Westchester View

Whenever I go on a listing appointment, I generally find that the seller already has a “number in their head” about what their home should sell for.  This number can come from various sources.  It is – unfortunately – almost always higher than the current market can command.

In truth, I can’t blame sellers for this…their minds have been levered to continued price increases to such an extent that the current market has left most sellers blind sided.

The first thing I often hear is that “I need to get X out in order to buy my next home which I can now get for Y  because its gone down in price.    The trouble if the property you want to buy has gone down so much in price, chances are the property that you want to sell has gone down by a similar percentage.  Wishful thinking is often the culprit here.  Markets are fluid – that was fine when prices were going up – but it also holds true when prices decline.

Misinformation is another issue.  Many sellers look at what their neighbor is asking for their home.  Asking isn’t getting.  Many listings are overpriced  in this market – so setting your price on the basis of other listings is not a wise strategy.

“But my neighbor sold their house for X just six months ago!”  Six months is a lifetime in a depreciating market.   If your market is depreciating – and many markets still are – then prices have decreased over six months.

Zillow zestimates and other information on the internet may or may not be accurate.  Zillow has been off as much as 25% in our area.   So if the zestimate of your property seems too good to be true, it probably is.

If you need to sell, price your home competitively – this is particularly important in a declining market where inventories are high and buyers are few. Overpricing your property will result in fewer or no showings.  The property will sit as the market declines further – resulting in an even lower price down the road.   Overpricing a home is just about the worst thing you could do in this competitive market.

© 2010 Ruthmarie G. Hicks – http://thewestchesterview.com – All rights reserved.

My initial rant on this topic was posted both here – and on Active Rain where I have another blog.  Active Rain attracts many from the industry itself – unlike this blog which is more consumer facing.  So I thought I would paste a link over to that blog and I have put together a follow-up since that posting created such a stir.

Since there was such a debate over my blog on designations and their relative value, I thought it would be nice if I culled through the responses in order to get a consensus and also offer up some references for further reading.

There were 41 responders to the blog – excluding those who posted more than once and of course my responses.  There were three distinct camps:

1.  49% Felt designations were of dubious value (I included myself in that group.)
2.  29% Felt that having one or two made sense.
3.  22% Felt  that felt multiple designations were valuable.
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Ok – so by the  criteria in my title I could declare more designations than most – since my name is relatively long.  But recently I ran into an agent that had the following designations on her card ….”Sally Smith, ABR, GRI, CDPE, CRS, & EPro.”  Ya gotta be kidding me!  This person has more designation letters then letters in their name.  It must be exhausting to write all that after your name!

Personally, I have a problem with designations simply because the testing required doesn’t have any teeth to show that the agent actually learned something.    Much of the testing is open book – and sustaining the designation involves paying your way and has nothing to do with learning new skills.
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Ok, so one of the advantages of having a pet-friendly real estate practice is that my dogs can sometimes accompany me on my outings.  They add something to the mix by actually calming my buyers during times of stress.   Many like to pet them and play with them in between showings.

But Tundra has taken to wanting to be in the driver’s seat.  I’ve told her that she needs to be at least 16 for a learners permit, but she just doesn’t want to listen.  So when I get back to the car – it really looks like she’s driving the vehicle.

It reminds me of one of my favorite SNL skits from the late 80s.  “Toonces the Driving Cat.”  For those who are too young to remember – enjoy  the clip.  For those of us who were watching SNL in the late 80s and early 90s – this should bring back memories.

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This is a message to all the real  esate agents that I know and love who haven’t changed the photo on their business card and other materials for 20 or more years!

Sure, I’d love to look the way I did 20 years ago. Well…not quite. I’d love to look as YOUNG as I did 20 years ago and still have an updated look that says 2010 – not 1990.   One of the reasons I don’t have a photo on my business card or web site is because agent photos have gotten so ridiculous.  I’m firmly convinced that if I put my 45-year-old mug on a card, people would automatically think I was 80 years of age.  After all, having a photo that is dated to about half of our actual age seems to be the industry standard.

So here are 10 signs that the photo on your card and other publicity might be a tad — ahem— dated.

1. You have a child the same age you were when that photo was actually taken.
2. Your eyeglasses cover your entire face.
3. Your hair is bigger than the eyeglasses that cover your entire face.
4. The padded shoulders on your power suit make you look like a football player.
5. Your kids laugh hysterically when they see the photo and ask “did you really look like that once?”
6. Your hair, clothing, and makeup make you look like you are dressed for a costume party with a vintage theme.
7. NO ONE recognizes you from your photo.
8. You have a full head of hair and sideburns in the photo – even though you have been bald for years.
9. You lapels and tie are so wide they cover your entire chest.
10. Your new client runs away in fear because they think the strange older person approaching them is impersonating the young hot agent they contacted.

© 2010 Ruthmarie G. Hicks, http://thewestchesterview.com.  All rights reserved.

Kris Berg wrote a very compelling post on Inman yesterday Don’t Forget the Customer The article was spot-on about how brokerages function – and often how the function to the detriment of the consumer.

Now, I think most consumers would understand that in order to keep their doors open, a brokerage needs to be profitable.  The bottom line for any business is that they must turn a profit or close their doors.   Ideally, profitability should be tied to customer service.  The agents of a brokerage should provide outstanding customer service including intelligent negotiating skills, a fine marketing plan, and service that smoothes  the transaction process.  Unfortunately, that model is not the prevailing one among brokerages.

The way brokerages function often is a mystery to the consumer and it often comes as a shock to new agents who think that the brokerage is there to “support” them.  After all they are paying very hefty splits to the brokerage -supposedly for leads and support and training from the brokerage. And therein lies the rub for the consumer.  Most brokerages disconnected from customer service and the newly licensed agent course became the big  cash cow.  They recruited and recruited throwing  anyone with a license and a pulse up against a wall and hoping that something will stick.  Even a non-productive agent had a couple of good deals in them from family and friends.
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It is very interesting that just as consumers are demanding ever more hyper-local content  and knowledge from agents  that we are also seeing another distinct trend in the opposite direction:  the tendency to list and sell to larger and larger geographic areas.

The contrast between old-school hyper-local agents and the newer nomad agnet was driven home to me while I was working with two listing agents who still work exclusively in small niche markets.  I was at a closing with one of them and she implied that since I had the entire city of White Plains to cover, why didn’t I simply refer out the client who finally bought in Scarsdale?

Can a real estate agent be too local?

I knew that the attitude about staying hyper-local is alive and well though it appears to be a staple of old-school real estate.  Still, I was more than a tad surprised.  Scarsdale is not the moon.  It is the town directly adjacent to the west side of White Plains and about a whopping six miles from my front door to the center of the village.  If we followed this line of thinking to its most extreme would mean that a buyer potentially moving from New York City to Westchester NY would have to have as many as five or six agents to explore all the possibilities open to them that were within about 30 minute commute.    For the consumer this seems most unwieldy if not highly impractical.  Could you imagine the mountain of agents all crawling over each other for the buyer’s attention?  What a mess. Not to mention a monster of coordination.

From the agent’s perspective, there could also be a danger to being too local. What if something happens to that small segment of the market you represent?  If your geography/price range are razor thin – you are setting yourself up for trouble.  This was clearly seen this year when agents who specialized in small high-end markets got creamed because jumbo loan issues bit them in the backside.   Another listing agent I encountered was used to selling about 10 major properties a year – but this year had only managed a single sale.

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This is a story about selling your home during a housing recession.

Sellers with homes listed today will be able to identify with some of the antics that buyers in a bear market will pull.  But this is about a listing that was active 14 years ago in 1996 – during another deep housing recession.   I wasn’t a real estate agent at the time,  I was a seller.  My mother had just died after a prolonged illness and I was listing her house for sale.  The house in question was a beautiful 1932 Tudor sitting on prime property with sweeping golf course views in wonderful residential area in White Plains.  There was a good deal of emotion involved since the home in question had been designed by my Grandmother and built by my Grandfather.

Although I wasn’t an agent  I was smart enough to read the newspapers and  so I know it was a crummy market.   The house would have been worth roughly $600k just a few short years ago – but in 1996-1997 I was hoping for about $550k – but knew I would probably only see a litte more than $500k. Gut instinct told me to rent the place, but my co-executor was adamant that the house had to be sold.

Nothing prepared me for the crazy home buyers that came through looking for a “deal.”

90% of them were bottom-feeders looking to steal a house – and looking for ANY excuse to chisel  the price to the bone.   My beleaguered broker  came to me with all sorts of concession requests – some of which made  sense.  But more often than not, the requests bordered on the absurd. Some of the more hilarious issues are worth noting because when we see frustrated sellers – we need to be aware that their pain is real and that some of the crazy concessions being asked by buyers can be truly ridiculous.

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Part 1 of “This Brokerage Has 750 Listings…..So they must be the best! ” was prompted by the fact that the Westchester NY real estate market had changed and as a result,  I was getting more and more questions about what a brokerage brought to the table in terms of marketing.   I emphasized the importance of choosing the right agent and that the brokerage itself was of less importance.    I also indicated that there was a lot of smoke and mirrors  regarding  brokerage brands and what that means to the seller in terms of marketing the home.  Also, for those consumers who would like to see broker/agent input on Part 1 of this post…you can go to my blog on ActiveRain where I re-posted the blog.  It got a good deal of attention and much commentary from real estate professionals.

In the end, I  promised a sequel  that got into more specifics.  So here it is – six  major myths about  listing a  property and marketing a property that are often trumpeted by our own industry.  Its been said that if you repeat something often enough it becomes “fact” in the eyes of the consumer.  So let’s put some of these “facts” to rest.

Myth #1 – “We have  12 billion to the 10th power  active listings, so  our reputation speaks for itself!”

Really?  How on earth does anyone come to that conclusion?  You can have all the listings in the world, but if you can’t sell them, what’s the point?   The percentage of sold listings is a bit  more pertinant. However, even that number does not discriminate between individual agent performance.

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Does size really matter?  Do the number of listings or the size of the brokerage have anything to do with the ability of the agent to market and sell a home successfully? Is it the brokerage or the agent that is the determining factor?

What Does the Brokerage Bring to the Table?

With the Westchester NY real estate market in a downward trajectory,  sellers realize that they need more than a sign in the ground to move their property.  In truth, this was always the case, but these days I’m getting more and more questions about marketing the listing. One of the biggest issues  I encounter on listing presentations  are questions regarding the brokerage itself.   Most questions revolve around marketing.  What does the brokerage do in terms of marketing  for the listing?

I think that most sellers assume that since the brokerage is “big” and has capital behind it, that they are the ones spending  big bucks on marketing the home.  But this is rarely the case.   Many big-box national brokerages build on that confusion and perpetuate the myth that their brokerage “brand” makes a significant difference in selling a home for top dollar.  They also tout their “marketing package” in terms of the amount of support they offer.  Some actually stress that the number of agents in the brokerage somehow makes that brokerage better or somehow more able to move the property.   With all the hype and misinformation out there it is small wonder that sellers are confused.

I  would challenge these large brokerages who claim that their numbers speak for themselves  to enumerate exactly WHAT  they do to justify their claims?  And while they are at it, I would like to have some hard numbers to back up their success stories.  I haven’t seen any of them come up with any marketing advantage that holds up under scrutiny.  Most of the time they appear to be blowing smoke.  Don’t get me wrong, I’m not slamming big brokerages. That would be rather foolish since the brokerage that I am currently associated with is quite large.  What I am trying to do is cut through the hype.
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