Over the past few months I’ve noticed that in social environments among people who have known me for years, one of the first topics that comes up is the state of the real estate market. Usually, one of the first questions I get asked is “how’s it going?” sometimes with an expression of concern. I’d like to take this opportunity to relay my response here:
The national news media and overall real estate economic statistics are dire, and getting worse on a seemingly daily basis. The truth is that the real estate market boom was overextended and very much speculative based (as opposed to need and/or value based). These current market conditions were not a surprise to me or to anyone who has been in the business through previous market cycles. Essentially, I’m the middleman in real estate transactions, I think a very valuable middleman, but nevertheless a third party to a real estate transaction. I’ve witnessed many dire situations in the past few months where owners have lost all of their equity and stubbornly clung to unrealistic prices - ultimately losing control of properties to the bank or other creditors.
I work for one of the largest and strongest local real estate companies, and yet I’ve noticed that around my office the number of active agents has dwindled. The ones that are left are those consistently ranked over the years as “Top Producers”. These real estate sales professionals are not one, two, three or four deal wonders but those that have the discipline, work ethic, business and organizational skills, and the experience to provide value-added services to their clients. Market conditions honestly make an impact on how we work on a daily basis- in a buyer’s market the skills I just mentioned become MUCH more important.
So, my response to the casual question “How’s it going?” is- it’s a challenge, an exciting challenge that makes all of us so called “Top Producers” reach deep down inside ourselves and our skills to make sure we have the discipline in guiding both buyers and (especially) sellers to “get real” and make informed decisions. Deals are still getting done, there are many foreign as well as local buyers making offers and closing on properties. However, everyone today knows that this is a buyer’s market (especially the Greater Miami area and even the coveted South Beach market). A seller today must start by pricing their property aggressively and working with a qualified real estate sales professional. In the past ten days, I have personally written four sales contracts/offers totaling over six million ($6 Million) for a combination of both commercial and residential properties. The one thing all of these had in common: all were priced right, in very good locations, and were being handled by competent real estate sales professionals that know how to present the properties to qualified buyers and their agent (me).
I’ve noticed that contracts take longer to close, and negotiations are longer and more protracted with financial underwriting departments looking much more carefully at each and every loan application. The value equation HAS to be there today and for the foreseeable future- the latest evidence of this are the headlines from newspapers indicating a pending revision of national mortgage broker regulations and new stricter national underwriting standards. So, to summarize, the real estate sales business is still healthy for “Top Producers”- those of us that have the ability to be selective in who we work with, and for those of us that also have the discipline to stay focused and use our hard-earned skills to provide a true value-added service for our clients.
• My team and I focus only on motivated sellers- those willing to do whatever it takes to sell their property.
• Working with motivated and qualified buyers-particularly those from Europe that understand the value in purchasing income producing and/or prime waterfront properties. If a buyer has the goal of purchasing for x dollars per square foot, then we set up a purchasing system until they get what they want.
• Continuously and religiously following up with creative & innovative marketing programs and then with direct buyers, cooperating agents, and interested parties on behalf of our clients.
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