The New Normal in Real Estate -2010

If I were to ask you what a normal real estate market looked like in today’s environment my guess is that you’d indicate that whatever condition the market is in at this moment would be the new normal!

The fact of the matter is that things are shifting around so fast that it is hard to fully comprehend what normal should look like and how you should position your real estate investing business to profit in this new normal.

The New Normal…


This new normal is characterized by constant change. For those actively investing in 2005 you know that for the most part national and local markets were fairly stable. The only real change was ever climbing sales prices and consistent vacancy and rental rates. A very easy market to navigate and profit in.

The constant change of today includes ever increasing government intervention (think Homebuyers Tax Credit), constant rule changes (think the S.A.F.E. Act), an unstable economy (think high unemployment), any number of “interventions” imposed on real estate investors by local or state authorities, and actions taken within the private sector to either chase the profits or avoid the challenges embedded in all of these interventions.

Our challenge as real estate investors is that we are required to make decisions today, amongst the constant change in our market and we most likely will not see the outcomes of those decisions for months after they are made… and as you know… a lot can happen in just a couple of short months.
Sadly, it is almost impossible to stay ahead of this constant change and to make predictions regarding the real estate market beyond the next 6 months is almost pure folly.
What to do?
The key is to stay informed. Know what is happening in your market, paying particular attention to the actions or in-actions of those government agencies that could impact your real estate business. And then make adjustments to your business activities as quickly as possible to position your business in front of the oncoming changes/market.
Before I get into some specific recommendations, lets review a few facts.
1. We know normal is hard to predict… and what works today most likely won’t work tomorrow.
2. Continued intervention into the real estate market by all levels of government should be anticipated for the next 2 years at least.
3. Unemployment, the key to any housing recovery, is not going to improve enough to make a difference until at least the 2nd or 3rd quarter of 2011.
With this as a back drop how do you position your business to get in front of the changing (new normal) market in your investment area?
1. Be prepared to make dramatic shifts in your business plan. For example… if you specialize in REOs and the trend towards short sales catches on you need to change your acquisition strategy. If you live in states like Maryland or Texas and you don’t make that shift properly you could end up in jail. Best course of action… make friends with many wholesalers and learn how to effectively conduct your own conventional (non-MLS) marketing.
2. Some markets will no longer support your selected exit strategy. A good example of this would be markets like Las Vegas or parts of Florida. While it is possible to buy, renovate and sell homes to homeowners in these markets the margins are constantly being squeezed because you just can’t pick up properties at a low enough price… and of course the new low price may not have been reached. Best course of action… either change your exit strategy or consider moving your investing activities to markets that will best support your business plan.
3. Being conservative is the only option! I can’t drive this point home enough. You don’t need every deal that you find… and some of the best deals for you are the ones that you don’t do! When you know the new normal could descend into your market at anytime the last thing you want is a marginal deal that goes bad due to factors now beyond your control. Everyone of us should have learned that lesson in 2006. Best course of action… buy at the lowest prices acceptable to your business plan or don’t buy!
4. Ruthlessly execute your exit strategy. This should be obvious to everyone… but based on horror stories even today I know that it is not. By ruthlessI mean taking control of the acquisition, renovation, sale or rental process such that these actions are completed within your prescribed budgets and time frames. Look this is not some game played with funny money! Your outcomes are tied directly to how well you execute. Best course of action… adopt a sense of urgency regarding everything, and I mean everything.
The key takeaway from this discussion is that for the prepared and shrewd investor, one who is willing make changes quickly, there will be plenty of opportunities for profits.
The bottom line… stay informed… keep an open mind… and move decisively!

What is a Short Sale?

A short sale is a sale of real estate in which the sale proceeds fall short of the balance owed on the property's loan.[1] It often occurs when a borrower cannot pay the mortgage loan on their property, but the lender decides that selling the property at a moderate loss is better than pressing the current debtor. Both parties consent to the short sale process, because it allows them to avoid foreclosure, which involves hefty fees for the bank and poorer credit report outcomes for the borrowers.

In a short sale, the bank or mortgage lender agrees to discount a loan balance because of an economic or financial hardship on the part of the borrower. The home owner/debtor sells the mortgaged property for less than the outstanding balance of the loan, and turns over the proceeds of the sale to the lender. Neither side is "doing the other a favor;" a short sale is simply the most economical solution to a problem. Banks will incur a smaller financial loss than foreclosure or continued non-payment would entail. Borrowers are able to mitigate damage to their credit history, and partially control the debt. A short sale is typically faster and less expensive than a foreclosure. It does not extinguish the remaining balance unless settlement is clearly indicated on the acceptance of offer.

Lenders often have loss mitigation departments that evaluate potential short sale transactions. The majority have pre-determined criteria for such transactions, but they may be open to offers, and their willingness varies. A bank will typically determine the amount of equity (or lack thereof), by determining the probable selling price from an appraisal or Broker Price Opinion (abbreviated BPO or BOV).

Lenders may accept short sale offers or requests for short sales even if a Notice of Default has not been issued or recorded with the locality where the property is located. Given the unprecedented and overwhelming number of losses that mortgage lenders have suffered from the 2009 foreclosure crisis, they are now more willing to accept short sales than ever before. This presents an opportunity for "under-water" borrowers who owe more on their mortgage than their property is worth and are having trouble selling to avoid foreclosure as a result.

Short sales are common in standard business transactions in recognition that creditors are not doing debtors a favor but, rather, engaging in a business transaction when extending credit. When it makes no business sense or is economically not feasible to retain an asset, businesses default on their loans (called bonds). It is not uncommon for business bonds to trade on the after-market for a small fraction of their face value in realization of the likelihood of these future defaults.

For the best representation on how to purchase a short sale, contact a Professional Realtor ...call Scott Nabors.

For More Information on Short Sales Click Here

The Attitude of a Top Producing Realtor

A "Top Producing" real estate agents attitude is one of an entrepreneur, here is a list of 20 commonalities found amongst some of the most successful real estate agents attitudes.

1. They love to make money, instead of making money to do things they love.
2. They have bigger dreams then most people.
3. They are very success oriented.
4. They are restless and impatient! It often shows with people, situations, and in meetings.
5. They work hard and play hard. At times they are not sure whether its work or play.
6. They are better at something - anything then most people.
7. They look at risks differently then most folks.
8. They are proud and can be easily annoyed or insulted.
9. They have a smaller and tighter circle of friends then most people.
10. They have a lower tolerance for office politics, water-cooler discussions, and gossip.
11. One or more parents/family members are self employed.
12. Many have been fired one or more times.
13. They have a nack for business/communications at a young age.
14. They are commonly the oldest or youngest child in the family.
15. Most are less then 45 years old.
16. The majority are married, yes married!
17. Most have at least an associates degree.
18. They can be loners and be sociable people when need be.
19. They lack structure but are also super organized.
20. They are highly competitive.

These attitudes are not set in stone, every body has their own path to success and yours could be totally unique. As always, it takes hard work and dedications.

And yes, I am a Top Agent!

Let us assist you in your next purchase or in the markeing of your home ...and you will see the difference that a true "Top Producing" Agent makes in the transaction.

Cheers!
Scott

How to Find The Right Agent

When buying or selling a home, we already know why it's important to have an experienced local real estate agent on your side representing your best interests.

“The biggest mistake is
choosing the wrong agent."

Three Reasons Mistakes Happen

Most real estate mistakes happen for three reasons:

Not having enough knowledge, not thinking clearly and, the worst of all - not having agents who care enough to help you avoid the mistakes.

1. Knowledge

It is hard to avoid mistakes if you lack knowledge. Real estate agents have a huge advantage - they are the experts. The agents will tell you "this is the way it is done" and if it sounds plausible - as it often does - you will go ahead and do it.

Many homesellers, after they have lost thousands of dollars, often say they had a feeling something was not right. They lack knowledge, but not instinct. If you meet an agent and have a feeling that something is wrong, you are probably right. You could be on the verge of making a big mistake, so find out why you don't feel right. Often, all you have to do is ask a few simple questions. Check things out a little better. A bit more time, before you make a decision, can save you a lot of pain later.

2. Thinking

"I just didn't think about it," is what people often say when disaster strikes. Thinking prevents disasters and protects us from harm. The key to clear and accurate thinking is simple questions. When you add a little bit of knowledge to a few simple questions, you will enjoy the reaction of some agents.

Knowledge, as the old saying goes, is certainly power!"

Your knowledge, plus your ability to think clearly, will save you thousands of dollars.

3. Caring

It is not the homesellers who have the problem with caring, it is the agents. Thousands of homesellers give their homes to agents who only care about one thing - their commission. They do not care about their clients and they do not care about getting the best price.

The best decision you can make when selling your home is to choose the best agent. And the best agent is the one who really cares about you.

The next step is to find the best agent for you.

People find agents in many different ways. I'd like to share some of the most common and the most effective online and offline methods for finding your next real estate agent.

Pre-Search Checklist:

Before your start doing your homework, I want you to envision your ideal real estate agent. Write down your thoughts. Then start searching.....

Online:

Search Google - Agents name you are interested in. See if they're websites and blogs appear on the first few pages and then research the agents on each site and blog. This also allow you to see how they market themselves, which is a direct reflection on how they market their clients homes.

Offline:

1. Ask your friends and neighbors - Get recommendations on who they recently used to buy or sell a home.

2. Ask for referrals from their past clients. If they can't provide one happy client, it could mean trouble down the road.

When deciding on what real estate agent to work with, sometimes is just a gut feeling that helps you decide. Ultimately, you have to trust the agent you're working with. You should have good chemistry. After all, it's a relationship you're forming. It just has to feel right. An agent that has the the right mix of local knowledge, experience, professionalism, integrity and personality is the one that can be the difference between finding a good house versus finding your dream home.

Click Here to visit my site to find out more about my Team

Why Brand Yourself As a Professional?

Branding is one of the most misunderstood terms in the industry. It is a misconception, many people think of branding as a process that involves developing a cool logo design.

In actuality, branding is an entire strategy that places focus on the company's foundation through utilizing the elements of marketing. Think of it this way, when you are in front of your number one prospect, how important is it for you to ensure that they remember your name?

If your branding efforts are not as strong as your competitors - stop and think how much business you are loosing. Branding creates value for you, your company and is one of the largest marketing variables that are often overlooked today.

If branding is done correctly, it makes the buyer believe and trust your product over your competitors. "Branding is the reason why people perceive you as the only solution to their problem.

One of the most important things you can hope to establish for your online business is a sense of professionalism. Everything from the design of your website, to the services you provide, to the product you produce should project an aura of professionalism.

The same holds true for whatever image or photo you decide will represent your business. If you are going to brand your company with one particular image it is important that it be of the highest quality. You should also ensure that it is something you would be proud to have associated with you personally or your business.

It's Time to Get "MAGNETIC"

Do People "HUNT" For "YOU"...If Not Get "MAGNETIC"

In all of business, Marketing may be ...NO, is the most important aspect of creating business.

Why?

Because it is the heart of business, without people to work with, there are no transactions, and with out any transactions, well, yeah, your broke. That's why so many of my fellow Realtors have left the business. NO Leads, NO Sales, NO Cash Coming In. It's just a fact that no business can survive without cash flow.

Unfortunately, most average Realtors don't have a clue in how to generate leads?

There are only two ways to market, you can either "HUNT" or be the "HUNTED".

I don't know about you, but i would much rather have people calling me, than me bothering them. Don't get me wrong, some people can call someone they've never met, work them, sell them and have them a listing, that's called selling.

Most TOP Producing Realtors consider themselves, not the Salesman, ...but a Marketer.

I let them come to me, on my turf, where they are privileged to work with me. When you have swagger and a total professional attitude, your confidence will rise as will your paychecks, trust me.

In my early days, there were only "old school" ways of getting leads; cold calling, warm calling, door knocking, bugging your neighbor or spending hundreds of dollars on a magazine ad representing a couple of homes that no one called on.

I Became so sick of trying to generate business that i completely gave up hunting people trying to get something going! In turn, I became the Hunted.

I created an online (MAGNETIC) presence driving prospects to my site, using ad campaigns that had my pipeline full within 30 days. I now have 3 others on my team just to handle the servicing of the clients.

I create value in they're eyes by representing myself as a Leader in the market.

It's Time to Get MAGNETIC