The Odysseus Medal: “Until we start fixing what is really wrong we’ll continue to struggle in quicksand”

by Greg Swann

Suburban Phoenix Real Estate Broker

Author website

The story of the year is the lending crisis, so it’s no accident that this week’s Odysseus Medal should go to Morgan Brown for Struggling in Quicksand – Why the Government Continues to Exacerbate the Problem:

So here’s the rub – all of these “do gooders” are making the situation exponentially worse. Their rash actions are actually making it HARDER to get financing. Witness the spreads in jumbo vs. conforming loan amounts. Witness the restriction of loan programs. Witness the increase in underwriting stipulations. Witness the interbank rates compared to the Fed. The fact is that all of these bail out programs (which they all are in one form or another) have added MORE uncertainty to the system. They have not improved the psyche of the people with the money. And those are the people that count right now. If the people who hold the cash don’t want to lend it because their return is unclear we’ll never see the calming of the mortgage market.

The idea is not to make Fannie and Freddie buy everything in sight; the idea is to make the mortgage market a transparent and friendly investing environment so that cash returns to the secondary markets (and debt markets in general). Will that take time to work out? Absolutely. Are any of these rash knee-jerk reactions improving the situation? Not at all. We shouldn’t be worrying about how to bail out responsible people. We should be looking at how to fix the credit and debt markets to provide transparency for investors. Transparency builds credibility. Credibility builds confidence. Confidence drives investment. Investment drives down costs of borrowing, increases program expansion and makes markets healthy.

Until we start fixing what is really wrong we’ll continue to struggle in quicksand.

Krista Baker takes this week’s Black Pearl Award with How To Create Your 2008 Business and Marketing Plan:

Identify the gaps. Now that you’ve documented where you are and where you want to be, where are the gaps? For instance, if you made $50,000 in 2007 and want to make $100,000 in 2008, what does that mean? First, $50,000/12 = approx $4200. If you want to double your income, you have to make twice that each month or $8400.

Now work backwards – what do you have to do to make $8400/month? If the average home in your area goes for $300,000 and you make about 1.5% commission (after everyone is paid), you’ve made $4500 – you’ll need 2 paying clients. If the average home is $200,000, you’ll make about $3000, so you’ll need 3 paying clients per month.

Keep going backwards. If you need to work with 3 people, how many people must you meet for appointments with? If you close 50% of those you talk with, you’ll need to schedule at least 6 appointments each month. How are you going to get those appointments? Perhaps you’ll get a few from referrals – what can you do for your best referral partners and past clients so they’ll want to refer business to you? Perhaps you’ll get a few from advertising – where should you advertise and what should you say? Perhaps you’ll get a few from mailings – who should you mail to and what should the offer be? etc. That’s how you create your marketing plan.

The People’s Choice Award this week goes to Jeff Kempe, an excellent writer with excellence for his theme, with Excellence Unchained:

This morning ninety-one singers and a nineteen piece orchestra sang and played Bach’s Magnificat, one of the most difficult (and gorgeous) pieces in the choral repertoire.  In the 450 seat Sanctuary we had 715 attend the first of two services, 569 the second.  Three of the kids I used to work with in youth group came up to me between services with versions of “OMG!  That was totally AWESOME!”, the very kids who we’re told can’t sit still for…classical music.

Excellence trumps everything.

The general relevance to the real estate industry – or any other – should be obvious: you can talk and cajole all you want; you can even find yourself on Sixty Minutes and the Today Show, but if you’re pushing mediocrity while others are delivering excellence, you’ll lose. Period.

If you didn’t check out this week’s nominees for The Odysseus Medal, you should. And as always, if you light upon the most gorgeous of winter flowers, nominate it.

Deadline for next week’s competition is Sunday at 12 Noon MST. You can nominate your own work or any post you admire here.

Congratulations to the winners — and to everyone who participated.

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