Remarkable Marketing

This property at 5946 Llano Ave. in Dallas was just listed by an Edwin Dolatkhah with Plugin Realty. It's priced at $209,000, which is pretty good for the area. It's also listed as a "short sale." But how about those photos, huh? I mean, nothing says "Welcome Home" more than scary pitch black photos. Amiright?

But seriously, how in the hell can any reasonably intelligent person upload those photos, knowing they will be distributed to all major real estate websites, and not think to themselves, "You know....These photos are a little on the dark side. I wonder if I should retake them?"

And then there is the person who snapped these photos. Did you even think to try a light switch or maybe open the blinds? You didn't? Okay. No. That's fine. No, no, no. Really. You did a great job. :/

Ways to Lose Your Client's Trust

This is a short but accurate article from Realtor.org outlining 3 mistakes a Realtor can make to quickly lose their client's trust.

I can relate to Rule #3:

Saying what your client wants to hear. When I hired the father of one of my son’s friends to sell my last home, I asked him if we could get a very ambitious price for it. He said what I wanted to hear: "No problem." Well, he got the listing but couldn’t sell the house.

So I brought in the top salesperson in town, and she promptly told me what I didn’t want to hear: "Replace these windows and lower the price by $125,000." She sold the house in less than a week. I recommend her to everyone.

I know for a fact I have lost listings to competing Realtors because I told the clients what they didn't want to hear. But I also admit that I try and educate the client and can forget that building repoire is also an important part of earning someone's trust.

Anyone out there have similar stories? Like when you hired your friend only to fire them 6 months later, hired a top producing agent, they show you statistically why you need to reduce your price by $100,000 and the house sells 30 days later?

I'd love to hear them.

Want To Meet the True Top Producing Agents in the Park Cities and Preston Hollow? The Numbers Don't Lie

Over at Dallas Dirt Candy posted some production numbers for the Preston Hollow and Park Cities areas. To me her source's numbers were a little vague and didn't give the clear picture of who was doing what type of production. If you know me at all, you know I love me some numbers. I didn't look specifically at the companies but at the Top 50 producing agents. I find that just as interesting. So dig in, analyze, discuss. (Can you believe I came in above number 1? I needed my own line because I'm in a different league. This was so unexpected.)

Production in Park Cities and Preston Hollow only:

How Much Are Realtors Worth?

Many people don't want to pay the traditional 6% commission (3% to listing broker and 3% to selling broker) so they turn to discount brokerages in order to save a quick buck regardless of the service or competence of the agent they hire. But aren't some agents worth more than others?

If Ebby Halliday wanted to list your home, would you tell her she isn't worth 3% and ask her to reduce her commission? Would you tell Virginia Cook to take a hike because you would rather list your $1.5 million dollar home with a no-name, start up, discount real estate brokerage? Of course not.

If you list with a discount brokerage then you should expect discounted service. With all of the criticism surrounding Realtor commissions, how has no one come up with a commission structure that consumers are truly happy with after 106 years? The sad truth is that no one ever will because consumers will always be cheap and Realtors will always have a poor reputation.

Are There Too Many Realtors? Part II

Is this your Realtor?

Lawrence Yun, NAR's chief economist, gives us some great news. The number of Realtors is finally going down instead of rising exponentially as it has over the past 6 years or so. He leads the article with a candid, refreshing and honest,

"NAR membership figures have finally begun to fall. Whew!!!"

Then comes Jessica Swesey of Inman News Blog as she shares her thoughts about the matter. She mentions the obvious,

"And NAR definitely benefits from having more agents. More agents = more members = more dues = more powerful trade group. NAR's swelling membership of recent years certainly has helped the group maintain one of the largest political contributions in the country and the political clout that goes along with that." Sound familiar?

She touches on the fact that older agents who are not very tech savvy are deemed less than capable by their younger clientele who, more than likely, utilize technology in their every day life. And I'm not just talking about Gen X & Y. I learned about Firefox and all sorts of other techy stuff from a past client and mother of 4 college kiddos. (Thanks Sue!) Am I telling older agents that don't have email addresses to get out of the business? No. I'm also including the 70% of Realtors that only make $1,000/month selling real estate.

Who wants to go to a "professional" that only works 4 or 5 weeks out of the year only selling 3 or 4 homes in a year? Who wants to work with an agent that doesn't know how to log onto the internet and thinks a Treo should be dipped in milk and has cream filling? Apparently many consumers are ok with the agents I just described. Lydia Player does a good job of exposing this type of incompetence. Someone please tell me why someone would be ok with this type of agent?

I Hate Paying Taxes!

Sure, take 30% from each and every one of your closings and put that amount into a savings account. Then on April 15th each year use that account to pay your taxes. Sounds easy, right? Hello! This is America. We love us some credit cards and love to spend beyond our means. There's a reason people escrow their property taxes and roll it into their mortgage payment. Because we're inherently fiscally irresponsible. I can't tell you how many agents I know that owe the gubment tens of thousands of dollars because they haven't been paying their taxes as I described above. (I have to admit I haven't been as responsible as I should be but I'm certainly able to pay my taxes on time...painfully.)

This is the reality of the real estate industry. But it doesn't have to be that way. Ever since I got into real estate I have heard from the old timers and NAR that we want to keep taxes out of our commission checks. Um, I don't! Have at it! I say this at the risk of getting hate mail from my fellow Realtors. But I'm sorry, if I don't have to stay up till 4:30am for 3 days straight running through my Quickbooks trying find tax deductions then I say, "PUH-LEEZ TELL ME WHERE TO SIGN UP!"

How Successful is Your Realtor?

I'm a huge advocate of buyer and sellers making sure they are working with a successful and professional Realtor. Many buyers and sellers use a family member or a friend. Or even worse, a friend of a friend. The sad part is that those buyers and sellers never know if they are actually working with someone who knows what the hell they are doing. This blog post from a Realtor in Western New York addresses this issue and does a great job of explaining why it's important to ask your Realtor, "How many transactions did you close last year?"

If your Realtor closes 2 or 3 deals a year do you really think they know how to negotiate on your behalf to get you the best deal possible? Do you think they know and understand their market and sales statistics? Real estate contracts and amendments change all the time and if someone isn't constantly utilizing these legally binding documents do you really want to put your transaction in their hands? Or would you rather work with someone who closes 30 or 40 deals a year?

This seems like a no brainer to me but yet there are many buyers and sellers out there right now who are working with a subpar Realtor. And I don't blame the Realtor as much as I blame the people who chose them.

Woodrow Wilson Hosts Realtor Open House and I'm Not Invited

Tomorrow, Thursday from 10am to 12pm. But I wasn't invited.

The Lakewood Advocate is touting the event as "...a good idea, because some Realtors aren't familiar enough with Woodrow and the entire neighborhood public school cluster to speak intelligently about the pluses and minuses of our schools." It goes on to accurately state, "When prospective homeowners new to the neighborhood are thinking about moving here, the first and most authoritative person they'll probably talk with at first is a neighborhood Realtor."

I happen to live 100 yards or so up the street from Woodrow Wilson and I don't get an invite? WTF?

Uh, HELLO! (weeping)

Listing Agent vs. Buyer's Agent

Now that Pandora's Box has been opened we might as well explore it.

Listing Agent - represents seller's best interests, pricing the property correctly for quick sale while negotiating the highest sales price for the seller.

Buyer's Agent - represents buyer's best interests, finding the right home for the buyer and helping them negotiate the lowest price for the home.

After reading these descriptions, which agent do you think the seller should ask to reduce their commission? Since the buyer is working against the seller's best interests you would think the seller would be more likely to reduce their commission but yet this is not the case. (This is why I love bringing buyers to FSBO's. They have no idea we are taking them to the cleaners. I am representing my buyers yet the sellers are so happy I brought a buyer they start yakking and spill all the beans and they pay me just as any other seller would but without the professional representation. I win, my client wins, seller loses but has no idea.) But I digress.

So who works harder in your opinion? If one or the other doesn't deserve a full commission how much are they worth? Bring it. I can handle it.

RE: How do Realtors Get Paid?

I received the following comment from a reading posing a tough real estate question regarding Realtor commissions.

Selling a $250,000 house and selling a $500,000 house aren't all that different, but the commission is double on the $500K house. That makes no sense to me. What's the rationale behind it?

I wish I had a solid answer for you, dear readers, but unfortunately I don't. My only rationale behind comes from our friend Einstein's theory of relativity. This same argument applies to many professions and not just real estate. There are many people out there today with the same job description and responsibilities but are being paid unequal salaries across different companies and professions. Usually, the larger the company, the higher the salary. CEO's of Fortune 100 companies are getting $50 million dollars for simply resigning which doesn't make sense to the average person. This same disgust for overpaying someone unfortunatley applies to real estate for many people.

So what do I do differently for a $250,000 home versus a $500,000 home? Nothing. I work just as hard on the $250,000 home as I would on a $100,000. But why should the person selling a $100,000 home pay more than a person selling a $50,000 condo? This same logic can apply across the board. ($1 million dollars and up is a different story and the marketing level and dollars spent increase.)

There are many real estate business models out there offering discounts to the seller. They'll list your house for a flat fee, etc. But almost always, they will offer the agent that brings the buyer 3%. This is what doesn't make sense to me. Someone is willing to pay an agent 3% to bring a buyer whose job it is to help that buyer negotiate the LOWEST price for that home. Meanwhile the sellers want to give less than 3% - and sometimes nothing - to the representative that is there to help them negotiate the HIGHEST price for their home.

It is also important to note that many high end properties $1 million and up almost always utilize the assistance of a well known area Realtor. You rarely see these properties try to sell For Sale By Owner or hire a small real estate firm. (You will NEVER see a $3 million dollar FSBO or using a discount brokerage) Common sense would tell us someone who lives in a million dollar property is probably smart and more than likely business savvy and yet they choose to use a a Realtor to help sell their home. Even if they ask their agent to reduce their commission they are still being paid more than a $500,000 home.

So what's the answer? Is a new real estate business model needed? The current discount brokerages are not prevalent in Highland Park or Preston Hollow and are seen more in East Dallas in new construction homes. So this tells me the average consumer feels a good listing agent is worth what they are being paid regardless of sales price and percentage.

I should have an articulate and impressive answer but I simply don't. But I would love to hear your thoughts on the matter.

Are There Too Many Realtors? Yes!

The National Association of Realtors (NAR) is one of the largest trade associations in this country with over 1.3 million members. In 2000 there were only 766,000 Realtors nationwide. That's a 41% growth over 7 years. That's quite impressive. You probably don't know that a real estate agent can only call him or herself a Realtor if they are members of NAR. Many Realtors probably don't even know this. The running joke in many cities across the country is "everyone knows a Realtor". After looking at these numbers you can see why people say this.

So we have too many Realtors and also have to battle a terrible public image. A major reason for this is because it's not that hard to become a real estate agent anywhere in the nation, but at least in Texas they make it tougher than most other states. You have to sit through 150 hours of class or 210 if you don't have a college degree then pass a national and state exam. In comparison, Georgia and Florida only require 63 hours of class to become an agent. Keep in mind each state decides its own requirements to become a real estate agent.

So wouldn't it help NAR's cause to make the process more selective and harder to get into the industry? Not only would that help rid the profession of the slackers, it would leave the professional and successful Realtors to work with buyers and sellers which would eventually help boost public image. Why not kick out those Realtors that sell 2 or less homes a year? Sounds great in theory but there's a serious Catch-22.

NAR's Realtor Political Action Committee (RPAC) raised $11 million for the 2005-2006 election cycle. That's some serious dough and it gets shelled out to help get NAR supporters across the country elected. Where do you think most - if not all - of that money comes from? Realtors. So if NAR made states become more selective they would lose TONS of money. And if I've learned anything in this life it's that money talks, money's king, show me the money, and all that jazz.

How do Realtors Get Paid?

The common misconception is that when a Realtor sells a home they get 6% of the sales price. Now we all know commissions are negotiable and technically this statement is true, but what people don't realize is that half of the commission goes to the buyer's agent, or selling agent. Let's look a the following example on how a new-to-the-business agent would get paid on a $300,000 sale at a 6% commission.

Sales Price: $300,000

$18,000 Gross commission to Listing Broker
-$9,000 Given to cooperating Buyer's Agent

$9,000 Gross commission to Listing Agent
-$540 Most large companies charge a 6% affiliate fee

$8,460
-$4,230 Most new agents start at a 50% split with their company

$4,230
-$635 Let's assume the agent spent 15% of their commission marketing the property

$3,595
-$1,079 Take out 30% for tax purposes

$2,516 Agents Net Income

If the agent sold 13 homes at at average sale of $300,000 that's $4 million worth of real estate sales in one year! Wow! This agent must be rolling in the dough! But in reality that would equate to a net income of $33,500 for the entire year. And that does not include any other costs such as buying office supplies, gas and other business expenses such as magazine, newspaper and direct mail ads. You can see that a "successful" agent in this business can very easily net less that $30,000/ year with 13 sizeable transactions.

So the next time you see an email or postcard from a Realtor that says, "Multi-million Dollar Producer", you should probably feel sorry for them.

How Important Are Multiple Photos on Realtor.com?

Please note, I am not picking on or critiquing the following real estate agents' marketing methods nor am I implying they are less than capable Realtors. I am simply curious as to how important having multiple photos on Realtor.com is to today's sellers. The following listings on Realtor.com have 1 or no pictures and are over $1 million. I'm wondering if the owners of these homes realize how detrimental this can be. Or maybe I'm missing the mark and having multiple photos on Realtor.com is no longer important to sellers. If you were selling your home in today's market would you be ok with 1 or no photos on Realtor.com? I'd love to hear your feedback.




6706 Tulip Ln. - $1,070,000




6530 Brookshire Ln. - $1,100,000




6011 Mimosa Ln. - $1,149,000

6539 Lakehurst Ave. - $1,149,000

6423 Dykes Way - $1,149,000

6735 Aberdeen Ave. - $1,995,950

6406 Lakehurst Ave. - $2,195,000

6010 Lakehurst Ave. - $2,495,000

Bitter About Real Estate

My friend Lydia Player over at North Dallas Homes Blog sent me a link yesterday to a blog post on Real Estate Radio USA saying the National Association of Realtors (NAR) is virtually expecting 2008 not to bring any relief to the real estate woes of California, Florida, Vegas and all of the other hard hit cities across the country. (But not Dallas!) The blog authors are also real estate investors with a take no prisoners attitude that want to get the best deals possible. You get the idea from this excerpt.

If your client does not NEED to sell, take the house off the market. It will NEVER sell because the Seller does not and will not understand that his property value is about to s#&t the bed. If he is just seeing what he can get he is wasting the agent’s time and the prospective buyer’s time. Cancel the listing and tell him to batten down the hatches. He should be safe, we’re looking for roadkill!

This blog post caught the attention of NAR's attorneys but it doesn't look like these guys are backing down. I get it. They want to make sellers hurt when they buy their properties 30% below market value. But what is their issue with Realtors?

Using professional and real estate in the same sentence, as I just did, is an oxymoron. A true professional would be able to provide sincere credible advice on their product and most real estate agents simply can not.

They sound like scorned and bitter ex-husbands. Now I won't argue that some of it isn't warranted. There are many real estate agents that do not conduct their business professionally but I don't want to go there right now. (Another blog post maybe?) But there are quite a few Realtors in my market area that should take issue with the statement above. Feel free to leave comments on their website...and on mine.