THE DICKENS YOU SAY?

13 03 2010

“It was the best of times. It was the worst of times.” Or, if I was the Great Decider-er, maybe I would say it is the better-er of times and it is the worser-er of times. Either way, it’s still the Tale of Two Markets here, in the decidedly surreal world of real estate.

Dickens has the story right. The words ring true: “…it was the epoch of belief, it was the epoch of incredulity, it was the season of Light, it was the season of Darkness, it was the spring of hope, it was the winter of despair, we had everything before us, we had nothing before us, we were all going direct to heaven, we were all going direct the other way…”

Two things happened this past week, that brought my angst-inducing astigmatism into sharper focus.

The first: On Wednesday, I wrote an offer for a client on a new listing in Soquel. Bank-owned. Seven quick offers. Two short days on market. Competition. Overbids. Client’s adrenalin pumping. Racing to write the offer. Racing to get the pre-approval letter. A familiar flashback. Shades of 2005!

The fears and doubts of the multiple offer game. What can we do to please the Seller? Make our offer look more attractive? Did we offer enough? Now, we wait for the mysterious ‘asset manager’ to render a decision from on high. Might take 3 or 4 days. Or a week. That helpless feeling. Something you have absolutely no control over welling up and washing over. And so we wait. Doesn’t feel much like a buyer’s market, like it’s supposed to be.

The second thing: On Thursday I met with the Seller of a listing I put on a month ago. It hasn’t sold. A few tire-kickers. No offers. He’s worried about the growing no-shows. Should we have put it on the market earlier? Are we going to have to lower the price? He is freaking out a little more each day as another drip of Chinese water torture hits him in the head and kicks him in the ass.

We thought we had it right. We looked at the comps and knocked the list price down another $25k to make it even more desirable. And yet.. Nada. No hint of adrenalin in the air. Just a few Agents calling to ask why the seller is selling. Or wondering what his “motivation” is. Or whether there is “flexibility” in the price. Doesn’t feel much like a market on the way up, like it’s supposed to be.

Small moments in the larger scheme of things. But representative of the mixed messages the meta-market is sending. Are we really gaining traction on what still feels like mighty thin ice? Are we (pick one): At the bottom? Near the bottom? Past the bottom. On the way up? Or just getting set up for the next big dip?

I finally figured out why this is all so hard to figure out. We don’t have one real, real estate market anymore. We have two. And both happen to share the same MLS circulatory system just like Jekyll and Hyde co-existed in the same brain. Our two markets are like parallel dimensions occupying the same space and time. They look similar at first glance. They overlap in some ways. But they are wormholes apart in other ways. And the spit confuses the hell out of us, because we keep getting them mixed up. Mistaking them for each other. Or wanting one to become the other. Or fearing one is becoming the other whether we want it to or not.

There is the Distressed Real Estate Market. And there is the “Regular” Real Estate Market that keeps saying it isn’t distressed.

Bank-owned Properties, Short Sales and any number of other situations lumped under the umbrella of pre-foreclosures made up more than 40% of the sales last year. Almost half.

Spring has arrived (a little early) for all those Real People who own those non-distressed properties and see themselves as being the Real, Real Estate Market.
Time for the real buying to begin. Any day now. Those real sellers are waiting for you real buyers.

For those basketball afficionados out there, old enough to remember when there was both an NBA and a separate ABA, this feels like then. There were two different leagues playing the same game but also playing slightly different games. What was clear to all who could read the writing on the wall, was, sooner or later they were going to have to merge. There wasn’t room for both.

Well sports fans, these real estate markets are going to have to merge too. I’ve already accepted the three point shot. I just hope we don’t get stuck playing with a red, white and blue ball.

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The Trouble with Bubbles…

6 03 2010

I was taking a long, slow walk down memory lane the other day, rooting around in some old Real Estate of Mind columns, when I re-read this one from May of 2005. Hindsight can be a sobering, 20-20 experience… I thought I’d share a little bit of it…

I’m much b-b-b-better, thanks. My rehabilitation has come a long way. I can actually utter the word b-b-bub-bub-bubble now with only a bit of a stutter and without feeling completely overwhelmed by guilt and remorse for bringing up such a taboo real estate subject in public.

Bub-bub-bub-bubble. It has a rhythmic ring to it doesn’t it? An inherent onomatopoeia – specially when I take my finger and flick the front of my lower lip up and down while mumbling my real estate of mind missive.

Since I began blowing up the bubble question last week, there’s already been a front page story in the Chronicle sounding the alarm about the huge number of interest-only loans being issued in the Bay Area – 60% of the total this year- at a time when our housing mania seems to be seriously  surging over the top.

Such bastions of wisdom as Fortune 500 and Money Magazine have devoted considerable space in their May editions to examining the speculative nature of further real estate investment. Warren Buffet, the Oracle of Omaha, has stepped up to the podium and waded into the vast smorgasbord of opinion feeding our heads on the subject.  Many of you out there have also been kind enough to email me your favorite mystifying quotes from Alan Greenspan and a bevy of other well-known economists posing their own particular slants on the bubble question.

Greenspan is wandering around the economic landscape like a drunken sailor alternately denying a bubble exists:  “housing conditions are scarcely tinder for a speculative conflagration,”  acknowledging concerns about “froth in the housing market,” and ominously using those obfuscating double negatives:  “We don’t perceive there is a national bubble, but it’s hard not to see that there are a lot of local bubbles.”

I don’t know about you but images of froth and a lots of local bubbles brings to mind belches coming out of bloated beer bellies and the telltale signs of over-indulgent flatulence rising to the surface of the frat house hotubs and bathtubs. (By the way folks, this is just a lowly advertorial column. I appreciate all the thoughtful feedback, and high-minded discourse but how do you know that I’m not setting you up for my latest “make millions on real estate foreclosures scheme?” Just kidding, I think : – )

At any rate, it is clear that the “bubble” and other things suspiciously “bubble-like” are bubbling up in a steady stream from the collective consciousness. Google currently has 2,270,000 entries logged under ‘real estate bubble’.

If it looks like a bubble, walks like a bubble and bubbles like a bubble then it probably isn’t a duck.

But here’s the trouble with bubbles. They are tricky things. Even if we skip over the question of whether or not there is one, we are still stuck with the difficulty of defining
exactly what “it” is or exactly what “it” looks like.  By nature, bubbles are malleable. They float. They bend light and reflect rainbows. They appear and they disappear into thin air. They take many shapes and forms. You can see through them but you can’t quite touch them.

Bubble-sayers and Bubble-nayers. There’s a whole cast of characters out there stepping up to the mound to pitch us their best spin, couched behind a phalanx of logic and arguments and experiences and wishes and dreams and hopes and fears and expectations. If our heads aren’t quite doing Linda Blair 360’s yet, they are sure bobbing and weaving to the leitmotifs of the mosh pit.

Since so many people believe that reality inevitably follows perceptions created in the media – there are a lot of players competing for our hearts and our minds in the psychological battle
of the bulging bubble.

Next week we’ll round up the usual bubblehead suspects ranging from, those hardy souls that do believe in the bubble but also believe that they can time it just right – to those closet Howard Ruffs out there, already packing their survival gear and digging up their krugerrands from coffee cans in the back yard – to those still polishing their jewels of denial and singing the la-la-la song loudly to themselves – to all those others still enjoying the bubbly of the champagne bottle they just uncorked after their last big bazillion dollar sale.

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The Dance of the Realtors

26 02 2010

If you want to witness an interesting phenomenon sometime, park yourself  in the corner of a busy broker’s open house. Become a fly on the wall  and watch a small slice of the real estate parade roll past. It won’t disappoint. The Dance of the Realtors is always entertaining.

After more than two decades,  I still get a kick out of  the little realty bites they gift wrap and deliver up.   Even in difficult times. the banter between colleagues, the stupid human tricks, the strange people tics, the fascinating mix of funny-weird, funny-haha and outright gallows humor is a life-affirming event for the cultural anthropologist in me.

It adds healthy fiber to the steady diet of doom and gloom I’ve been dining on lately – by virtue of knowing/working/talking with so many struggling through the comings and goings of difficult home transitions.  Nothing like a little real estate lite on occasion to  balance out the existential torture of it all.

I hardly have time to wrestle the beat up plastic sign out of my trunk and get the lock box open before three nosey-neighbors are already in the door and roaming like hyper-active children at the Mall.  There’s something about that sign going up.  It’s a beacon.  A gold-embossed invitation to anyone harboring any iota of curiosity about ‘the people down the street’.  It feels like the entire cul de sac has me surrounded.  They’ve been up since 5am peeking through Venetian blinds. They’ve got their Nike’s on.  Just waiting for that damned sign that says Open House.  They can’t help it.

One Seller, years back, was determined not to give his neighbors the satisfaction of a free-look-see into his private life. Of all the uncomfortable things Sellers put up with, that was the one thing that irked him the most.  I put a person at the front door and asked Agents to present their cards like tickets to a show. Wow! Some people really got angry when they were denied a chance to see how the other half lived. They even questioned the “legality” of  keeping non-brokers out of a broker’s open house, feeling their right to snoop was guaranteed by the constitution.

Here come the first few agents breezing through with their salvo of quips.  “Hey, it’s Brezsny in the flesh!  What are you doing working an open house? Don’t you have minions for this task?” My reply: “Elvis has to be in the building before he can leave it.”

“Hey, Brezsny where are the fresh croissants? Didn’t you get up early to bake?” Sorry, mon amis, it’s 2010 and as the other King (BB)  says: “The frill is gone.” No more free courier service from the title companies. No more free equity lines topping off those 100% liar’s loans. And no more free spreads to lure agents through places that are either going to sell or not sell themselves. The fancy catering gig was always more about impressing the Sellers anyway.  That gig/jig is up.

“Hey Brezsny, how come that listing in Aptos didn’t sell? That was a great house.” To explain that mystery, I can only invoke Dr. John, the Night Tripper: ” Musta’ been the right place. Musta’ been the wrong time.”,

Shhh. Here comes, what could be an actual buyer. (I’m not sure what they look like anymore! Given  all the beating of drums about this being a  perfect “buyers market’, they are conspicuously absent) She’s looking thoughtful.  She’s drinking it all in.   I can see her communing with the soulful ambiance of this old house offered at the low, low price of $500/sq ft…

She wanders over, makes direct eye contact and asks the one question that, for some reason, they all have to ask.  Is there a book  I don’t know about, that everyone else has read, that says, whatever else you do,  always ask:  “Why are they selling?”

The look in most people’s eyes when they ask this, is eerily expectant. Every time. Pregnant with pause. It’s hard to tell what answer they are really seeking.  “The teenager next door plays Twisted Sister at decibel level twelve all night long and the Sellers are slowly going insane from lack of rem sleep?”  “Black mold has infiltrated every pore of the home’s hideous wallpaper and six innocent people have already died?” “The divorce is so ugly that if they don’t sell, it might end worse than Michael Douglas and Kathleen Turner in War of the Roses? “

How about…”They just want to move.”  It could be that simple you know. Or not.  And how about if we continue to caravan through a few more live open house, open mike moments next week…I’ve hot wired the webcams on about a dozen Agents’ laptops…so we can tune in and sneak alot more peeks.

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Touching the Elephant

22 02 2010

Hey, it’s me. Want to shoot the bull about the real estate market? Want to find a few bearish real estate messengers to shoot? I’m game. I’m not going anywhere. I’ve got plenty of time on the horizon – just like the market does.

I know I can be a pain in the real estate butt at times. I often say things some of you would rather not hear. Mea Culpa. I can’t help it. It’s a dirty job but someone has to get out of their BMW’s, roll up the sleeves of their Armanis and just do it.

There is value in giving voice to those secret things our clients are entertaining, fearing, hoping but are afraid to talk openly about in polite company or even to themselves in private.  Nobody likes a nattering nabob of negativism, so very few of us want to volunteer to shine a flashlight into the dark closet of the marketplace, illuminate the scary shadows there and diminish the power of the bogeyman guarding the gates of the unknown.

Bringing things to the surface is good medicine. Like all good medicine sometimes it tastes bad. But real grown-ups know that if you want to get better you have to force yourself to swallow it.

So.what are we going to do with the 5,000 pound elephant that’s still standing over there in the corner? It is taking up a lot of room. I don’t think it’s going to leave any time soon. We have to keep feeding it something or it’s eventually going to swallow us.

Most of us know the story about the 3 blindfolded men asked to touch an elephant and describe their experience. Each touches the creature in a different place and comes away with a completely different conclusion about what they feel.

The message: reality depends on what your approach and perspective is and how your brain creates structure and logic out of the chaos of atoms that is swirling around out there as it comes in contact with your senses.

At the moment, we’ve got lots of blindfolded people moving around the real estate market. They are close to the elephant. They hear its breath. Sniff its proximity. And they are desperately reaching out to grab hold of something tangible. They are working hard to make up their minds about what the heck they really feel.

Depending on which part the market they happen to be in contact with there’s a veritable smorgasbord of conclusions they can come up with about it’s true nature.

Sellers have all kinds of realities going on. Some are frustrated about the lack of an offer. Others are confused because they didn’t get three or four offers the first week. Some are afraid the Bank-Owned listing down the street is going to undercut their value. Some are exhausted by too many days on market. Some are convinced that one special buyer will show up with a suitcase full of cash any day now. Some are noticing more “for sale” signs starting to pop up and getting worried.  Some think the market is in for a double dip.  Some think the market already hit bottom months ago and is on the way up.

Buyers are on the other side of the same elephant and just as scattered. Some feel like there is no need to hurry. Some think they better buy now before it is too late. Some are scared to death that if they buy today, their house will be worth less in six months. Some think all the bargains out there are a steal. Some lose hope every time the median price rises. Some don’t even know what the median price is.  Some can’t decide whether it is still a Buyer’s market or not. Some just want to own a home and don’t really care what the market is doing.

So fellow Realtors let’s gather around and huddle up. Is there anyone who hasn’t heard some variation of all of the above in the last few months.? Can it all be true? Can it all be false? Or is it all just indicative of the various realty tunnels we create?

Our job is to watch and listen and work with many different people who are touching the elephant in different places. In turn we can share the cumulative wisdom that comes from gathering all those different perspectives our clients have because in turn they are counting on us to help put the jigsaw pieces together – at least enough to  make a little sense out of the big picture.

Remove your blindfolds and embrace the elephant. Wrap your arms around it as wide as you can. We have all met the elephant. It is our clients and by extension, the elephant is us.

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ALL IT TAKE’S IS ONE BUYER….

13 02 2010

Ok, so you are thinking about listing your house. If you are already listed and part of the growing ranks of the un-solds just pretend you are starting over. Like there was no yesterday. Because if you really want to , you can change your situation tomorrow.

This may sound like a dumb and dumber version of Real Estate for Dummies. I apologize in advance if I offend anyone’s sensibilities. But what I’m going to say applies to the vast majority of Sellers out there – whether they un-cup their hands from their ears and stop singing La La La La long enough to hear it or not.

There are two methodologies for pricing a home. One is market-based and the other is something akin to playing the lotto.

For months I’ve been badgering you with two mantras everyone should carry in their real estate repertoire. One more time? Ok. Here they are:  1) At the right price, everything sells. 2)  At the right price all objections disappear. Simple.

The market is a remarkably honest feedback mechanism. But the truth is, most people in a transitioning market (downward) don’t want to experience the pain of honesty. It doesn’t matter what they think their home is worth or what they feel they need to get for it. It doesn’t matter what their Agent thinks it is worth. A house is worth what the market will pay. Those of you still sitting without an offer in sight? You’ve got a definite objection that your price just isn’t disappearing.

I’m officially adding a third mantra to the list. Repeat it as many times as it takes to sink in.  “At the right price, there will be more than one buyer for your home.”

This is the premise of market-based pricing. It’s why so many people are running around collecting comps and trying to make sense of them. (Hard thing to do in eclectic SC County.) The value of any home stands in relationship to every other home. When buyers look – they look at more than one house. They compare what they can get for what it costs to get it. If you have something good for the right price, compared to what else is out there, buyers (plural) will want it.

If you are listing or selling your home and would rather toss market logic out the window then there’s always the lottery approach to fall back on.

The catchphrase that best captures the essence of lotto pricing is this: All it takes is one buyer. It’s also the most common rationale Sellers use when their houses aren’t selling. All it takes is one. You may be getting one lonely showing every couple of weeks but… all it takes is one. You may be going broke in the process but all it takes is one.

Pricing a home for that one right buyer that meshes so perfectly with it, they won’t care what it costs, is a pleasant thought. Imagine that one right person walking through the door, instantly smitten and ready to write an offer for any amount. And yes, they are eminently qualified to pay all cash, no contingencies, no appraisal worries. How soon do you want to close?

Possible? Sure, It’s possible. In the same way that we could meet tomorrow morning, buy lotto tickets at the mini-mart and win the big spin. The odds may be against us – but that doesn’t mean we won’t hit paydirt tomorrow. Or the next day.

Or perhaps twenty years from now, we’ll still be buying tickets convinced our odds are getting better as time goes by. We’ve spent thousands of dollars. We’ve invested all that time and hope. We can’t cut our losses and quit now. We have to win back all that money  we’ve spent trying to win.

All some of you Sellers need to do is continue those mortgage payments you’ve been paying on that empty house, while waiting for the perfect buyer to show up and you don’t have to meet me. You are already playing the lottery. As inventory increases, your odds of winning decrease. As days on the market increase – ditto. You aren’t getting closer. You are getting further away. And it’s costing you a bundle – financially, emotionally, psychically – trying to score that one fantasy buyer.

Keep it up long enough and you’ll chase the market down far enough, you’ll wish you’d given alot more thought to Gambler’s Anonymous sooner.

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When You Know That “This” is Really Happening

6 02 2010

Selling your home?  Put your game face on. Get a firm grip. Gird your loins.  Make sure you are all buckled up and fully programmed on zen mode.  You might also want to rummage around in that junk pile you call a garage (there’s a secret hoarder stashed in all of us)  and see if you can find a makeshift crash helmet, in one of those old boxes of  football stuff or in that motley collection of pots and pans you’ve been saving for a rainy day -  just in case you need it.

If you are getting ready to sell, you are soon going to be venturing outside the private, gated universe of comfort and safety you’ve been living in, in blissful ignorance and relative isolation, for years.

You are about to take the plunge. A leap of faith that can resemble a header off the side of the abyss.  Sometimes it feels like the doors of both your home and your soul  are getting thrown open to the great unwashed masses of the marketplace – exposing you to a new strain of swine flu, genetically-altered to infect susceptible Sellers.

Most of the time we play with real estate like we are armchair quarterbacks in charge of our own Fantasy Football Team. Fantasy Real Estate is one of our favorite pastimes. We keep up with all the stats in the newspapers. We wander through open houses doing advanced scouting reports.  We download virtual tours of promising new talent from the websites.  And we love to peruse the glossy pictures in the magazines in search of potential draft choices for the future.

We imagine making all big time moves just like the pros do. Claiming that little desert condo  we’ve always wanted, on waivers. Getting a bank-owned beach bungalow for a song, because the mortgage exceeds the owner’s salary cap.   Making a blockbuster trade – like exchanging our  4,000 sq ft franchise home for a  mountain cabin,  10 acres of  pristine lakefront property and a duplex to be named later.

But sooner or later, all those life transitions we hear about and all those changes we know are coming, eventually do circle around to include us.  Suddenly it is our turn on the hot seat. Suddenly, real estate becomes a lot more real – when it is our  home and we are the Sellers.  It isn’t Fantasy Real Estate anymore. We have to buck up and shed the last vestiges of our Intention Deficit Disorder. We aren’t in a position to take six years to window shop and try on a million different scenarios for size or for a lark.

It’s always interesting to notice which things carry the most weight and trigger those crucial aha moments for Sellers as they journey down the road towards the realization that “this” is really happening.

Here’s my quick list of those edge points -  small quantum leaps along the way that both scare the hell  out of Sellers and help them come to terms with realty.

The first happens when the Realtor shows up and a few nosey neighbors recognize him getting out of the car. Suddenly there are a whole lot of questions and no real answers. It catches Sellers off guard. Throws them for a loop.

Then, after all the talk, the Seller just can’t put off signing the listing contract any longer. There is something about putting their John Hancock at the bottom of a formal document that makes them feel like they’ve just endorsed the antithesis of the Declaration of Independence.

A third  moment of truth comes when an Agent asks a Seller to de-clutter their house. Meaning: get rid of  stuff so that someone else can imagine their own stuff in its place.  It is strangely unnerving when someone tells someone else how to live in their own house for the first time.

Perhaps the defining moment for most Sellers is the day the sign goes up. There’s something so iconic about it that most of those last traces of denial that Sellers still hold in their hearts are vanquished.

And then of course, there’s injury to insult. Sellers often have inspections done before going on market. While it’s a great idea, it can sure feel disconcerting to pay a stranger to tell you everything that’s wrong with the home that has nurtured your life for many years. Ouch.

Selling your home. Love it. Hate it. Want it. But don’t want it.  Like I said, buckle up and get into zen mode – quickly.  Maybe it’s why Sellers are supposed to bury the statue of St Joseph upside down in their yards.  Sometimes it takes a while to get to the upside of the downside.

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THE ROAD

29 01 2010

Welcome to  real estate circa 2010.  I think.  I hope.   It’s January 30th  and we are already a month into it. Time sure flies when you are having…. having…

What is this market we are having?  Do we know?  Is this the market that’s going to preside over the waning debacle of the last decade? Or are we already past that? Is this a different market now?  The new and (un) improved one? Stripped of its heavy baggage? Ready to kick start the beginning of the next ten year cycle?

Has anyone found a pulse strong enough to make a  prognosis or a diagnosis yet?  Has anyone gotten a good read? A glimpse behind the curtain?  Is there someone out there who feels confident enough to stand up in front of  the class and venture a guess – let alone suck up a long deep cleansing breath and tell us in 25 words or less where this is all going, in no uncertain terms?

What to say?  Where to begin? How to know? And in the absence of any real, clear cut answers, how long do we wait around before we pack our bags and  decide that we have to just set out in one direction or another, headed for parts that can only be referred to as unknown?  I don’t think it is a coincidence that Vigo Mortensen and Denzel Washington have recently been summoned up to star in a spate of post-apocalyptic tales like The Road and The Book of Eli. It’s just us projecting onto the big screen so we can look into our own existential mirrors.

Is this the right time to Buy? Sell? Hold? Fold?  Yes. Or no. Or maybe. To some or all of the above.

The worst thing in real estate is uncertainty. The place of not knowing anything even remotely for sure. Real estate revolves around transactions. If no one transacts, nothing moves. Nothing flows. There’s no money available to oil all the parts of the machine sitting idly by.  Escrow Companies, Mortgage Brokers. Real Estate Agents. Everyone is dressed up waiting for those addresses to get going.  Until then, it isn’t much of a party.

In order for the average person to get out of bed,  venture forth, enter into agreement and conclude any kind of business engagement involving something as huge and as  personal as home is,  they have to feel like they know where they stand in relation to the larger world (or market) that surrounds them.

They need reference points.  More of them. Or less of them.  But at least enough of them to instill faith that there really is a right direction to choose.  If  there are no stars visible enough in the night sky or if  the constellations of data being spun are so confusing and so contradictory that it is difficult to discern any recognizable shape or pattern, folks simply stop dead in their tracks. They don’t go forward. They don’t go backward.  They don’t navigate in any direction because they don’t have a map.

Do we want more of the same old that we’ve had?  No, I suspect there aren’t many buyers, sellers, Agents or other constituents that comprise the cast of usual real estate suspects that are lobbying for Door #1. Even if we are hard-pressed to find exact words to describe the vagaries of the no man’s market we’ve been wandering around in for the last year,  or two. or three., we can at least say that we don’t want to go back there for more of the exquisite torture that comes from sitting in the eye of unsettled silence waiting to see if the dreaded dull thud of the other shoe dropping is going to materialize.

What do you think?  Feel free to weigh in with whatever version of realty you’ve managed to make your peace and your resolutions with for the coming New Year.  All plausible explanations are encouraged. Any reasonable plans or strategies for bailing ourselves out of the remains of the great bailout will be thoroughly entertained. Carefully vetted. Stress tested and fully digested. The best of the best or the least of the worse will be culled out and unabashedly shared with other members of our live studio audience in future columns.

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To Know or Not to Know

23 01 2010

Whew. Do I feel better. The pressure is off.  I don’t have to pretend to be perfect anymore.

For a long time, I’ve been inching my way forward. Cautiously beating around the bush. Discretely spinning my one-sided conversation in these columns towards just the right place in time. The moment when I could remove the gag order and finally blurt out the truth.

Well, it’s come to Jesus time and I’m here to tell you that we real estate agents – whatever we say, no matter how many years we’ve been in the business or how much we fluff up the auras of our own sales personas  -  don’t really know exactly how much your home is worth.

At least not before you agree to put it on the market and steel yourselves for that purgatory of a process otherwise known as listing your home. That’s the one and only way you are ever going to find out.

There can’t be anyone out there actually masochistic enough to enjoy opening their home up to the great washed and unwashed masses of the marketplace.  The game of “show and sell” may ostensibly be an impersonal one but it sure feels like an intensely personal experience when all those prospective buyers and a revolving door of nosey neighbors, lookie loos and curiosity-seekers come trooping through your lives and your dinner times without a lot of grace or prevailing sensitivity.

Sometimes it feels like you are under perpetual siege by the lifestyle police. Sometimes it feels like every showing that goes unrewarded by an offer is a rejection slip handed out to one of the things you have grown to cherish most in your life.

Yes, we Agents all come to visit and perform some version of the old comparative market analysis trick, just before we whip out our bulging brag books and tell you all the incredible things we plan to do to bring more of those prospective buyers and nosey neighbors through your front door.

Somehow we are able to snatch a proposed value out of thin air for that geodesic dome you’ve lovingly remodeled. Even when there isn’t another one remotely like it  between here and Timbuktu. To compare apples and oranges to comparing real estate comps in a place as diverse and eclectic as Santa Cruz,  is a fruitless task.  Specially in this market. Try to find all the similarities between apples and kangaroos and you’ll have a lot more success divining our local market’s secret handshakes and esoteric passwords.

What Agents don’t always tell you is: In the end, it doesn’t matter what we think your home is worth. (We aren’t buying it.) And it doesn’t matter what you think your home is worth. (Most of you wouldn’t or couldn’t buy your own homes in today’s market anyway.)

What matters is what those buyers out there think your home is worth. If you really want to sell your home, that’s just about all that matters. In the end, the truth always emerges out of the grand inquisition of the marketplace, resolved by trial and error and trial by ordeal.

I know you want us to be perfect. And we would dearly love to be perfect. Yes, sometimes, we get lucky and we get it exactly right. (Even a blind agent finds an acorn now and again.) Sometimes we read the auguries well and we get pretty close.

I always figured that if an Agent could predict home values consistently within 5% of their eventual sales prices then that Agent was right up there with Nostradamus, Edgar Cayce and the Oracle of Delphi in terms of his/her prophetic acumen.

A whole lot of other people figured that with the advent of Zillow.com  all the muss and fuss and the great mystery of home valuation would disappear forever.  They were hoping against hype that they could just type in an address, hit the return button and … Voila! -  that great big braniac algorithm in the sky would spit out God’s honest truth and tell us all exactly what every home was worth. Heck, no one would ever be stuck again having to offer anyone coffee or pretend to smile while listening to a sales pitch extolling the virtues of one real estate company over the next.

Well, Zillow’s been around long enough now, along with a slew of sibling-spawn like Redfin and Trulia.  Their results have been even less impressive than those of us real, realty people.  Zillow  has gone through enough accusations and lawsuits to remind us all once again, what we should already know and keep knowing.  No one and no thing has the answer ahead of time. You just have to hitch up your doors and your drawers and make that leap of faith into the unknown.

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Categories : Real Estate Of Mind Articles

Open Says Me

15 01 2010

I hadn’t worked a “real” weekend open house for a while, so last Saturday, I decided to inaugurate a nice new listing and what I’ll call a  hopeful, New Year, by going “retro” with what has always been a traditional staple of real estate marketing.

I hope my open house was as entertaining for those of you who visited, as it was for me.  I had a great time. Some part of me had forgotten how interesting it is to publish an ad, put up a sign, open the door and just see who decides to wander through on that particular day.

For me it’s like throwing the yarrow stalks and reading the I Ching. Is who comes through really coincidental? Are there deeper meanings that can be drawn from these chance meetings?

What are people looking for? What do they have to say? What are their stories?  What kinds of questions do they ask? What does their presence say about the larger marketplace we live in? It doesn’t really matter if they are actual buyers, part of the entourage of family experts that often accompanies, just curious neighbors or dedicated lookie loos indulging their hobby and/or feeding their jones.

As it usually is with the universe:  When you put something out there you almost always get something back – if you pay attention in the way the Buddhists call ‘beginners mind.’

Call me old-fashioned or maybe just old and out of touch,  I think there’s still room for a kinder, gentler version of the weekend open house.  You know, something much more relaxed, gracious and conversational in tone than those all-out frontal assaults we sometimes get blasted with by over-hyped Agents.

I say “we”, because I  make a point of going to open houses whenever I am out of town. far enough away, so that I can be incognito and experience real estate from as much of a non-Agent’s perspective as possible. Nothing better for honing your craft and hopefully becoming a better human being than making a conscious effort to put yourself in other people’s shoes.

Open houses don’t have to be all about “picking up buyers” as though they were invitations to a happy hour singles bar,  strangers looking for other strangers to entice and shack up with in the purchase of a new home.  Open houses don’t have to be about cornering people for their names and addresses so that they can become part of an ever-expanding empire of spam.  And of course, it isn’t really necessary to follow folks from room to room, pointing out the painfully obvious while callously pushing past the delicate boundaries of their personal comfort zones.

The more you talk, the less they grok  (google it, younger readers) about the essence of the property in question.  The larger you loom, the smaller those rooms get. The more invasive your shadow, the less light there is that seems to filter in through the skylights and those nice big bay windows that are beckoning.

Open houses don’t need to serve lavish spreads of gourmet food or drink.  They don’t have to emulate bingo night and offer free raffle tickets and trips to Hawaii.  Forget the guys in the clown suits waving signs. Leave the helium balloons back at the office.  We don’t all have to be filling the funnel and selling the sell every second of every day.

Open houses can simply be open.  Open for the experience of the house. Open to whomever comes through.  Open to whatever connections get exchanged. Shallower. Deeper.  It’s all good.

In the end, whether Sellers of properties truly understand it or not…homes have to sell themselves. Agents can market them, but they can’t sell them to people who don’t really want to buy them.

There may always be a mythical notion, woven into the culture, that sees the real estate agent as a used-car salesman. The fear that somehow, he/she is going to talk an unsuspecting buyer into an $800,000 Toyota Camry they didn’t plan on driving off the lot. In some ways I’d love to be able to say that I have enough Svengali-like mojo stored up from years of success, to hypnotize a stranger into dropping some really, really serious cash on something that doesn’t speak to them on a much deeper level.  But it ain’t so Joe. It just ain’t so.

If any of you want to come by and join me this weekend,  I’m open for it again.  Click here   http://www.87hagemann.com and get the scoop.

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Categories : Real Estate Of Mind Articles

Channeling the Future of Real Estate

31 12 2009

There I was driving home from the office on Highway 1, the other night ruminating about the future of real estate, when I came to a grinding halt in bumper to bumper traffic. As I sat unmoving and frustrated, I realized  I was sitting right in front of the electronic Caltans billboard near 41st Avenue. Glancing up. I noticed strange flashing lights and what appeared to be a string of random words running across the electronic screen.

Suddenly my cell phone rang and an eerie mechanical voice on the other end said: “Pay attention and write.” I was so shocked I grabbed my laptop and for the next three hours a series of messages channeled through the traffic board as I feverishly tried to keep up with my meager typing skills.

What follows is only a small part of all I was shown and told. Predictions for the future? Real estate for the coming year – courtesy of some Century 23 Agent traveling back in time? Who knows? Fact or fantasy….you be the judge. I’m just the instrument of some higher power with a heck of a cell phone bill .

-  An exhaustive study  tracking homes sold in 2005 with subprime loans and resold 5 years later as bank-owned properties will be published under the title of Garbage In Garbage Out.

- “Housing Bubble” Gum will become the new “Pet Rock” of 2010.

- A local Real Estate Agent will rise to the top of the fashion world with his Armani Hazmat Suit – high couture that protects against daily exposure to the standard household threats of formaldehyde, radon gas & lead-based paint.

- Mass demonstrations of seemingly random St. Vitus  dancing will  be traced to the hallucinogenic effects of a new strain of toxic mold found growing in the glut of vacant foreclosures across the country.

- Organic Sellers will attempt to secede from the market by forming a separate MLS where bank-owned properties are prevented from being listed for sale.

-  Disenchanted Appraisers unhappy with new HVCC legislation will quit the business and flock to an evangelical end of days cult called Appraise the Lord and Pass the Ammunition.

- New legislation attempting to slow the mounting tide of foreclosures will require troubled properties to first be labeled Afault, Befault and Cefault before being allowed to go to Default.

- In November a local real estate agent will give birth to a 14 pound escrow file and be prominently pictured on the cover of the National Enquirer.

- A local psychiatrist turned real estate agent will lose both of his licenses after he is discovered marketing pre-pre-pre-foreclosure properties on Craigslist using confidential client information.

- As the shadow inventory of homes held off market by the nation’s largest banks grows to record numbers Foreclosures will be re-named Noclosures.

- Scientists studying Real Estate Buyers and Sellers will identify a new psychological syndrome called Intention Deficit Disorder (IDD)

- In June, a radical cult of new age economists will flock to Sedona, Arizona to celebrate the advent of  the Un-harmonic Convergence, otherwise known as deflation.

-  New Fair Housing laws will require Short Sales to be called Chronologically-Challenged Sales in all real estate advertising

- Local Real Estate experts will issue a forecast guaranteeing that the market will be much better in 2010.  When pressed for specifics a terse one page explanation will be issued explaining that better really means “less bad.”

In a related story,  a record number of homeowners will burn their mortgages and declare their freedom in a series of  celebrations reminiscent of the “tea party” phenomenon of 2009.  Freedom will be identified as “just another word for nothing left to lose.

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