Should I Buy Now?

In a radio interview I provided this morning, the host asked me if it was a good time to buy right now.

My answer is not a simple yes or no.

Yes, you can find great deals out there today.

“But shouldn’t I wait? What if prices go down even more?” clients ask me.

There are costs associated with waiting such as rent, living in areas from which you want to leave, and the stress of being in a holding pattern.

On the other hand, if you buy right away, there’s no guarantee that a home's price will stay the same.

And here’s where being an expert counts. Not only are you able to communicate this information to your buyers, you’re also armed with a home's sales history.

After 20-plus years working in Beverly Hills and its surrounding neighborhoods, I provide my clients facts. The value went up during this period, down during that one, and here’s the overall trend. This information is critical to providing superlative client service.

How Has Business Been?

November, December, and most of January were a true challenge. But with ’09 has come some good news. It’s still difficult. The sales process has stretched out much longer than in recent years, sellers are very nervous. But people are buying and selling homes, and I foresee this trend to continue throughout the year.

Next, the interviewer what asked what I thought about foreclosure properties. We all know the plus side—low price. However, there’s no such thing as a free lunch. My advice is buyer beware.

Clients should expect additional paperwork when securing a loan on a foreclosure. The bank hasn’t lived there, so it’s doing its best to protect itself.

You’ve got to make sure that you’re aware of all the home’s weaknesses. Foreclosures are most likely because an owner defaulted on a loan. She didn’t have the funds to cover the mortgage, so she certainly didn’t have the money to pay for repairs. And when you keep something in disrepair for too long, you’re really making matters worse. The result is a home that may have been neglected.

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How to Bring in the Buyers

In the January issue of Personal Real Estate Investor Magazine, I provide some insight into how to sell homes under current real estate conditions.

With the amount of inventory in today’s market, it’s more important than ever to make your home shine and stand out from the competition.

In my book, I point out that buyers will be swayed by their senses: sight, touch, taste, smell, and sound. You should focus on these five when you’re selling your client's home. I'll give a brief overview of the first one: sight.

The first impression, or curb appeal in real estate speak, is essential.

Here’s a list of exterior must-haves:

1. Freshly painted front door with polished door knocker
2. Landscaped front yard with new plants
3. Clean and clutter free driveway and entry

There’s much more you can do, like paint the entire exterior and redo the landscaping. But if your seller’s budget can’t cover these costs, then pour your marketing money into the first three.

Once your buyers make it inside, I suggest that you stage a home rather than leave it empty. A vacant home has no soul—it doesn’t encourage the buyer to imagine coming home to the space. There’s no place where the buyer can sit, relax and take in the home’s interior.

Staging isn’t an option for everyone. But it’s really important in high end properties. Your buyers are paying big bucks for the home, and it’s worth it to spend the money to fill the property with elegant furnishings.

When I’ve suggested to my clients that they stage their homes they sometimes balk at the price. Once I tell them how much more they can make if the home is fully furnished they give in, and I’m usually on the money.

In the Personal Real Estate Investor article, the writer asked me how I market my homes.

“Post cards and color brochures are done,” I said, “We’re inundated with so much junk mail nowadays. I do a virtual tour. They [postcards and brochures] don’t speak to [buyers] like the video tour does.”

I hire a professional photographer who also shoots a video tour and adds music to the final cut. Then I e-mail four or five virtual tour properties to prospective buyers. They can focus on listings at their convenience. They can watch the presentations in the comfort of their own homes, at their offices, or even on their smart phones. The cost to create a virtual tour varies. A 10,000 square foot home is about $1,000.00.

I’ll provide further detail about how to address the four other of the five senses—touch, taste, smell, and sound—in my next post.

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Go with Your Strengths

“If I was down to my last dollar, I’d spend it on public relations.”—Bill Gates, Microsoft Founder

Last time, I shared that what’s old is new. One positive result of the economic slump is that our families will be motivated to revive time-tested traditions that we may have abandoned.

For instance, rather than spending money at amusement parks and expensive family outings, we may find ourselves relaxing at home over a modest meal and a board game.

At work, you may revisit some low-tech practices as well. And the result may be good for business.

Our mobile offices with web-based CRM’s, our smart phones that are really handheld computers, our expensive drip marketing systems, have all sped our businesses up and have kept us connected with more people than ever before.

Despite the benefits of our virtual world, there’s nothing like real human contact.

At one point in history the phone was a huge step forward. Now it’s an old-fashioned way of doing business. If what’s old is new, then it’s time to go through that phone list and reconnect with those whom you’ve haven’t communicated with in months or years.

I reflect on how I launched my career, over 20 years ago. Throughout most of my marriage, I had been a stay at home mom. My life was consumed with maintaining my children’s schedules, getting the meals cooked on time, and keeping our family organized.

Now I was thrust into the take no prisoners world of sales. Sink or swim. No holds barred. You get what I mean. And since my husband, Saeed, was well known in the local community, I felt the pressure to succeed. Or the pressure to not fail.

I thought about who would form my contact list. Who would hire me to be their broker? I was an inexperienced Realtor in one of the toughest markets on Earth.

I had three kids. As a result, I was constantly on the go. Picking them up, taking them to acting, basketball, ballet, and more. I was surrounded by other parents and we created bonds. We counted on one another. They would form my client base.

As we waited and watched our kids rehearse their instruments and practice their sports, conversations about real estate would come up.

“Our family’s growing and my husband and I want a bigger house,” a friend would say. And now that I was a Realtor, I could offer my help.

Everyone Wants Something for Free

It doesn’t matter if your clients are working class or upper class, people always like something for free. Buy chocolates, notepads, or any number of simple gifts, send them to your prospects and clients, or even better, deliver them personally.

I shared the story of purchasing chocolate at my son’s school fundraiser. I bought boxes and boxes. I probably made him a top producer. When I revealed my plans to give the sweets away to prospects and clients, many looked at me as if I were crazy.

“Who in Beverly Hills would appreciate something like that?” they thought.

But it worked. I’d give someone a call, let them know that I had bought chocolate to support my son’s school, then offered to drop a box off. When I arrived, they appreciated the gift and we would catch up.

During these months of belt-tightening measures, you must remind yourself that giving to others is one of the easiest ways to create opportunity.

It may feel painful and excessive if the bottom line is tempting you to do otherwise. But the generous steps you take will benefit business.

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Back to the Basics

Everywhere you turn, it seems, the current economic crisis stands right before us. You hear it in daily conversation and on the radio. You see it in the newspaper and on-line. You may have experienced it in terms of decreased income and rising expenses.

Pulling the Reigns in a Runaway Society

Compared to societies in Asia, Africa, and Europe, we’re a young country. Adolescent, if you will.

Like any young person, we’re full of possibility. The future is ours to embrace with open arms. At the same time, we can be short sighted. We think that we can do whatever we want because we’re young and the concept of consequences is abstract.

During the real estate boom years, so many of us over spent. We amassed debt on our credit cards. We maxed out our home equity lines of credit. Now the piper is demanding her pay. And many of us don’t know what to do.

No doubt we’re living in stressful times. What’s the upside?

Less income means less to money to spend. This also means that we’re learning to stretch our dollars farther than we did before--maybe spending less time in the strip malls and departments stores and more time at home.

We’ve gotten so distracted by technology: Mobile phones, text messages, laptops, and gaming systems. We’ve forgotten the value of reading to our children and pulling out a board game and spending a couple of hours together around the dining room table. Things that our parents did but seemed outmoded, like home cooked meals, are suddenly part of our lives again.

I’ve seen it in my business. For the holidays, my clients made donations to charities on my behalf and gave me baked desserts rather than wine baskets. Parties that I’m used to attending were cancelled because of cost-cutting measures.

From everything I’ve read 2009 is going to be a difficult year. But with setbacks come opportunities. Take LEGO Group for example. The global toy company is doing quite well during this economic slump posting a profitable 2008. Another company that’s thriving is Campbell Soup Co. Although there are many reasons to explain the profitability of both companies, it’s hard not to think that a tough economy is actually helping them.

My optimistic take on the economic difficulties we’ve faced and will continue to deal with is that first, old values are becoming new again. Conserving rather than consuming, spending time with our families by staying at home rather than at amusement parks.

In our professional lives, we’re being called on to be more creative. We may revive past business practices that we had forgotten about. In my book I share about how everyone likes something for free. We may offer our prospects and clients simple gifts, like notepads and stationery, and generate business as a result.

We may decide that 2009 is the year that we'll connect with our colleagues, clients, and prospects in new ways. In addition, we'll make more effort to maintain the relationships we’ve already created.

The months ahead are going to be full of challenges. But time has taught me that this too shall pass. Staying upbeat is not only more difficult than ever but more important as well.

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