Rhonda Duffy\’s Blog

I feel that this is too much risk for the brokerage. The risk is two-fold. The buyer and seller™s motives are not clear to the upper management and the real estate contracts are based on time, not really on payment from the buyer and seller, and the agents can get too loose in their thinking and not be motivated to work at all.

Back to the real estate agreements. If all of the contracts between the consumer and the brokerage was based on payment up-front, then the model of salaried agents makes sense. Then the brokerage is only responsible for advertising to get such and that is a similar model to other retail businesses.

But the bigger issue is the attitude and ongoing skill set of an agent that works in a business where buyers and sellers are fickle. It is easy to get sucked into the media and buyer and seller thinking and be in a fog that no one around the agent recognizes. And, the skill set needed to take a buyer from A to Z in the transaction is often missing a few letters.

So, the model that makes the most sense to me is one where the agent is an independent contractor and is on a 6-month quota. The quota is based on how much money they make the brokerage. Some brokerages have elected to have the agent pay a desk fee instead. This too is quota but is run a different way. The brokerage is not worried about the business that the agent is doing; they are worried only about collecting their monthly fee.

The quota paid based on transactions and revenue to the brokerage is best though when you are a lead-producing machine. How many buyers are being sold is important to know when the brokerage is spending money to advertise.

We do something different that has started creating quite a stir at our real estate company and the feedback from our sellers, even if the offer does not work, is thank you for trying. I am grateful that you are my agent and at least you are making something happen.

So we call this a reverse offer. We made up the components of what we do exactly and sometimes we change what we do to make the components fit the situation but we follow a couple rules all the time.

In the situation when a buyer has seen a house two times, we call the agent and ask if we are on the short list. When they say yes, you are on the short list but they don™t say that we are the top house, we ask what the objection is in the house. One situation was that there was not heating and air in the basement. We say okay and then ask; “Do you mind if we give your buyers and offer?”

This throws the agent off quite a bit, but then they say okay after thinking about it and asking us over and over if it is legal to do that. I promise you, that is exactly what happens and it really makes you wonder why agents are so much in-the-box that they would think that something out-of-the-box would be illegal.

Anyway, we go to work now and call our seller and get the offer together based on our desire to overcome the objection and then we present the offer to the buyer via the agent.

Whereas the Reverse Offer does not work 100% of the time, we are working them to close about the same amount of time as when we get the offer from the buyer to the seller. Again, the most important thing is that we are making something happen instead of sitting on our hands, and frankly that is what my sellers expect from me.

1. How is the neighborhood association; strict, crazy or what?
2. Are there any assessments coming in the future?

3. How is the construction on the homes in the neighborhood?
4. Is there any crime in the neighborhood?
5. Is the neighborhood social?
6. How are the amenities?
7. Why are the neighbors (house you are looking at) moving?
8. Have they had any trouble with their house that you know of?
9. Is there anything that would prevent you from buying your own home again?
10. And anything else you want to know.

Learn how to add value to any home with these quick tips:

Cosmetically Challenged: Some homes simply suffer from poor taste; horrid carpets and personalized paint choices may have been the pride and joys of the original owner but don™t translate well into the general market. Rather than succumbing to the “shock and awe” when encountering a cosmetically challenged home, focus on the structure and surroundings instead. Cosmetic fixes often result in the largest “bang for the buck” when it comes to adding value to the price of a home.

It can be used a couple different ways for both sellers and buyers. For sellers, it can help jog the memory to aid in filling out the seller™s disclosure and it can help fill in the clues of what happened before the current seller purchased the property if the current owner has not lived in the property for the last seven years.

For buyers, it is critical to understanding the risk of the property and what has happened to the property. Risks could include flooding, lighting and any other routine risk as well as theft, etc.

Buyers must ask the seller to provide them with the C.L.U.E. report as only the owner can secure this document. A buyer should ask for this report during the negotiation round of the purchase.

Once the buyer has the document, it would be wise to closely compare the document to the seller™s disclosure. If something is noted in the report that the seller has not added to the disclosure, ask the seller to revise the disclosure and to give you the details of what happened from their documents. This would also be a great time to ask for copies of the documents to compare to the report and give a headstart to the buyer™s own house file.

Sellers can obtain this report for free from www.choicepoint.com by filling in just a few fields. You will get the report immediately online

1. Bank-owned homes, investor purchased homes and new construction will not include a seller™s disclosure.
2. You will need to study this document closely, looking for the age of depreciable items and any item that is marked with a “yes” or “don™t know”as a disclosure. Any “yes” needs to have an explanation that is detailed with what, when, how etc¦ If the item is not detailed, ask for further explanation. “Don™t know” should be taken seriously and approached by your inspector.
3. The disclosure also tells you what is included in the sale. This list includes the mailbox; kitchen knobs, light plates and many small items that buyers think automatically come with the home. Make sure that you ask for any items that are in the house that you want included in the sale by comparing the disclosure against your own list.
4. The document will also tell you about neighborhood assessments, warranties on things in the home and any bonds that are on the home. Make sure that you follow-up to make sure that you have the paperwork on these items at closing.
5. Use the disclosure to also have your inspector search for specific problems that the seller has claimed on the disclosure. Remember that “don™t knows” need to be thoroughly inspected.
6. If the inspector finds something that the seller has not disclosed, you may be able to get out of a contract based on fraud during your inspection period if your contract is restrictive. The seller has the obligation to tell you everything that should have seen or known about the property.
7. Sellers should use the disclosure that was given to them by the previous seller if the home was a resale when they purchased it.
8. Read the document twice to make sure that you understand the disclosure that the seller is making to you and then proceed accordingly.

Should you find anything that needs to be updated by the seller, ask the listing agent to get the seller to make the corrections and add Revised, the date and their initials. This is a very important document and it should be taken very seriously. Take your time when you are understanding this document.

Deadly rules for homeowner™s plans can be as simple as:

• Adding a pool or hot tub
• Adding a fence
• Adding a basketball hoop
• Adding a structure like a shed or additional garage
• Painting your house a certain color
• Adding landscaping or cutting trees
• Adding a satellite dish
• Adding certain items to your patio or front porch

Even of more concern are the rules pertaining to:

• Renters “ some neighborhoods cap the amount of rental homes that can be in the neighborhood

Fines can be assessed for:

• Leaving the garage door up
• Leaving the garbage cans out past 5:00 on garbage day
• Not cutting the grass or trimming the bushes
• Leaving Christmas or other holiday decorations up too long
• Barking dogs
• Roaming dogs
• Loud kids

All of these rules are part of the Covenants, Conditions and Restrictions. In this important document you will also find how the monthly dues are spent and what the condition of the budget is, as you should also ask to see the budget.

Here is the history of the real estate broker and real estate agents from the 1950™s to today, 2008, some 60 years later¦

1950™s “ In the 1950™s there were no women in real estate. Real estate was a man™s world – period. All deals sold by a real estate company were the real estate companies listing, with few exceptions. Brokers knew each other, but they rarely sold each other™s listings. The broker was also the “deal doctor”. The broker was the smartest person in the office when it came to real estate. Agents did not do a deal without the broker being involved and them going to every listing and buying appointment. The agent was basically the assistant. The broker was the agent in the 1950™s. Listings were kept on index cards and buyers viewed these cards only if they met the broker™s approval.

1960™s “ In the 1960™s the first multiple listing service was formed to help companies sell each other™s listings. The first multiple listing service was done with index cards, similar to how brokers had kept their listings before. Cards were sent to each other™s offices listing the commission that an agent from another company would be paid. Then the MLS progressed into the book that was published every week. An agent was prohibited to give this book to their clients. However, every Friday (or whatever day of the week that the book came out) the offices would have new listing night where families could come to the office and see the new listings in the new MLS book.

1970™s “ Franchising became popular. Franchising offered brokers some continuity in training. Franchising also brought in referrals from other parts of the country to the broker. The Realtor boards also started offering training and designations. The agents were able to tell the public that they were “trained” and that they have this or that designation. The Million Dollar Club became known as a designation to the public. However with all of this “training” agents became more independent and they started doing business without the broker.

1980™s “ The real estate agents take over. They start marketing themselves on signs, not just the brokerage. The real estate agent starts demanding higher splits from the broker for the business they are doing. They start getting glamour shots and personalized advertising. ReMax starts with a bang and many agents leave their current broker for higher splits. Their thought is, they already know what to do to bring in their own business and they have been trained by the Realtor board.

1990™s “ Cendant now known as NRT starts to buy all the big affiliations. Coldwell Banker and Century 21 become one in the parent company but still appear as different brands to the public. The real estate business becomes more about branding of the company than advertising homes. Agents are taught more about synergy and passing leads through relocation companies.

The co-founder of MTV is involved in this giant corporation and he starts to teach the business about selling other services besides the home. One-stop shopping for the consumer starts.

1998- Brings Internet shopping for homes to the consumer. This shopping also brings the emergence of discount brokers and multi-level brokerages like Keller-Williams, which is a model based on recruitment and overrides of what those who you™ve recruited sells.

2001 “ Hyper inflationary market begins and produces rapid increase in broker and agent populations. The Realtor boards grow from 800,000 agents in the U.S. to 1,400,000. Everyone was getting into real estate. There was absolutely no lead management in most of the brokerages because buyers were plentiful.

2005 “ Contraction in home sales begins. Unprepared brokerage firms begin to fail. Unprepared for a lack of profit and agents start getting out the business and many affiliated firms drop their contracts to become independent. Their effort is to make more money for themselves as brokers in the everyday business.

2007 “ Housing sales drop as doom and gloom sets into the financial markets. Lenders face record numbers of foreclosures due to hyper inflationary markets in 2001 and their lending practices. Under the Clinton administration, Congress had passed laws for social engineering to help buyers buy homes with loose financing restrictions. These homes could not have been purchased by these buyers without more stability or while under free market conditions. Realtor board numbers drop back to 800,000 as many agents get out of real estate.

Today, the Internet tells the story.

Market and Neighborhood demographics, mortgage history, taxes and Google Earth shows buyers exactly what they want to see before they visit a home. The information highway is doing the job that real estate agents once coveted as the most important part of their job “ finding a buyer a home. Now, buyers walk into real estate agent™s offices prepared with the facts that ultimately prepare them to buy a home. Sellers are telling agents what their neighbors sold for and how long it took them to sell. Buyers are now literally and figuratively driving the agents. The power that a real estate agent and a broker for that matter have individually and collectively has now shifted. Real estate agents now need to re-invent themselves to stay in business.

Redesigning your real estate website is essential to keeping your business current in the marketplace. It is also essential in keeping your mindset about your business current as well. So, although the website is the focus of this article, you must know that if you are not current in your thinking about whatever business you may be in, you are not staying on top of your business. And in business, if you are not going forward, you are going backwards.

Here are the benefits of redesigning your website:

1. Gives you an opportunity to check your work. Often times as you re-read your website you will see that you have changed something that you forgot was on your website. This gives you an opportunity to change the statement or idea and also ponder the thoughts around the idea to make sure it is still germane to the business.
2. Gives you an opportunity to change and update pictures. Many times when I view my friends™ websites, they are still using a picture of themselves with a haircut that is not their current haircut or before they lost all the weight, both of which would make their appearance look much better. All photos can use updating from time to time and focusing on this will give you ideas of how you want your company represented.
3. Changing the content of your website will allow the spiders and robots that search and rank web sites in organic searching to know that you are still around “ in business and kicking. This is very important as many people spend a great deal of money monthly updating their site to make it search higher on the search engines.
4. Redesigning your real estate website also allows you to use newer technology like Joomla “ a free software site that has search engine optimization built-in to each block of your page. This gives you so many more options to increase your website traffic.
5. A re-design allows you to re-address email options and phone numbers “ basically ways people contact you. Now, you can choose chat features where viewers on your site have the ability to chat with you on the site. There is now also a new feature available that allows you to reach out to them and initiate the chat first.
6. An overall overhaul of what you learned and how you want to change your business can be implemented on your website. This is the most powerful contact to your business that the public has because your website is your creation “ their first impression of you. And as you grow and get better in business, your first impression also grows and gets better. You are your website and your web site is you.

Constantly changing your website is not a bad thing. Embrace the change and reap the benefits.