HOW TO REVERSE THE REAL ESTATE "BUYERS' MARKET" AND CREATE DEMAND FOR HOMES. Agents have the MOJO!

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HOW TO REVERSE THE REAL ESTATE "BUYERS' MARKET" AND CREATE DEMAND FOR HOMES. Agents have the MOJO!

BUYERS WILL NOT GET OFF THE FENCE!
BUYERS WILL NOT PULL THE TRIGGER!
BUYERS ARE SO SKITTISH!
BUYERS ARE NOT MAKING REALISTIC OFFERS!

How often do we read or hear all of the above day after day? The only folks who will really predict the end of the real estate industry recession or depression, depending on your location, is the NAR or some agents who Home Sold believe that if they think good thoughts reality will follow.

YES, we, REAL ESTATE AGENTS, can force a reversal of the buyers market in many communities across the country.

Come on Lenn, get real. Our inventory is a 15 months supply. That's a long way from becoming a seller's market or even a neutral market. Have you taken leave of your senses. . . . .

again??

LET'S START WITH SOME FACTS so we can get off on a realistic start.

FACT: SOLD TRANSACTIONS will remain stagnant for the next 3-5 years. Expect real estate transactions to remain no more than about 2/3 of the average number of transaction represented by the years 2000 through 2005.
FACT: THE TREND IS FOR MORE FORECLOSURES. As a percentage of listings and SOLD transactions, foreclosures will dominate some markets and grow dramatically in others.
FACT: THE TREND IS FOR MORE SHORT SALES. The percentage of short sales will increase as home owners are relocated, lose jobs or 3-5-7 year ARMs reset and force mortgage payments higher.
FACT: MOVE UP HOME BUYERS WILL BE RARE. If home owners cannot sell their existing home because they have negative equity, they cannot buy the larger or second home.
FACT: OVERPRICED LISTINGS WILL EAT YOU ALIVE. Home buyers have the power if not the market knowledge to reduce the glut of homes on the market.

STEPS TO BRING SOME BALANCE TO THE REAL ESTATE MARKET.

AGENTS: Use the American Recovery And Reinvestment Act to the fullest. Last time I looked, the Home Buyer Tax Credit of $15,000 was reduced to $8,000 and is still limited to First Time Home Buyers. But Senator Johnny Isakson, the Georgia Republican who sponsored the amendment, has suggested that the measure could re-emerge in a stand-alone bill. Even if the benefit is limited to $8,000 and first time home buyers, USE IT. GEEZ! ABUSE IT. I surely intend to. Learn about this benefit and include it in your online advertising. Based on what I'm reading today, it will be good for buyers purchasing a home before December 1, 2009. Create a flier to explain the tax credit from an authoritative source and include it in every buyer's folder ( YOU DO HAVE BUYER'S FOLDERS, DON'T YOU?). Print the fliers and include them in the brochure for all of your listings. Include them in the handouts at your open houses.

STOP AVOIDING THE SALE OF SHORT SALES. So what if banks don't know how to sell real estate. I read many agent who say that they have a duty to show homes with pathetically low co-ops. Yet, some of these same agents will refuse to show short sale listings because of the nightmarish delay, arbitrary acts of the banks and less than helpful listing agents. START SELLING SHORT SALE LISTINGS TODAY. I can tell you that your buyers will love you. Compared to the average foreclosures listing, short sales are usually in lovely condition, represent homes in very popular areas and communities and are offered and SOLD at prices far below what they would be selling for if they were not a short sale. WAIT A MINUTE!!! First, do your homework and learn about the different bank procedures. Prepare your buyers to have patience, respond as quickly as possible when the bank finally assigns a negotiator and asks for a document. If they have a 48 hour deadline, get on it. I've come to refer to this indecent as the "negotiator's test". This happens with such regularity, I believe it's done just to see if the buyers are serious and the buyer's agent is on the job. Foreclosure For Sale

SELL SOME FORECLOSURES and get these things off the market. Foreclosures are a dream transaction compared to some short sales. No, the moon is not made of cheese and your buyer will probably not get the house with a 50% offer. Foreclosures are priced by appraisals or broker's price opinion and, while they are often discounted, they are not anywhere near 50%. If they were, they'd all be SOLD. These ridiculous offers are a waste of everyone's time. EDUCATE YOUR BUYERS by providing them with the LIST-TO-SOLD price statistics in that market. Once a serious buyer has a handle on value and understands that the banks usually get near or often more than the list price, they'll know that they need to get real or get to the rental office. Be firm and if the buyer is more interested in negotiation than finding a home, NEXT.

AGENTS: LEARN ABOUT THE FHA 203(k) Purchase and Rehabilitation Loan. If you are in a market where a number of foreclosures are in need of repair and may not qualify for normal FHA financing, educate your buyers about the FHA 203(k) loan. It will help you sell homes and help your home buyers earn some equity quickly.

IF AGENTS AND BROKERS KNOW THAT THEY ARE WORKING WITH ONLY 2/3 OF THE BUYING POOL, THE REMAINING 1/3 BEING THOSE MOVE UP BUYERS WHO CAN'T SELL, we should be figuring out ways of attracting home buyers who can buy and CLEAN OUT THE INVENTORY of foreclosures and short sales.

WHAT HAPPENS IF WE CLEAN OUT THE INVENTORY OF foreclosures and short sales??

Fewer homes on the market.
Buyers better prepared.
Banks are slow but they have begun to learn.

PRICES WILL BEGIN TO RISE? EVERY LISTING AGENT'S DREAM. You won't even have to advertise it. The NAR will do it for you. They'll do it whether prices rise or not so take advantage of the opportunity and include the announcement by the NAR that "home prices rising" publication by the NAR in your buyers Real Estate Agents folders, at open houses and in your listing brochures.

NOW GET OUT AND SELL SOME REAL ESTATE. CLEAN OUT THE INVENTORY.

WE CAN DO IT. NO ONE ELSE CAN.

Courtesy, Lenn Harley, Broker, Homefinders.com, 800-711-7988, E-Mail.

_______________________________________________________________________________________________________

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Posted by Lenn Harley, Real Estate Broker, Virginia & Maryland on 02/15/2009 06:50 AM

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110 Comments on HOW TO REVERSE THE REAL ESTATE "BUYERS' MARKET" AND CREATE DEMAND FOR HOMES. Agents have the MOJO!

FEB

2009

Lenn,

As usual a very insightful and well thought out post with lots of great information. Thanks for sharing and helping to point the way to many during these trying times.

Best wishes

There are so many agents that have never been involved with a down market. Those of us who have no how long it can take to hit a turn around. In the last down period that started in 1987 it was not until 1993 that things finally started to turn around. The market and economy are much worse this time. I think there are many Realtors that just think this will be over and done with soon. Wish I could say that but my Cristal ball says otherwise.

HI Lenn, thats about as good a pep talk as I can take this morning, get out there and educate and sell... great idea, and the $8,000 tax credit, (now that it is not a loan) I will promote the heck out of it... first point of education is .. first time home buyer doesn't literally mean the FIRST EVER home one bought. I think there is a blog in there... let me go think about that one. :) Wishing you a great week.

Jennifer. Thanks. Trying times indeed. Just spreading a few thoughts.

Bill. We're looking in the same crystal ball. I remember the late 80s early 90s period. In my market it was 1995 or so before homes began to appreciate again after losing up to 25% of market value.

However, we didn't have the negative equity situation then because most folks had made down payments and had been in their homes slowly building equity at a mere 3.5% a year.

Then there is "Catch 22". First time homebuyers are more often than not, using FHA financing. A LOT of foreclosures would not qualify. If the banks pull them up to the bare minimum, then it really could be "game on".

Ellie. If the buyers can qualify for an FHA loan, they can qualify for an FHA 203(k) loan. I just added a paragraph. Thanks.

Gail. If you're referring to the "3 years", let me know. I assumed that is what it meant, but couldn't find it.

Lenn, I don't know where you get your energy but I'm glad you have it! Positive and practical advice. Thank you.

Lenn, you are on the money with foreclosures. One of our agents has sold a foreclosed home her last 3 transactions. Some of our clients will ONLY look at foreclosures. Are there deals? Often times yes. Are they the only deals? Absolutely not. Some folks widen their home search to include other parameters, some do not. It is what it is for the next few years...

OH my.. yes, I thought those rules were unchanged, the first time homebuyer, who hadn't owned a home in the past 3 years. Yikes, I hope I didn't jump the gun, I will indeed have to do some homework. (i hate to assume, but maybe I did this time ohno)

Ahh the good old FHA 203K loan. In the early to mid 90's we did a ton of them as the Rehab market hit its frenzy.

Back then I did them on predominently early 1900's homes. Today I think they would be perfect for those 1970's and newer homes that have not seen much love lately.

Barb. Apples and blueberries and green peppers and onions and zuccini and spinach and beans and rice and . . . . . .

Frank and Jodi. If an agent eschewed foreclosures in tours for buyers under $300K in my area, they wouldn't have anything to show. So many good, really good homes have been foreclosed, it's an important market segment in our area. Far easier to deal with than short sales, but we can't overlook them either.

Lenn, on the NAR website there is a breakdown of changes, and the 3yr first time homebuyer still applies. I would guess that its ok to say and reference NAR's website as the information page?

Lenn - This is so well put! We do have the power - heck; it's out DUTY to educate to the public about not only the Tax Credit, but the Current pricing of homes - to MAKE them realize the value in buying.

What we also must do; is educate them on Short Sales. These are NOT for the faint of heart. I'll do them; but only if I think the client has the will and the patience for it! They simply don't work for many folks who are on time-tables.

Lenn - where do you come up with all this stuff? If we start doing these things what are we going to be able to b*t%h about? Oh, and add Rural Development loans to your list. They take a bit more effort than FHA but don't have the same liveability requirements as FHA. So, for the person/couple/family that want to do it themselves, if the location qualifies for Rural Development, they won't need the 203K (which is fantastic).

MORNING LENN! Talk about kicking my " ... " - to get me to just do it -- I have been lightly pushing foreclosures - and talking about it! And that doesn't "do it"! -- Gabrielle

Lenn...

You need to figure out a way to monetize these excellent posts. There is so much valuable information here, it's got to be woth something to those that don't have a full grasp of where we are and where we are heading! Thanks for a great "free" post.

I had not heard that this credit "might" be introduced in a different bill.

Here is what I have seen the last 2 weeks in Ann Arbor.

Every Lead we called wanted to know about it. They didn't want to get off the phone, they wanted to talk and many relationships were started. However, most wanted to wait and see. So now we know it is only for 8000 and first time home-buyers. The A2 News interviewed me Friday, asked if I thought it would help. I said did the 7500. work?

In my opionion it helps those who are already thinking if buying but didn't bring any one NOT cnsidering buying. I did believe the 15K would have made folks ears perk up.

I am wondering if the buyers "think" a separate bill "might" be passed if they will still be in wait and see mode.

Great post, the 8000 credit only applies if it is financed, and also has a 3 year recapture in full if the home is sold before 3 years. It does not apply the way I read it to a cash buyer.

The amount of traffic that I am having on most of my listings is significant. The reason that buyers aren't pulling the trigger in some cases is the agent. When I call to follow up on the showings they come up with some of the lamest reasons as to why their buyers are still on the fence.

One spent 15 minutes talking to me about the staging on two other homes that they saw. When I asked about the size of the homes or the price of those homes as compared to my listing she still went on and on about the staging. Good grief if that is what you are using as your criteria to make an offer then your buyers are in trouble. PS the listing is clean and neat-no clutter!

Now off to make new flyers with the tax credit information-Thanks!

This is a good post and a 'wake up' call to many agents out there that think that selling real estate is as simple as sitting next to a phone or doing "up time" at the office.

Lenn, great post ! I agree that as agents, we are on the front lines and we are on the pulse of the real estate market. Agents should absorb all the info and communicate communicate communicate with the consumers. Knowledge is power. I love many of your suggestions and thoughts regarding the short sales and foreclosures. I have seen so many negative articles and comments regarding them, yet every short sale listing we have taken on since the beginning of 2008 has settled ! I think most of the problem is that the agents are not familiar with the process. Also, great suggestion regarding becoming familiar with the FHA 203K program... a great program for the properties that need work and/or updating. Lets accept the realities and make it a great 2009 ! ~ Chris

Another post with great points. Now that our "friends" on Capital Hill have passed the legislation there's no reason for those who were sitting on the fence not to get off an get active. I hope Senator Johnny Isakson introduces separate legislation extending the tax credit to all homebuyers. This would provide true stimulus and be a major component in getting the housing market moving again. I left a message on Senator Isakson's site encouraging him to pursue the expanded tax credit.

All good points.

I just think that a lot of people, including those in Washington, are going to be disappointed with the results of this home buying tax credit.

Use the tools that are out there for us. Any and all of them. We are seeing the short sales and foreclosures selling and it is "cleaning" up the market some and moving it towards a change and also opening up the door for the Non distressed homeowner to get looked at. Our builder inventory is a lot of the short sales and there are becoming very limited and with no new building going on... hmmm demand will be there but none available - a positive thing.. I also plan on working extremely hard on keeping unrealistic sellers off the market at least with me. I don't like working for free and throwing money to the wind... Love this post Lenn. Thank you. We all need a kick in the butt - quit moaning and go latch on to what is out there. AGENT Inventory is down as well so now's the time to be the "ONE!"

Hi Lenn, Thank you for all the great information in this post. Info I can definitely use. I have to confess, I do not have a buyer folder... what's in your buyer folder?

Gail. Thanks. I thought so.

James. I had some buyers who inquired about short sales but needed to close in 30 days. My advice to them was to rent short term. The value gained would be more than worth the trouble.

Mike. We do the Rural Development Loans. However, they are so geographically limited, they are marginal in many areas. I have one under contract now.

Gabrielle. Foreclosures and short sales be included as inventory to show. Otherwise, good homes are missed.

Richard. Thanks. Let's hope a lot of folks read it. I love my subscribers.

Missy. I talk with a lot of folks too and in the past week only one buyer even knew about the tax credit.

Jim. MMmmmm. Evidently the provision was included to make some lenders happpy.

Cindy. That is so typical. I once visited an open house held by an agent in my network and a couple of agents came to take a peek. They spend 1/2 hour talking about how the house could be staged. The house was beautifully furnished with valuable antiques and priceless minimalist decor.

What was so funny was that while the agents drummed on and on about staging, my partner was in the den writing an offer for the person who purchased the home.

Martin. WAKE UP! is exactly what I meant to do.

Christopher and Stephanie. The process stinks but it is what it is. We, as agents and brokers, MUST learn our way around these listings and work them. The key words are "learn" and "work".

Alan. I left a message about negative equity. I don't believe that most on the hill understand the dynamics of the real estate industry.

Mark. The tax credit isn't much, I agree. The buyer FIRST has to have the ability and resources to BUY.

Valerie. Thansk. You got my message.

Mary, Mary, Mary. What do you present to buyer consumers when you first meet with them?????

Lenn-- I could be a wise-a$$ and say "My Card"...but that's not true. Generally with walkins we go over maps of the area, listings that they are interested in, a covenant package if they ask...they will leave at the end of the day with those items iin a folder. I don't have a buyer package...slap me...then help me, Please.

Lenn- You speak great wisdom with this post as with all of your posts. We as agents do have the ability to help the market begin to rebound and to clear out the inventory for the benefits of all!

Best wishes,

Scott

I was just thinking about this last night. I have a short sale that is priced ready to go with much interest. The agents don't want to play the "waiting game". I work hard on these files but there are alot of real estate agents that don't understand nor want to put the effort into it. I have my flier made and am getting good results from it.

An excellent post!

Lenn - we have more property eligible for rural development, in this area, than not.

"STOP AVOIDING THE SALE OF SHORT SALES"great statement and don't understand why agents avoid them but they do? Lazy comes to mind. I have had agents tell they don't want to show my listing went they realize it's a short sale. Even though I have much of preliminarily leg work to expedite the process. ?????? Great post again...

Mark. The dynamic of a short sale is so different, it's throws agents. We do them. It's just inventory and it gives me excuses to curse banks.

Barb. Good for you. Shucks if I were a listing agent with short sales, I'd be looking for buyers myself.

Mark. Thanks. We don't. But, I do advertise for buyers in those areas that are.

Scott. I figure that if we can't change something, just learn to do it.

Mary. You are not a buyer's agent at heart. Call me sometime and I'll brief you.

Very true Lenn. Trying not to be a pessimist but I see the market we are currently experiencing lasting a lot longer.

Low prices, at 5-year lows to be exact, low interest rates at 50 year lows and tax breaks , now is the time to buy

Bill. Same here. At least a couple of years. Which is why we have to look to all opportunities.

James. Indeed. That's the message.

Lenn- Anyone who has ever worked with a young, just married couple, buying their first home, knows they needed patience, hand-holding, guidance and reassurance, before they could comfortably put in their offer. These are the same techniques we need to employ, today, applied to a broader range of homebuyers.

Marilyn. Indeed. Buyers today are exceedingly skittish.

Lenn---Working with first time home buyers can be so rewarding --- they are always just so excited to get into a home. You are so right, everyone needs to get off their duff and do something. Mama Liz's Signature

Thanks Lenn, I will be calling you.

Amen!! Let's get out there and kick butt!!

I do avoid the short sales because the other agents don't have the process started and expect me to carry the ball. I guess I will have to rethink the process.

Lenn- well goodness, Im impressed. I thought you were stuck in legislative bashing so am glad to see you pushing what we got. This is life so get out there and do with what we have.

FEB

2009

Lenn, first of all, I'm still in awe that you read the dang thing! I tried. You're a better woman than I am.

Specifically, I read someplace that there were income limits for those taking advantage of the $8000 tax credit. I fumbled around the Senate web site and went nuts and gave up. Do you know if they put limits on or not?

Martha. Legislative bashing is a well earned RIGHT of citizens of the United States of America. It is embodied in the Constitution and the Bill of Rights.

Congress shall make no law respecting an establishment
of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.

=====================================================

16 SEC. 1006. EXTENSION OF AND INCREASE IN FIRST·TIME

17 HOMEBUYER CREDIT; WAIVER OF REQUIRE-

18 MENT TO REPAY.

19 (a) EXTENSION.-

20 (1) IN GENERAL.-Section 36(h) is amended by

21 striking"July 1, 2009" and inserting "December 1,

22 2009".

23 (2) CONFORMING AMENDMENT.-Section 36(g)

24 is amended by striking "July 1, 2009" and inserting

25 "December 1, 2009".

0: \ERN\ERN09560.LC

S.L.C.

1 (b) INCREASE.-

2 (1) IN GENERAL.-Section 36(b) is amended by

3 striking "$7,500" each place it appears and insert-

4 ing "$8,000".

5 (2) CONFORMING A1VIENDMENT.-Section

6 36(b) (1) (B) is amended by striking "$3,750" and

7 inserting "$4,000".

8 (c) WAIVER OF RECAPTURE.-

9 (1) IN GENERAL.-Paragraph (4) of section

10 36(f) is amended by adding at the end the following

11 new subparagraph:

12 "(D) WAIVER OF RECAPTURE FOR PUR-

13 CHASES IN 2009.-In the case of any credit al-

14 lowed with respect to the purchase of a prin-

15 cipal residence after December 31, 2008, and

16 before December 1, 2009-

17 "(i) paragraph (1) shall not apply,

18 and

19 "(ii) paragraph (2) shall apply only if

20 the disposition or cessation described in

21 paragraph (2) with respect to such resi-

22 denceoccurs during the 36-month period

23 beginning on the date of the purchase of

24 such residence by the taxpayer.".

0: \ERN\ERN09560.LC S.L.C.

1 (2) CONFORMING AIVIENDMENT.-Subsection (g)

2 of section 36 is amended by striking "subsection

3 (c)" and inserting "subsections (c) and (f) (4)(D)".

4 (d) COORDINATION WITH FIRST-TIME HOMEBUYER

5 CREDIT FOR DISTRICT OF COLUMBIA.-

6 (1) IN GENERAL.-Subsection (e) of section

7 1400C is amended by adding at the end the fol-

8 lowing new paragraph:

9 "(4) COORDINATION WITH NATIONAL FIRST-

10 TIME HOMEBUYERS CREDIT.-No credit shall be al-

II lowed under this section to any taxpayer with re-

12 spectto the purchase of a residence after December

13 31, 2008, and before December 1, 2009, if a credit

14 under section 36 is allowable to such taxpayer (or

15 the taxpayer's spouse) with respect to such pur-

16 chase.".

17 (2) CONFORMING AlVIENDMENT.-Section 36(d)

18 is amended by striking paragraph (1).

19 (e) REMOVAL OF PROHIBITION ON FINANCING BY

20 MORTGAGE REVENUE BONDS.-Section 36(d), as amend21

ed by subsection (c)(2), is amended by striking paragraph

22 (2) and by redesignating paragraphs (3) and (4) as para23

graphs (1) and (2), respectively.

0: \ERN\ERN09560.LC S.L.C.

1 (f) EFFEC'l'IVE DATE.-The amendments made by

2 this section shall apply to residences purchased after December 31, 2008.

Terry. Who cares what other agents do or don't do. If your buyer needs for you to deal with someone, no matter how incompetent, you do so to get the job done for your buyer.

Dorie. That's what I'm doing.

Lenn: As always, great information. .Realtors often said that lower prices are needed to stimulate sales, and it's true, but potential buyers also need some assurance that prices won't drop much further after they take the plunge. The bleeding hasn't been stopped yet.

Fernando. No. The bleeding hasn't stopped yet. The market is an absolute mess.

Hi Lenn! Just catching up to this post and having read all that has been commented upon, I have nothing more to add other than I'm sending the other members of my team here to READ, READ and RE-READ this post!

Some of us are such 'snobs' that we won't even think about taking a course in short sales--and won't show foreclosures! In my humble opinion, those agents won't be in business this time next year--this is THE market right now and you are SO right, we must embrace it only AFTER we learn it!

Great post, as always, Lenn!

Debe in Charlotte

Debe. It took me some months to get the agents and brokers in my network up to speed on short sales and foreclosures. In the lower price ranges, they ARE the market.

We do make allowances for price trends which information is right in our MLS providers' reports.

Thanks Lenn --- you always have positive and helpful advise for us all. Thanks, too, for sharing it!

Best, Pam

By the way, how did you get your photo in the comment section? Do you cut and paste each time? or is there a change to make on your profile... Best, P

Pamela. It appears to be an automatic include. I'm sure they're going through the database and adding.

Lenn, very comprehensive post. I think one of the reasons the original tax credit proposals did not take off was real estate agents did not get forcefully behind it. To many were hung up on the repayment provision. Well now apparently that is gone at least for a minimal holding period prior to selling.

So much to comment on in this post, but let me be succinct--I agree.

Jay

Thanks Jay. It's a start. We still need help for buyers' acquisition costs, but we'll take whatever we can get.

Lenn- As always you hit the nail dead center. The limits on the $8000 don't help much in my area. It would be nice if they had left the $15K alone without the income limits. CA housing is one of the hardest hit areas in the nation yet we get very little help as many of our areas are expensive. If they really want to jump start housing then a credit that could be used by everyone would be a good start.

Lenn, you are right on the money. I am in Miami which I consider pretty close to ground zero when it comes to distressed properties. I did my own analysis and yup! 2/3 of the closed sales in the past 6 months are short sales and foreclosures. Business is booming! I am juggling 20-30 buyers and we are finally seeing BIDDING WARS on the best priced homes!! Yep, bids OVER list price, I am submitting one tomorrow and we have three others in process! I think we were the canary in the coal mine when the market went south (no pun intended) and maybe our change will spread North as well.

Janie

Lenn, remember that Real Estate is local. Down here in our little corner of paradise, demand is very strong, but with a huge market shift. The buyers are the new home owners that are finding homes affordable for the first time - while our upper end of waterfront and golf course homes has slowed quite a bit as those folks are carefully watching their portfolios.

Great post - agents who are on the ball and willing to work in this environment will do well. The fact that you do have to work will continue weeding out those agents who got into the business thinking it was going to be an easy job.

Lenn - excellent as always. Around here we actually have a few areas and price ranges that are experiencing very strong sales and buyers are in shock. They can't believe it. ~Rita

Good reminders. I would love to have buyers to show short sales or foreclosures. It seems everyone has just dug their claws in deeper waiting for the next offering. We are having a lot of company layoffs and closings. Not a sign to spur the buyer to move forward.

Thanks for the advice, it is excellent. I have a short sale listing right now, but getting a hold of foreclosures, well, the conventional wisdom in my neck of the woods is that unless you already have a relationship with the banks, then forget it....wish I did, though. BTW,. I am SO glad to know that someone besides a history teacher doubling as a real estate agent knows what the First Amendment says....

A great post. It is up to us to do it.

WOW I am pumped!!!

I have to admit that I am one of those who, in the past, has run from Short Sales and Foreclosures. But I have now seen the light. What sold me was the "getting rid of inventory" goal.

Great post - thanks Lenn.

RIGHT ON! Those that will take heed will help all of us and the market in general.

Right now I want to do whatever is in my power to help recharge the economy.

If this is it, then this is it! I'm hunkered down and ready for the long-haul.

Lenn,

Thanks for all of your knowledge, it is appreciated

Lenn I love your blog, back in the day I was the repo queen. I sold Hud houses, when you had to stand at the HUD office to see if you got the highest bid. That was before computors!

Lenn, great post to get us all excited about selling again! I agree with the negotiators test on short sales - it's a way to test your buyers sincerity too. 2/3rds of the buying pool is also correct, people just can't move up because their home just won't sell. In my area, it's best after reviewing the market to stick with first time homebuyers on the low end.

Lenn,

Thank you for the inspiring post. It is just the kick in the pants that many agents need.

www.KathleenKelly.com

Lenn - I was thinking about your comment about move up buyers becoming rare, just this weekend. I use to deal mainly with that segment of the marketplace, because I was dealing with many repeat customers. BUT now my clients are staying put, and digging their trenches!

Lenn, You are a bright spot on a cloudy day. Thank you for the educational post!

Great pep talk Lenn. I'm going to put out those flyers at my Open House on Sunday. I'm representing sellers in a short sale. It's taking forever but I'm still hanging in there. The first one is probably the most difficult but after that I will have the confidence to do more of them.

Quite the analysis and perspective! Love it!

FEB

2009

Excellent Post!!! And how true it is, it's a shame the Media doesn't promote home-ownership benefits instead of always being so negative. Loved the post so much, I re-blogged it. Thanks for allowing us to do that.

Hi Lenn - Thanks for the info. You put a lot in one post... Doug

Lenn,

Thanks for the post. I will need to learn more about the American Recovery And Reinvestment Act & FHA 203(k) Purchase and Rehabilitation Loan. Pretty much the inventory here in South Florida is short sales and foreclosures.

Eva, I understand you're market. Actually, in lower price ranges, short sales and foreclosures are our market in lower price ranges too.

You Go Lenn : )

Lonn. I'm going, I'm going.

Douglas. I'm often accused of being too negative. I'm not at all. I am a realist. I study the market and I make adjustments to focus on profit centers. That's not at all negative.

Gina. My pleasure. ReBlogging benefits me too.

Liz. Thinking, thinking.

Kelsey. Patience is what you'll need because the banks make any success almost impossible.

There are a lot of agents in this market who have said don't waste your time on short-sales --heellloooo! You'll have lots of time if you don't start selling short sales!

One thing I really like in this post, you tell agents to learn. Learn about tax incenitves, short sale, foreclosures... And, then educate your buyers. This is a key point. A knowledgable agent instills confidence in a buyer and a confident buyer makes offers and closes deals.

What a POWERFUL post!

You made me want to dust off my old Buyer's Agent Hat, Pull out my old, old Buyers packets and get cracking on this market with a vengence.

THANKS for the wakeup call !!!! and you really did WAKE me Up this morning.

Great post. I have a Realtor partner that just recently switched his focus to selling short sales and REOs. He busier now than he's ever been and he's helping to improve the local market.

Darrell. Makes sense. If we don't respond to the market in our area, we have no work.

Debbie. Good for you. Help us clean out some of the foreclosures and short sales in Silver Spring.

Catherine. I firmly believe that one reason agents lose buyers is because the buyers aren't learning the market and value when with an agent. We are a lot more than walking keypads.

Tami. They are a necessary evil.

It is in the mindset, Lenn. I love this get off your ass and work post. What a classic.

I hope we look back in a few years and laugh. You are so motivating!

Janet.

I hope we look back in a few years and laugh

From your lips to . . . . .

It seems everyone wants foreclosures now, so lets give them what thye want! The weird thing is even if a house priced similarly in the same neighborhood is a heck of a deal, they only want to see foreclosures! I'm in the middle of three deal sright now all with the same listing broker and my clients want more good deals! Wish she was more together and we could get through it faster!

Kim. Typical. Shucks. Give them what they want. If there is a perception on the part of a consumer that foreclosures are the best buy, sell them.

Dear Lenn,

Once again, you are very accurate with your insightful comments. I have 5 short sales in Brooklyn and Nassau Counties (NYS). The banks are incompetent and if their share holders knew how disorganized their staff is who handle short sales and reos, their CEOs would be fired. You would think that these banks would give bonuses to their loss mitigation and foreclosure staff so the paperwork moves faster and serious offers are processed faster so qualified buyers don't walk away or after several months lower their original offers.

I had one short sale finally close after 14 months of hard work.

John F. Maniec, LLC licensed real estate broker e-Pro certified trainer

Serving Northeast Queens County, NYC

http://FinestNYRealEstate.com

Lenn, I hear you. I am now very picky on what listings I take. And if a seller should wait to sell I try to make them wait. I'm trying to do my part on reducing and not adding to the useless listings.

DeAndrea. GOOD FOR YOU. Far too often, the goal is "getting the listing" and not selling the house.

John. We had one that took 10 months. Oh well.

I have to agree with many of your points. Agents need to adjust to current market trends, not expect the trends to accomodate them. These days that means short sales, foreclosures, better communication, better market knowledge, etc. Thank you.

FEB

2009

Lenn - Great post. I'm kind of late to this one...just about all of my comments or concerns have been addressed in the commenting. Thanks for the great information and the little kick in the a**.

Kent. Thanks for stopping by. One thing I would hate to see, considering the state of our industry, is agents who just qive up without a fight.

Samantha. Right you are. That is the message.

Be firm and if the buyer is more interested in negotiation than finding a home, NEXT.

Thanks for remind us of this very easy to forget fact!

Wez. Thanks. I learned from experience that buyers who are looking for the impossible deal are just time wasters. They aren't in the market for a HOME. They just want to negotiate. They don't usually buy. They just play iwth buying and then drop off the landscape.

Lenn,

Wow great article. Gave me the rev up I need. I am going to give a copy to everyone in my office. Love it.

Kathy. Spread the word that we agents are here and we're keeping the market going.

FEB

2009

Lenn, I enjoyed the post. I needed that kick in the butt. I like the idea about putting the tax credit on flyers. I have it on my website but I need to apply it to flyers. Thanks!

Debbie. Indeed. Rent an airplane and fly a banner.

Lenn, Thank!! Great post!! Great ideas!! I

Lenn, There are some great ideas here. Thanks for the fuel for thought.

FEB

2009

Great advice Lenn. In the January solds for the Truckee market nearly 30% involved banks. This is higher than we've seen. At Lake Tahoe, only 2 of the properties were listed as short sales. Our MLS just recently started including that info in the database, so we don't have historical data at our fingertips.

Lenn, Thanks for the great post! i've recently sold a home with an FHA/203k fix-up loan attached on a foreclosure way below appraisal, as well as a USDA Rural Housing Development sale. both gave my 1st time buyers really great deals, esp. the foreclosure. Both loans are fantastic; here in York County in PA, more homes qualify for USDA than not, as we are mostly a rural county - only homes in the city of York and a few other larger towns are the ones that don't qualify. I'm working on another FHA/203k now; I think they are wonderful!! Also, I've already been using a flyer our Mortgage broker made up, along with a new HomeBuyer's Guide he provides us with (very comprehensive on the lending aspects). What a great set of tools he provides us with! I've been calling and emailing my buyers database since the bill passed and am starting to get some active results. since my database is over 200 now (I'm only in the business 1&1/2 years, focusing only on buyers), I have quite a lot of work to do, but my belief is that it is our duty and obligation to reach out to all of our buyer prospects now and let them know about how this could help them, and educate them about it. Many of them have been just on a drip campaign for a while, and this could be the incentive to get them really interested now, as the time limit is only until 12/1. I'm pointing that out to everyone to give them a sense of urgency! The flyer, which I have added my info box to, is in my buyer's packet and will be at every open house I do (one every Sunday!).

Puzzling! How do you do business without a Buyer's Packet????? I always have them made up and in the trunk of my car, along with Listing Packets, FSBO Packets, & Expired Packets; that way I can always pull out whichever one I need when I find someone to talk to who is even halfway serious about any of them. If you don't know what to put in them, think it through. You need some of the things I mentioned above, plus your Consumer Notice, Buyer Representation Contract, literature from your company & local/state/national associations on REALTOR value, local stats, county info, links to informational web-sites, & other pertinent buyer info. I also include a sheet I have made up about "Moving Tips" and other Buyer-related information, including copies of pertinent news articles, etc. I try to give my buyers as much information and value in my initial packet as I can. They really seem to appreciate it. BTW: I will only take a prospect out ONE TIME without them signing a Buyer Representation Contract, and I write them for a year, pointing out that they can fire me if i don't do the job for them anyway. If they won't commit to me, I cannot represent their best interests. That's another thing i put in my packet - a list of what a REALTOR in PA can and cannot do if you don't contract with them, because, w/o a buyer's contract, we all represent all sellers in the state, essentially, and must represent the seller's interests first. Signing a contract w/us allows us to put the buyer's interests first, over the seller's. works like a charm!

Thanks again for making us think this through and get/stay on track for the future! I see it as very bright, because we can take advantage of the market and do exactly what you are recommending! I heard someone recently say "it's not a seller's market; it's not a buyer's market; IT IS AN AGENT'S MARKET - let's make the most of it!!!" I love that one!

Lenn - Thanks for a very informative and upbeat blog that I will carry with me until I know it by heart. It has prompted me to wipe the egg off of my face, come out of hiding and persevere. As a new agent (no excuse, just a fact), I excitedly talked up the tax credit during a phone conversation with a prospective client. I asked if she was a first time home buyer, and after she answered yes, I listed all the benefits for her. I steered her toward a mortgage lender for pre-approval, and found out through them that yes indeed, she was a first time home buyer - she had just bought her first home this past year! Live and learn, ask and listen. And thanks to Paula Burt for more great info. Another keeper for my ongoing education.

FEB

2009

Lenn - I've always said that agents need to adapt to the current market conditions, not expect it to "come" to them. Great advice on how to do that, thank you!

Paula. Goodness. I don't want any year long contract with a buyer. I have a 15 day contract. I let them know that I'm giving them my time and expect them to work hard to find a home. That way, if I want to continue working with them, we extend the BA Agreement for another 15 days or so.

If they are not serious about working hard to find a home, they need to take someone else's time. If they are serious, I'm putting tremendous effort into educating them about the market and buying process. I expect buyers to be serious and devote the time to find a home now, not six months or a year from now.

Of course, once we have found a home, the Agreement is extended to cover a couple of weeks through settlement.

I don't have hard fast rules, but I start off with 15 days. It makes buyers (and me) very comfortable that we're going to find a home quickly.

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Lenn Harley, Real Estate Broker, Virginia & Maryland

Leesburg, VA

More about me…

Lenn Harley, Homefinders.com, MD & VA Homes and Real Estate

Address: Lovettsville, Fairfax, Arlington, Alexandria, Stafford, Woodbridge, King George, Fredericksburg, Leesburg in VA., Rockville, Laurel, Columbia, Baltimore, Waldorf, Frederick, Eastern Shore, Bowie, Harford, Annapolis in MD. , Maryland, Virginia

Office Phone: (800) 711-7988

Email Me

Maryland and Virginia real estate agents and brokers serving buyers and sellers with experience. Search listings in Maryland and Northern Virginia and get daily updates of new homes for sale by e-mail. Contact Lenn for a tour of homes. REALTORS available every day for home tours. Homefinders network of experienced agents and brokers includes new home specialists, resale specialists and luxury home experts. We can help you with your home buying needs. Homefinders offers discounted 5% listings for Maryland, Northern Virginia home owners. Experienced agents helping buyers and sellers in the Washington Metro area since 1985.

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