I hate manipulative advertising. Hate is a strong word but it’s probably because that type of advertising works. In the ad above they are leading you to a conclusion that they don’t state. They want you to believe that RE/MAX agents are never part-time agents. If that was true why wouldn’t they just come out and say that?

I don’t mind a play on words but this borders on a lie of ommission. It’s similar to a teenager telling his mom he was at his “friend’s” house. If mom finds out it was his girlfriend’s house should she be mad? Yep, because he knew he was hiding something

Pizza Hut sued Papa John’s over thier slogan, “Better Pizza, Better Ingredients.” They won but Papa John’s appealed and, though the jury’s decison was upheld, the court determined “Pizza Hut failed to prove that the misleading advertising and puffery had a material effect on consumers’ purchasing decisions.” Um, why do they think Papa John’s uses that slogan?

Now to the issue of part-time agents. At one point I thought it was bad but as I saw my fellow agents getting second jobs to fill in the gaps I saw that some could still keep up with their clients. Some couldn’t but that is even sometimes the case with full-time agents as well.

This industry has always had part-time agents and most likely always will. And RE/MAX has made money off the backs of the people who did which is another reason why it annoys me. My mom was a part-time agent in the 80′s when I was a kid. She worked while I was in school and made it work other times in the day much like I am sure thousands of other part-time agents did.

I know business owners in many fields that have had to get part-time jobs. I remember my teacher had a part-time job during the school year. There is an issue in the real estate industry that there isn’t much of a barrier to get into it. So people have to look to simple clues because there are few others. People look at our cars, our clothes, our company (not as much anymore), they want to see how fast we sell (doens’t prove much), etc. And that is why RE/MAX does this kind of advertising.

In truth, if an agent is dealing with more than one client aren’t they working a second job? If they can juggle the needs of several clients at once why can’t they work a second job? It goes back to people trying to find a filter to figure out who is a good agent or not. You can’t be sure until you are in the middle of deal.

RE/MAX also has a tagline that they sell more real estate than anyone in the world. If you stop there it may be impressive. If you ask how many agents there are you understand why. McDonald’s used to do that too when they listed how many millions of burgers they sold. But does that doesn’t speak to quality.

If a brokerage wants to stand out they would tell you that they only hire the best. They would tell you about the mandatory classes each agent has to take. The extra requirements that they have to ensure the agents are the best.

This is not a slam on the agents of RE/MAX but on the advertising the company chooses. There are fantastic agents at RE/MAX. I just feel RE/MAX is doing it wrong and slamming their own agents at the same time. I worked for RE/MAX for two years and I never saw anything in my contract that said I couldn’t work a part-time job.

Thanks to Jeff Bernheisel for pointing this video out to me. It caused me to go on a rant that meandered a bit so I appreciate you making it this far.

For the record, I do not have a second job but I have good friends that I know who are doing a good job for their clients while also taking care of their families by working another job much like other small business owners in this tough economy.

Oh, and RE/MAX, if you have changed your policy and you don’t allow your agents to work part-time please send me a copy and I will be more than happy to post it and eat my words.

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There are some agents out there who think they are Gordon Gecko or Terrell Owens’ agent Drew Rosenhaus and try to negotiate as such.  I have often said that trying to negotiate with strong-arm tactics and ultimatums don’t seem to work well.  And easiest answer to give when you are pressured is “No.”

I have read books on negotiating but those usually apply to big business where negotiating is an everyday thing. I am also not the agent who thinks my clients are mine to control though I have been told a few times by agents on the other side that I needed to. I told one that it was a great idea and to go ahead and do that with her clients and we could get the deal done.

Last night I was reading “The Upside of Irrationality,” (p20.) In it they talk of an experiment with rats and shock, which is a favorite element for research into stressors and deterrents. They used the shock to see how well the rats learned where to walk. Low voltage didn’t affect them much. Medium voltage caused them to learn quicker than normal. With high voltage the rats could not focus and were unable to figure out how their environment was structured.

They gave some human examples of where stress overloads our ability to make rational decisions or perform to our best. In the human examples they studied CEO’s, created experiments with monetary gain, and watched “clutch” NBA players. These motivations were linked to money or notoriety. They found that the higher the money reward the worse they performed. In the case of players that were considered “clutch”, their percentages did not improve. For the others, the fear of losing the monetary gain makes them react and decide worse.

So even though agents negotiate day in and day out it is still the clients that have to make the decisions contrary to the type of agent I mentioned above. So back to my original premise that strong-arm tactics don’t work well. If a client is already in a situation that some say is a stressful as a death in the family, there is the fear of loss, and the now the agent is creating more stress with time deadline (really? 3 hours to respond to an offer?) or ultimatum that they accept now or it’s over, it is very likely they will say no. I have seen it plenty of times.

Story Time: My clients counter-offered some tiny conditions from a pushy agent two years ago who bashed the house and relayed some comments by her clients that were unnecessary. By chance, well actually it’s a thing I do that gives my clients a little extra time, another offer came up for exactly the same price and conditions. My clients felt that the agent and buyers were going to be difficult through the transaction and revoked their counter offer and then went with the second offer. The first offer might have been fine but the conduct of the that side backfired on them.

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Many people wondered, or predicted, that the tax credit would just steal sales away from the future.  That may very well have been the case though we can only hypothesize what would have happened if we didn’t have the tax credit, well, unless you are a politician.

I wasn’t a fan of the original tax credit and, besides the fraud, it looks like it didn’t spur a lot of sales that wouldn’t have happened anyway.  I really wasn’t a fan of the extension either.  With it ending in Spring I felt there was a good chance that it could kill our Summer.  Though it is possible the tax credit which brought rates down even lower with less demand.

The latest news for real estate isn’t good which just drops confidence in a time when real estate doesn’t sell well anyway. The news likes to report bad news, “If it bleeds it leads,” is the line often quoted.  The recent headline is that sales are down 27%, the largest drop in four decades and the weakest in 15 years.  Great, while those are meaningless numbers it still scares the crap out of people.

So where are we?  I, along with so many others are shocked at how low rates are.

Copyright © 2010 Mortgage-X.com, Source: www.mortgage-x.com, Reprinted with permission

Truly historic levels and I don’t know when they will go back up. Last year or so Time Magazine suggested buying because they thought interest rates would go up. They made the point that a 1% rise in interest rates would counter any gain from a market being down 10%. As of today we are down a point and down about 10% in many areas.

My advice is always, if you have the money and you plan to live somewhere for 5-7 years than it’s probably worth the risk, but remember, it is a risk. The pendulum has swung from “Real estate is a no lose investment” to, well, you know.  And lastly, you can’t make your decisions based on fear.  I am bring you the numbers and perspective.  Truly no one knows what is coming whether it’s good or bad, the market and the economy is it’s own beast.  Just make thoughtful decisions.

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I don’t hear as many people talk about this as much as before but if dollars per square foot was all you need then banks wouldn’t require appraisers when they gave loans. If it was that simple then sites like Zillow wouldn’t have to work on an algorithm to come up with their Zestimates

About the only place I can see where this metric works is for condos and large developments where they have built the same floor plan over and over.  The dollar per square foot metric doesn’t and can’t take into account the floorplan, condition, upgrades, lot size, amenities, views, shape of the lot, and individual taste.

I have had plenty of clients be shocked when a home with 200 sf less than a previous home actually felt bigger.  Floorplan layout is one of the biggest factors to a home selling especially once you get past 2000 sf.  I could keep beating this but if you just look at comparables you know if a house is priced within range without taking the time for this useless math problem.

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The RMLS Comparative Market Analysis (CMA) report shows the percent difference between sales price and final list price. While doing some research on Short Sales, that later sold as bank-owned properties, I found some very interesting numbers.

11 out of 14 listings had some huge price drops.  The following numbers showing the discount from the original sales price as a short sale and then from the bank’s original listing price.

1. 88.1%     94.7%
2. 75.4%     96.6%
3. 66%        98.8%
4. 92%       80%  (In this case the bank actually went above the original Short Sale price. Dumb.)
5. 87%      91.5%
6. 80%     100%
7. No short sale   73%
8. 67%     86%
9. 82%     91.3%
10. No short sale  91.2 %
11. 81%     98.3%

I have seen many numbers average about 97% in many cases from Last Listed Price.  Remember that people raise the price to include closing costs which again interferes with this number making it less meaningful.

None of the numbers help much except it shows just how badly some agents are pricing homes. I don’t create the typical CMA in part for these reasons.  I don’t like artificial numbers and it can become distracting to rectify all of the them.

I pull the listings and then look over them with my clients while comparing individual similarities and difference with their home to help find a price because that is what buyers are doing.  Once again, if these useless statistics mattered we wouldn’t need appraisers and Zillow wouldn’t need an algorithm to create their Zestimates. It’s an art as much as it is a science.

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Quite often buyers ask me how long a listing has been on the market and sellers ask me what is the average days a listing has been for sale. I usually grimace a bit because I know they are most likely going to read too much into that number.

Every listing has a number linked to it in the RMLS. Not too long ago if an agent wanted the listing to look fresh they would cancel the current listing and do a new listing, get a new number, and the DOM would start over at zero.  Previously our average DOM was anywhere from 30-90 days.  RMLS finally decided that we should show a true number and now, as long as the string isn’t broken by more than 3o days, they count all of the previous listings to get an accurate number and that is around 150 days now.

So why doesn’t the number matter much to me? If I list a 1 bedroom home facing the freeway for $1,000,000 will it sell in 150 days just because?  No.  If I list a 5,000 sf new home for $1,000 would I expect to wait 150 days to sell it?  No.  Another reason for a five month average is because many sellers either can’t or won’t price their home at a reasonable price.

Also short sales have a large effect on the number.  Even if we get an offer on a short sale it will stay on the market until the bank approves the numbers.  I had an offer accepted in January and the bank accepted it in late June which added five months to the average to it’s DOM that weren’t real.

Buyers like to look at that number to guess how motivated the seller might be. The number can matter to me a little here.  If the seller is sitting on one number for three months I am guessing he might not budge but that isn’t always the case either.

Sellers look at the number to guess how long they have to wait before they will move.  It just doesn’t work like that.  A house will sell when the right buyer comes by for the right price.  Houses are still selling above what you would expect just because buying is still an emotional decision.

I was looking at comparables for a listing and in the history of some sold listings.  I saw they had a pending offer at a higher price than the final sale price.  Someone was willing to pay more earlier but than the deal fell apart for whatever reason.

I think if anything, DOM shows the prevalence of short sales and either a seller or agent overvaluing a listing.

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A family was packing up as a foreclosure loomed in the not to distant future.  The home had been in the family since at least the 1950′s.  While going through the basement they find 8 or 9 comic books.

One happened to be the first appearance of Superman in Action Comics #1.  That issue has sold for upwards if $1.5 million but the article guesses that their copy could go for $250,000.  I am guessing it wasn’t in great condition if they didn’t even know it existed.

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Before you sell a home, you must remove old, polluting woodstoves and fireplace inserts that are not certified.

Oregon’s new woodstove law designed to protect homebuyers and clear the air of unnecessary wood smoke pollution takes effect on Aug. 1. The law requires the removal and decommissioning of any uncertified woodstove or fireplace insert from a home when it is sold.

The 2009 Oregon Legislature passed the law and Governor Kulongoski signed it.

Uncertified stoves and inserts were manufactured before 1986 when the State of Oregon passed a law requiring emissions certification to control smoke from these devices. Uncertified woodstoves produce approximately 70 percent more pollution and burn wood far less efficiently than today’s newer, cleaner certified woodstoves. Many of those old stoves may have been improperly installed, creating a potential fire hazard in the home.

“As home inspectors, these items – wood stoves and fireplace inserts – are already on our radar,” says Steve Blaha a certified home inspector in Portland who owns and operates HomeCheck Inspection Services and served on DEQ’s Heat Smart Advisory Committee.

“This rule gives home inspectors some pretty straight forward guidelines to use in the description of an important component of the home. We typically point out safety hazards to clients, along with visible structural and visible performance deficiencies anyway.

Several jurisdictions in Oregon have already adopted similar measures including Deschutes, Klamath and Jackson Counties, the cities of Bend, Medford, Ashland, Central Point, Eagle Point, Jacksonville, Talent, Phoenix and the Town of Lakeview. The City of Bend’s ordinance has been in place over 10 years.

Oregon is the first state to formally establish a woodstove change out requirement upon sale of a home. Back in the mid-1980s, Oregon was also the first state to adopt woodstove certification and emission limits. The U.S. Environmental Protection Agency later adopted and implemented this certification nationwide.

“Wintertime residential wood burning is a significant source of air pollution, including fine particles and air toxics,” says Rachel Sakata, project manager for DEQ’s Heat Smart program. “Removing uncertified woodstoves from service and replacing them with more efficient models would help Oregon’s efforts to restore and preserve healthy air and reduce heating costs.”

For more information about the requirements for uncertified woodstoves visit: www.deq.state.or.us/aq/burning/woodstoves/heatSmart.htm

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The loss of equity in the homes of couples that want to divorce has left them stuck because they either bought at the top of the market or, on the ride up, they borrowed against the new equity they found. Without the resources to pay the difference, or an agreement on who would pay how much of the negative equity some troubled couples are finding themselves stuck.

So here you have a couple that wants out of a marriage, feeling even more trapped. I imagine this doesn’t help too many couple reconcile. I have worked with quite a few couples that were divorcing and as hard as a normal transaction can be this is exponentially tougher.

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Watch This Intro Video! from sparky rose on Vimeo.

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Did you know that Americans are spend $22 billion a year on self-storage? According to The Self Storage Association, there is over seven square feet of self-storage for every man, woman and child in America. That’s a lot of unused stuff! NeighborGoods helps us get more use out of that stuff, which means less waste and less production of unnecessary items.

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Is it safe?
NeighborGoods is a safe and friendly environment for sharing items. When you add an item to the NeighborGoods inventory, you choose how to share it with the community. For example, you can allow your friends to borrow the item for free and charge others a rental fee. Or you can decide to make the item only available to friends. It’s your stuff, so you set the rules.

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