By Joel Persinger
YourRealEstateDude.com
When I was a kid, my uncle’s favorite saying was “It’s a jungle our there.” It always sounded like a slogan I might read in a newspaper advertisement or see on TV and I never quite understood what he was talking about. Then I got into real estate and his meaning suddenly became crystal clear.
Ask any real estate professional and you’ll find that the current real estate market is indeed a jungle. Just about every transaction reminds me of a journey through a misty rainforest full of pitfalls, booby traps and dangerous critters with big teeth. Just when you think you’ve figured out where the dangers lie, something pops out of the bushes and starts tearing everything apart. That kind of challenging business environment is understandable, once you come to terms with the fact that the market is dominated by foreclosure and pre-foreclosure properties.
In such a market, buying a home is a daunting task, largely due to what I call the “who cares bug.” When properties are facing foreclosure, many sellers move out and leave the properties to fall into disrepair like old, dead animals left out in the sun to rot. If the sellers haven’t stripped the homes of anything and everything, the looters and thieves who break in repeatedly, do it for them.
In the past two months, we’ve had one home broken into four times, another house in which someone tossed a concrete block through the front window and took all the copper wiring out of the house and still another home that the police had to chase people out of who had broken into the place to throw a party! This doesn’t happen all the time, but when it does, selling the house can be difficult. By the time a buyer comes along, the house is in such a state that the buyer’s lender may not want to lend against it.
If it isn’t the sellers with the “who cares bug”, it’s the agents hired to sell the homes. When a bank forecloses on properties, the homes are typically assigned to brokerages that “specialize” in selling such properties. Given the number of foreclosure properties on the market, such agencies quickly become overwhelmed. As a consequence, buyers and their agents can never get a response out of them. It is quite common for buyer’s agents to leave messages, send emails and even send in offers without ever getting a response from the brokerage selling the house. Even if a response does come, it is generally from a clerk or assistant whose previous job, judging by the attitude they project, must have been at the DMV.
As an agent, you begin to realize how common the “who cares bug” has become when you return a call from another agent and he or she can’t stop thanking you for doing so. Just yesterday I called a fellow back who had left me a message about one of our listings. He was absolutely thunderstruck and delighted that I had actually returned his call. He thanked me over and over again for the entire ten minutes we spent on the phone. I almost couldn’t get a word in to tell him about the house. He was too excited about having gotten a call back. It was almost as if he had been locked in a dungeon for thirty years and I was the first person he had talked to in all that time.
Facing these kinds of challenges, buyers can become frustrated almost to the point of giving up entirely. The key to staying in the game and eventually winning is to set your expectations properly in the first place. Since you’ve read this article, you are now well prepared, because now you know what to expect. So, dust off your pith helmet and safari gear, steel yourself for a challenging adventure, use lots of bug repellent to ward off the attacks of the “who cares bug” and remember, house hunting in this market can be a great experience, but you’ve got to be prepared. It’s a jungle out there.
Tuesday, January 27, 2009
Tuesday, January 20, 2009
Will Obama Save the Housing Market?
By Joel Persinger
YourRealEstateDude
Whatever your opinion of President Obama might be, it is an undeniable fact that millions upon millions of people worldwide have become convinced that he can cure what ails us. But can he?
As of this writing, President Bush is still in office and President-Elect Obama is about to be sworn in. Interest rates are the lowest I will probably ever see in my lifetime, buyers are busily buying homes, homeowners who have equity in their homes are quickly refinancing and sellers who were hopelessly attempting to sell homes that would not sell a few months ago are now successfully selling their homes in short sales and moving on. The system is far from healthy and there is much left to do. But, in spite of the concerns expressed by many including me, the underlying support for the market that has been provided by the federal government’s purchase of mortgage paper has helped get things moving again.
Those decisions were made during the previous administration and will not be fully implemented until well into the new one. If it goes well, President Obama will get the credit for work done in President Bush’s term and probably won’t bother to mention Bush in the process. If it goes poorly, the new administration will get the blame and shift as much of it to President Bush as can be shifted. That’s just how politics works.
The question now is, what will Obama do to improve the situation? Thus far, other than in broad generalities, he hasn’t really said anything of substance regarding what actions he might take and no-one in his administration seems to be talking either. This leaves us having to guess what he might do based upon his actions thus far. What amazes me, in the absence of any clear articulation of his plans, is that so many people that I talk to are unwaveringly convinced that Obama has a magic bullet in his pocket and is just waiting until after inauguration day to pull it out. Unfortunately, I have never been a good magician’s assistant and must point out that no magic bullet exists and that any hinting to the contrary is just smoke and mirrors. Fixing the housing market and the economy will take wisdom, leadership, fiscal responsibility, hard work, time and patience.
Thus far, President Obama has failed to display many of these traits. The inauguration is an example. Throwing the most expensive and lavish inauguration celebration in the history of this county while in the middle of a national economic crisis demonstrates neither fiscal responsibility nor leadership. In fact, it is an insult to the millions of Americans who are losing their business, jobs and homes. President Obama may be capable of great things. Only time will tell. Still, if he has any hope of restoring the vibrant housing market and economy of the United States, he will have to stop pretending to be a rock star and start being a leader.
YourRealEstateDude
Whatever your opinion of President Obama might be, it is an undeniable fact that millions upon millions of people worldwide have become convinced that he can cure what ails us. But can he?
As of this writing, President Bush is still in office and President-Elect Obama is about to be sworn in. Interest rates are the lowest I will probably ever see in my lifetime, buyers are busily buying homes, homeowners who have equity in their homes are quickly refinancing and sellers who were hopelessly attempting to sell homes that would not sell a few months ago are now successfully selling their homes in short sales and moving on. The system is far from healthy and there is much left to do. But, in spite of the concerns expressed by many including me, the underlying support for the market that has been provided by the federal government’s purchase of mortgage paper has helped get things moving again.
Those decisions were made during the previous administration and will not be fully implemented until well into the new one. If it goes well, President Obama will get the credit for work done in President Bush’s term and probably won’t bother to mention Bush in the process. If it goes poorly, the new administration will get the blame and shift as much of it to President Bush as can be shifted. That’s just how politics works.
The question now is, what will Obama do to improve the situation? Thus far, other than in broad generalities, he hasn’t really said anything of substance regarding what actions he might take and no-one in his administration seems to be talking either. This leaves us having to guess what he might do based upon his actions thus far. What amazes me, in the absence of any clear articulation of his plans, is that so many people that I talk to are unwaveringly convinced that Obama has a magic bullet in his pocket and is just waiting until after inauguration day to pull it out. Unfortunately, I have never been a good magician’s assistant and must point out that no magic bullet exists and that any hinting to the contrary is just smoke and mirrors. Fixing the housing market and the economy will take wisdom, leadership, fiscal responsibility, hard work, time and patience.
Thus far, President Obama has failed to display many of these traits. The inauguration is an example. Throwing the most expensive and lavish inauguration celebration in the history of this county while in the middle of a national economic crisis demonstrates neither fiscal responsibility nor leadership. In fact, it is an insult to the millions of Americans who are losing their business, jobs and homes. President Obama may be capable of great things. Only time will tell. Still, if he has any hope of restoring the vibrant housing market and economy of the United States, he will have to stop pretending to be a rock star and start being a leader.
Should you fire your agent when he sets boundaries?
By Joel Persinger
YourRealEstateDude.com
For as long as I can remember, and I started in the real estate business almost 20 years ago, consumers have felt that real estate agents should be available at a moment’s notice, 24 hours per day and 7 days per week. This unfortunate and unrealistic expectation was actually propagated by real estate people. In fact, when I started in the business, my broker at the time admonished me on this very subject just five minutes after I joined his office. “Joel,” he said, “If you’re going to survive in this business, you must make certain that you are always available to your clients at any time of day.” I thought he was insane! But, he was the broker and I was new. So, I made myself available 24 hours a day, seven days a week. It almost killed me.
19 years and at least a thousand gray hairs later, I am the broker and I am routinely caught admonishing my agents NOT to be available 24 hours a day, 7 days a week. Those thumping sounds you hear are all the old school brokers crashing to the carpet having fainted from shock after readying this article. Many of the old school folks believe that a real estate agent must be available to jump every time a client blinks in their direction. Consequently, consumers expect what the agents have been foolish enough to deliver: constant availability.
Not long ago, I ran into an agent who told me that he NEVER turned off his cell phone. Furthermore, he proudly announced that he answered it even if his clients called in the middle of the night. “I had a customer call me at 1AM the other day,” he said, “and I picked it right up.” When I questioned the wisdom of such a policy, his wife, who was also a real estate agent, began to lament the fact that her husband would never consent to going on vacation unless the vacation spot had good cell coverage.” Now, I ask you; would you live like that?
I have an agent who recently joined my office and I quickly found that he suffered from the same backwards point of view. He allowed his clients to control his schedule to the point that he didn’t have a life outside of real estate. I urged him to set some boundaries by establishing business hours during the week, take at least one day off every week and meet with clients in the evenings or on weekends only by prior appointment. No sooner had he begun to follow my advice then one of his clients began to complain. The end result was that the client fired him and started working with another agent who promised to be available 24/7.
I submit to you that anyone who wishes to achieve a level of professionalism in any industry must possess knowledge, patience, honesty, integrity, strength of character and discipline. The practice of real estate is no different. Therefore, if the agent you work with does not have one of these basic qualities, such as the discipline to manage his own schedule, then he may not be the best person to work on your transaction. Likewise, if your agent has let you run him ragged and is now in the process of growing in his character by establishing disciplined boundaries in his business, firing him could be a grave mistake. You might be firing a newly established professional in order to hire an amateur. An agent who is organized and disciplined about his schedule is an agent who will likely be organized and disciplined in his approach to providing for your needs. To me, that sounds like a winning strategy.
YourRealEstateDude.com
For as long as I can remember, and I started in the real estate business almost 20 years ago, consumers have felt that real estate agents should be available at a moment’s notice, 24 hours per day and 7 days per week. This unfortunate and unrealistic expectation was actually propagated by real estate people. In fact, when I started in the business, my broker at the time admonished me on this very subject just five minutes after I joined his office. “Joel,” he said, “If you’re going to survive in this business, you must make certain that you are always available to your clients at any time of day.” I thought he was insane! But, he was the broker and I was new. So, I made myself available 24 hours a day, seven days a week. It almost killed me.
19 years and at least a thousand gray hairs later, I am the broker and I am routinely caught admonishing my agents NOT to be available 24 hours a day, 7 days a week. Those thumping sounds you hear are all the old school brokers crashing to the carpet having fainted from shock after readying this article. Many of the old school folks believe that a real estate agent must be available to jump every time a client blinks in their direction. Consequently, consumers expect what the agents have been foolish enough to deliver: constant availability.
Not long ago, I ran into an agent who told me that he NEVER turned off his cell phone. Furthermore, he proudly announced that he answered it even if his clients called in the middle of the night. “I had a customer call me at 1AM the other day,” he said, “and I picked it right up.” When I questioned the wisdom of such a policy, his wife, who was also a real estate agent, began to lament the fact that her husband would never consent to going on vacation unless the vacation spot had good cell coverage.” Now, I ask you; would you live like that?
I have an agent who recently joined my office and I quickly found that he suffered from the same backwards point of view. He allowed his clients to control his schedule to the point that he didn’t have a life outside of real estate. I urged him to set some boundaries by establishing business hours during the week, take at least one day off every week and meet with clients in the evenings or on weekends only by prior appointment. No sooner had he begun to follow my advice then one of his clients began to complain. The end result was that the client fired him and started working with another agent who promised to be available 24/7.
I submit to you that anyone who wishes to achieve a level of professionalism in any industry must possess knowledge, patience, honesty, integrity, strength of character and discipline. The practice of real estate is no different. Therefore, if the agent you work with does not have one of these basic qualities, such as the discipline to manage his own schedule, then he may not be the best person to work on your transaction. Likewise, if your agent has let you run him ragged and is now in the process of growing in his character by establishing disciplined boundaries in his business, firing him could be a grave mistake. You might be firing a newly established professional in order to hire an amateur. An agent who is organized and disciplined about his schedule is an agent who will likely be organized and disciplined in his approach to providing for your needs. To me, that sounds like a winning strategy.
Thursday, January 08, 2009
Is now the right time to buy?
By Joel Persinger
YourRealEstateDude.com
I’ve been asked the age old “timing” question over and over again for many years. Lately, the question has been, “Is now the right time to buy.” The general answer is quite simply, “Yes.” However, there are some specific things that buyers should consider before getting started. Here is a short list:
How much money can you spent? This gets into the “B” word that nobody likes. In order to set yourself up for success, you must have a budget. If you don’t have one, get one. If you don’t know how to put together a budget, I strongly suggest that you take a class on budgeting and have a working, functional family budget before you start house shopping.
What kind of loan should you get? Lending is as individual as clothing. One size does not fit all. Each loan must be tailored to the particular needs of the borrower. Therefore, the first consideration is not the loan, but the skill, experience and integrity of the Loan Officer and the lending company. If you use a Loan Officer who is lacking in any of these areas, you may find yourself getting a loan which does not properly fit your needs.
Once you have found a good Loan Officer, you should explore the various loan products that are available to you based upon your credit score, down payment amount, debt to income ratio and other factors. Then you can select a loan which will help you accomplish your goal without putting you at risk of losing everything a few months or years down the road.
What type of property should be your focus? First, you should consider my grandfather’s old rule, “Buy a home that you can own, not a house that will end up owning you.” If buying your dream home is going to leave you with more month than money, put your dream back in your pocket and buy a home that you can afford. If buying that dream home will require you to get a crazy, lunatic, risky loan, then STOP! Some things are best not forced. Remember, it is far better to be content in a small house, than to be miserable in a big one.
Having figured out what you can actually own, you should decide what kinds of homes will be easier for you to buy. In this market, most of the homes that are for sale are either bank owned properties or pre-foreclosure properties (short sales). Bank owned properties will generally close escrow sooner and be less hassle to buy. However, they often have multiple offers on them as a result. Short sales are more difficult to buy and require much more patience.
Either way, the same is true about Realtors as is about lenders. If you start off by selecting the right Realtor, your buying experience will go much more smoothly. In this market, that means hiring a FULL TIME, experienced Realtor who understands the buying process as it applies to a foreclosure marketplace. Such a Realtor must be professional in word and deed and have extraordinary patience.
So, getting back to the question at hand, the answer is, “Yes.” It is the right time to buy. However, in order to succeed, you must first understand your own finances. Then you must put together a team of professionals who can guide you through the process. And finally, you MUST control your own emotions and desires. A very wise man once prayed, “Lord, give me what I need and not just what I want.” If you take this approach, house hunting will be a great experience!
YourRealEstateDude.com
I’ve been asked the age old “timing” question over and over again for many years. Lately, the question has been, “Is now the right time to buy.” The general answer is quite simply, “Yes.” However, there are some specific things that buyers should consider before getting started. Here is a short list:
How much money can you spent? This gets into the “B” word that nobody likes. In order to set yourself up for success, you must have a budget. If you don’t have one, get one. If you don’t know how to put together a budget, I strongly suggest that you take a class on budgeting and have a working, functional family budget before you start house shopping.
What kind of loan should you get? Lending is as individual as clothing. One size does not fit all. Each loan must be tailored to the particular needs of the borrower. Therefore, the first consideration is not the loan, but the skill, experience and integrity of the Loan Officer and the lending company. If you use a Loan Officer who is lacking in any of these areas, you may find yourself getting a loan which does not properly fit your needs.
Once you have found a good Loan Officer, you should explore the various loan products that are available to you based upon your credit score, down payment amount, debt to income ratio and other factors. Then you can select a loan which will help you accomplish your goal without putting you at risk of losing everything a few months or years down the road.
What type of property should be your focus? First, you should consider my grandfather’s old rule, “Buy a home that you can own, not a house that will end up owning you.” If buying your dream home is going to leave you with more month than money, put your dream back in your pocket and buy a home that you can afford. If buying that dream home will require you to get a crazy, lunatic, risky loan, then STOP! Some things are best not forced. Remember, it is far better to be content in a small house, than to be miserable in a big one.
Having figured out what you can actually own, you should decide what kinds of homes will be easier for you to buy. In this market, most of the homes that are for sale are either bank owned properties or pre-foreclosure properties (short sales). Bank owned properties will generally close escrow sooner and be less hassle to buy. However, they often have multiple offers on them as a result. Short sales are more difficult to buy and require much more patience.
Either way, the same is true about Realtors as is about lenders. If you start off by selecting the right Realtor, your buying experience will go much more smoothly. In this market, that means hiring a FULL TIME, experienced Realtor who understands the buying process as it applies to a foreclosure marketplace. Such a Realtor must be professional in word and deed and have extraordinary patience.
So, getting back to the question at hand, the answer is, “Yes.” It is the right time to buy. However, in order to succeed, you must first understand your own finances. Then you must put together a team of professionals who can guide you through the process. And finally, you MUST control your own emotions and desires. A very wise man once prayed, “Lord, give me what I need and not just what I want.” If you take this approach, house hunting will be a great experience!
Subscribe to:
Posts (Atom)
