey to be performed during the inspection period, and immediately thereafter placed in escrow."
OK, I know, it's a bit wordy, and there are probably 50 simpler ways to say it. But do ya think it might have gotten somebody's attention and avoided a whole lot of unpleasant stuff?
Well, for what it's worth, all my agents have heard this story more than once, and they all know better than to let "to be determined" cross the broker's desk.
So, may I conclude with the words of some wise old bearded contract attorney who said, "When writing contracts, AVOID AMBIGUITY AT ALL COSTS."

Real Estate is the Greatest Profession in the World!

2008-09-23T11:27:29Z

My Dad owns a Schrade-Walden pocket knife. It's nothing fancy, just a simple little 3-bladed folding knife, and being a patient and meticulous man, he has always kept a razor edge on it. As a boy, I greatly admired that knife and the care Dad gave it. One day as he sat in his living room chair honing one of its blades, I expressed my admiration in such a way as to let him know that I wouldn't mind owning such a knife one day.
He kept thoughtfully stroking the blade on that old Arkansas Oil Stone, and after what seemed like a long time, he stopped. He carefully wiped the oil from the blade with a cotton cloth he kept for the purpose, and then folded it closed. Then, placing it in the center of the palm of his left hand, he raised his arm, palm up, so that it extended straight out from his body, parallel to the floor.
Then with a twinkle in his eye, he asked, "How long do you think you can hold this knife in your hand just like this?" I didn't know and said as much, but made a guess of some description -- I don't recall what it was. Then Dad made the following proposal: "Tell you what -- if you can hold this knife just like this, standing perfectly straight, without lowering your arm to even the slightest degree, for ten full minutes, I'll give you one just like it."
Well, as you might imagine, I was anxious to give That a try, and agreed with considerable excitement. And as you might also surmise, I had very little understanding, at that moment, of what I had just agreed to. But, to make a very lengthy ten minutes a lot shorter, suffice it to say that I have a Schrade-Walden pocket knife, just like my Dad's, (although I've never been patient or meticulous enough to get as fine an edge on it as he kept on his). And, of course, because of how I came by it, it is one of my more treasured physical possessions.
But, as is the case with all things temporal, it is of far less value to me than the accompanying moral lessons of discipline, determination, and the human ability to control physical circumstances by the power of our thinking. Dad used such opportunities to build my character and I'll never be able to repay the debt.
I believe, however, that the best thing I can do to try, is to use what he taught me. And I do. I use the Lessons of the Knife, and many others, every day in my real estate career. I have found them indispensable. Without them, I never would have had the ability to leave a steady paycheck and great benefits, to embark on a commission-based journey, where it has been sometimes hard to see from paycheck to paycheck. I never would have believed that I could succeed.
But, succeed I have, and not just in monetary terms, (heaven knows that has been, and still is, hard enough to come by). My most treasured success has been in the realm of intangibles. My love of the work; Great confidence in my own ability; The lasting and irreplaceable friendships I have, that never would have even come my way, on any other road; The ability to stand firm in a storm, enjoying the wind and firmly believing that I'll come out the other side alright, and the tremendous satisfaction of a job well done, when I do; these and many more, are all great gifts that have come to me because my Dad gave me the necessary "equipment" to take on the challenge of being a professional real estate agent.
Well, I guess I don't have much else to say right now, except -- Thanks, Dad.

How to Keep Clients Coming Back to You!

2008-09-22T13:06:30Z

I periodically teach a class on making escrows "bullet-proof", entitled "Transactional Kevlar". (For all you non-military/non-law enforcement types out there, Kevlar is the stuff they make bullet resistant vests from) In the intro of that class I hasten to point out that there are bullets that will pierce most any vest, but that the objective in the worlds of both law enforcement and real estate is to be as "bullet resistant" as possible.
Anybody that's been doing this for a while knows that the process of seeing a real estate transaction through from the start of negotiations, all the way to closing can be very complex and sometimes hazardous work -- definitely for REALTORS, but more importantly, for our clients. I view it as something of a mine field, where the inexperienced or un-cautious may well step on stuff that can blow up your deal, (or maybe sometimes it's just a pasture where you step in stuff that turns your deal into a stinkin' mess.) Either way though, I offer my agents, and all my AR buddies out there, a few thoughts on safe passage.
Thought 1: Remember the old Ford TV commercial that proclaimed: "Quality is Job 1"? Here's mine: What's a REALTOR'S FIRST DUTY? To Protect and Promote Our Clients' Interests, of course! So, for us, that's JOB 1.
And I teach all my agents the following: If you always do Job 1 first, and do it well --
(a) Your Deal Closes,
(b) Your Client Doesn't Sue You,
(c) Your Broker Doesn't Sever Your,
(d) Your Client Loves You,
(e) Your Client Refers More Business to You,
(f) Your Client Uses You Again in the Future, Aaaaand --
(g) You Love Real Estate!
It all boils down to the fact that when we develop a "Client-1st" mindset and make all our decisions on that basis, everybody wins.
Thought 2: Always Keep a Transaction Log. This is a simple running account of everything that happens in regard to any transaction. I prefer a hand-written one that goes in the front of every file. It's set up as a table that allows event entries by date, start and end times, and my notes pertaining thereto. It creates a track-able chronology of:
-All My Actions,
-All My Statements,
-All My Conversations,
-All My Clients' Requests,
-All My Phone Calls,
-All My Faxes,
-All My Emails, and basically --
-All Transactional Events.
In today's litigious society, this gives invaluable protection to your client, to your company, to yourself, and even to the folks on the other side of the deal! It's just plain good business.
Thought 3: The days when REALTORS could hoard information, thinking that their possession of it was their only value to the public are LONG GONE! Today, service and information are the watchwords. In fact, I think another Fiduciary Duty needs to be added to the list we teach new agents. Together with the duties of Confidentiality, Accounting, Reasonable Care & Skill, Loyalty, Obedience, Advocacy, and Disclosure, I am convinced that we need to add the duty to Educate our Clients!
True professionals do this as a matter of course, and they do it early on. Consider the following educational points:
Help both Buyers and Sellers understand the lending process, but especially teach Buyers the importance of such things as avoiding large, unexpected credit purchases during escrow. (And the purchase doesn't even have to be large. I once saw a deal fall apart over the Buyer signing a new cell phone contract just before the loan went to the underwriter.)
Buyers & Sellers alike should have copies of the contract and other standard documents they are likely to use, long before they are asked to sign them. Spend time with them in advance, not only reviewing the docs, but especially making sure all their questions are answered. Doing this saves a world of time, stress and anxiety when it comes time to build a deal. It's so much nicer when everybody has some idea of what's going on.
We should always familiarize them with the standard contract deadlines and other time frames. They need to understant that time really is "of the essence."
Help them understand how title insurance works and what to look for on a preliminary title report.
Help both sides, but especially buyers understand Due Diligence, Inspection Periods, and the various inspections they might expect to see during the escrow.
Thought 4: Communicate! There is no question that probably the single biggest cause of a deal falling apart during escrow, is a failure to communicate, somewhere along the way. Whether it's the agent, the buyer, the seller, the lender, the escrow officer, the inspector, the loan officer, the processor, the underwriter, or all of the above! In the end, it really doesn't matter who dropped the ball, the bottom line is that the deal's off, we consequently don't get paid, and most important of all, our clients are unhappy. (Ever try to get repeat business or referrals from a disgruntled client?)
The cure is relatively simple. If you don't already have one in place, establish a systematized checklist of all the communications that have to happen during the course of an escrow, and use it religiously! Then, just get in the habit, with all your clients, of calling, texting, or emailing them at least 2 or 3 times a week. I think you'll find that the result will be a pretty much daily flow of emails, faxes, & phone calls on most transactions, even if they are sometimes just to reassure an anxious, client that you really are on top of every detail of their transaction.
These are just a few points that I believe will help us all do a better job of taking care of all those people who place their confidence and trust in us for what is usually the biggest expenditure of hard-earned money most of them ever make. Use 'em in good health folks!

How to Get a FSBO to Love You.

2008-09-20T20:33:11Z

I read a good post from Paul Campbell in Lexington Kentucky earlier today wherein he inquired about ways to approach FSBO's -- especially those who really don't have a feel for how to price their homes. After I finished sending him a comment, I got to thinking that there's more to say on the subject so, voila -- here's another post.
First here's the comment I sent in response to Paul's post:
"I think we all face the same dilemma w/ FSBO's, and indeed, all sellers in this market. But FSBO's may be among the more under-informed sellers out there. So, like BethAnn said, they need someone to not only TELL them the truth, but also DOCUMENT the truth.
Show them what people have been willing to pay for similar homes in the same or similar neighborhoods.
Then show them what their competition is -- the active listings.
And finally show them the expireds -- those are what DOES NOT WORK.
Don't be afraid to give them information and educate them about what is required to sell their home, e.g. clean-up, fix-up, staging, how essential it is to price correctly and competitively, etc. Not all at once, mind you, just a bit at a time over a few weeks. Stay in touch with them. Bring them something new and helpful each time.
Serve them a little for free to build the relationship, and they will come to you when they finally realize that they truly do need a professional.
Statistically almost all FSBO's either eventually list with a REALTOR, or take their homes off the market. The key is that they typically list with the agent who has contacted them 3 times or more. Persistent customer service is dang near omnipotent w/ FSBO's. Good Luck in Lexington!"
So now, here are a few more thoughts on the matter:
(1) With regard to pricing, the fact is that most FSBO's don't understand the basic fact that their home is not worth --
a. What they paid for it in 2005,
b, What their neighbor up the street got for his last year,
c. What their neighbor down the street is currently asking for his --
-- It is only and exactly worth what a ready, willing and able buyer will give for it in the current market. And, that is indicated clearly by recent sales data that is typically found either in the multiple listing service or in the county record.
And, the difficulty faced by most folks trying to sell their homes without a professional, apart from inexperience, is that although the sales data is a matter of public record, most of them don't know where or how to look for it. Even if they did, they then don't know the finer points of how to use that information to assemble a Comparative Market Analysis, and come up with a projected selling price. (value)
(2) Once a Current Market Value has been determined, a look at the competition is vital. Most FSBO's in my experience, don't really see other homes for sale as competition, and consequently don't think about competitive pricing. Our ability, as REALTORS to do this objectively is another of the many reasons why they "pay us the big bucks." We don't have the emotional attachment that the typical seller has to his or her home. And, most of us have a high level of training and experience that the average FSBO just doesn't.
In my town of Prescott, Arizona, the real estate market has been a tad volatile over the last year or two and one of the important lessons we've learned is that a seller has to get ahead of the downward pricing curve from the get-go. If you price anything over the anticipated selling price with the thought in mind that you can always drop the price later, you end up behind the curve in a buyer's market where, if you're not priced in the lower 20% of what's currently for sale, you don't even get shown, let alone receive an offer.
(3) Then, of course, there's the really important lesson that even REALTORS sometimes forget, and that is: ANYTHING that distracts a potential buyer from being able to envision a house as their home, with their stuff in it, diminishes the likelihood of them buying it, in exact proportion to the level of distraction. And that's not just limited to things like pet hair on the furniture or the smell of cigarettes. It includes things like forty years of family pictures on the walls, and yes, even your beloved collection of Elvis memorabilia stuck in every nook and cranny through out the house.
Keep in mind that the rule of thumb is that "Less is More." But that's not all. The "Less" must be well-positioned or properly combined and arranged. Even if you think you can't afford a stager to come in and do a complete number on the place, most home stagers will, for a much-reduced price, meet with you in the home for a consultation wherein they will give you guidance and instruction on how to stage it yourself.
Now, back to Paul's questions. All these things and a jillion more, are things that a FSBO really NEEDS to know, in order to be successful at selling his/her home -- and most of them don't. And even if they are successful, they'll still remember you in a positive light and odds are they will refer you if they ever get the chance. So, I recommend going out of our way to help them and teach them.
I like to take them sample copies of the SPDS, and the Real Estate Purchase Contract. And our association puts out a brochure entitled "10 Things Every Seller Needs to Know About the Arizona Real Estate Purchase Contract." I also give them that.
A great benefit of this approach is that, by the time they do list with me, I have a well-informed Seller who trusts me implicitly because I've proven myself to them in advance. That just makes for a smoother transaction all the way around.
It's been my experience that the more help, service and info we give them, the more thankful and appreciative they become toward us. And, they start to gain a real understanding of how much we really do and how valuable our knowledge and experience really are to them.
The vast majority of private home sellers still end up listing with a REALTOR. The difference is that it's usually the one who has stayed in touch and been so willing help, even before having an autograph on a listing contract.
Guys and Gals, this is still only scratching the surface, but I hope it'll help some of you out there who, like Paul, may be scratching your heads and wondering what else you might do to persuade a FSBO that he/she really does need a professional real estate expert, and that that expert is YOU!

Are You Willing?

2008-09-19T12:22:19Z

A while back, I was sitting on the side of my bed around 10:00 or 10:30 one night, pulling off my boots. It had been a long day and I was looking forward to my head hitting the pillow. About halfway through that process, my cell phone rang. Glancing at the caller I.D. I saw that it was one of my agents, whom we'll call Lisa (cuz that's her name). I figured something must be pretty wrong for her to be calling at that hour, so it was with some trepidation that I answered the call.
Lisa's sort of shy and has this often timid little voice, that was a good deal more timid than normal as she apologized for calling so late, "But," she said, "I just had to tell you what happened today"
That was on a Monday, and every Monday morning I'd been teaching a series of Production Classes for agents that were either new or off their game and not producing. That particular Monday was a class on prospecting everywhere you go. I'd done two hours on how, when and where to talk to people; how to overcome nervousness in approaching strangers, carrying your cards all the time and various other tips of the trade.
Probably the single most important part of each of those classes was the assignment I gave them to be completed by a deadline. That day's assignment was to talk to at least one complete stranger (other than door knocking) and give them a business card, each and every day that week, and before the end of the week, have a solid buyer or seller lead from one of those, complete with full contact information.
Continuing her call, Lisa said, "Dave, when I left that classroom this morning, my stomach was in my throat, and my knees were literally trembling as I walked out. I just couldn't imagine how I was going to do what you were requiring."
Later, it appeares that Lisa had gone shopping for vegetables in the produce section of a local grocery store. Seeing a produce clerk stocking vegetables, she said, "I was so scared, but I just made up my mind I was going to do it, so I walked up to him, gave him my card, and started talking."
Now I've gotta tell you, while Lisa is a bit shy, when you get her started talking, she is in her element and there's very little chance she won't say what's on her mind. She had apparently engaged (cornered might be a better word) this young clerk for some time, and try as she might, she just couldn't get his full attention or interest (he apparently, while trying to be polite, had just kept stocking veggies).
So, feeling a bit deflated, she started winding down and was preparing to take her leave of this guy, when she felt a tap her shoulder. Turning around she stood face to face with a fellow shopper who'd overheard almost all of her presentation to the veggie clerk, and, in fact wanted to talk to Lisa further about the area real estate market and the possibility of buying a home. Needless to say, a somewhat dazed Lisa floated away on cloud nine, with the needed contact info and an appointment. Of course, I congratulated her heartily, doing all I could to reinforce the great work she'd done that day.
Long story short, I'm a little concerned about what I may have unleashed on Prescott, Arizona. No, just kidding. The fact is that Lisa called me twice more that week, just bubbling with excitement as she told me about further successes. In a bank, she'd struck up a conversation with someone she didn't recognize but had done business with many years before who, as it turned out was looking to buy investment property and needed a REALTOR -- instant client!
There were others and I could write another whole blog about Lisa and her successes that week. Suffice it to say that she filled the assignment several times over, and proved to be something of an inspiration for all our other agents.
Just goes to show ya, there's no end to what can be accomplished by the willing mind and the courageous heart. Here's to Lisa and all you other real estate heroes out there!

Open Up -- It Works Really Well!

2008-09-18T12:06:52Z

We've been having so much success with this, I wanted to share with the AR bunch in hopes that it'll do some more good out there.
I know most of us, if we've been doing this any time at all, have experienced, in one form or another, the "Ho-Hum Open House." You know, that's the one where you bake cookies, get there early, put signs all over the neighborhood, kick the owners out, turn on all the lights, open all the shades, and then . . .
break out the book you've been reading.
After an hour you're dozing, so you get up and pace around, lookin' out the windows. You eat a cookie or two, check your voice mail and . . .
go back to the book.
By the end of the Open, you're thoroughly bummed and swearing for the umpteenth time you'll never do another open house cuz, "they just don't work!!!"
And you were right, the "Ho Hum Open House" doesn't work.
But, we've been tryin' it this way:
1. Hold the Open on Saturday
2. On the preceding Monday, mail out 100-200 "You Are Cordially Invited", invitations to the neighborhood. (they don't have to be expensive, companies like ExpressCopy.com will do laminated post cards, addressed, posted & sent for $59/100).
3. On that same Monday, place a small reader ad with a border in the open house section of Friday's paper (if it comes out in the evening), or the Saturday edition, (if it comes out in the morning).
4. Make a 100 or so full-color flyers, again announcing your Open and Cordially Inviting them. These are just simple flyers with very little verbiage on them. Include your picture and a good picture of the front of the house. Remember it's just an invitation, so don't get wordy. Just the Date, Time, Location and JUST enough of a description to tickle their interest.
5. On the Friday before the Open, dress professionally but comfortably, and then take those flyers and start knocking doors in the neighborhood. Cowboy Up, bury the fear & anxiety and just get out there and talk to the neighbors! Remember, you're inviting them to a shindig. No big deal -- I guarantee they all put their pants on one leg at a time, just like you. And, before you know it, you'll be havin' fun!
6. A few things to point out to the neighbors as you're talking to them: (a) You're serving food; (b)Your intent is to get the word around and create exposure for the place; (c) Even if they aren't personally looking to buy, they might know someone who is; (d) You know they're curious about the neighborhood market, and exactly what is for sale and for how much, because it helps them keep a finger on the pulse of their own property value.
We've been doing this for almost this whole year and the results have been exciting. I'm not telling you that it has been a magic cure-all for a very difficult market but, I am here to tell you that we've been getting leads and listing like crazy. And, as all you ol' timers will attest to, the more you list, the more buyers you get, and the more money you make. It is, after all a numbers game.
We get both buyer and seller leads while knocking the doors, from people who never even show up at the open house. And while you'd expect and hope for buyer leads at the open house, we also have people show up who've been thinking of listing their own homes and just want to check us out as agents to see how good a job we actually do for their neighbors.
Bottom line folks, is that, especially in a down market, we can't just sit around waiting for business to happen. We've got to get out among the people and Make it Happen!
In closing, two quotes come to mind.
I don't know who the first one is from, but I'm told it's an old Chinese proverb and it goes like this: "One may sit a long time with mouth open, waiting for roast duck to fly in."
And the other is from the venerable John Wayne, in one of his many movies wherein, as he was about to lead one of his heroic charges into a desperate battle, he yelled, "Let's go amongst 'em!"
The best of success to all of us 'till next we blog!<\b>

Plowin' A Straight Furrow

2008-09-17T18:51:15Z

As a boy growing up in New Mexico's Pecos Valley, I necessarily spent a lot of time around cotton, high-gear, and alfalfa fields. Now, alfalfa is not a "row" crop, meaning it's not sown in furrows, but instead like grass. But, the numerous fields of cotton and high-gear were invariably characterized by long parallel furrows. On one occasion I was riding with my dad along an expansive cotton field and noticed how uniformly straight the rows were. After "chewin'" on the why & how of that for a minute or two, I asked Dad, to explain it. Dad had farmed as a boy there in Chavez County, and had spent his share of hours in the driver's seat of an old "B" John Deere tractor, one of which, he still owned.
He waited 'till we got back home and then took me out to where the tractor sat. His explanation went something like this: He pointed out how the seat was positioned at almost the very rear of the tractor, and how the long, narrow cowling extending forward, had two stacks protruding upward from it -- one was an exhaust stack and I don't remember what the other was. Anyway, he proceeded to explain that when, as a young man, he was plowing, disking, harrowing, or cutting furrows, he would always begin by examining the far side of the field, looking for any feature such as a fence post, a rock or a bush, that he could use to line up on. Having chosen one, he would sight along the two stacks above his engine cowling, and line them up on the object he'd picked as his target on the other end of the field. Then he'd lower whatever implement he was using and engage the clutch. This process was repeated on every pass. He emphasized how important it was to keep his eye on the target, and continuously steer the tractor so that the stacks remained aligned with it. The result, he pointed out, was a field full of arrow-straight rows that could be efficiently irrigated, cultivated and harvested.
I don't recall ever seeing crooked or uneven rows in any field in New Mexico. The farmers there apparently all understood and used the principles my father taught me. And the late summer and early fall always brought ample evidence of their skill as the cotton fields turned billowy white.
Interestingly, I have seen some crooked, uneven and unfinished "rows" in the world I now travel. That world, which is also a world of planting, cultivating and harvesting, is the wonderful world of real estate. And here, it's evident that we don't always apply these priceless facets of the law of the harvest. They are priceless because they are perfectly reliable and function flawlessly whenever faithfully applied. Like the farms of my youth, the real estate world is fertile and yields a bounteous harvest when we:
-Select a target;
-Line up the stacks of our "tractor" on the target;
-Throttle up;
-Release the brake and engage the clutch;
-Keep our eyes on the target;
-Keep our hands and feet on the controls, and --
-Steer!
Now, there are, I know, many other items I could list to fill out the bare bones of this analogy, but do you get my point? Do we not all too often, drive our "tractors" out into the "field" with no specifically determined target or goal? Or if, indeed, we have a definite goal or purpose, do we not sometimes get distracted by all manner of things, and lose track of where we intended to go, or even forget to steer?
My point is simply this: We all have these tremendously high-quality "tractors" (read: hearts, minds, bodies, souls, etc.) and they will, with just a little planning, programing and guidance, take us to the farthest reaches of our hearts' desires. Absolutely any of us have the potential to be great in this, or any other work of our choosing. We have only to believe we can, choose to do it, and then diligently apply the unfailing principles of the law of the harvest. May it be so, for each and every one of us. Best wishes to you all 'till next we blog!

What Were You Thinking?!

2008-09-16T11:39:57Z
I stop, with a fair degree of frequency, to give thanks for all the good friends I've been given in my life. From that perspective, it warms the heart when some of these give me looks of genuine concern and inquire, "Dave, are you doing OK?" or, "Are you selling anything?" or, "Is anything moving?" While there is a measure of just plain curiosity in the mix, most of them are really worried for my financial well being (and some, perhaps, are a bit concerned about my sanity) since I am still in real estate.
And, given the reality of the market slowdown as compounded by national media hype, their questions are understandable. I would even venture to say that most of us who are in real estate, have spent some time, this year, worrying and wondering. It is, after all, a fact that the last 18 to 24 months have been a pretty bumpy ride for your average real estate agent. And, I am no exception, since my personal dollars closed over that time period are less than a quarter of what they had been the two years before.
The blessing for me has been that as owner of our company, I've had the duty and privilege of trying hard to help my agents succeed and survive the down-turn. Most of them have been in the business 5 years or less, and so, have never seen anything like this. (Frankly, neither have I.) Fortunately, we'd been building these agents on a good foundation, and while several have had to resort to taking jobs outside the industry, we've only actually lost a couple of them.
"What foundation?" you ask. Why, it's simple. We've taught them since day one, what the great Earl Nightingale called the Greatest Secret in the World, namely -- "We become what we think about." We've taught them the truth of how the human mind, like the fertile farmer's field, will abundantly yield exactly and exclusively what is planted and cultivated over time.
Our agents know that they are free to pace about, wringing their hands with hearts and minds full of fear and anxiety, wondering if they'll ever close another deal, or even get one in escrow. They also know that they will end up with exactly what they propagate. So, most of the time, they face their challenging business days by pausing to decide what they actually want from that day, affirming verbally and in writing, that they already have it, and then moving forward to turn their thoughts into physical reality.
Now, I'd be a liar if I told you that either my agents or I are perfect at this process of managing our thoughts. In frequent interviews with my agents, it hasn't been at all uncommon for some, when asked to recount their recent activities and accomplishments, to shoot a confused half-smile across my desk, shrug their shoulders and tell me they just don't know what happened. They'd been working hard, prioritizing, getting out and talking to people, "everything I'd been teaching them to do," but it just wasn't working.
Almost invariably, the first question that crosses my mind, and frequently the first one verbalized, is: "What were you thinking?" And, with equal frequency, it comes out that their mental focus had been disrupted or forgotten in some fashion. Then I give them the gentle reminder of Dave's First Fundamental Law of Life: Mind Management, (Keeping Our Thoughts Positively Focused on Our Primary Desire) is a Full Time Job! And, by now they all know to expect my grinning reminder of the corollary -- "But it's the best-paying full-time job you'll ever have!"
I know full well, that I have waxed verbose here this morning, and for you "D" and "I" personality types out there, I offer sincere apologies. The only excuse I have is that I wanted to help by putting forth the following: Just like all of my agents, and perhaps many of you, I, too have struggled from time to time to stay mentally focused. The solution for me, as I know it is for you, is to:
-Decide what I want.
-Make sure I want it more than any conflicting desire.
-Actively control what I think about, minute by minute.
-Take time daily to envision me obtaining what I want, in "Sensory-Rich and Emotion-Laden Detail" (A reference to Visioneering, by Dr. Dennis Deaton).
-Affirm my success in the present tense, verbally and in writing, every day.
-Immediately reject all negative thinking as spurious and bad input.
These things are the basics of all success in life, and the really "cool" thing about them is that even if we occasionally drop the proverbial ball, we can always pick it up and run with it again on any new day, for each one begins "fresh, with no mistakes in it." (from Anne of Green Gables)

I've Been Telling You to "Ignore the Headlines!"

2008-02-23T14:30:42Z

Hey Folks!
How many of you have read the February 25th, Time magazine article entitled, "Ignore the Headlines" by Dan Kadlec? You've got to read this one. Mr. Kadlec acknowledges all the media doomsaying, and the tendency of the average American toward inertia. He then poses the cogent question, "...what, exactly are you waiting for?"
Kadlec quotes the renowned investment consultant, Peter Lynch, "in spite of all the great and minor calamities that have occurred...all the thousands of reasons that the world might be coming to an end..." and aptly adds, "there has rarely been a moment in history when you couldn't scare yourself into doing nothing."
Albeit more eloquent, this is precisely what I've been saying about the current real estate market. Far too strong is our average tendency to behave like sheep by following the movement of the herd. If the media screams disaster, we typically believe them outright without further inquiry, and respond accordingly.
Interestingly, the media intimately knows this, and as always, knowledge correctly applied, is power. Just as one who shouts "Fire!" in a crowded theater, could reasonably predict the reaction of the crowd, the media, (or more correctly stated, those who control the media) can very reliably anticipate the response of the populace to whatever cry they make. This is the reason for the cry in the first place. That, if nothing else, should be serious food for thought.
Anyway, as you may recall, I've counseled many of you to resist the urge to "buy with the herd".   An important corollary is not to join the herd in paralytic fear. Mr. Kadlec quotes John D. Rockefeller in making the same point: "The way to make money is to buy when blood is running in the streets."
Both Kadlec's and Rockefeller's reasoning is sound, especially as applied to the current situation in real estate. The article references Jim Svinth of Lending Tree who said, "The thing that will make home prices stop falling is the very same thing that will push mortgage rates higher," namely, rising interest rates. Folks, it isn't a question of whether interest rates will begin to rise. It is only a question of when. When that happens, sellers will become less pliable, real estate prices will rise, and opportunity for "buying low" so that you can later "sell high", and make a profit, will immediately begin to diminish.
Those of you who've been perhaps a bit overly adherent to caution, might want to have a second look at your "hole card" and begin to nose around for opportunities to invest in real estate that are here today, but may well be gone tomorrow. 'Till next time, it's
Dave@PrescottHomeInfo.com

Fed Funds Rate Cut

2008-02-14T14:57:42Z

Hi Folks!
     Y'all are probably aware that the Federal Reserve Board cut the Fed Funds inter-bank interest rate (that's the rate at which banks lend money to each other.) twice for a total of 3/4 point in the last month. And, as you may or may not know, the "Prime Rate" is typically 3.0% above the Fed Funds rate. That's about 6.0% at this writing.
     Anyway, what the Fed did, effects short term interest rates for credit cards, adjustable rate mortgages, home equity lines of credit, and installment loans such as car loans. It does not effect long-term mortgage interest rates. The Fed's objective, instead of giving the housing industry a boost, is to increase the supply of money circulating in the economy by decreasing the cost for short term credit.
     Long term mortgage interest rates, such as 30-year fixed rates, are primarily effected by worldwide economy and the daily fluctuations of mortgage bonds (mortgage backed securities). As a result, somewhat negative economic data can actually be good for lowering mortgage interest rates. For example, when the stock market is down, investment capital runs for cover in the bond market and mortgage interest rates decrease. So remember, a federal reserve interest rate cut does not effect long term mortgage interest rates.
    Just though some of you might appreciate a little clarification of some of the recent goings on in in the news!
Dave.

All Real Estate is Local

2008-01-08T22:26:49Z

Just a few thoughts here about the Prescott area real estate market. First of all, it's important, if you're from these parts, to remember that economically, the Prescott area doesn't typically follow most of the media's alleged "national" trends.   We live (and have for many years) in some of the most desired living space in the whole country. I can remember when Prescott Valley only had about 5000 people, a couple of paved streets and everybody's sewage was dealt with by septic systems.    Now the streets are all paved, almost everybody's on the sewer system, and there's around 35,000 of us! I heard on the radio yesterday that Prescott's over 40,000. Exceptional growth has been the trend here for almost two decades, and I don't think it's a news flash for any of us that the trend is continuing.
Yes, sales volume is down somewhere between 15 and 30 percent compared to the last couple of years, depending on exactly where in the area, and what kind of property you're talking about. But you've got to keep in mind that 2005 especially, was a radical exception to the rule in the real estate market, especially here! So what I'm seeing now doesn't worry me a bit. I see it as more of a return to sanity if not true normalcy. There's a lot of inventory and buyers are taking their time to look more carefully -- trying to find and make, the best possible deals.   And, these days they actually have to qualify for a loan to get one, so they won't likely find themselves facing payments they can't make, or imminent foreclosure either! And, most important of all, is to remember that buying any kind of investment when the market on that investment is booming just ain't real smart. Profit on any investment is made when you buy it. Buying before the stampede is your best shot at getting a bargain. So, I say it's a terrific time to buy real estate. Prices will turn and start to rise again, and while I don't know exactly when that'll happen, I don't think it's too far off. So, give it some thought. Kick it around with friends & family. But whatever you do, don't just swallow all that media hype about how awful things are. It just ain't so here in the Prescott area. And, remember, all real estate is local!
So, ‘till next time, everybody enjoy the journey, because that's what it's about!     Dave.