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It's the 4th Quarter....How Will the Year End?

For every real estate professional, the new year starts out with uncertainty and no small amount of anxiety. We do not pull a bi-monthly paycheck, or have an annual salary upon which to base our budgets. I don't care how experienced or successful, no one in real estate sales knows exactly what the year ahead will bring. Which is why so many of us like to plan and analyze and look to industry experts for forecasts and predictions.

This year has been much stronger for real estate sales than many of us had anticipated (or hoped for). But if there's one thing the last few years have taught me it's that nothing in real estate is "ordinary" any more.

While NAR, tells us that pending homes sales have increased for the seventh straight month (longest streak since 2001), I know that in my market, a large portion of these sales are because of first time home buyers. Folks who have watched prices come down and who are anxiously moving now to take advantage of the expiring $8000 tax credit.

There have been several bills introduced in Washington to extend or change the Home Buyer Tax Credit but really no one knows what Congress will do. There is debate back and forth amongst Economists and "experts" but there's no doubt in my mind the credit has helped to stimulate home sales in South King County, and more specifically my community of Maple Valley. On a Nationwide scale, the numbers speak for themselves.

So what will happen if the credit isn't extended? No one knows for sure

In years past I would have told my clients that at the end of October we can expect to see a Seasonal/Holiday slowdown...but this, this year I'm going to admit that I have no idea what this year's end will bring. (Other than a slew of predictions and prognostications).

Interest rates, tax credits, unemployment numbers and consumer price indexes....they are all things beyond my control which may or may not dramatically affect sales in my area.

I have no idea what lies ahead, but I do know that I'm going to keep taking it one day at a time, keeping a keen eye on market trends and law revisions, embracing new technologies and marketing strategies and always remaining grateful for the clients and friends I've met along the way and for my fellow Associates who like me, are survivors.

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Colleen Fischesser is the Broker/Owner of RE/MAX Select Real Estate. She has been successfully helping clients buy and sell real estate in the greater Seattle area since 1990 and specializes in South East King County including the communities of Covington, Renton, Auburn, Kent, Ravensdale, Black Diamond & Maple Valley. Voted by clients and industry professionals as one of Seattle Magazine's 5 Star, Best in Client Satisfaction for 4 years running, she and her team rank in the top 50 of RE/MAX teams in the entire Northwest region. Colleen is committed to remaining on the cutting edge of real estate marketing and technology while providing value-added, personalized service.

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Posted by South King County Broker/Owner Colleen Fischesser 425-432-5400 on 10/04/2009 11:26 AM

Comments (46)

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real estate market, first time home buyer tax credit stimulus, 2009 fourth quarter

Originally posted at: : It's the 4th Quarter....How Will the Year End?

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46 Comments on It's the 4th Quarter....How Will the Year End?

OCT

Hi Colleen, thank you for sharing this excellent article with us.

John Pusa

This year had been strong for the team but no resting on our laurels. Lots of new things in the works for 2010 that will hopefully rock our group and keep us motivated!

Pat, for us too. I feel a strong excitement for 2010 as well and am motivated for many new opportunities we'll be implementing!

Hello Colleen, What a great post. I agree with you that you never know what the year ahead will bring, good or bad. This was my first year as a Realtor and I am excited to see what the upcoming year will bring us all. Part of what I enjoy about this business are the challenges that we are presented with. You make necessary adjustments with your plans and move forward.

I always get very apprehensive at the end of the year/beginning of the next. It's nice to sell something late in the year and know that you are starting the year with a settlement or two in early January. I have one coming near end of February but it's a small one and there's a giant relo referral fee due (this was a personal referral and the dreaded relo called and said, guess what?? if you want them, even though you got them yourself, you owe us 35%). But, I'll take it. Better than nothing! We have to take it day by day, as you say, because there is no normal anymore!

OCT

Hi Colleen

Great post - it is true that the end of year brings alot of anxiety --especially this year. I am thinking positive and trying to have an upbeat attitude about the years end andthe coming new year. Hoping somewhere it will turn around but also being realistic about it too. Thanks for the post.

This year's end is certainly far from ordinary not only for Realtors but for just about everybody. Instead of waiting for 2010, I decided to do a new business plan focused on the 4th quarter of 09 and the lst qtr of 10. Why? Nothing is the same in real estate and by recognizing this new reality I can hopefully launch some out of the box ideas and strategies focused on being positive and realistic. Thank you for a great post and reminder to make something happen everyday rather than wait for it to appear.

Colleen

The pending sales number increase has a lot to do with the short sales pending and we all know the percentage of these that make it to close is a low number. Very good post. Thanks

So true. The cash for clunkers program stimulated car buying all at once. I would like to see the credit extended or modified for another 6 months. If not have government at least take it off the table sooner, then later.

Colleen - Gary Keller has a great saying that is something like "who cares what 'the market' is doing? What I need to worry about is what I'm doing - stay focused on that, and you'll have a great year."

I think all the national news, statistics, etc. can DISTRACT us from the simple fact that in almost every market, there are HUNDREDS of closing that take place each and every week - and if we focus on what WE are doing to generate leads, appts, and help customers to the best of our ability, the question you posed will fade to the background.

p.s. I have seen this first hand in my parents real estate business, selling St. Paul and Minneapolis houses, where they have had their best year ever in 2008 after being in business for 30 years, and 2009 is shaping up to be even better! (yes, they work very hard and long hours, and this is by units sold, NON-REO)

Here here Colleen! To survivors and adjusting to the flow, whichever way that might be~

I have to agree with Sean - market -smarket - who cares what the market is doing.

The name of the game is understanding how to change and when... Those who can't keep up with that, are the ones standing around and complaining, the ones who do get it - well, they are too busy to keep it up at the watercooler...

Colleen, great post....thanks....wishing you a great fall selling season

Collen, so true no one knows how any market will begin or end. October is my month annually to refocus or retool my business plan and budgets. The good news is that it can not get any worst than 2009 has been.

I agree with Gary Keller. If you are focusing on forces outside of your control you just set yourself up for failure. Focus on you. On what you can do to get sales. No matter what the market is there will be people buying homes. Personally, I think the tax credit has been a failure...even according to NAR it only brought out 350,000 additional sales. Of course whatever NAR says is almost always bloated to make them seem more important--so really probably only 200,000 addtl sales. Of course 2 million buyers took advantage of it but 90% of those would have bought anyways. At a cost of 16 billion in tax payer funds seems like we could have saved that for something really worthwhile. The home buyer gets enough subsidies as it is. Of course all us NAR members just want more and more handouts to improve our business---like moths to a flame. Wise up Realtors--the tax credit is a losing deal for America as a whole. It is time you start carrying more about your country than your personal sales volume.

Colleen - although we don't know what next year will bring, you are right if you just keep moving forward and taking it one day at a time focusing on what's important in your business, you will not only survive but figure out how to thrive in any market. Those that work the hardest and don't rest during the 4th quarter, have a great 1st quarter of the next year!

Colleen, You're right about how agents need to take a leap of faith when looking forward at the next year's market. Being an optimist helps doesn't it ?

Thanks so much Colleen. This is where a lot of faith comes in handy too. We as professionals also have the challenge, as we keep positive about the market, to also encourage our clients that things will improve. Thanks for your insight.

This year our problem has been not enough homes on the market. I have buyers that cannot find homes. I have a buyer that put in 30 offers, most over asking, but has now given up.

Forecasting the real estate market is like predicting the weather, and you know how accurate those are! Oh, if we only had a crystal ball - our lives would be so much easier!

Colleen,

On the seasonal slowdown you mentioned, I work on the other side of Washington State, east of the mountains. For those who think it rains every day in Washington, well, I live in a desert portion with less than 10" per year of rain.

I was once told, by a veteran agent, that the slow period of the year was from Thanksgiving to the Super Bowl. I has proved to be accurate more times than not in my experience.

Personally I could use some good winter sales. Like you say, I don't know what this year end will bring, but I am hoping for success and planning on working hard.

Colleen, Thanks for sharing a glimpse of your market there. Here the market has been up slightly from 2008 but still slower than we wish. Many agents in my area have left real estate or had to find additional jobs in order to survive. The Mid Columbia area is composed of many small towns in 4 counties and 2 states. When the market was stronger many people got into real estate. We still have a lot of agents for the limited area we cover which spreads the sales pretty thin.

One thing is certain. The future is always uncertain!

Colleen,

Kudos for hitting the nail on the head. Predictions are difficult to make in these historic times. In fact, yesterday on "This Week" news show one commentator made the same point regarding the unemployment numbers. Yet, I also have to agree to stay away from the water cooler, concentrate on local trends in your market, and then implement an appropriate marketing strategy to help your clients.

Colleen,

Great post... We sure have some challenges ahead of us.

Thank you for sharing with us!

Colleen,

Increased unemployment and dismal CPI will continue to depress the economy and real estate will not be spared. True, we have no control over our market, but one can still turn lemons into lemonade. I intend to make the best out of today first.

Colleen - you are a survivor because you were able to keep you head above the rising waters all year long. Congratulations. If your broker doesn't make you do it, you should prepare an annual production plan so that you have something to guide you - and your broker- in evaluating your performance and objectives. Even if your goal is to make as much next year as you did this year, you need to know how you are going to go about doing it. And then, we all need to be held accountable.

Good luck!

What is happening nationally IS important....especially when it comes to the 'buyer credit'.

Gary Keller is correct in that you can't control what is going on outside of your immediate influence. Focus on what opportunties are within your grasp....focus on who you can help. Thats just smart.

As business people first, we need to take the information and then decide how to apply it to our businesses.

For example, (as many have pointed out)....if the cash for clunkers program is any indication of what happens when the 'stimulus' is removed....if the buyer credit isn't extended/ renewed (which looks 50/50 at best)...there WILL be an effect.

(on a side note, in many markets the credit caused home prices....to artificially escalate. More demand etc. Often times, the homes were seeing multiple offers etc. Buyers ended up paying more than they otherwise would have had that 'stimulus' not been in place. So, any money they 'saved' in taxes they more than paid when they bought. Now, add to this the added $$ they will pay over the life of their mortgage on the increased loan amount)

As agents we need to be letting all of our buyers know the importance of taking action NOW. Really, this month and maybe the first week of November is their last opportunity find something with hopes of closing on time.

Sellers. Call all of them and perform radical price-ectomy. Let them know that the best, most motivated buyers are buying NOW. If they miss this surge there are no guarantees there will be another. Also, let them know what we DO KNOW is going to happen next. 7,000,000 bank controlled homes hitting the market over the next 24 months (or less)...etc. Use this info to motivate them to lower their prices so they can sell before the markets potentially worsen.

Hope all of this helps. We created a free fourth quater business plan...and a 60 minute how-to audio. If you want to download it..here is the link

Yes, Colleen these are interesting times. The only way to take it is to live in the hear and now.

That was well stated! We are survivors!! My brother and I sold more in the first 5 months of this year than we did all last year in dollar volume. We had an AWESOME 5 month run and then it died when school started which is normal for us.

When it should have picked up, we stayed down in production because the Jewish holidays came early and that is a Big Deal around these parts.

Just last week it appeared to be headed back to busy. I read today that Obama is backing the continuation of the $8,000 credit. NAR does a good job too of pushing for what works best for us, so hopefully it will pass on a positive note.

Until then like you said, WE WILL SURVIVE! Joy

Great post and I've just spoken this same thing with 2 sellers this week. 'In past years', well that phrase I used to use. It's all different as you say and who knows how each month will turn out. I can't say this year has been terrific by any means for me. I do know that I've planned and tried to find the trends much faster than my counterparts have.

Hi Colleen,

It's been a rocky ride in Westchester and Putnam Counties in NY for 2009. To date, only 1/3 of all producing agents have done over $1million in closed sales.

I'm hard pressed to say that it's been a good year but I'm optimistic that the year end will be better. A bit more sales than expected.

Yes, I agree. One has to not worry about what others are doing and focus on getting out and meeting people. Action feels better than waiting around-it always has.

we see a winter break from sales in October as well in the Lake Norman area. I am hoping that people will still feel in the buying mood!

Hi, Coleen, I sold a home in Maple Valley this year although I usually work further north. This is because things are slow for me, and I took what I could get. Winters ususally are not too bad for me because I tell buyers that this is the best tiem fo year to get a good price on a home. But, who knows what will happen this year. Are you going to be at RainCamp on Wednesday. If so , I will see you there!

OCT

Those who look forward to the future and plan to do well in spite of the ups and downs probably will... because they'll use their belief to keep working at it!

Colleen,

We certainly do live in uncertain times! However, going back to basics appears to be the way to go. I'm now doing all the things (some dreaded!) that I did when I was a rookie back in the mid 80's plus the technology market of today!.... and it's working!

Kathy Opatka

I don't have anxiety right now, surprisingly. If you asked me 6 months ago it would have been a different story. I've been trying to adjust that change is the new normal and we have to be adaptable and not feel we will definitely get anything. Be proactive every single day working the plan and keeping the plan flexible. That's how we will all "win" in whatever way that means for each of us.

Hi Colleen,

I agree with you about the Real Estate market. Noone knows what is the trend anymore specially here in Toronto. Market has picked up so much that there are bidding wars and for one property there are 7-14 offers.

I guess all first time buyers are in the market right now taking advantage of low interest rates.

Sellers are happy that they are enjoying this market. I am now gearing up for next year to start well.

Thanks to Active Rain, from where I have learnt so much and made good friends too.

Happy Thanksgiving...(just round the corner)

www.gtawesthomes.com

Colleen, it is looking like this is going to be one of the best fourth quarters ever.

OCT

Colleen - I've noticed in the last few days articles indicing that interest rates may well be on the way back up, this will likely nudge a few of those still sitting on the bench to get out there and buy.

Very beautifully said...and I'm right there with you...doing my best to adapt to the new normal and roll with whatever happens to keep it going!

Colleen~

Thanks so much for writing what we are all thinking who are excited about a future in RE!

You go girl!

Gina

Colleen~

Thanks so much for writing what we are all thinking who are excited about a future in RE!

You go girl!

Gina

OCT

Hi Colleen: I predict we're going to see more of the same. Short sales, foreclosures. When the tax credit goes away at the end of November, it will open the floodgates for investors to buy short sales. Heck, those floodgates are open now because most buyers can't close by 11/30 on a short sale. I see little incentive for the government to want to stimulate December sales. April, now, that's another story.

Hi Colleen - Great advice. Focusing on your local market and understanding what is happening there is what will keep you being successful. No doubt things are changing all the time and there is no such thing as "normal" anymore but that just makes it all the more challenging. Good luck to you.

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