Realty World Northern California & Nevada

Purveyors of goods and services who are at the top of their marketing game rarely use their mouth to draw a prospects attention and then pitch in the prayer of a sale. Rather they use their ears to learn what a potential customer needs and then present a solution that is cost effective and worthwhile.

I mention this because recently I had the privilege of meeting two of our newest members to the Realty World Northern California Family, Robert (Bob) Fernandez and Francisco Gonzalez, co-owners of Realty World – Golden Hills in San Jose, California, formerly Century 21 – Golden Hills. Both are long time veterans of real estate in the South Bay and both knew immediately what their business needed in order to compete in times of rapid change. Bob and Francisco are keenly mindful of the activities it takes to run and profit from operating a real estate brokerage firm with over fifty sales associates and a long book of business.

Since joining Realty World, our meetings have focused on the consolidation of tasks that real estate agents need to do in order to compete and win in the eyes of consumers. Bob and Francisco knew these activities were important and a prerequisite for any successful associate continuing in or just launching their real estate career. Their validation of what we are doing at Realty World was a positive sign to me that we had invested right in terms of bringing the business to the agent.
However, there is more to it than that. If you have attended any of the presentations we have conducted at various industry functions this year; you’ll know that the game of finding real estate and a knowledgeable professional to help is changing. Change is the one constant denominator of all markets.

I expect Realty World – Golden Hills to be one of the companies that will be on top of that game too. It’s my pleasure to introduce them to you and I hope you’ll take a minute to welcome them aboard! Bob and Francisco can be reached by phone at 408-238-5111.

So, you’re probably wondering amidst all the good news about the economy spun from the dominate media culture, why the economy still feels bad? Simple answer, many in the media complex don’t run businesses and they are listening to people who don’t run businesses for their sources. What to do?

Well, if you’re like most real estate people I know; you’re working 5 times harder for less than half the income. You’re not alone either. You know where the vacant buildings, warehouses and retail stores are; you drive by them every day. Just last summer a little over two-thirds of the entire industrial capacity in the US was working and in some sort of production use. Today, that has dropped to just under 75% or about 5 points less than normal when the economy is doing well. Don’t hear that in the news to you?

What does all this mean to your income? It means you have to see and touch more people with your value proposition in person. Belly to belly. Face to face. A prospect can’t send you to the deleted file, mail filter or trash can. They have to talk with you at some point, hence your selling strategy and listening skills had better be ready and oiled for action.

What advantage will I have in this scenario? Well, most salespeople are going to be dead before they start. Meaning they are getting ready to get ready. They will never go anywhere. You know who I’m talking about too. Second, most salespeople will resist the street in favor of blast emails, wasted postage and off line gimmicks from personal promotion to refrigerator magnets. That will account for about 93% of the competition. 7% will know this and immediately shift to the street for instant prospecting and immediate results. Remember, even a call on a prospect that has to interest to purchase or sell is a worthwhile event. It tells you who’s not players; sharpens your tactical skill and presents an opportunity for seeking referrals.

Those same 7 percent will communicate not only in person, but will use that offline call time to redirect their prospect to an online resource (namely their BLOG) to keep the prospect attenuated to the needs analysis and selling points of your in person call. Similarly, to what you do in the online world.

There is no better time to wake up and smell the pavement.

Image by HomeBiss via Flickr

A good friend and business associate recently turned me onto a new source of powerful information I thought was very interesting and fun to use.  It is a computational knowledge engine that is in its early but exciting stages of development.  This application is based upon natural language processing, which simply means you can compute massive mathematical computations by using simple language.  The site is http://www.wolframalpha.com/ .  However, I recommend watching the short presentation before using the application.

What can it do for us in real estate?  Well, it will calculate debt payments; give you the estimated value distribution of properties in an area; display histories of prices and medians with interactive graphs and just about anything you can verbalize into a mathematical sequence including internal rates, etc. Why would you not want cool stuff like that, especially if it’s that easy to use?

I thought it was interesting and certainly a different perspective to learn that I’ve been alive 18,244 hours.  Put your birthday in; your LDL level; find nutrient levels, etc…

I’ll wrap up by asking to watch this presentation. Even if you don’t use the site you should know about it.

And I always thought natural language processing was something humans did since the dawn of time…

Image via Wikipedia

Since I was a kid, or as long as I can recall, I followed the airline and oil business because I was interested in the way they worked.  Those dynamics are not any different than any other business I learned as I grew older.  Eventually, the bastion of profitability wait on the many efficiencies software developers invented to fill a specific need. Airlines eliminated travel agents by bringing the ticket directly to you via software.  When was the last time you called a travel agent for a round trip ticket to Orange County?

The successful real estate agent today needs a systematic solution-based program that functions as the central nervous system of the marketing, sales and communication process.  To make selections of tasks based on data that is already uploaded for multipurpose uses is increasingly the central need and more agents are demanding that kind of power in real estate specific applications.  The trend turned movement and there is no sign of slowing down.

Every broker and associate in our company should make assessment of this business dynamic and how it can positively impact your bottom line.  I’m grateful to work with talented people that craft and create these types of applications for your benefit.  Sometimes we forget what we have invested in and we just need reminding.  We have easy to use tools for you to compete in the new world and the additional advantage you have is access to millions of dollars in software for a sub-fraction of the cost.

If you’re wondering why some of the associates you know are doing more business, chances are they are involved in these online systems.  They take advantage of online video training, integrated applications and web driven tools that are easy to use and make practical sense.  So, do yourself a favor and log on or call the corporate office and ask what we offer.  You’ll be amazed.

Image by brentdanley via Flickr

There is no question there have been hundreds of tantrums regarding the control of inventory REO agents have had in the past couple of years. Many who had those tantrums failed to create the relationships early enough to get a foothold on any meaningful accounts is the main reason. Other reasons follow – many discovered that being a rock and roll REO agent requires a lot of patient capital; extremely disciplined work standards and the fact REO agents resign themselves to server side applications that keep them at the keyboard for hours on end.

Well, times are changing and I’m going to make a short explanation of why door knocking is vogue…

Lenders statistically net more money on a Short Sale than on a REO. That is the shift that is taking place and the key to capitalizing on this requires an effort similar to what successful REO agents did; simply create the relationship before anyone else!

The only way you are going to find out who these sellers are is to find them prior to the Notice of Default (NOD) being filed. Once that happens, they are open and fair game for everyone and a new target for a litany of mail. Good old fashioned shoe leather will beat out direct mail on this one. Why? Because nothing beats a face to face call on a prospect and especially on this subject. Also, direct mail cannot ask and receive referrals like you can in person. Pretty simple.

Count on NOD’s rising too. There will still be an REO market of sorts, as a result of poor documentation of liens, uncooperative subordinate lien holders, high income sellers that don’t fit guidelines and poor yield spreads that will cause the lender to elect foreclosure over a short sale.

I mention this because rock and roll Realty World REO agents should diversify the marketing effort to accommodate short sales and polish up on using our new listing presentation materials and commence a canvassing plan without delay.

As recently as yesterday, two agents from Realty World – Delta Country in Byron, CA spent the afternoon cold calling and returned to the office with two listings! That is why door knocking is back in fashion.

When you buy a big boat and register it with Homeland Security and the Coast Guard you have to name the vessel and its hailing port to obtain your documentation.  So, years ago when it came time to name our boat, which we worked hard for and we’re fortunate to finally get, I took the matter seriously.  I wanted a name that reminded me of good dealing, clean hands, equity and honor.  So I named her Covenant.  I thought the name would best represent our faith, goodwill, meaningful alliances and promises we make with others and our consequential relationships with much of the universe.  And, I’m equally proud of her name as the American flag she flies.

Recently I’ve had some dark thoughts about people’s obligations to mortgage companies and other creditors in these tough and trying economic times.  Those small lingering thoughts of default; the breaking of a promise and the premeditations of allowing one’s self to break a covenant with another have met a different reality and environment that give these notions birth.  Sadly, these seas are rooted politically.

I’m not referring to borrowers who have suffered a substantial or complete loss of income or those who obtained mortgages that shouldn’t have; I think those are separate matters entirely.  I’m talking about the people who have equivalents in income and other growth and income opportunities that otherwise could financially afford to maintain their present obligations and promises to lenders and simply choose not too.

Increasingly, reports of creditworthy and stable individuals are weighing the risk of future losses in real estate equity and purposely plotting strategies to benefit from mortgage default.  They reportedly move to a similar property in the same area that has gone down in value and walk on their present loan(s).  How they get financing remains a question to me?

Many have coordinated time lines to maximize withdrawals on remaining credit lines, equity loans and have somehow balanced in their mind a cost benefit factor of living with derogatory credit report.  Just the thought of that is a big reach for me and I grow increasingly worried about this situational ethic, off-the-rack culture and what that will mean for self worth of America’s children and our investment reputation in the financial world.

But, this is what I have to say to the real estate brokers and agents at Realty World…  Please stay clear of any involvement in a transaction that smells of this.  Even in times of desperation your self worth and personal integrity has greater equity than a commission from a transaction that is part and parcel to this behavior.

I understand economic waters may be rough; I’m right there with you.  But we have navigated through tough currents before and during these times, and while trying as they may be it brings me no justification to change the name of my boat.

I hope you feel the same way.

Scott LeForce
President
scott.leforce@rwnc.net

Logorrhea? What’s that? I know… maybe I could have picked a better title. But the more I thought about it, the more I saw it fitting. Let’s start with a clear definition:

logorrhea \law-guh-REE-uh\, noun:

1. Pathologically incoherent, repetitious speech.
2. Incessant or compulsive talkativeness; wearisome volubility.

Example: By his own measure, he is a man of many contradictions, beginning with the fact that he is famous as a listener but suffers from “a touch of logorrhea.” He is so voluble that one wonders how his subjects get a word in edgewise.
– Mel Gussow, “Listener, Talker, Now Literary Lion: It’s Official.”, New York Times, June 17, 1997

Okay, now we’re past that and you’ll hopefully agree that is not something you want. I can tell your customers certainly don’t and are experts at avoiding it. Simply, they are in search for the perception of quality in a relationship with the agent they choose. The notion behind my approach in bringing this to you is simple… In struggling markets a habit that many salespeople develop is one of a compulsive nature to spew information, statistics and the like to consumers. It is a bad habit that can manifest itself into an appearance of personal desperation. I can think of a few time-share salespeople that have a terminal case of this!

What we are talking about is narrowing your focus in real estate; the shift from a general practitioner to that of a “specialist”. Why? Because the perception of quality will always reside in the mind of the customer; whether a buyer or seller in this case.

When you narrow your focus in your blogs, and other marketing channels you become more of a specialists than a generalist. You’ll agree that a specialist is typically perceived to know and understand more (or have higher quality) than that of a generalist. Would a cardiologist know more about the intricacies of the heart more than a practitioner of general medicine? Most people would think so. The perception is certainly true. This connotation is one of the reasons we label you a specialist in our system.

This is where the content of your blogs become very important. Potential customers interested in property in your ‘neck of the woods’ will probably be following you before you even know it. You can become a specialist and avoid catching logorrhea by providing content that narrows the focus to your market and the characteristics your market offers. If a customers asks about a community event you can certainly discuss that, however we should refrain from having your blog be the ‘official’ site of that event and remain focused to real estate related matters you actually specialize in.

Everyone may think they can tell a high-quality product or service from a low-quality one, but sometimes it is not that easy. Does a BMW have fewer mechanical difficulties than a Buick? Are you sure? Does a Cartier keep better time than a Seiko? Are you sure? Is an agent that specializes bank-owned properties know more about local property values than an agent who specializes in short-sale negotiations? Are you sure?

Scott LeForce
President
scott.leforce@rwnc.net