As long as I have been a REALTOR® there always seems to be the sentiment that one side or another just “doesn’t get it”. It teetered between the buyer, the seller and the agent who had no clue what realistic expectations of what ever the current market conditions may be. Who doesn’t get it now: The Renters.

It Really Is Not A Good Time To Be A Renter

Inventory is low driving rental prices up. The typical renters are competing for a smaller amount of inventory with people who would have been home owners but cannot or choose not to buy right now. Many of those that used to be strong buyers such as  first timers, relocation clients and down sizers are just a few examples where many are choosing rental options for the present time.

A Renter Is Not  A Distressed Property Owner’s Savior

More and more I am receiving  inquiries about renting properties listed for sale, especially the short sales. With a few exceptions renting does not resolve anything for the typically home seller. There are many reasons why including:

• A seller cannot move on and purchase a new home without getting rid of their current mortgage and the equity out if there is any.
• Many owners are not in the financial position to rent. Unless there is equity in the property, market rate rents are not going to cover mortgage, insurance and taxes.
• If an owner is attempting to do a short sale that means that for what ever their situation is(i.e relocation, heath, divorce, job loss) they are not in the position to hold the property and the property is not worth what they owe on it.

Look For What Is Listed For Rent Not What Is Not

If a seller has the desire to be a landlord as well as the financial wherewithal they would have listed it for both sale and rent. 

Surviving Your Serengeti was Stefan’s first book that was not real estate specific. It was about struggles and survival strategies in today’s world. Its wisdom arrived for me at the perfect time when I was in a period of transition. The other day I ended up with an hour block of unexpected time between showings. I had taken care of my to do list for the day before leaving the office. Glancing at all the apps on my iPad, I decided to tap on Kindle and ended up going back to the Serengeti.

As I read this fable nine months later my perspective is slightly different. This has been a most challenging time for family, friends clients and other professionals. I have been watching the journeys of so many as they have been starting over, recreating and generating success. So many people I know have reminded me of the cycle of the Serengeti including myself.

I have to wonder if I took the test today, what animal would be? 

Last week a cheesecake was delivered to my office. There was a handwritten note from Marc Schulman, the president of Eli’s Cheesecake thanking me for including them. It just illustrated to me people do read what you post. Be sincere, be honest, be thoughtful and you will get the same in return.

On a side note, the great steakhouse that started this incredible cheesecake company holds special memories for me. I remember as a child going to  Eli’s the Place for Steak  for special dinners and being dazzled by all the attention we received. I was introduced to Eli Schulman through the hostess of our dinners there and remember how gracious and kind he was. These qualities were obviously passed on from father to son.

When I started in the real estate industry in 1999, it was the early days of websites. Most agents were just depending on what their company’s. I decided I needed one. My instincts told me I should be in control of my product, my message, my platform. Over time, as different types of websites were popping up I registered, posted my profile and started blogging. Then I realized I needed to own that as well and started created a Blogger blog linking it back to my website. In the fall it will be 2 years since I dumped my expensive static website and separate blog and went WordPress.

As social networks have grown over the last few years, many people inside and outside my industry have made it appear that it is all about Facebook. Twitter for some, but many people still cannot wrap themselves how the conversation on Twitter works or that it is a conversation.

My instinct throughout all the rapid growth of the medium is I need to have a platform that I control. If I don’t own it, I have no control over it. I don’t want to be a renter. I can take my brand and post it anywhere but I cannot take a Facebook page that some people have invested so much time(and for some money) in and move it to Google+ or whatever comes down the line.

If you search this site, you may notice I have not posted in a while after being an active blogger. I lost my focus on this marketing/branding tool as I get busy listing and selling. The massive explosion over the last few days was a wake up call for me to go back and work on what I already know. So by the second anniversary of my WordPress blog, the plan is to have it where it needs to be.

If you haven’t figured it out by now, social networking will be changing faster than you can say “Follow me on my Facebook Business Page”. At the very least, most may still be around but in order to continue growing your network and brand you will need to be able to go from site to site. Just like everything else these days it is all about the ability to be mobile, even virtually.

Everyone’s home is a work in progress. It is not on Facebook, Twitter or Google. In the virtual world it needs to be a mobile home. You need a great base that you can take out on the road down what ever the current paths are.

As the departure date for my vacation was approaching I had much anxiety about leaving. After spending the last eighteen months re-establishing myself as a selling agent after managing for a few years, my business was back on the sales track but something appeared to becoming to fruition that could derail me. The rumors about the brokerage company I had been affiliated with that had been stirring for the last few months seemed to be coming true. Long waits for commission checks, many bouncing, talk of fraud and escrow violations. I knew I had to disassociate from them but where do I go? Would my clients follow? Would my groove get disrupted? How did this happen? I never imagined that I would have ended up being associated with people like that. The company was a well respected brand internationally now tarnished locally. I had to make an immediate move.

Choosing a brokerage in this economic environment was difficult. So many of the brokerages, including the big brand franchises are under funded and over leveraged. They took on too much debt acquiring companies, expanding and/or are under capitalized. There are also several firms where the companies and their principals are facing a variety of lawsuits which if they lose, will impact the firms financially leading to necessary restructuring or sale. I wanted stability in an unstable atmosphere. I just wanted to focus on listing and selling and not be concerned about if the company had the wherewithal to withstand the next few years of turbulence.

On the only day it was warm enough while I was in South Florida to sit by the pool, I took the book out of my suitcase and settled in poolside. Being that I know Stefan Swanepoel as a leading expert in the Real Estate industry, I was not sure what my expectations were as a starting reading this fable, just as the visitors to the Serengeti did not know either. Then as I read further the light went on. It was about the ongoing journey and surviving.

Surviving Your Serengeti: Seven Skills to Master Business and Life is a quick but captivating read. The story of this American couple and their journey through the Serengeti of Africa gave me perspective. I was at a point where I needed to step out of the place I was in and look at myself and my surroundings. What do I need to do to survive? In my case it was what did I need to do to move myself and my business forward? The fable gave me the vantage point to determine what I needed to do for myself to survive and succeed in the world I am in.

What Animal Am I? Each of the animals in the Serengeti possess characteristics that we find in people. Different ones come across differently in each of us. Some are stronger. I won’t use the word weaker for the other end. I choose less dominate. So now it was time for me to take the test. I am the enterprising crocodile. It is a great reminder of why I have achieved success as a REALTOR® as well as other paths I had previously gone down professionally.

I wish to share this story with all. It is not about real estate sales skills. It is about business skills. It is an ongoing process to use the characteristics and instincts that we possess and adapt. Not just survive but prevail.

It has been about six weeks since I first read Surviving Your Serengeti and four weeks that I have been at Coldwell Banker. Exclusively of cleaning up some loose ends with my former company and waiting for the new office to be up and running, it has all been good and even some days great.

I thank you, Stefan for allowing me the privilege to preview the book. It was a gift of guidance that arrived just at the right moment for me to figure out where my journey needed to take me.

Revised 12/27/2010 – I had a great afternoon today with:

Janie Coffey @JanieC and Jorge Fernandez @MiamiJorge

(This list is in no particular order and I apologize if I forgot someone)

Mark Jeffers @mjeffers99

Chris Smith @TechSavvyAgent

Darin Persinger @darinpersinger

Sara Bonert @sbonert

Luke Krzysztofiak @AgentLuke

Rich Rogala @RichIdeas

Tony Lazzari @TonyLazz

Todd Carpenter @tcar

Nicole Yeary @NicoleYeary

Tim McDonald @tamcdonald

Alex Lange @Alexander_Lange

Ginger Wilcox @GingerW

Daniel Rothamel @RealEstateZebra

Kelly Koehler @housechick

Kathleen Herron @sarasotadream

I look forward to a much longer list in 2011!

A while back I opted to stop rehashing the monthly housing numbers. They are what they are and everyone  else is writing commentary on them.  What this is about is understanding there is a housing marketing. People are buying and selling homes.

Get That Look of Pity Off Your Face

It seems whenever I run into  people I know lately they approach me with this very sad face and assume I am unemployed based on what is being communicated about housing values. Smile People. The fact that most are either not understanding or missing is that just because home values decline does not mean sales are not happening. Yes, there are fewer transactions than in the heyday of the mid-decade and yes the real estate market is being effected by the economy and distressed properties.

If you are going to pay attention to the story get the whole story. The story is the perfect storm of a troubled economy where housing values combined with lending issues that have created a distressed property market that we have never seen before. Just because values are down does not mean that homes are not selling. As in any market it is the partnering of price, timing and a qualified buyer.

With that being said I want to let  you know I am gainfully employed working as a REALTOR® as well so many others. As a professional, it is my job to facilitate the negotiations bringing the buyers and the sellers to the closing table and I am doing it.

The buyer I am referring to is the typical condominium buyer looking for a place to live who is getting a mortgage and putting about 20% down. Not an investor,  not a cash buyer and not an FHA or VA home buyer. You have certain public transportation requirements.

So your lender has pre-qualified you for a specific price range with approximate taxes and monthly assessments. You start your search online. You read all the posts about what great deals there are out there. Some good information, some misinformation. You are now all caught up in getting a great deal in that you seem to be overlooking what is the most important thing about a home: Do you want to live there, does the space and location work for you, what is the health of the association and will the property qualify for a mortgage?

Buyer Be Rational

You tell me you want to be in a neighborhood where when prices rise, you will see a greater, faster increase. So what you are telling me is that you want to do something smart which is buy at the bottom of a top market. And then you say but I want to look at short sales and foreclosures. “I want a deal”. The Chicago neighborhoods where overall property values have always remained strong (Lakeview, Lincoln Park and Gold Coast) have been effected by lower property values as a result of the economy but not greatly impacted by distressed sales such as the South Loop, West Loop, Rogers Park and Albany Park. The faster the rise, the greater the fall, the harder the climb back up.

The Correct Way To Go About It

• Start looking at spaces that meet some of the criteria you have set fourth. Prioritize them.
• Once you have identified homes you would want to actually live in where the location works for you, start working through the value.
• Throughout the process it is the real estate professional’s job to help in determining  if the properties are both a good value and a condo association you want to become financially obligated to.

Defining Value

Work with me on this. I am working on behalf of your best interest. The good value of a home is not determined by if it is defined as a distressed property such as a short sale, foreclosure or estate sale. In the neighborhoods at the top of your list the deals are a result of the economy on  housing values, not sellers unable to afford to be in the home. They have to move. The reason could be a result of a growing family or relocation.  They have equity in the property or the ability to bring a check to closing to cover the shortfall of value since they purchased.

You have about 20% to put down. In your mind you are saving thousands of dollars on the purchase price which the majority is being amortized over thirty years in a condo you may only own for 5-10 by focusing on distressed properties. Make your money work best. Think smart. Many of these condos are not in move in condition. Are you better off spending $375,000-$400,000 on something that is move in ready or buying something in the $275,000-$325,000 that needs a new kitchen, 2 new baths and lots of odds and ends work . At the end of the day at mortgage rates where they are what is a better investment?

Look At the Numbers Typical Buyer

20% down on a $400,000 move in ready condo is $80,000.

20% down on a $300,000 distressed property is $60,000 plus the $50,000-$75,000 you would need to make it habitable on the typical 2 bedroom, 2 bath condo. On top of the work, in buildings that have a lot of  distressed properties you have to be concerned about making it through the lender’s condo questionnaire. What then happens to your assessments when there is not enough to cover the expenses of running the building because of all the owners in arrears on their assessments. You better have your chestnuts stored for this one.

No market is immune from short sales but you need to look at the building as a whole. In some buildings and local markets they are rare and there is less long term risk. That is when the experience of an active REALTOR® comes in. It is more than just the particular unit that needs to be evaluated. It is the association, the building and the local market and knowing what is happening on a day to day basis. It is a full time job.

Every condo building needs to be looked at on its own merits. But if you are buying at the bottom of the bottom, you will be selling at the bottom.

I have been following the #NARdiGras hashtag on Twitter. So many people I follow and engage with are going to be speaking. As I went through the speaker directory I realized something. Through social media and other venues, these great people are part of my education day in and day out. The majority of them share on twitter on a daily basis. Some host or are guest on webinars and blog talk radio. All write great posts and create videos. Many of these people I have spoken to on the phone or met them in real life at local events.

Social networking has created an environment that establishes virtual connections on an ongoing basis and turns many of those connections into IRL relationships. The venues in which we meet are just not the traditional association conventions. There are newer more current venues like Inman’s Agent Reboot and ReBARCamp. Being local, they are easier to manage my schedule around. The same superstars show up in my neighborhood virtually and physically. Think of the economics.

Oh, the virtual platforms. I am a big fan of Blog Talk Radio.  Two shows I always try to listen in on are Michael McClure’s(@ProfessionalOne)  Raise the BAR #RTB and Ken Cook & Jason Crouch’s Social Media Edge with Mike Mueller which is playing while I am writing this post.  I can have it running in the background of my laptop or on my phone while doing other work or running around on appointments. I can join the chat and ask questions.

I am a big fan of webinars for both meetings and learning opportunities. I can always listen in and/or follow on my computer, but am anxiously awaiting the day when Go To Meeting releases their iPad application. Mike Bowler of PRETEC, a REALTOR® and trainer in Lansing Michigan has been hosting weekly webinars about tools real estate professionals should know about and how to use.

Stefan Swanepoel, the industry leader regarding trends in both brokerage and tools, makes himself and his information accessible through all of these platforms. I buy the book.

The virtual mixed with the local IRL events seem to be giving me the knowledge that have given me the tools to grow my business. Since I am not longer a Board of Director for the REALTOR® association, I look at what do I get out of an event from a different perspective. I am not required to be there, so the question is do I choose to be there?

From an agent’s perspective, if I am going to take the time out from my daily business, travel to an event and spend the money, is the National Association of  REALTORS® Annual Convention as relevant to me and my business as say an Inman Connect?

Sorry Regis. I guess we won’t be seeing each other in New Orleans:)

The Chicago Real Estate Market

Transactions are happening. It is the skills of the agents making the deals happen and getting them to close. According to  Case-Shiller Indexes® average prices are up in the Chicago area. I would agree with that but sellers need to read the fine print in all this. The sales that are closing are with more qualified buyers who are paying cash or are putting greater amounts of money down. These buyers are buying at the bottom of the top markets. The point to all this is values are still continuing to decline(in some areas more than others) but upper bracket properties are starting to move. Dennis Rodkin  in his post on  Chicago Magazine’s Deal Estate blog says “It’s 2002 all over again”.

Many factors in a transaction are no longer dictated by the buyer or seller. If it is a short sale or the buyer is getting a mortgage, much involved in the sale is imposed by the banks. One obstacle that cannot be overcome in this market is the numbers. Real estate is local. The numbers are based on comparable properties that have closed recently. What used to be does not count anymore. Both the buyers and sellers need to be pragmatic.

The Industry

As renewal time is coming up for the REALTOR® association, there is speculation on how many of us there will be in 2011. For those us in it for the long haul it is about ongoing education and a full time commitment to our buyers and sellers. Education is no longer how we have traditionally perceived it. Don’t think that if you sit in a classroom you know what you need to know to grow your business and service your clients. It is virtual such as webinars, blog talk radio and the information that is shared through Social Media. IRL education is through day long seminars such as Inman’s Agent Reboot and the Houston Association of Realtors® Digital Media Summer Camp. Just as the industry has become global so is the way we get our information. Mashable is a perfect example of that.

In Conclusion:

We learn from past experience. What I have learned over the last year is I cannot do business as I have in the past. Everyday is a new ball game. As a real estate agent you have to function well in a dynamic atmosphere. As a buyer or seller you must have realistic expectations if you are going to become involved in a transaction and expect it to close.