There’s always something to howl about.

Month: July 2007 (page 2 of 7)

Testing the StarPower premise: Is success contagious?

A tuxedoed Russell Shaw holds forth at the newcomer’s reception at tonight’s opening session of the StarPower Conference. An important principle of the StarPower method is the idea that success is contagious, that highly-motivated Realtors can hoist themselves to the next level not just by learning new skills and techniques, but also by learning from and modeling the behavior of mega-producers like Russ.

I’m skeptical of anything that sounds like mumbo-jumbo, but I do love the idea of learning new skills and techniques, and I deeply admire many of the people StarPower has brought to Phoenix.

As an example, we got to meet Joe and JoAnn Calloway tonight. In Phoenix, they’re famous as Those Calloways, another team, like Russell’s, that does hundreds of millions of dollars in business every year. As much as Russ is big, blustering and brash, the Calloways are small, gentle and very quiet. You would never, ever peg them as Realtors, yet they completely dominate some of the richest zip codes in Scottsdale.

Immediately to Russell’s left in the photo is Richard Pomisel, with whom I took pre-licensing more than six years ago. Do the math: A class of around 30 students. Many didn’t pass the school test. More didn’t pass the state test. Still more didn’t get licensed. The failure rate for new licensees is 85% in the first year, very high thereafter. And yet two people out of one pre-licensing class are still working.

I don’t want to oversell StarPower. This is very much old-school real estate. Even where they think they’re being hi-tech, they talk about things like “stealth” web sites, marketing-by-trickery. But the bulk of the curriculum is a devout belief in the power of business-like systems for organizing and growing a real estate practice. Cathy and I have taken a divide-and-conquer approach to the classes to bring home the most new information.

I don’t know if success is contagious, and I don’t have much truck for mumbo-jumbo. But I will tell you one “law of attraction” that never fails: Nothing brings out immediate real estate needs like a real estate class. StarPower runs all day Thursday, Friday Read more

Keeping Up With What Frank Doesn’t Know — Earth Round — Circles Sun

There’s a mindset that has always befuddled me. It’s origin seems to be grounded in the belief that if I’ve believed X for years, than something proclaimed to be superior to X just can’t be true. Furthermore, the evidence I point to, is how many people agree with my belief in X.

Huh?

The world’s population believed the earth was flat, and that the sun circled it. They were wrong. However, when Copernicus found empirical evidence to the contrary, he was wrong, because he was virtually alone. (Sometimes I think Greg Swann is directly descended from Copernicus.) πŸ™‚ The central argument against him was — all, 100%, totally — false data based upon a long held belief — which was based upon subjective interpretations of bad science — and anger at having their food dishes moved. How dare Copernicus?!

Those arguing for 401(k)’s as superior to F.I.U.L.’s (Now, often referred to as E.I.U.L.) are no doubt sincere in their beliefs. The problem is, when they retire, they’ll notice the guy next door who opted for the insurance approach, and realize very quickly, sadly too, I’m sure — they were sincerely wrong.

I watched NOVA last night, and they said without reservation that the earth is still round, and it revolves around the sun, not the other way around.

My hope is, this post hits its intended target: Those who run companies. Employees who are relying upon the experts made available to them — by their employers.

Before I continue, let me correct a mistake made in one the previous two posts. I’d misread a ‘3’ for a ‘2’ and subsequently wrote 20 instead of 30 years for one of my examples. My error — as I reviewed the document, it indeed read 30 years, not 20. This resulted in misstating one of my numbers. This didn’t change the outcome of the piece though, as you’ll shortly see for yourself.

As we get into the nitty-gritty of the actual comparison of 401(k)’s and F.I.U.L.’s, let’s establish exactly where I’m getting the numbers, and if the source I’m using is credible. πŸ™‚ I do this because it became Read more

What should you do when the real estate news turns out not to be as bad as you had feared?

A. Smile in good grace:

Today, in its Existing Home Sales report for June 2007, the National Association of REALTORS noted that mortgage rates are lower by 0.02% than in June 2006.

I guess I knew that, but wasn’t paying attention to it.  I had wrongly assumed rates were higher because this recent run-up was so long and extreme.

B. Fear harder:

A lot of media, including BusinessWeek, reported that large numbers of mortgages would reset at higher rates, potentially forcing huge numbers of borrowers into default. A popular number widely reported was that $1.5 trillion worth of loans was due to reset in 2006 and 2007, according to the researchers at Economy.com. That’s about a quarter of all mortgages outstanding. Mozilo says that in reality more than two-thirds of the borrowers with adjustable mortgages refinanced their loans before their payments spiked. For example, the company notes that only 26% of prime mortgages that were due to reset to higher rates in 2007 are still active. Among subprime loans, 36% are still active. That suggests that most people have, in the words of analyst Samuel Crawford, “refinanced…out of the way of danger.”

Of course it’s easy to blame the media and analysts like Economy.com for suggesting there may be problems with adjustable mortgages. The reality is that even if many folks with toxic loans did refinance, there are still millions of other borrowers getting squeezed right now.

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I’ve Been Working Too Hard! Ask the Wall Street Journal.

Thanks to Athol for this definitive guide on how to sell your own home without all of the inherent hassles and baggage of dealing with a professional real estate agent. And, I do mean “thanks” since, being a wee-bit short on discretionary reading time this week, a Permalink has to slap me upside the head.

Kudos to the Wall Street Journal for finally giving us the bottom line on this crazy real estate transfer process. If you read the blogs or listen to the industry, or even if you have merely used an agent in the past to assist in the sale of a home, you might have been left with the impression that the process is complex, involved, and fraught with potential difficulties and liability. Even I have fallen into this trap. We can make it hard, or we can make it easy.

Accordingly to WSJ.com, it is all so very simple really. Just follow these three easy steps, and your home is as good as sold! No muss, no fuss, and no “6%” fee, which they point out is “a hefty penalty for selling your home”. Who wants penalties?

  1. Find out what your home is worth. There is … a group of free services on the Web, such as Zillow.com, that allow you to estimate the value of your home by comparing it with neighboring properties.
  2. Market your property. The goal when marketing your home… is to “drive as many buyers as possible to your ad,” so make sure you choose a site with a lot of traffic, and augment your listing with high-quality color photos and a compelling description. You might even try a “virtual tour” if you’re willing to pay a little extra.
  3. Transfer the title. Once your home is sold, you need to call in the professionals… Regardless of who handles yours, you shouldn’t pay more than about $500…

That’s it! Zillow that house, take some color photos (not black and white, and absolutely no pencil sketches), consider one of those newfangled virtual tour thingies, and cash in the loose change from between the sofa cushions. Congratulations! And to think I just Read more

Verizon and YouTube Finally Hook Up

director's chairVerizon and YouTube, sitting in a tree… K-I-S… well, you get it. After endless rumors, it’s official- starting next month, Verizon users (with compatible phones) can upload video from their phones directly onto You Tube. Simply modify your YouTube account to accept this stream, then text “YTUBE” for videos to instantly populate from your phone to the ‘net! Yeah, it seems a little Back to the Future to me too. Hello… McFly!?!?!?

VCast owners know you can already view YouTube material with your phone and will delight in being able to share your videos from anywhere! Verizon has contracted with Veoh to create a mobile video-swapping network, so I suspect this is just the beginning!

What does this mean to Real Estate? Virtual tours may be grainy, but your phone can instantly show clients what you’re seeing. Inspections can be attended vicariously, tours can be done from afar, and best of all- your out of town clients can have instant proof that yes, the sprinkler heads were in fact fixed and you can get your butt over to the closing table.

Or, if you’re more like most of the public (or like me), you’ll film a hampster, instantly upload it to YouTube and be famous in 30 seconds. We’ll see if this is a productive tool, but it sounds like it could at least be entertaining!

First the Starpower Conference in Phoenix, then Inman Connect in San Francisco: Posting frequency may be down for a little while

Starting tomorrow and running through Saturday, Cathy and I will be at the Starpower Conference. Russell Shaw is one of the Stars, so he’ll be there as well. I may write about some of what transpires there, but I wouldn’t be at all surprised if my output is curtailed.

Almost immediately after that is Inman Connect. Kris Berg, Brian Brady and Dan Green will be in attendance, so you might get a chance to meet them there. Even so, I don’t think they’ll be live-blogging the event.

But: Brian Brady will be presenting at the Show Me The Leads event. And Dan Green will be a part of 10 Tips From Bloggers.

I’m not going to Inman, but I’ll be monitoring every little breathless announcement of useless new sucker-bait for Realtors and lenders. I have no use for trade shows, but I had a great time last summer making fun of all the goofy crap vendors try to peddle at these things.

In any case, if posting is a little light over the next seven or eights days, you’ll know the reason.

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A Realtor’s Guide to Creating A Market Through Lease Options

Realtors can increase business by solving problems. This twenty minute presentation is a recording of the lease option webinar I hosted on Meet Brian Brady, my webinar site.

We teach Realtors how to use lease option financing as an alternatve financing method. Of course, we didn’t invent this simple idea. We stole it from here and perfected it here, back in the late 1990s.

Ask the Audience: How do you defend your own paycheck?

This came in as an Ask the Broker question:

Thanks for having this site.

We found the house we like and we made the offers and counter offers, finally getting to a place where we got stuck. The seller does not want to came down on her price and we cannot pay more. We are $20,000 apart.

What I would like is for all parties involved — the buyer, the seller and the two agents — to come to the table to make up the difference.

Have you heard of a situation like this?

Alas, I have.

I can be pretty free about using commission dollars to solve problems with transactions, but there are constraints. I will rebate every cent of an untoward commission or bonus, and I don’t hesitate to pay out of my own pocket to make problems go away.

But: My money is mine to do with as I choose.

I can address the problem posed by the question with a very simple analogy:

If your employer decided to buy a company car for his own use, would he be justified in asking you to kick in $1,000 toward the purchase price?

That clarifies that.

But take up the problem as a Realtor or lender: What would be the optimal response to an appeal like this?

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Missing links? Playing idea-tag leads to a Web 2.0-ish way of improving BloodhoundBlog posts

Okay, start here. I had an idea for an organic method of collecting arguments, pro and con, about divorcing real estate commissions. Using a PHP form, I could collect user-submitted links to apposite articles, then show them all in an “included” PHP file in each post about divorced commissions. That PHP file would be available to be included on other sites, as well, although I don’t think anyone has done this.

I’ve manually built this kind of file before, for ongoing news stories and for breaking news stories we cover in multiple posts. The difference here was eliciting contributions from readers in a semi-automated fashion.

Last night in a comment, Barrett Niehus of 4MySales – Real Estate Investment and Marketing commended me for having added a Wiki to BloodhoundBlog.

Except I hadn’t done that. I wasn’t even sure what Barrett was talking about. By email, I asked for clarification, and this was his response:

The Wiki comment just relates to the Bloodhound’s ability to add posted links from your online form to the list that you are creating on your blog post. For your readers (me included) this adds another way for them to participate in your blog. I think it is a great feature that few other bloggers use which makes your blog even more unique.

For a one-off post, it made a certain kind of sense. But imagine the same idea expressed globally, for every post. Now that’s an insanely great idea.

I planted a seed, really just a way of seeking something like permanence in the evanescent world of weblog posts. Barrett saw more than I did, a little bit of that Web 2.0-ishness, and his email led me back to see a tiny sprout springing up from the earth. Tonight I’ve nurtured it into a little sapling. I honestly don’t know if people will use something like this, but it seems to me to be a fantastic way to make BloodhoundBlog’s posts more comprehensive and informative.

What am I talking about? New code that will permit you to amend any post on BHB with supplemental links. If you look at Lani’s post from earlier Read more

Uh Oh… Apple’s iPhone Caught With Its Pants Down

apple-iphone.jpgSo, some of you camped out for your new toy, others ordered it online. Many of you devoted much time covering the gadget until you were blue in the face. Look- the iPhone is undoubtedly cool… I’m all for shiny toys that make noise. But for all of you Mac Hipsters who have made fun of my loyalty to the PC (you know who you are), guess what- your iPhone is has been caught with its pants down…

The Independent Security Evaluators out of Maryland has exposed the “serious problems with the design and implementation of security on the iPhone“. Multiple separate hacks were made. First, ISE used an unmodified iPhone to “surf to a malicious HTML document they had created. When this page was viewed, the payload forced the iPhone to make an outbound connection to a server that the researchers controlled. The compromised iPhone then sent personal data including SMS text messages, contact information, call history and voicemail information over the connection.” Uh oh- I see London, I see France…

The second vulnerability found was the ability of the hackers to “perform so-called ‘physical actions’ on the iPhone. Using their iPhone to visit a second malicious web page, they forced the device to ‘vibrate for a second’.”

Other hacks:
*
because apps run with admin priviledges, “a compromise of any application gives an attacker full access to the device
*premium-rate rogue-dialler fraud
*transforms an iPhone into a bugging device
*wirless Internet used to hack and store dialed numbers, texts etc. for later use

So, what’s next? Well, for me, I’m sticking with my ol’ Sprint phone. ISE shows that I can hack admin priviledges to your iPhone and use your e-Key to enter homes when that function becomes available (remember, it’s a sleeper hack… I can come back whenever I want to access your iPhone). Or, if I’m a jerk competitor, I can text your buyers telling them the house is no longer available and they smell like garlic and you refuse to work with them, or when I get bored, I can call your wife and tell her that I caught you with Read more

What makes a home sell? Marketing, preparation — and especially price

This is me from last Friday’s Arizona Republic (permanent link):

 
What makes a home sell? Marketing, preparation — and especially price

I looked at houses with a long-time client last week. We shopped ten houses, of which two were actually in turn-key condition. Two others were fix-ups in every way but price. Three of the homes had front-yard landscaping so overgrown they were virtually inaccessible. And the prices were all over the map.

The resale market is not as dire as it is portrayed to be, but it’s not great, either. There are a lot more homes for sale than there are qualified buyers. For a home to sell in this market, it has to be priced right, perfectly prepared and properly presented to the marketplace. Miss on any one of those factors — especially price — and the buyers will take the home up the street instead.

Consider the Terracina floorplan at Ashton Ranch in Surprise. I’ve sold several these, and I really like them. They’re bright and spacious, with wide-open sightlines. Without pools, there are seven of these available right now. Two are priced at $199,000, then they shoot up all the way to $231,900.

The two lower priced homes will probably sell first, even if the others have better landscaping and better interior amenities. Only one of these models sold in June, for $200,000.

A few miles east, at the Sundial subdivision in El Mirage, there are 25 units of the 1,238sf Zocalo floorplan available. Prices run from $166,900 to $213,900, a huge spread.

Three of these homes sold in June, and it would be reasonable to argue that the market value of this model is $185,000. The problem with that is that ten of the 25 listings are offered below that price — and they’re still not selling.

In any subdivision, I would have to look at the listings house-by-house to tell you which ones will sell soonest, and for how much. But it’s a certainty that if a home is not marketed properly, is not cleaned and repaired to show-room condition, and, especially, is not priced aggressively to the current market, it will not Read more

Real Estate Investing vs. Stock Market Investing- Is there a Clear Winner?

Real estate enthusiasts have been sounding their trumpet during the latest run in the real estate market. Many real estate focused investors truly believe real estate outperforms every other investment by a wide margin and even go as far as to wonder why investors would choose any other investment vehicle. Our own Jeff Brown even took quite a swing at the stock market in his post, My 4% will Beat Your 10 Any Day — Stocks vs. Real Estate. In the other corner stock market aficionados contend that in the long run stock market returns dominate. As an investor in both I am here to definitively say neither dominates.

Starting with the facts: Long run real estate investment returns average about 3%. This is simply a year over year long run appreciation average (cnn.com report data), while the average long run stock market return hovers around 10%. It is important to note that anyone can point to specific year, or even five year, period that one asset class has outperformed the other. This is not relevant because long term investing is the focus of this discussion.

Many stock market champions simply stop their analysis right there. That is wrong, plain and simple. Of course, as the analysis goes deeper, the water gets muddier and muddier. The starting point is leverage. Very few investors pay 100% of the purchase price when they buy an investment property. At most an investor will put the standard 20% down in a direct commercial real estate investment. This means that an investor could buy 5 times value of an investment. For example, if an investor has $100,000 to invest, they could buy $100,000 worth of stocks or $500,000 worth of real estate. Using some simple math, after 1 year the stocks would be worth $110,000, while the real estate investment would be worth $115,000 ($100,000 + $500,000 x .03).

Unfortunately many real estate investors stop their analysis here. This is also incorrect. Not only is it unfair to compare a leveraged real estate investment to an investment in the stock market that is not leveraged, but there are a Read more

Stuck in the middle – Real Estate Business Basics and Clearing the Cobwebs

To Do Post ItMy life is a series of Post It notes. They are stuck to my computer screen, they clutter my desk, and they litter my backyard when a light wind kicks up in the vicinity of my patio table. They can be found in the floor of my car, at the bottom of my purse and, more than occasionally, on the foreheads of my children.

My organizational skills are not so hideous that they would be the subject of the next Lifetime family movie, but my life (we will call it my “back office”) is certainly, at this point in time, in a state of disarray.

I could read a book about organization and time management, but I simply don’t have the time. I think I will make a note to do that tomorrow. In the meantime, I will come to my own defense – It’s not my fault!

Lani’s Internet which has become such an essential part of our lives, Greg’s Internet which is well on its way to replacing the paper book, and our collective Internet which births eighty-seven more ways each day to make our lives easier has simply made me numb.

My frying pan runneth over with fish. Jeff Brown turned me on to Jott awhile ago, thinking it would be useful to a girl on the go. Call the toll free number, speak your message, and the next morning you will be emailed a transcript. A virtual To Do list. Now, I have to remember to Jott.

And I have to remember to blog and comment and trackback and linkback, to be a Trulia Voice and a Zillow neighborhood specialist, to log onto Meebo when I am “in” and off when I am “away”, and to download and study my Altos charts. The list goes on. With each of these exciting opportunities comes an email reminder, and each of these “to dos” involves a brave new world of email inbox populating never before seen. So much so, that I find myself “saving” these messages for another time, a time that often never comes. So large is my inbox, that it has lost Read more

Top Buyer Agents Unite To Put Themselves Out of Business – Russell Shaw Tries to Save Them

The missing word in the title above is, “completely”. Top Buyer Agents Unite to Put Themselves Completely Out of Business. Also, based on my schedule boardwalk-coastal-wetland_AJM5A2and the (so far, at least) almost total unwillingness of Top Buyer Agents to even listen to this vital message, there may not be much reason to keep saying it. These Top Buyer Agents don’t seem to understand that they are not like most buyer agents. They are quite different. These Top Buyer Agents take their duties to their clients so seriously that they actually DO put the client’s interests above their own. Every time, in every way. These Top Buyer Agents have figured out that the current system of the listing agent paying them, with the seller’s money (of all possible pay plans in the universe) isn’t the most optimum pay plan possible.

But it IS a pay plan. You do get paid. Your buyers do get real representation.

In many well written, thoughtful and sincere posts here on BloodhoundBlog there has been a strong case made for divorcing the buyer agent commissions completely from the seller and the listing agent. Most of the points made are valid. There has been even more to think about in the back and forth in the comments section of those posts. Some very bright people saying some very bright things.

I won’t try to appeal to your self interests here, but to your interest in caring for your future clients. The current “system” offers you the best opportunity you will ever have to help the most people with your counsel. Should the commissions become “divorced” (and yes, this could happen due to some decision in a federal court room or even the Supreme Court) you will be out of business. O – U – T, out. The perfect transaction (each side having splendid and fabulous representation) will occur so rarely that anyone who worked on bringing it about will have lots of time to reflect on how great it could have been. The funny part is that you already know what will bring about your demise. It has been commented on Read more