With many markets across the nation weathering a storm of distressed properties, coupled with the potential of a sizeable shadow inventory lurking ahead, many potential buyers are still hesitant to purchase. After all, there are many signs that all the talk about a possible double dip is becoming less of a theory and more of a stark reality.

Most assume that Maui, as a destination location, would be the first to take downward plunges and the last to recover.  However, recent statistics and analysis are proving otherwise.

Year to date sales for 2010 (comparing Jan-Aug 2009 to Jan-Aug 2010), statistics show that residential unit sales have risen by 35%, average sold price by 6%, and total dollar volume sold by a whooping 43%.  Condo sales (with condos being a popular form of ownership in Maui, particularly for those looking to invest in vacation rentals) have increased by 48%, average sold price declined by 9%, but the overall total condo dollar volume sold increased by 36%.

Although I am a skeptic by nature, but these numbers are too strong to ignore.

Furthermore, in July noted economist Paul Brewbaker, former Chief Economist at Bank of Hawaii and currently of TZ Economics, went in great length to explain how lagging indicators (i.e. high unemployment rates) still give the perception of a recession when in reality we have already gone through the first stages of a long-term recovery. As per his statements, first come increased sales volume (which we are experiencing) and then comes increase in sales prices.

Let’s see how the rest of the year shakes out.

So how can sellers thrive while the local real estate market stabilizes itself? Continue reading this post

Part 1: Starting Over

The decision was made to move my business from Wisconsin to Florida.  I’ll leave all the reasons behind this decision in this post, however it’s my goal for you to take a new look at your business from another angle.

So often we’ve heard the 3 L’s (Location, Location, Location), yet I should point out that as Realtors® we don’t choose our own location.  Instead we sell where we live — after all it’s where we live right?  I must say that the most valuable lesson I learned in business so far is that “you have to give, in order to get.” (That’s another post.)

My family and I chose to give up our Real Estate business and lives as we knew it, and move to Florida.  Currently I am negotiating a deal at liquidation value with another firm to take over for Worthington Realty.  (Worthington Realty has been in business since 1954 in Manitowoc in case you’re wondering how hard this decision was.)

We said goodbye to our family and friends and days later were gone.  Hello, Florida!  Hello great weather, palm trees and expensive homes.  My wife and I have been craving year round nice weather for so many years.  Finally we did something about it. Continue reading this post

First Look Program

Fannie levels the field

New Incentives
Fannie Mae markets its REO through its HomePath.com Properties. Under the new incentive program, owner occupants and public entities that buy a HomePath Property between now and December 31, can receive up to 3.5% of the purchase price in closing cost assistance. The sale must close within 60 days of acceptance of the offer and no later than December 31, 2010.  The incentive must be requested in the initial offer.

What Is It
Individuals and public entities are given a period of time, generally 15 days after a property is listed at HomePath.com (a Fannie Mae site). HomePath.com is the listing site for about 190,000 properties held by the GSEs. Individuals and public entities (read non-profits) have a lead time over investors to inspect  and submit an offer to purchase. After 15 days, the listing is open to all potential buyers.

The idea is to offer first to those who would live in the home and become stakeholders, adding stability to the community and to avoid  too quickly putting property back into a supply laden market. By offering a sneak preview to owners first, Fannie hopes to encourage home ownership without the edge professionals may have and avoid the pressures of bidding against professional investors.

Why Should I Care
Levels the playing field and it’s working.

Fannie has moved more than 29,000 homes out of its owned real estate portfolio of properties acquired by the  through foreclosure to owner occupants. Some 800 non-profits have also bought an additional 5,000 properties through First Look.

Yesterday we held a live 30-minute call and webinar to discuss the results of the HomeGain 3rd Quarter 2010 Home Prices Survey. The call was attended by a few HomeGain folks, including myself, Ken Yee and General Manager Louis Cammarosano; real estate agents who completed the survey; and real estate reporters and bloggers.

Survey results have been referenced in multiple news sites including Reuters, Boston Globe, CNBC, Fox Business, AOL Real Estate, UPI, Baltimore Sun, Inman News, RIS Media, and more.

Highlights of the call:

The survey opens up by showing the disconnect between buyers and sellers (question 1). With homeowners continuing to think that their homes are worth more than their agents’ are recommending (more so than last quarter), it also reflects an unchanged disconnect between Realtors and sellers over the last year (question 2 and 3).

The results show that even though agents may be more realistic in current and future home prices (question 6), sellers are still reluctant to list their home according to the agent’s recommendation (question 4).

However, the end result of what the home sells for shows that sellers are having  to bend to a lower selling price in the end in order to get their homes  sold. (question 5) Real estate agent Concetta Pepenella commented:  “Sellers are in all types of situations that are affecting their  decisions. It depends on their motivation and time frame if they are willing to accept an offer for less than they had hoped for. Some sellers are getting out of a difficult mortgage payment because the household income has change due to job loss. Everyone has a different story. In the end they will be selling lower and buying lower.”

Continue reading this post

It’s been an interesting first 5 months in Brevard County Florida.  Arguably we have one of the worst Real Estate markets in the country.  Our prices came down from $275k average at our peak in 2005 to $117k average currently.  The good news is that we seemed to have leveled for about a year and days on the market are averaging 90-120 days for most homes with 30-60 days for homes priced correctly.

Many consumers have been burned by a short sale or two and have decided to stay away from them.  We like that!  We also been able to increase our home sales price to $144k this year by better understanding our buyers and our leads.

Like I said, it’s been an interesting first 5 months.  We are on track to beat our numbers from last year by at least 20% maybe more.  We are closing 30-46 homes per month which is up from our average last year of 28 closings.  It’s very exciting. 

So what can I attribute our continued growth each year?  Two things, Buyerlink and lead conversion.

BuyerLink is a no-brainer since I capture twice as many leads at half the cost of what I was paying with Google and Yahoo!.  Once you do capture the lead, you have to be able to do something with it.  The key to lead conversion is systems.  Because BuyerLink produces so many leads, you need to be sure to have a solid conversion system including listings, drip campaigns and most importantly phone call follow up.

If you don’t have a system in place, not only do you not get the return you are looking to get, you can waste a ton of money!

I could spend hours going over most of this stuff, but the reality is, converting leads is just not that hard.  Half of it is attitude.  Continue reading this post

The “Diamond-Water Paradox” is a basic, fundamental economic theory: Water is essential to life; diamonds aren’t, but because there is so much water available, consumers place much greater value on a diamond to a drop of water.

The same paradox can be applied to selling a home.

When potential home buyers view homes these days they’re looking for that diamond (or, a “diamond in the ruff” to be exact).  And, just like diamonds with their detailed system of clarity (FL, VSI, SI, I, etc.), a home’s marketability may be characterized by three important details: Price (P)/Condition (C)/Location (L).

• Above average landscaping & curb appeal (+C)
• Kitchens and bathrooms that have been remodeled with the latest and greatest (+C)
• Freshly painted rooms in neutral tones (+C)
• A home that is clean and spotless (+C)
• A home situated right next to a factory (-L)
• Orange shag carpeting (-C)
• A home’s price that is at the top-end of the market for similar homes in a given area (–P)
• A home that has easy access to major highway and is also located in a community with very little noise & traffic (+L)
• A home that’s priced at or slightly below market conditions (+P)
• A home located in an area of superior job growth and stability (+L), etc, etc… Continue reading this post