LISTING NO NO: PART 1-WEAPONS OF MASS DISTRACTION

So I was showing a home last weekend when we came upon this…

Now, I should start by saying that this is not a treatise on gun rights.  It’s more about common sense mongoring than fear mongoring.  With that said, there are a myriad of things that would be best to tuck out of view or even move to another location when opening your home to the public.  Over the next few posts, I’ll be throwing out a few quick thoughts on some of these things. Since we have this photo, let’s start with weapons:

I’ve been in literally thousands of houses over the past 13 years and like most of my veteran colleagues, occasionally find myself in homes with weapons out in the open and accessible.  Nun-chucks, swords, shields, knives, guns – sometimes just sitting right there.

The thing that struck me when we encountered this gun cabinet was that there were a few open rounds and a box of ammunition sitting right next to the rifle.  Potential disaster.

When you put your home on the market, you never know who is going to enter your home or how well attended to they will be.  From open house theivery (which happens more often than you might think) to non-attended to children, the potential for disaster looms when there are weapons about.

They are also distracting. When we saw this gun we started talking about it and stopped talking about the house. The whole reason you let us in your house is to show us how great it is and make buyers want to buy it. It doesn’t make sense to have things on display that distract from that purpose.

This principle applies to wall-mounted weaponry as well, no matter how “tasefully” displayed.  You may be very proud of your Klingon War Blades and even possess the ability to wield them with enough verocity to inspire Picard to violate the Prime Directive. (sorry for the geek speak)  But for the sake of showing your home, let’s keep those tucked away in a safe & secret place… maybe with the Romulan Ale??

What about seemingly innocuous and common things like kitchen knives?

Hide those away too.  While the likelihood of a blood thirsty maniac stopping by your open house is low, chidren are left unattended constantly. Most families are great but it’s not uncommon for parents to be having a conversation with an agent in one room while Lord of the Flies is being acted out in the next. At the bare minimum, place them in a drawer or better yet, up in a cabinet.

You want your home to feel like nothing bad could ever happen there so let’s make sure it doesn’t and store the stabby and shooty things away until after the sale.

Tune in next time when we’ll find out what Lord of the Rings and 50 Shades of Grey have in common.

Is the Real Estate market improving and are builders really building again?

Yes and yes.

Recently I was talking with an investor. A very successful investor who from 2009-2011 spent a lot of time and money investing in builders and contractors.

Why?

Because everyone else was selling and selling very low.

He told me that he stopped buying a year ago and that over the past several months has been making money on the investments.

Why?

Builders are building again.

National reports are echoing that same sentiment. According to MSNBC applications for building permits are the highest they’ve been in 4 1/2 years. And though housing starts slowed last month (largely due to Tropical Storm Sandy) they had also reached 4 years highs in October.

Builders don’t build unless there is a market for their product.

Locally all you have to do in Seattle is turn your head and you’ll see new homes being built or a crane moving building materials around. These are all pointers that there is a market for new homes, which means there is a market.

In Seattle proper, we went from a balanced market with an absorbtion rate for sold properties in the 20s% for several months (Under 20% absorption rate Buyer’s market, 20-40% balanced market, above 40% Seller’s market) and in March of last year it bumped into the 40s% and has only grown since (58.5% for November). Take a look at the year over year stat comparison below:

Numbers compiled from NWMLS reflect Seattle Metropolitan Area

As you can see, demand has increased and inventory has decreased. In short, it’s a Seller’s market.

So with low inventory, high demand and continued low interest rates can we expect builders to keep building and the real estate market to improve in 2013? As the Magic 8 Ball says, “All signs point to yes.”

Hey everyone… we’re number 2!! Seattle is number 2!!!

Ok, Bloomberg Business Week recently announced that Seattle is the 2nd best city to live in.  We came in second to San Francisco.  But the most important thing is that we beat out Portland.  We Seattlites specialized is jealousy-fueled inferiority complexes long before Portland even knew what the inferiority complex scene was!

Here is an article from the Seattle Times that seconds that notion!  http://seattletimes.com/html/edcetera/2019269988_seattle-2nd-best-city.html?prmid=obinsource

How can an entity foreclose on a home they don’t own?

The short answer is no. If you’ve been foreclosed on, you may want to check your records and see exactly who it was that performed the foreclosure. In August the Washington Supreme Court unanimously de died that the giant lending clearing house MERS (Mortgage Electronic Registration Systems) could not foreclose on a home because they could not prove that they they owned it. Further more, the court also ruled that homes unlawfully foreclosed on by MERS and anyone else who could not prove ownership may meet the criteria for consumer affairs lawsuits. I would expect to see class action suits in short order.

If you’ve been foreclosed on by MERS or thought that tour foreclosure was fishy you may want to seek the council of an attorney.

Here’s a story from the Seattle Times from August.

http://seattletimes.com/html/businesstechnology/2018934163_mers17.html

Will Your Smell Help You Sell?

Of the five senses, only three really get talked about in real estate. It’s common to hear phrases like “This house looks great!” or “We want to live on a quiet street.” or even “This house sure feels solid.”.

So we have sight, hearing, and touch covered but what about the other two?

“This wall tastes delicious!” …. after 10 years in real estate I can gladly say I have never witnessed a client tasting a house. Although, I can imagine taking much pleasure in buying a life-sized gingerbread or candy house. There’d be a lot of negotiation over whether to use peppermints or spearmints for the driveway and such… but I digress. I’ll concede the sense of taste isn’t really a factor in marketing a home.

That leaves us with smell. Smell is the sense most associated with memory. And smell has produced some of the most visceral responses I have seen to date. People don’t usually have much of a response if a house smells nice or is void of smell but they absolutely notice when a home smells wet, dirty, or just outright gross. People remember smelly houses.

“Hey Ted. Do you remember that place that smelled like cat pee and Funyuns??? Did that house ever sell?”.

That is not the type of memory you want associated with your home.

I’ve touched talked about the use of cookies to help market homes in the past but I came across this article the Seattle Times swiped from the AP that talks about about how even what you cook for dinner can effect the sale of your home.

Give it a read and decide for yourself if baking that onion & garlic rub into your fish the night before an open house is really worth it!

Banks Are Blind to the Effect of Bank Owned & Short Sale Properties

According to the New York Times, the commercial appraisal system is broken.  At least that’s what I read in an article the Seattle Times pilferred from them last week.  As I read the article I was struck by two things:  1. I know nothing about commercial appraisals  2. If commercial appraisals are anything like residential appraisals then these findings are faulty and misleading.

Here’s why I think I might smell some stupidity here:

“Using data from thousands of securitized real-estate bonds in which the properties were foreclosed on and liquidated, the study, by KC Conway, an executive managing director at the brokerage firm Colliers, and Brian F. Olasov, a managing director at the law firm McKenna Long & Aldridge, found a wide discrepancy between the appraisal values and the eventual sales prices of the properties.”

If the basis for their findings was predicated on the sale of foreclosed properties, of course the original appraisals these properties were purchased with are going to appear elevated!  They are distressed properties.  Distressed properties sell for less… at least they do in residential real estate and I can’t imagine it’s much different in the commercial arena.

So how much less do REO (bank owned) and Short Sale properties sell for?

Let’s take a look at the latest NWMLS residential stats for King County & the Seattle Metro Area:

April in King County saw a total of 1746 completed home sales. 16.4% of those sales were REO properties which sold for 55% less than non-REO/Short Sale properties.  Short Sales weren’t much better.  Short Sales made for 11% of those sales and sold for 42% less than non-REO/Short Sale properties.  The median price for sold REO properties was $187,000 vs. the non-distressed median sales price of $415,000.

Those are staggering numbers!

It’s numbers like these that make me question the accuracy of these findings. And though this study was done by a supposed nuetral third party, it appears to be part of the blame game the banks so ofter take part in.  I must say, it puts sand in my shorts when I see banks blaming appraisers for failures in their lending practices.  Let’s not forget that we have an all new Federal mandate (HVCC: Home Valuation Code of Conduct) thanks to the unscruptulous acts (blackmail) banks were committing when they had direct access to appraisers.

All I know is that banks refuse to acknowledge that there is a difference between the sale of a non-distressed residential property and the sale of REO/Short Sale properties.  As I read this article, this appears to be the case in commercial market as well.

What do you think?

There’s a Real Estate Sucker Born Every Minute

I will apologize ahead of time for the snarkiness of this post.  Sometimes one must vent…

I was just thumbing through the latest issue of REALTOR magazine when I was reminded that real estate brokers are “suckers”.  Every month I get this magazine and it is filled with advertisements for worthless gimmicks and tools and invitations to see this or that real estate icon.  These items and services must sell or these companies wouldn’t continue to advertise in the magazine.  In fact, I know they sell because I’ve been to the seminars and classes that are akin to old fashioned tent revivals.  All you have to do is walk down the aisle and smack your $300-$2,000 on the alter to have instant lead generation and client contact management salvation!

Ugh….

Many a P.T. Barnum-like real estate celebrity has been born due to the ease with which agents are exploited. Mike Ferry, Joe Stumpf, Hobbs Herder… everyone in the business knows these names.  Just employ a system or buy this gadget/marketing plan and watch your business start booming!

I hate things that prey on people’s egos and insecurity.  And there is a TON of ego and insecurity in my industry.

Here’s a short list of things we don’t need in the industry:

• Moving trucks with gigantic pictures of us on the side
• Personalized Listing Radio Stations that give information about the agent or the home
• A $500 – $5,000 branding/marketing campaign that sends crap our clients won’t read so we won’t have talk to said clients
• A $40-$200/month lead capturing system that feeds us contact information for people that are annoyed when we call or just wanted to know if the yard was big enough for their dog
• Another charismatic guy/gal in a power suit telling us that all we need to do is ask for referrals from our clients to gain a never ending supply business
• Another article on how great social networking is for building your business
• Another over generalized auto-sent newsletter that talks about the Las Vegas, Phoenix, or non-relevant market when my clients live in Columbia City & Ballard

I think you get the picture.  Death to overpromising!

Ahhhhh…. I feel better now.

Again with the cameras….

So yesterday at our weekly sales meeting it came up again… “Beware of the Voyeuristic Seller”. That’s right, it’s becomeing more and more prevelant for Sellers to set up cameras and watch video of people touring their homes.

I wrote about this before in 2010 after hearing a particularly disturbing story of a Realtor being video’d from a bathroon while he was urinating… I know, creepy.

Though I can see why a Seller would like to protect their belongings or try to gain negotiating leverage by capturing touring Buyers on video, I am not a big fan of this tactic. There is something intrinsically violating about being “spyed” on. I would at least like it to be posted that the property is being monitored.

As this practice grows in popularity, it will be interesting to see what the state and the Northwest Multiple Listing Service require of Sellers and Brokers.

Until then, I guess I’d better stop taking naps in other people’s beds.

 

 

Are Zillow, Trulia, and the like, a bunch of thieves???

There is a new battle being waged in real estate over whether listing syndication websites such as Zillow, Trulia, and Realtor.com (which has nothing to do with the National Association of REALTORS by the way) are good for consumers and the real estate industry.

This question was brought up in a real estate technology forum that I am a part of earlier this week.  Most of the brokers in the room, including myself, agreed that anything that aids in promoting our client’s listings and makes information more available to buyers is a good thing.  One of the higher ups in our technology company said that that there was momentum building nationally for brokerages to start pulling their listings from these aggregate sites.

Since then I’ve a come across a couple of videos that as far as I can tell lay both sides general assertions.  To be honest, I’m not crazy about either of the personalities in these videos.  Mr. Abbott seems to be fear-mongoring, while Mr. Glick is a little condescending .  That being said, there are fair points coming from both sides.

Here’s Jim Abbott’s spiel:

Here’s Fred Glick’s rebuttal:

I currently support the continued supply of information to the syndicates simply because the other point of view seems more self-protective than based in concern for the public.

However, Mr. Abbott’s points about the absense of regulation are valid.  Real Estate Brokerages are highly regulated to protect the public. We answer to Federal & State law, as well as self-imposed rules through our local multiple listing services.  Though listing syndicates must comply with fair housing law they explicitly avoid membership in MLS communities to avoid the complicated series of rules brokerages must abide by.  Those rules are important.  Many were birthed out of lawsuits that occured due to the lack of regulation in specific parts of our industry.  The public has been greatly protected due to the implementation of these rules and practices.

Mr. Abbott took an extreme stance in that his brokerage pulled all of their information from these sites.

I believe in a more reasonable solution.  In a nutshell, I think we would all be better served to work with these sydicates in creating a series of guidlelines (much less cumbersome than MLS rules since they aren’t actually practicing real estate) to ensure the accuracy and proper use of our data.  The syndicates need our information to make their sites viable and should be willing to work with brokerages on improving the presentation of that information.  There’s a lot that would need to be worked out but essentially it would be the best of both worlds in that we would keep information free on the web for buyers and sellers while ensureing its accuracy.

This issue is heating up and I’d love to know where the general public stands on it. Chime in if you have something to say!

Are those weirdos next door hurting your home’s value???

Ahhhh… the bad neighbor. How much can they affect a home’s value?  Good question.

The Seattle Times ran an article today that addresses that issue, citing some pretty outlandish behavior.  It’s a fun read.  It’s also somewhat timely.  I’ve had people broach this issue in somewhat different ways within the last 24 hours.  Let’s look at one of those experiences and play Good Neighbor, Bad Neighbor.

Yesterday I held open a fantastic modern, built green home in Seward Park. One of the neighbors came by while some other folks were in the house. We were all chatting when the neighbor offered up “I can tell you all about Bob if you’re curious…”

“Who’s Bob?” I replied.

The neighbor pointed at a house down on the corner that was in a state of disrepair and said “That’s Bob’s place.”

The neighbor was obviously concerned that Bob’s property was reflecting poorly on the neighborhood, particularly because Bob lives right next door to him!  Said neighbor, also clearly had a soft spot for Bob and didn’t want people’s imaginations running wild about what kind of “nut” he must be. So he carefully pointed out the “elephant in the room” that was Bob.  Here was a guy that cared about his neighborhood and his neighbor and I appreciate that.

Contrast that to an experience I had 3 years ago in Lynnwood. I was working with a lovely couple on a short sale up there. One day we were outside the house and bumped into the next door neighbor.  At first he seemed friendly and helpful. But each time we spoke with him he would become more mysterious:

“I would look underneath the house if I were you.”

“We know they replaced the floor and some rotton joists there…” we’d reply.

He’d continue, “I’m not saying anything… just look under the house.”

Seems harmless enough but being that we had already had full disclosure regarding rot that had been in the flooring/sturcture and how it had been remedied we didn’t need Captain Creepy stirring the bad feelings pot.  I don’t know if he thought Hoffa was buried there or what, but it was a bit much and were my clients not so well-informed they may have been spooked and the deal may have fallen apart.

Not helpful sir.

Thankfully my people were of sound mind and are enjoying their perfectly fine floor and the rest of the house to this date.

I could go on about vengeful neighbors blocking a potential buyer’s car in a driveway or go back into the story of a house I was watching last year that is sure to fall collapse soon (check out this post, you won’t believe the pictures).  Or how my neighbors (who are nice people by the way) have at least 7 vehicles and 2 yipey dogs.  Everyone has a story.

I’d love to hear some of yours.  If you have an interesting or funny story about a neighbor, let us know.  We’d all like to hear about it.