Admin

Cream Rises to the TOP....Gunk Gets Stuck at the Bottom!

By
Mortgage and Lending with First Lending Solutions NMLS ID 1325784

Over the last few days at my local Starbucks, I've been interviewing more real estate people (realtors, agents, appraisers, lenders, escrow, title, and home warranty) than you can think of as I'm starting to see a trend that is becoming more pronounced than I've seen over the years. Namely, its the title of this blog entry.

CREAM RISES TO THE TOP.....GUNK GETS STUCK AT THE BOTTOM!

What I mean is that when the market starts to slow down as it has recently, I've noticed that the people in the business that know what they're doing have an eerie calm about them because they're working from a position of strength (knowledge, faith, experience, creativity, marketing) that I do not beleive I ever noticed until now. I've often been told this is how I've operated, but never put much though to it, as I tend to be pretty low key, even when I'm steamed inside. Of course, the other side of this coin, is that those that are not doing so well are willing to lie, cheat, and steal to make a buck. I recently interviewed an agent that claimed to know the foreclosure and short sale market extremely well, and that they had chosen to advise a client. Whatever knowledge they had was about 30 seconds deep, like a sound bite on tv, so the advice they were giving their client was sure to put them in a worse situation than they were already in. I politely recommended that they "think it through" before providing a recommendation as they did, so that during this challenging time in real estate, we can prove to the general public that the industry as a whole has the consumers best interests at heart.

So my challenge to everyone is this:

Provide 2 unique thoughts (short and sweet) to share with someone in our field so that they may understand that real estate is cyclical, and that during this time, it is even MORE CRITICAL than ever to make sure that you are worthy of being called one of the "good ones", by providing customized advice that REALLY looks at the specific scenario thoroughly.

I have my thoughts, and I'm wondering how to convey a positive message along to some of these naysayers that are giving our industry a bad name.

 

Show All Comments Sort:
Lenn Harley
Lenn Harley, Homefinders.com, MD & VA Homes and Real Estate - Leesburg, VA
Real Estate Broker - Virginia & Maryland

No question about having the consumer's best interest at heart. 

1.  I choose to not sell a home to an active duty military person who can't be sure they'll be here more than 3 years because our market is still falling, likely to fall for the next year or two.  I don't have it in my heart to have those soldiers and sailers stuck with upside down loans in 2-3 years. I recommend that they rent.

2.  I'm only selling new construction at this time becuase new home builders have lowered their prices and are offering fabulous incentives in this area.  Resale homes are grossly overpriced and property values are still falling.

I advise agents to save their money because it may get worse before it gets better.

Does that qualify??

Jul 28, 2007 10:59 AM
Bill Nazur
First Lending Solutions - Riverside, CA

Lenn

Brilliant! My nephew is Marine Corps, and I hadn't thought of your first recommendation. I agree completely about point #2, as well as advising everyone to save their cash. I suspect this cycle will last for the next 18-24 months as well!

Jul 28, 2007 11:10 AM
Bill Roberts
Brooks and Dunphy Real Estate - Oceanside, CA
"Baby Boomer" Retirement Planner

Hi Bill, judging by your answers on my posts I think you are one of the "good guys." We've had these cycles before. Lenn is right to recommend against purchasing if they are going to be moving within 3 years. In a stable market it takes 3 years to recover transaction costs. A declining market you never recover transaction costs.

I would say however that for most people and in most markets now is an excellent time to buy.

Bill Roberts

Jul 29, 2007 12:21 PM
Bill Nazur
First Lending Solutions - Riverside, CA

Bill Roberts

I know that most of San Diego is turning around (I still get 30% of my business in this town!), and I havent lived there in years!

I beleive there are many great buys to be made right now!

 

Jul 29, 2007 04:10 PM
John Youker
Kettering, OH

Bill,

I couldnt agree with you more, as a matter of fact, I started a post VERY similar to yours.  I am appaulled at the lack of professionalism and integrity that agents and lenders, etc., will display, just to make a buck.  they stake thier entire reputation on one single deal and risk it all.   They will tell a client ANYTHING, just to get the deal closed, or steal the client away from another agent who has an exclusive with them.

I have seen more commission cutting and just plain out ridiculous agents in the past six months then in the past nine years in this business.  We have agents in our area listing homes for $500 above the co-op fee - I am talking $400,000 homes listed for $500 in an up front fee - and they are paying for advertising and holding them open (obviously to pick up buyers).  What a total waste of time!  What do they say to the potential buyers?  "Oh, I am sorry, I won't get paid if you buy this house, this is simply my FREE lead generation tool to bring you into my life, so let's go down the street and buy one of those so that I can get paid and survive for one more month in this business?"  I just don't get it.

  1. My strategy has been to only list what I know I can sell and to be 100% honest with people about pricing.  Pricing is the KEY in a market like this.  We have also added to our services - staging, free moves, guaranteed sales, and other things that are setting us apart from our competition in town.  We turn down more business than we take, simplyu because we DO NOT take overpriced listings, period.
  2. Secondly, we are offering better service than we ever have before.  We have beefed up the amount of listing service our listing clients receive during the listing period.  We share market reports with them weekly, talk to them twice per week, and pursue showing feedback from other agents almost relentlessly, so we can inform our clients what they need to do to acheive a sale.

I hope this helps.  PLEASE agents, this is the time for us to BAND TOGETHER!!  Sellers and Buyers need us more now than they ever did before!  Stop trying to lie and cheat your way to the top and simply "Do the right thing!"

 

Jul 29, 2007 04:23 PM
1~Judi Barrett
Idabel, OK

Education on both points:

1.  Educate my sellers about the market and expect them to be realistic and prepare their home to sell.    

2.  Educate my buyers about the market and tell them to shop carefully for the right home at the right price that they can afford. 

Jul 29, 2007 04:40 PM
Bill Nazur
First Lending Solutions - Riverside, CA

John

Excellent! Your last line summarized it. I want to ensure that I put agents, lenders, title companies, regardless of which company they work for, or where they are located, in a position to think the way you are thinking and UNITE! If we all operated this way, we would not have the excess inventory on our hands that pits neighbor against neighbor trying to get the HIGHEST price instead of a realistic price. Stay tuned....I will be in contact before you know it.

Jul 29, 2007 04:43 PM
Bill Nazur
First Lending Solutions - Riverside, CA

Judi

Knowledge is certainly the key! Thank you!!!!!

Jul 29, 2007 04:44 PM
Rita Bradley
Laguna Hills, CA
Valuation Consultant in Orange County California 949-916-3263

Play nice!

Aug 06, 2007 04:13 PM
Bill Nazur
First Lending Solutions - Riverside, CA

Rita

I play nice 99% of the time.......gotta keep em on edge from time to time! :)

Aug 06, 2007 06:38 PM
Rita Bradley
Laguna Hills, CA
Valuation Consultant in Orange County California 949-916-3263

Ha ha!  :) 

 You know what??  I know houses are selling.  You know how I know?  Because I'm an appraiser and when I'm appraising a house and I look for comparable sales in a neighborhood-I FIND 'EM.  Houses are still selling.  In many areas the properties are on the market less than 90 days before selling.  The media is making more of this so-called "slump" than it should.  People are buying homes.  Investors are investing in income properties.  If we want to be successful, we have to learn to be the best at what we do to help our homebuyers and seller win. 

 PS.  I know prices have dropped in some areas.  Houses are still selling if priced appropriately.

Aug 08, 2007 04:22 PM
Bill Nazur
First Lending Solutions - Riverside, CA

Rita

Thank you.

It is funny that 2 years ago when I said this market is not sustainable at the rate of appreciation we were seeing, I was completely right as I've been through the cycle many times before. You are right in that houses are selling as I'm busier than I've been in the last couple of years, as long as the sellers can face the reality of pricing their homes in line with current market conditions. Let's make sure that we continue to educate the public as to this.

Side note: I did a drive time interview with an ABC Radio station on the east coast today, and I could hear his jaw drop when he asked me if the lending industry was to blame for our current woes, expecting me to say yes, only to let him know that this is a normal market correction that could not possibly be blamed on an entire industry, but rather a few bad apples. The fun part of the media is educating them which I've found is not as difficult as I'd imagined.

Aug 08, 2007 04:33 PM