Yes, It's a Hot Market, But Your Home Isn't Selling. So What Can You Do?

[My "Real Estate Today" column published Dec. 1, 2011 in the Denver Post]
By JIM SMITH, Realtor

This column is for those who have had their home on the market for months, but haven’t had many showings and have received no offers. Is it the market, is it the house, is it the location? Is the agent to blame?  You don’t know. You’re just frustrated.

Yes, homes are selling now, but yours isn’t. In Jefferson County, as I write this column on Monday evening, over 35% of the homes for sale are under contract, not counting the foothills areas.  That’s a lot of buyers buying homes — but not yours.  So, what can you do?

Your listing contract binds you to work exclusively through your agent. You are to refer all brokers, buyers and other interested parties to him or her and not speak with them directly.  And your listing agreement doesn’t expire for a month.  But you want action NOW!

Well, there are things you can do to get things moving. Here are some suggestions.

1) You can hold your own house open more often than a busy agent can.  Borrow his/her signs.  You may not negotiate with anyone, but you can provide access and answer questions. You can collect names and contact information to give your agent.  Unless the visitor knows you, I suggest you say you’re helping the agent without revealing that you’re the owner.  If the person wants to talk price and terms, give them the agent’s cell number and card.

 2) Google your home’s full address, including ZIP.  There should be at least one or two pages of results, including realtor.com, Zillow, Trulia, and broker websites which contain your listing. Are the pictures good and plentiful?  How’s the description?  Are there any errors that need correcting? Do you get any ideas from the way other homes are portrayed that could be used on your house?  Give this feedback to your agent.  Ask him/her to do more, but be specific. If you have good pictures (flowers in summer, etc.), give them to him/her to use.

3) If you are unhappy with your agent, you aren’t stuck with him. If he’s an associate in a big firm, you can talk to the managing broker about assigning the listing to another agent, or at least coach the associate so he does a better job for you. Remember: the brokerage, not the associate, owns the listing.

4) If that doesn’t work, or if your agent is his own boss, you can ask to be released.  If he refuses, you can instruct him to remove the listing from the MLS and cease all marketing of the home, at which point he might as well release it. Instruct the broker to list it as “expired,” not “withdrawn,” because the “days on market” starts over at zero after 31 days of being “expired,” but not if it’s “withdrawn.”

5) If you’re happy with the agent and his/her marketing of your home, try calling the agents who have not seen your home yet to get them to preview it. (This is not forbidden in your listing agreement.) Tell them your listing will be expiring eventually and you’d like their opinion about the home in case you decide to change agents. Ask them for pricing, staging, and marketing feedback. Ask them what they’d do that your agent isn’t doing.  (I suggested this strategy to one of my own clients recently because it’s a great way to get agents to preview a listing they haven’t seen.  And we’ll get some genuine professional feedback.)

6)  If you have reason to think your agent may have overstated his track record, you could also ask these other agents, “Is it true that my agent sold 50 homes last year with average time on market under 30 days?”  That would be useful to know, wouldn’t it?  Only other agents can check that kind of data on the MLS.

7) Ask your agent to show you your competition.  Put yourself in the shoes of a buyer. Ask yourself, “Would I buy my house versus this house which is listed at the same price?”

8) Share these ideas with your agent and brainstorm other ways to stimulate showings and offers for your home. You could be part of that 35% that’s under contract!

You can receive my column by email each week if you'd like.  Just ask!

Thanksgiving Is a Gift We Give Ourselves, Reminding Us How Blessed We Are

[Published on Thanksgiving Day, 2011, in the Denver Post]

With all the news from around the world, we hardly need a reminder that we have much for which we can be thankful.  Thanksgiving is our opportunity to remember that. I don’t know of any other country besides Canada which has a day set aside solely to contemplate one’s blessings.

When I give the opening prayer at my weekly Rotary meeting, I like to say that “We are blessed, and we are a blessing.” In other words, it is because we are so blessed that we are able to bless others with our gifts of time, love, financial assistance and service.  It is out of our gratitude for how blessed we are that we are driven to do good in the world — and Rotarians do a world of good!

What are you thankful for? It’s a metaphysical law that we draw to us more of what we think about, so let’s think positives, not negatives!

I’ll start with my family, especially my now-deceased father, Abbott Smith, who taught me values I still hold dear. He was never a Rotarian, but those values he taught me are entirely congruent with the values of Rotary.

My family moved from Maine to Colorado when I was in kindergarten, and for that I couldn’t be more grateful! Somehow I was lucky enough to be enrolled in St. Anne’s Episcopal School, where I was taught first and second grade by then-Sister Irene, the school’s now deceased founder. What a blessing that was!

Space doesn’t allow me to recount my other personal blessings, so I’ll limit myself here to listing some professional blessings. It starts with being introduced to real estate as a career by the fine people at Coldwell Banker, including Kathy MacLeod and Rich Sands. I still recommend that agents begin their career at CB, even though I moved on to RE/MAX Alliance and then launched Golden Real Estate.

Being rather outspoken, I know that I have irritated some of my colleagues in the business, especially in my early years, and for that I apologize. Nonetheless, I am grateful for what I have learned from many of them and from people in related industries such as lending, inspection, appraisal and repair. I am so much smarter than I was 10 years ago, thanks to them.

And, of course, I am thankful for the several hundred clients who have honored me with their business.  Without the experience I gained from serving them, I wouldn’t be nearly as knowledgeable.

My wife, Rita, has been my love and inspiration since we met in 2003, and I wouldn’t be the success I am today without her presence in my life. I wish all could have the kind of relationship we enjoy.

Notes from the NAR Convention 11/11 thru 11/14/2011 in Anaheim CA

1). Greening the MLS

Energy Efficiency Mortgages (EEMs) are 20 years old and hardly anyone knows about them. Lenders are overwhelmed or disinterested, and Realtors don't promote them. HUD's 203(K) program is only slightly more utilized.  EEM dollars can be in excess do the $35,000 allowed for other improvements in the 203(K) loan. VA allows up to $6,000 in its version of the EEM, and more if savings justify the excess.

Fannie Mae has a "HomeStyle Renovation" program.  Inexplicably, FHA eliminated the Smart Commute form from its package of forms.

Consumers are more conscious of indoor air quality and energy costs, which is a start.

Inability to obtain value for sustainability improvements upon the sale of one's home could be a disincentive for making such improvements, especially if a homeowner doesn't anticipate remaining in the home long enough to enjoy a return on their investment. Fortunately there is some movement in getting appraisers to give value to such improvements without the burden of finding comparable sales which demonstrate that increased value.

The problem is that no national player is engaged in the concept of EEMs, although I'm told that Fannie Mae does require consideration of energy efficiency when valuing a home.

The Appraisal Institute has released the first definitive approach for green appraisal with its Residential Green and Energy Efficient Addendum.

There is a rule in place that appraisers must be competent both geographically and in terms of features when valuing a property, but unfortunately no one involved in a conventional, FHA or VA transaction gets to be involved even peripherally in the selection of the appraiser, thanks to the Home Valuation Code of Conduct (HVCC) implemented a few years ago.  Perhaps some regulation of the unregulated Appraisal Management Companies (AMC's) could help to correct this problem.  Certification of appraisers in the area of sustainability could also be an answer.

Aside from the above issue of valuation, homeowners interested in increasing the sustainability of their homes can visit HouseLogic.org for help in choosing and valuing improvements for their home.

2) The One Thing Power Brokers Can't Live Without

Observations and advice from...

Margaret Kelly, CEO of RE/MAX International (also sits on the Federal Reserve Bank regional board of directors): there will be no double dip recession. Household formation has dropped from 1.2 million per year a few years ago to 500,000 and ultimately to 350,000 last year  That represents lots of pent-up demand for homes. However you feel about immigration, know that every immigrant is seeking the American dream, which includes buying a home. The biggest buyers of homes in Arizona last year was Canadians. With immigration, our population would have declined.

TJ: We are in an epic battle against FUD -- Fear, Uncertainty and Doubt.  One  strategy is price protection. See what Syracuse has done in this regard. Now buyers can purchase price protection.  Interesting!

3) Mobile apps class

www.mobilerealestateid.com has an app for tracking QR code users to capture inquiries. 

Evernote:  Take and store notes in any format

Voice: A dictation app

Skype:  Face to face calling, Can add Skype button to your website.

Expensify:  Easily categorise, tag and add comments to expenses. Saves you keeping receipts on the road

Milebug:  Simple and IRS friendly tracking of mileage

Magic Plan: Create Floor plans using iPhone. Just hold in the air and take a spin. Creates a plan

My Measures:  Take a photo and add dimensions to a room picture

Trulia, Zillow and Realtor.com apps:  It's what consumers are using.

More info at www.amychorew.com/handouts

4) High Tech/High Touch

Use Google Alerts - sign up at www.google.com, click on More, then Even More to find it.

Do your social media posting at 8am and 8 pm, which is when most people are online.  Use Hootsuite to schedule posts so you don't have to actually write your posts at those hours.

Check out Handwriting Pro app for iPad.

Make your client calls between 5:30 and 6pm when people want to get off phone, to keep these conversations shorter.

Use videos within emails.

Include interviews with neighbors about neighborhood in listing videos.  Much more effective than just describing the house.  People like to know that the neighbors are friendly and welcoming!

5) Branding Yourself

Learn from "Ritz Carlton Service":

Credo - it's all about the customer

Motto -"We are ladies and gentleman serving ladies and gentleman."

3 Steps of service - warm greeting by name, anticipation & fulfillment of each guest's expectations, fond farewell using guest's name

Make customer feel special

Demonstrate that you perceive and share their interests, values and priorities

Note: Branded products command higher prices

Leverage your broker's brand with your personal brand to create a unique selling proposition (USP)

Do's:

   Be consistent

   Be yourself

   Be professional

   Deliver what your brand promises; Don't try to be someone you're not

Ask yourself: How do you define your brand?

Who is your target audience?

How do you communicate your brand to your target audience?

Who is your competition and how do they communicate their brand?

Remember: If you're standing still, you're losing

One agent's motto worth stealing: "Your home, our expertise "

6) Marketing Masterclass

There is lots of pent up buyer demand.

Don't play it safe.

Include interview of owner describing what they loved about their house when they bought it and what they love about it now.

Have a historian write about house, when applicable.

Try walking tours or bike tours of neighborhoods which have concentration of listings.

Consider a travel time heat map.  Website idea: link to Sigalert (http://denver.cbslocal.com/traffic/) so people can see if highways are congested.

Check out Loku, which provides local info.

Advertise in unexpected places - e.g., romance ads

Vary promotion of same house (especially main picture) on different websites

Use Vizzishots to change weather of pix (take picture with gray sky and turn it blue)

Make pictures full-screen with insets for info -- e.g., Te Atrium features million dollar properties with full screen pix

Promise specific service - e.g., "We deliver feedback within 24 hours." -- not just "We provide great service"  or "We are available 7 days a week on our cell phones."

Check out "Get Satisfaction" - turn likes to loves

Check out "Twitter full" - capture key word activity on Twitter

Good Facebook app - PropertyPage

Set  property search for sellers so they know about activity in their area.

Offer free signs for schools,  events -- If they put your sign in their yard promoting a school event (with your name at bottom, "sponsored by..."), they're more likely to envision your sign in their yard when they sell.

Use DropBox to make flyers and other collateral material available to all -- keep it updated!

(Note: DropBox or other cloud applications are how to get documents onto iPad easily.)

Don't publicize website, so people have to call for info.

In summary: Essentials + Separators + Gosh = success

7) Lead Generation Tips for the Green Market

Publicize the new Appraisal Institute green addendum, which most may not know about

Google "Appraisal Institute webinar" to learn more.

Be a green consultant to builders, whether green or not.

Find energy raters and introduce yourself.

Publicize availability of energy audits and HERS ratings

Speak about healthy homes instead of green features when prospecting to Moms.

Find out if your lender does Energy Efficiency Mortgages?

Check out Better Buildings program from Dept of Energy

Note: Energy Upgrade California pays agents for leads

Create a Green Homes IDX website.

Check out www.GreenHomesLA.org

Create a drip email campaign with suggestions and tips to send to prospects/clients

Put RSS feeds from others on website

Check out www.builditgreen.org - LA offers scholarships for certified Green designation

Calif. Assn. of Realtors subsidizes HERS ratings for members' clients.

Check out what Better Buildings benefits might be available in Colorado

8) Double Your Business Quickly (Walter Sanford class)

Have lenders call FSBOs for you (long explanation....)

Ask info on buyers before showing homes (has form)

Advertise buyer needs - will attract sellers

Advertise team - not just agents, but inspectors, lenders, title, etc.

Stress surety of close over price -- promote percentage of your contracts that close (unless it's not good)

Weekly to-do's:

  Call buyers on Monday morning - find out what they did this weekend, where they visited, etc.

  Give value every time you call - useful info, "thought you should know that..."

  Get updates on pendings every Wednesday

  Call Thursday for price reductions/value enhancements (for example, change in inclusions, carpet allowance)

9) Selling a House Using Madison Ave Methods

Realtors tend to talk features, whereas Madison Ave ads aim at emotions

What is it like to live in the house?

Do not ignore negatives -- "Some highway noise, but that's why it's priced $35,000 less than comparable homes!"  "This home is for people who enjoy the freedom of no yard to maintain." Principle of sacrifice - (embodied in these examples)

Ask seller what they liked when THEY bought it.

Promote a primary theme that other properties can't match

Only 3 elements to a good ad:

  Headline most important

      Never put address in headline - it's not a feature!

      Use decisive headlines -

  Photo

      Madison Avw would never accept a so-so photo.  Don't upload so-so photos!

      Wide angle photos essential

      Do opposite of open house: Take the house to the buyers thru great photography

  The Story:

      Use conversational voice

      Ogilvy: pretend you're talking across the kitchen table. 

      Sell lifestyle

All 4 Front Range Cities Rank Among Top 20 Healthiest Housing Markets

{Published Nov. 10, 2011 in the Jeffco editions of the Denver Post]

Fort Collins/Loveland, Colorado Springs, Denver Metro, and Greeley were recently ranked #2, #7, #10 and #20 respectively by Builder Magazine as having the healthiest housing markets. The magazine projects that building permits will nearly double in 2012 over 2011’s.

While the report is focused on the new home market, the analysis applies also to the existing home market.

In a “mid-2011 update” posted on Sept. 15th, the magazine said “A housing recovery is blooming in Denver…. Decent job growth — the metro area is on pace to add 20,000 jobs this year — will contribute to strong income growth of 3.6% next year.”  The report predicted a decline in foreclosures, which was confirmed this Monday in a report released by the Colorado Division of Housing.  “2011’s median price, $233,100, is only $20,000 below 2006 levels,” continued the posting.  It also says that the building of FasTracks is “creating new building opportunities all over town.”

It’s hard not to notice all the building going on around Jeffco and the metro area, not just related to FasTracks, although that project has certainly had an impact on the economy.  Over the past two years, KB Homes succeeded in selling out its 60-home Canyon View subdivision in north Golden, at a time when the new home industry was considered stagnant.  Richmond American Homes was equally successful during the same time period with its 30-home subdivision nearby.

In downtown Denver, the 42-story Spire skyscraper across from the Convention Center was built during this time and is now nearly sold out of its high-end condos.

A month ago, I reported that about a third of all current MLS listings are under contract.  I just searched again and the figure is still over 30%.  Although most of my under contract listings have now closed, another listing went under contract Sunday and I’ve been told to expect an acceptable offer on a $500,000 listing shortly.

In short, we are indeed in a healthy housing market now, and the promise of continued low interest rates suggests that it will remain healthy into 2012.

Newly Devised Real Estate Index Answers the Question, "How's the Market?"

By JIM SMITH, Realtor®

      When you are thinking of selling a home, the first question that comes to mind is usually, “How’s the market? Is this a good time to put my house on the market?”

      Frustrated by the home sales statistics routinely published by the media — especially national statistics which may differ widely from our local reality — I have finally come up with a measurement that I feel answers that question.

      My new index measures the percent of inventory that is under contract.  It’s a snapshot that can be taken at any time, as opposed to a monthly report that comes out on the 10th or 30th of the following month.

      Here is my index for this Monday, Oct. 31. Thanks to Metrolist’s new “advanced search,” it only takes a few minutes to generate the report.  I’ll update it on the last day of each month and publish it here and online.  Although it is generated on Metrolist, the Denver metro MLS, it counts all the listings on IRES serving northern Front Range and the Pikes Peak MLS serving the southern Front Range.

Jefferson County (Plains)  32.3

Jefferson County (Foothills)  16.8

Denver Northeast  41.9

Denver Southeast  25.4

Denver Northwest  30.6

Denver Southwest  42.2

Downtown Denver  15.3

Denver (all sections)  32.1

Adams County  39.0

Arapahoe County  39.8

City of Aurora  50.8

Douglas County  28.3

Broomfield  24.5

Boulder County  11.4

Clear Creek County  19.0

Gilpin County  10.3

Elbert County  23.5

El Paso County  17.2

Larimer County  9.1

Weld County  19.4

Total MLS 23.8

     The percentages speak for themselves.  They tell us that half the inventory in Aurora is under contract, while less than 10% of the inventory in Larimer County is under contract. It would be a great time to put a house in Aurora on the market, but not so good a time to do so in Larimer County.

      Jefferson County (except in the foothills) shows about one-third of the listings under contract, but the foothills with half that percentage.

      Colorado’s Front Range as a whole is doing quite well compared to the rest of the country, with almost one in four listings under contract.  It will be interesting to track the monthly changes.

      It’s easy to understand why the numbers are so high in Aurora and Denver Northeast/Southwest.  These are areas which have been beaten up significantly by foreclosures and short sales.  The values are way down from their highs of a few years ago.  Combine that with record low interest rates and little wonder buyers are snapping up the inventory.

      Call me if you’d like the calculation for your sub-market of Jeffco.