Real Estate Snippets

Busy Real Estate Business

It's been one of those weeks.  My desk isn't quite as bad as the picture, but my brain probably is.  I'm thankful for the business.   Two years ago, there wasn't any real estate business.  Work is good, but this week was piled with it.  The problem is compounded by the week being a day short.

So what did I accomplish this week?  Nothing but what is normal for every St. Paul real estate agent:

1. Create three comparable market analyses.
2. Take pictures of two properties for pre-listing information
3. Process a new listing and get it on the market.  Install lock box.  Make copies of seller's disclosure.  Create brochure.  Order sign install.  Set up listing with appointment scheduling company.
4. Attend a buyer's inspection.
5. Negotiate a buyer's offer.
6. Create 3 virtual tours with photos
7. Follow-up with new prospects explaining the home buying process.
8. Follow-up with client on property that closed 2 weeks ago.
9. Tenant management at my rental property including 2 middle of the night calls for overflowed toilet.
10. Process paperwork to convey copies to title company, lender, and my office.
11. Deliver copies of purchase agreement and earnest money check to listing company.
12. Attend a house warming for clients who purchased their home in February.
13. Set up auto e-mail searches for new home buyers.
14. Attempt to pin down a short sale lender so they accept my buyer's offer.
15. Order a truth in housing for another listing.
16. Order a city inspection for a rehab project.
17. Attend office technology training.
18. Write blog posts.
19. Dig in the garden
20. Rub the dog's belly.
21. Rescue my Webkinz from dying of neglect!

Maybe there's a reason why I'm so tired tonight!

Dear Mr. Interested Buyer

Dear Mr. Interested Buyer:

Today you called my office phone number from one of my listing signs.  The office connected you with my cell phone.  I was thrilled to hear your interest in the vacant lot I have listed four blocks from Como Lake.  It's a nice piece of property with easy access to both Como Park's golf, walking and biking trails, as well as shopping and freeway access.  I desperately wanted to tell you this.  You were interested in the price, and I would happily have given you that information.

There is only one small problem.  You left your name with the comment, "You can get my number from your caller ID."  I am so disappointed.  My caller ID shows my office number because they were the ones who forwarded your call to me.  I looked your name up on the web and in the phone book.  There were no last names (I tried several spellings.) with your first name.  Despite all my effort, I couldn't return your call.

I do wish you had left your phone number in the message!

Sincerely,

Bonnie

In Memory of the Protectors

Geese are fascinating creatures if one ignores the great green logs they leave in the grass for unsuspecting travelers to step in.  They fly in formation when they migrate, each following in the draft of the one that goes before.  When the leader tires of breaking through the wind for the others, s/he falls behind and another takes the lead.  When one of the flock is tired, sick or injured and leaves the sky entirely, two others join the injured one until s/he recovers or dies.  The ones who have stayed to console then return to the air flying in formation once again to help one another survive the long trek to fairer climes.

The picture above reminded me of another attribute of geese that we can all respect.  They are family oriented being loyal to their mate until death and ever watchful of their goslings.  The little furry feather fluffs can constantly forage for food while the adult watches protectively over them. 

Somehow, for me, this protective quality of the adults and the peacefulness of the grazing little ones connected with Memorial Day.  I am thankful for those who fought before my time for a country of freedom and a place in which we can live and work peacefully.  I am thankful for the genius minds that created our governing documents and those who lost everything so we could live out their dream.  Even today, the protectors are ever watchful of our freedom.  Their sacrifice is great and they deserve our tribute.  My thanks go out to those who have and continue to serve our country in this brave manner.

Diggin Dinos for Schools

Finals are done and the students have trekked off for home or places between. 

Macasaurus spent last summer guarding the student union grounds at Macalester College at Grand and Snelling.  Proud as can be, he was created by Carly Schmitt for Macalester College.

Unlike "Mac", Scholasticasaurus spent last summer gracing Rice Park in downtown St. Paul.  Despite the fact that school was out, Scholasticasaurus was ever prepared for learning complete with books, binoculars, safari hat, and compass.  Scholaticasaurus was created by Toni Dachis for The College of Saint Scholastica.

 

Interpreting Real Estate Statistics

I love reading Bernice Ross on Inman News.  Bernice is a regular writer for Inman as well as a blogger in her own right.  What fascinates me is her insights into the market and her quick wit.  Today she has started a series on Inman about the real estate sky not falling as is so often published.  Like myself, Bernice realizes that statistics can be made to mean what the interpretor wants them to mean.  Her article today "Put a Gag on Chicken Little" points to a perfect example of statistical conflict!

According to Bernice, much of what is published in the media today regarding real estate has been gleaned from the S & P/Case Schiller Index.  This index has only been resourced by the media in the last couple years.  The S & P is full of doom and gloom regarding the real estate market, but conflicts with the figures published by the National Association of REALTORS® (NAR), the Office of Federal Housing Enterprise Oversight (OFHEO), and Realogy.  According to NAR, OFHEO, and Realogy the real estate market is stabilizing, some markets have shown signs of improvement, and prices have fallen less than 1% nationally. (New figures from OFHEO are published here.)  The S & P reports between a 12% and 13% decrease in prices.  The S & P includes jumbo loans and lends "weight" to certain factors before calculating its formulas.  The other three agencies do not.  As Bernice says, "weighing" factors is done by human judgment and human judgment is not necessarily unbiased!  Scientifically when data produces differing results, it is compared with other sources.  In the case of our real estate market, the S & P index is the odd man out producing results that drastically differ from the other three agencies that are reporting on our housing market.

Why is it that the media has picked up the negative story to publish instead of the more positive ones?  I'm told it's because bad news sells!  My question is whether this bad news can produce a Pygmalion effect on our market.

Real Estate Continuing Education Meanderings

Minnesota real estate agents are required to complete 15 hours of continuing education every year for their license renewal.  In addition, every two years agents must complete an hour each of agency and fair housing.  Every four years St. Paul real estate agents must take 4 hours of ethics.  It's impossible to be in real estate and not be exposed to agency, fair housing, or ethics.  My personal theory is that agency, fair housing, and ethics cannot be taught.  I believe that right treatment of other people comes from deep within as a heart response rather than a head response.  I do believe the laws can be taught so one who wants to act rightly can conform to the law, but the desire to act rightly still comes from within.

Having opined about what is taught, it's interesting to note little statements that were made in my St. Paul continuing ed class this week.

1. REALTORS® (members of the real estate trade organization National Association of REALTORS®) have the lowest average income of any licensed profession in Minnesota.  (I would have liked to see the source for this statement as I know "teachers and preachers" are pretty low on the continuum, too.)
2. Real estate is the career of last choice for many.  (Again, what is the source for this statement?  Do I fall into this category because I had to break down my own stereotypes about real estate agents before I would practice real estate?)
3. A professional is anyone who has done the job well and performed as promised.  Now this I can agree with.  I consider the person who cleans the toilet or digs a ditch well, and as promised, to be as much of a professional as a doctor.  I often think of this when viewing pictures of my house being slid down into a 10 foot hole by a "simple truck driver"!  I think not!  That person had expertise and skill not many would even venture to learn!
4. The most respected profession is medical doctors.
5. There were 35,000 licensed agents in 2006, 28, 000 in 2007, and expected to dwindle to 22,000 at the end of 2008.  It seems real estate is not the place for the weak of heart or for gold seekers.
6. Minnesota has only 3 industries with fiduciary responsibility:  attorneys, real estate brokers, and mortgage brokers.
7. Fiduciary responsibility is the highest level of service that can be given to another person.  The "agent" (read attorney, real estate agent, or mortgage broker) acts in the best interests of the principal (the client) and acts on their behalf to perform the legal instructions given by the principal to the agent.  Principals make the decisions, not the agent!

Fiduciary responsibility (item 7) is why I'm in real estate in St. Paul.  I take pride in being a "professional" (item 4) real estate agent, but item 7 defines my purpose.  I am not a salesman trying to convince a customer to do something they don't want to do.  I LIKE looking out for my client's best interests!  I LIKE using my experience and training to give my client an edge!  I LIKE trying to find that perfect home and then negotiating that perfect price!  I LIKE the challenge of following through on the principal's legal instructions.  I LIKE keeping confidential info confidential!  Yep, fiduciary responsibility is my big WHY for real estate.

Housing Options

Not everyone is meant to be a home owner.  Some have recreational property and don't want to maintain two properties.  Some travel and need a home base without maintenance.  Some have lifestyles not conducive to owning a home.  Some want lots of free time for other activities.  Some don't want the responsibility of maintaining a home.

Alternatives to single family homes in St. Paul are many.  Common interest communities include town homes, condominiums and cooperatives and are the right choice for the right people.  For others, apartments best meet their needs.  The oft forgotten option is rooming houses.

Rooming houses sometimes have shared bathrooms and kitchen facilities.  They come in all kinds of configurations.  The Lowell is an example of one St. Paul rooming house with history.  According to the resident manager, the Lowell is one of only two houses of ill repute still standing.  The grand staircase has since been partitioned off, but it originally led to a second floor teller type window where the gentlemen paid their fee and were introduced to their escort of the hour.  Twenty-five furnished rooms are now occupied at the Lowell with residents of both genders, all ages, and many who have lived there many years.  The paintings in the photos below are only 12 years old, but reminiscent of the building's origins.

Sellers Disclosure

The Minnesota Association of REALTORS® has an "approved" Seller's Property Disclosure Statement" which we use for our St. Paul listings.  I had somewhere figured that the form is required by Minnesota statute when what is really required is disclosure.  There's even a little clause under the MAR dislosure form title which "disclaims any liability arising out of use or misuse of this form." 

Without the form, however, how would the seller know what to disclose and what not to disclose?  For instance, it is not required for the seller to disclose if a predatory offender lives nearby, but it is required to give the information to the buyers which allows them to research the presence of predatory offenders.  As a result the MAR form has a paragraph with the Minnesota Department of Corrections website and phone number.  How would an unrepresented seller (one not using a real estate agent) know they were required by law to give that information?

The list of things the seller does NOT have to disclose includes:

• occupancy of the property by anyone with AIDS or HIV
• suicide, accidental death, or natural death in the home
• "perceived paranormal activity" which means ghosts or other presences
• the presence in the neighborhood of an adult family home, community based residential facility or nursing home
• the presence of a predatory offender in the neighborhood

Since this list is specifically addressed by the Minnesota legislature, it's clear there is no duty to disclose.  However, the statute says that sellers "are obligated to disclose all material facts of which the seller is aware that could adversely and significantly affect an ordinary Buyer's use or enjoyment of the property".  The list of things above is specifically excluded.  However, there are many buyers that do not want to buy a house where someone died an unnatural death.  Even though there is no DUTY to disclose, be assured your neighbors will inform the new owners of all the gory details.  Whether the courts would support withholding of such information is still to be determined. 

In the meantime, my motto is the more you disclose, the better.  If someone met an untimely death, the disclosure could be as simple as this:  "A personal tragedy occurred in this home.  Serious buyers should have their agent inquire about the details."  With a statement like that, privacy can be maintained without failing to alert the buyers to the gorilla in the room!

The Minnesota Sesquicentennial

Spelling it is the biggest challenge of all.  As a grade schooler, we challenged one another to spell Mississippi, but sesquicentennial would have been a bigger challenge.  The last two weekends kicked off the State of Minnesota's 150th year of Statehood and the State Capitol in Saint Paul was teeming with more activities than just the legislature!  Last weekend marked the arrival of a wagon train which originated in Cannon Falls.  This weekend there were tours, fly overs by the Air National Guard,  music, speeches, demonstrations all culminating with stupendous fireworks viewed from my front porch!  The two weekends were indeed quite full.  If you weren't aware of the celebration, more details and statewide celebrations can be found at the Sesquicentennial website. 

Wisdom from an Elder Real Estate Agent

Eight hours of continuing education to renew my real estate license seems like a long haul all in one day.  Real estate agents tend to like moving around a lot.  Sitting in one chair for 8 hours without use of a computer or cell phone is a bit overwhelming for many.  For me, it was especially a tough day as a tenant had awakened us the previous night with water  spilling from his ceiling.  The short night made for a difficult struggle with the sleep sheep during class!

The instructor was entertaining.  Thank goodness!  And experienced.  Over 38 years in the business made him an expert.  In addition, he chose real estate as his career right out of graduate school.  He has worked all of his adult career as a real estate agent!  Amazing!

So, I listened.  Not just to the content of the course, but to his wisdom.  Early in his career he realized that he didn't want to work with some clients.  When asked to meet with a prospect, he sees it as a great opportunity to determine whether that client is a fit for HIM!  If he feels the client is unreasonable or unrealistic in pricing, he chooses not to represent them. 

The whole concept is liberating.  In today's market if a client doesn't see that their St. Paul house has to be priced below the value of two years ago, what headaches could be saved for the agent if the agent chose not to work with that client.  Instead of spending nights worrying about how to market a home that is overpriced, don't list it, was the elder's advice.  Don't compromise your professional expertise just to get a commission that will never happen.  If you walk away in the beginning, there will be another to replace that client who IS realistic.  The realistic client is the one wants to devote time worrying about.

This elder REALTOR takes the reins in any interview and clearly tells the prospect that they, too, are being interviewed!  What a novel idea!