by Barry Cunningham

Real Estate Broadcaster and Investor

Author website

It’s no secret to most Realtors that the housing market is in the toilet right now, but there is still a group of aggressive buyers who are still quite active. The Real Estate Investor.

While the mere thought of working with investors causes some Realtors to cringe, it’s time for the vinegar and oil relationship to end.

Investors are willing to work with anyone that can bring them a deal. They use birddogs, postal workers, bankruptcy attorneys, court clerks and yes, they will use the services of a Realtor.

However, the breakdown in communication usually comes when the parameters of a real estate investor are not met. A real estate investor, if they are experienced, will have a very defined set of criteria that must be met if they are going to pull the trigger on a deal.

While condition and neighborhood often are irrelevant, the numbers have to absolutely make sense. Most investors that we work with will not look at any deal unless it either cash flows if it is held or provides for significant return if it is to be re-sold.

Cashflow means the property must provide for at minimum a zero balance after income and expenses are taken into account. That is to say that after the projected rental amount on the property, less expenses can not be a negative number.

Here is a calculator that you can use to determine cash flow BEFORE presenting a deal to an investor. You can obtain market rents very easily without the need of the MLS by simply going to Zilpy. The features on Zilpy are pretty accurate and we have used them to work the numbers on properties we own and properties we have purchased and it has proven to be quite accurate.

On a re-sale deal, the property has to be purchased at a price that is at minimum 60% or belowwhat is perceived to be current market value. Some more aggressive investors will take a deal at 70% below perceived current market value but the pool gets really thin at LTV levels above this number.

Where do you find properties like this to sell Read more

by Barry Cunningham

Real Estate Broadcaster and Investor

Author website

As the real estate industry awaits the long anticipated trial pitting the Department of Justice vs. The National Association of Realtors, another Multiple Listing Service has been targeted by the DOJ.

On May 2, 2008, the DOJ filed suit against the Consolidated Multiple Listing Service (CMLS) of Columbia, South Carolina. The suit challenges the manner in which the CMLS operates and governs its members.

The lawsuit states that CMLS rules unreasonably restricts competition among real estate brokers and has caused consumers in the Columbia area to pay more for the services of real estate agents and brokers.

The lawsuit alleges in part that the CMLS mandates that real estate agents and brokers perform a myriad of obligatory services, which provides for a reduced level of customer service and limits consumer choice.

The suit also states that these mandatory services provides for an exclusion of competitors who might offer innovative options that could provide better services to consumers in that area.

“Buying or selling a home is one of the most significant financial transactions in the lives of most Americans. The kinds of rules CMLS imposes stifle competition to the advantage of its members and the disadvantage of home buyers and sellers,” said Thomas O. Barnett, Assistant Attorney General in charge of the Department’s Antitrust Division.

“Today’s lawsuit seeks to remove unlawful impediments to competition for real estate brokerage services in the Columbia area, so that consumers will benefit from the additional options and reduced fees that competition can bring.”

The MLS in most areas allows for the free exchange of information by and between its members regarding available homes on the market. The efficiency of the CMLS, or any MLS for that matter, can be a benefit to the consumer.

The DOJ contends that certain practices by the CMLS negatively impacts how the real estate industry members can choose to operate their businesses and accordingly adversely influences competition.

Specifically cited are rules imposed by the CMLS wherein its members are not allowed to offer a home sellers the opportunity to avoid paying a broker’s commission if the seller locates a buyer on his or her own.

CMLS rules require brokers to Read more

by Barry Cunningham

Real Estate Broadcaster and Investor

Author website

The NAR has launched a new website called Realtor Confidential. This site is “designed to educate our membership about technology-related topics and investigate how NAR can best use Web-based technology to communicate with members”.

In this, the first season of the Realtor Confidential series, the camera crew and production team have decided to follow 2007 NAR President Pat V. Combs, as she and her staff “implement new technologies”.

You know, people accuse us of Realtor bashing and it is just unfounded. We just bring to light the incredulity of what is fast becoming the laughing stock of trade organizations.

When you view the video below, you may think you’re watching a skit on Saturday Night Live, but unfortunately, you’re not.

From the “We can’t make this stuff up” department, comes a video featuring the 2007 NAR President Pat V. Combs wherein she describes the mainstays, the must haves in technological advancement.

Without further adieu, I give you the 2007 NAR President explaining to the world, that technology that is vital to the success of a Realtor.

There you have it. For all of us who did not know, it is the typewriter that no real estate agent can do without because you simply can not fill out forms in any other manner. Ummm…okay.

So, since this video was placed out there for the world to view, just what do you think the reviews will be like?

The former head of one of the world’s biggest trade organizations just allowed herself to be filmed telling the world that Realtors will be technologically advanced if they have a typewriter, a fax machine, a printer and a scanner…and let’s not forget about email.

My God what would she do if she heard about Twitter?

Is writing a story on this Realtor bashing? We didn’t make this video and put it on the Internet. This was supposed to “help” agents? Much to the contrary, this has got to be really, really embarrassing for a lot of Realtors.

Waiting with baited breath for the next informative episode! I am sure you are too.

by Barry Cunningham

Real Estate Broadcaster and Investor

Author website

The old way is out and the new way is in. The manner in which you are presently engaged will cease to exist. You must change. You will have no choice!

The date of the metamorphosis has been announced. February 17, 2009 is the day of reckoning. You will either change or be left in the dark. Period!

“By law, all full-power television stations nationwide must switch from the old method of transmitting TV signals known as analog to digital television (DTV) on February 17, 2009. While the benefits of DTV are remarkable, millions of households risk losing television reception unless they take the easy steps to receive a digital signal.”

The cable industry and entertainment industry are taking the necessary, almost beyond necessary, steps to ensure that their customer base knows that in about a year, the way they currently are doing things will change forever. You either change or you will not be able to watch television.

Imagine that, an industry not debating change but mandating it. Imagine that, an industry that has decided that the manner in which they have done something is obsolete. Imagine that, an industry that was willing to embrace change because it actually IMPROVES the consumer’s experience.

Who would have thought it possible that an industry could do this? Who would have thought that an industry would want to do this?

Why make such a sweeping change? Well research determined that DTV is a “more flexible and efficient technology than the current analog system”.

Since digital television is a more efficient use of technology than analog television, the “turning-off” of the old way of broadcasting televised programming it will also free up parts of the airwaves so that incentive for even further innovation is provided to ambitious entrepreneurs.

So not only is there going to be a change to improve the consumers experience, the change is being made to facilitate the progress of future enhancement by others.

Imagine that, an industry that not only embraces change but does so in order for others in the business to succeed as well..

What if the real estate industry did this? What if the real estate industry Read more

by Barry Cunningham

Real Estate Broadcaster and Investor

Author website

The last time I checked, the short sale was on the gurney headed for the emergency room. I looked through the windows and saw the priest administering last rites so I am not sure if it’s going to survive. I can tell you though, it doesn’t look good.

What happened? Well, doing some investigative journalism, I crossed the police caution tape and started asking the witnesses what they saw. “Bank took to long to respond and my buyer walked”, remarked one distraught Realtor.

“My homeowner could not compile or would not compile all of the information the bank needed”, lamented another Realtor; while a third said she could not even find any pulse…the bank did not even respond. It was as if they simply gave up on life.

Yet, I could not understand why one Realtor, off in the distance taking pictures, seemed to be smiling, almost guffawing at the tragedy that other Realtors have endured.

I followed closely behind as he hurried away in his newly polished Mercedes. He did not seem to notice that I was following or if he did, he did not care. Either way, he drove for a while and showed up at a property. This property looked familiar.

It appeared similar to the property wherein the short sale was just shot down. The same weedy, tall grass, the same unkempt yard, even from my vantage point I could see the curtain-less windows that indicated that there was no one home. The property was vacant. Was this another short sale prospect ready to meet an untimely end? Was the Mercedes driver the Short Sale Killer?

I had to get a closer look. I moved up closer and closer until I was in view of the suspect. Just as he turned to see me, a bus drove up. From the bus emerged a bevy of other suspects who have been on the lam for some time. I recognized these perps.

They were BUYERS! They have been hiding for what seems like years! What were they doing here? Was the killing of a short sale some kind of gang initiation? Was it some crazy Mansonish cult Read more

by Barry Cunningham

Real Estate Broadcaster and Investor

Author website

Nearly 90% of consumers recently polled say they are not interested in buying a home any time soon.  A joint poll of the Associated Press and AOL indicated that the recovery of the housing sector will not be any time soon if the retail American consumer has anything to say about it.

60% of those polled stated that they were DEFINITELY not going to buy a home anytime soon while just 0ver 10% said they would be looking to purchase a new home in the near future.

You don’t have to be a mathematical genius to see that there is a tremendous amount of inventory available for a very slim and decreasing demand. If supply and demand ideology is true, then it is safe to say that there are going to be an overwhelmingly increasing number of unsold homes.

Since unsold homes equates to unearned commissions, what are the majority of real estate agents going to do? Earlier this year, we wrote what was viewed as an inflammatory article announcing the NAR Going Out Of Business Sale. Doesn’t sound too far fetched anymore does it?

Don’t Believe It’s A Going Out Of Business Sale…Then Somebody’s Lying To You!

While this news of prospective buyers not wanting to purchase any homes is somewhat disconcerting, it’s not the main reason to be alarmed. It’s merely a by product of a continued misunderstanding of the simple economic precept of supply and demand.

Many current home sellers do not understand it, and many listing agents do not understand it. It is my opinion that if this theory was more understood and accepted, then it is possible that the housing market would not be in the state that it is.

The Laws of Supply and Demand represent the cornerstone of economics and these laws are the basis for a free market economy. DEMAND is based upon how many buyers are interested in acquiring a certain product or service AND how much of that service or product they are interested in consuming. The latter part of that statement is often overlooked.

When planning to bring a product or service to market it is prudent to have a good Read more

by Barry Cunningham

Real Estate Broadcaster and Investor

Author website

Do you know that the Realtor who you have your house listed with is actually still earning their living as a Realtor? That was the concern recently voiced and posed to us by a concerned agent in Poinciana, Florida.

“In Central Florida, for example, over 50% of real estate agents are not actively working their listings. (That’s an approximation based on the number of agents who never return my calls and/or are know to now have full-time jobs doing something else.) Seems to me that there is something inherently unethical about REALTORS who don’t disclose to their customers that they aren’t working full-time to sell their properties.”

While I understand that this agent is probably a bit frustrated with her Central Florida colleagues and may be embellishing a bit, this comment gave me reason to ponder the implications of her statement.

A real estate agent approaches a homeowner and seeks to obtain a listing, prepares a listing presentation, and obtains a listing, all the while knowing that they will only be working part-time to sell the homeowner’s property. The homeowner, of course thinking they are hiring a professional, would probably not think to ask this “professional” if they are only in the game on a part-time basis.

Obviously this is not something the part-time “professional” is going to offer or disclose willingly, so therein lies the dilemma. Is there an inherent misrepresentation if an agent does not inform the homeowner that they are not earning enough of a living as a real estate agent and is not a full-time agent?

Does the homeowner have the right to know in order to make a fully informed and properly represented hiring decision that could possibly involve the signing of a binding contract?

In reviewing the National Association of Realtors Code of Ethics there seems to be some evidence to support the notion that an agent should indeed inform a homeowner of their status as a part-time agent.

Article 12
REALTORS® shall be honest and truthful in their real estate communications and shall present a true picture in their advertising, marketing, and other representations. REALTORS® shall ensure that their status as real Read more