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Marketing a House in 2012

Alan Pursell — Mon, 12 Mar 2012 22:45:28 GMT

My Approach to Marketing a House in 2012

We all know that house values have declined in recent years. But, here in San Francisco, we are very lucky! The median house value is only down about 12% since 2006. Still, this does not have to discourage sellers. I can show you how to recoup that loss with a little marketing trickery…all perfectly legal, of course!

First, we must realize that there are a LOT of Buyers out there. There is a LOT of pent-up demand for houses. This is mostly because inventory is very low. i.e., there aren’t enough sellers to match the housing demand. But, these Buyers are very particular. They want to buy just want they want right off the bat, not like past years when the market was in a frenzy and Buyers would take whatever they could get. Sellers today really need to satisfy Buyers’ needs in order to be successful.

This can be accomplished by sprucing up your house…giving it a “shoe shine”, as it were. It doesn’t have to be expensive; it just has to be done right.

Curb appeal: paint, fix up any obvious flaws, and landscape with multi-colored shrubs and flowers.

Paint the entire interior, neutral pastels and bright white ceilings.

New carpet where needed, flooring should be upgraded or refinished, and, Buyers LOVE stainless and granite, if you want to spring for it!

Clear out all clutter and family photos and keep only your best furniture in there. No real need for expensive staging.

Ah yes, the PRICE…very important. I suggest the low end of the comps range. Buyers will run the very same comps and a lower price will make them think it’s a bargain.

Now that you’re ready to show off your creation, I will list it in the MLS, put up a nice shinny sign out front, and advertise the first open house in every on-line real estate site that exists. Now for the coup de grace… I will put a “Bid Date” right on the flyer. This will be two weeks after the first open house. I will not accept offers until then. This little technique, along with the lower price, will create a mini-bidding war. Buyers also have little tricks of their own. They will find out what others have bid, by hook or by crook. They will then try to beat the other Buyers! This will only serve to benefit the seller by creating an atmosphere of competition. If all this works well, we will receive several very good offers on the bid-date. All we have to do is select the best one. Hopefully, it will be OVER the 2006 value.

Wanna give it a try? Call me! (415) 425-2014

Alan C Pursell March 12, 2012

Farm your Own 'Hood

Alan Pursell — Fri, 15 Jul 2011 22:43:02 GMT

Start Farming in your own ‘Hood

We’ve all received those pesky marketing mailings from Realtors. Some are postcards, some are letters, some are notepads, etc. But, as wasteful as they may seem and as expensive as they are to the Realtors, this is a standard practice in Real Estate…it’s called “farming”. The purpose is to put your face and contact info in front of as many people as possible in an effort to get more business.

Some Realtors have farms with thousands of addresses and do periodic mailings several times a years at over $1000 a pop.

It pays off eventually when people either die, or get divorced, or get a job transfer. “Hey, we have to sell this house now! Let’s get that guy who sent us those postit stickers last month.”

But, sometimes Realtors skip the really obvious areas for farming…your immediate neighbors!

Our Broker tells a story about his neighbor that he knew for many years who suddenly listed her house with another Broker. He asked why and she said that she “forgot he was in Real Estate”.

You’ve got to get exposure and keep it.

You can do a letter or postcard and actually deliver them yourself, saving a lot of postage.

But…don’t be annoying or obvious about it! Choose a campaign that is first and foremost a community service. You can hold a block party and invite all the immediate neighbors and collect their names, addresses, phone numbers and email addresses. Then compile the list into a neighborhood watch contact sheet…which incidentally has all your Realtor contact info at the bottom.

How about a baseball and/or football schedule for the fridge?

Maybe a postcard with useful home safety information?

Be creative and be helpful…people will remember you for it!

You’ve got to FARM to reap a harvest!

Should Other Agents Advertise YOUR listings?

Alan Pursell — Thu, 30 Jun 2011 16:36:27 GMT

Should Other Agents Advertise YOUR listings?

We’ve all seen the Real Estate magazines touting many, many listings all from one company.

Can they really be that good? Do they really have that many listings?

In most cases…NO!

These Agents grab most of these listings from the MLS, copy the photos, and publish them with the implication that these are all their listings. Not only are they misleading the public, but sometimes, the information is incorrect. eg. wrong number of bedrooms, wrong square footage, etc.

These are usually foreign language publications. The thought being that they get away with this because most people don’t understand the languages used.

But, as listing agents, why would we complain about free advertising of our listings?

These listings are available for other agents to search for on MLS anyway.

What’s the difference?

And, from a buyer’s standpoint, most people don’t really care who has the listing. They just want to browse and pick out what they like and have those properties shown to them.

That’s all these publishing agents want as well. They want to pick up buyers. This practice really doesn’t take away anything from the listing Agent. If the buyers make a good offer, the listing office will still make the same commission.

My suggestion is that any Agent who wants to put out a publication like these, should simply come clean. Don’t try and pretend that these are all their listings. Call the real listing agent and ask for their permission to include the property in their advertising magazine. Then, in the publication, a title above listings from other agents should simply say “Available for Showing”.

That’s all the clients need to know. They are buyers. They work with buyers agents, not listing agents.

If we all cooperate, we can all get along… and thrive!

What Kind of Agent?

Alan Pursell — Wed, 11 May 2011 23:22:00 GMT

What Kind of Agent?

If you are an agent, the question is: “What kind of Agent are you?” and if you’re a client the question is: “What kind of Agent do you want?”.

Well, there are basically two kinds: A Buyer’s Agent and a Listing Agent. One of the most confusing terminologies for new Agents is that a listing Agent “Lists” and a buyer’s Agent “sells”. That’s just the way it is. If a listing agent’s job is to sell a house for a client, doesn’t he then “sell” the house? And if a buyer’s Agent’s job is to assist the client in buying a house, doesn’t he “buy’ the house. No, actually the client “buys” and the agent “sells”. The listing agent just “lists”. Not too confusing, is it?

Most Brokers like to have listings and therefore, listing Agents. They feel that the “listing is king” and you then control the market. Also, there is a contractual relationship between the listing office and the client. When you work with buyers, no contract is usually signed at all. An Agent can spend untold hours driving the clients around and they could just go with another Agent without any consequences.

My question is why not do BOTH? If an Agent maintains a group of buyer clients and also obtains listings from farming, advertising, social media and networking, then he can introduce his buyers to his listings and “double end” the deal meaning he “sells his own listing”. Double commission is better any day of the week and any Broker would certainly agree.

How to Retire with your IRA

Alan Pursell — Fri, 06 May 2011 17:58:00 GMT

How to Retire with your IRA

Wow, that was almost a rhyme!

Have you ever heard of people calculating a “magic number” for their IRA? A mystical number of dollars that they must accumulate before they can retire? Think how absurd that is! How would you do that calculation? Perhaps by using actuarial statistics to determine when you will die and then multiplying the money you will need each year times the number of years you have left?

No, Friends, life is just not that quantitative. We need a plan that is fluid. A plan that I call my “financial perpetual motion machine”.

The idea is to start with a few hundred thousand in your IRA. Most people have at least that by the time they are 59 ½. (That’s the age when you can withdraw from your IRA without penalty). That money must then be invested in a safe, high yield instrument that enables your IRA to grow at or above the rate at which you withdraw for living expenses.

Mutual funds, stocks, bonds, commodities? No, the rate of return is not great enough and the value can actually go down like we all saw back in 2008. That ain’t going to cut it!

Consider Tax Liens or Tax Deeds!!! Most rates on Tax Liens pay 18% to 25% annually as dictated by LAW! That’s more like it! It can’t get any safer and it never goes down! Also, once in a while the lien is not redeemed, in which case you are awarded to DEED to the property…free and clear! This is because tax liens are ALWAYS the number one position lien on a property. They wipe out all other liens like mortgages, for instance.

Of course, you can’t just buy tax liens with your traditional IRA account. So, you must set your IRA as a “Self-Directed IRA”. Also known as a “Solo 401K” or a “Qualified Retirement Plan” (QRP). A third party sponsor must set this up for you and you will be assigned a new Tax Identification Number (TIN) from the IRS, setting the QRP apart from you personally as a separate entity, thus avoiding taxes on your gains. To fund your new QRP, you can transfer money out of your IRA into your new QRP. You “rollover” that money into your new plan just as you would do when you “rollover” money from old 401Ks into your IRA. We’re just going the other direction here.

You are the trustee of your QRP and you can then open a bank account for all the transactional activity such as wiring money to an auction company or depositing the returns from your investments.

Here’s a numerical example of how this works…

Say we have $400,000 in an IRA. After setting up the QRP, you can go online and start buying tax liens. There are literally thousands of them out there. All states and all counties have them. And most of them are auctioned off online with pictures and comps right there for your due diligence. Even if you screw up and buy lien on a house that gets burned out or ruined by a tornado, hurricane or flood and you are then awarded the deed, you can always find a contractor or investor who will buy it from you for at least double your initial investment.

So, with the $400,000 all invested in 18% tax liens, you will get $72,000/yr which you can easily live on, and your IRA remains the same. That’s perpetual motion!

Once in a while the lien will not be redeemed and you will be awarded the deed to a nice $200,000 house. Sell that, buy a new car and take a trip to Fiji.

Happy retirement!

Retail vs Wholesale

Alan Pursell — Wed, 02 Feb 2011 19:13:00 GMT

Every Realtor out there knows that, right now, in this economy, it is really difficult to sell a house for market value. That is the top end, the maximum price for a house. That is our definition of “Retail”.

Why aren’t people buying? Besides the shaky economy and the high unemployment?

Because buyers know there are better deals out there. They know the unlisted market is flooded with foreclosures and short sales. These would be known to us as “wholesale”.

So the thing for us to do would be to position ourselves between the banks who own this “shadow inventory” and the bargain hunters who can be just home buyers looking for deals, or they can be speculators or flippers looking to turn a quick profit. If they have trouble selling after their renovations, that’s their problem.

How do we get these wholesale listings? We schmooze. We wine and dine. We call banks, S&Ls, credit unions, the US Government agencies;

any entity that may be holding non-performing assets in the form of Real Estate Owned (REOs).

Trouble is, they are very reluctant to let go of these assets, even though they don’t really want them. Sounds strange, eh?

The reason is that they are greedy too, just like everyone else. They don’t want to take a loss if they can hold on for more money. Also, they don’t want to flood the market and bring down home values even more.

So, we’ve got take the few crumbs that we can get from good, old- fashioned persistence and wait for the foreclosure mess to subside, at which time more of these assets will be released. We’ve got to position ourselves to be the Realtors of choice when that does happen.

So, make those connections and network those asset managers. Better times will come. They have to!

Prepping a House

Alan Pursell — Tue, 01 Feb 2011 22:42:00 GMT

Initial impressions are everything!
Once the decision is made to list and eventually try to sell a house,

we've got to "spiffy up" the place.
This is sometimes called a "shoe shine" or a "staging".
The Realtor must work with the owner (or seller).
But not necessarily with a contractor or professional stager.
A contractor is only necessary if major work needs to be done just to get the house presentable.
We're talking holes in the roof or falling down decks or plumbing leaks or dangerous electrical problems.
In any of those cases, a reputable, licensed contractor should be called in and the work should be done to code and with warranties.
Professional Stagers?

Yes, they can make a big difference and actually make or break a sale.
But, in most cases, staging is just "fluff" and, with a little imagination, it's not difficult to just do it yourself.
You can get ideas from visiting other open houses that have been staged.
I've seen things like wine corks in a glass vase, or scarves thrown over a sofa table, or colorful throw rugs in an otherwise drab utility room.
Most people can just do that stuff on their own.
But, I'm getting ahead of myself.
Paint, paint, paint first!
A fresh coat of paint works absolute wonders!
Inside AND outside.
The color should be neutral, but interesting.
For the exterior, I like low-luster color.
Low-luster is between flat (boring) and semi-gloss (too shinny).
It has a nice sheen and looks great when the sun hits it.
Don't be afraid of colors...light blue, barn red, or just brown or charcoal.
I would shy away from green exteriors.
It competes with landscaping and shrubbery and doesn't usually look good.
Be aware that darker colors make the place look smaller.
This is true for the inside as well.
The very best neutral color for interiors is a simple "bone white".
It goes with absolutely anything and even takes on a gray, or green tinge when light hits it at a certain angle.
Carpet!
Where there's carpet, it should look new.
If it is fairly new, it should be professionally shampooed.
Where it's worn out, replace it with "staging carpet".
Any big carpet retailer will know what you're talking about.
Kitchen floors and bathroom floors should be new as well.
An alternative to vinyl or tile is a laminate floor.
They come in large tiles and can look just like Italian marble...very nice!
Hardwood!
This is a big selling feature. People LOVE hardwood floors!
But to get the nice reflective effect, they have to be refinished.

And then, no throw rugs.
Appliances!
If you can get the owner to spring for new stainless, great!
Otherwise, just leave it up to the new owner's taste

Explain that, and buyers will understand.
Furniture!

Why spend money to have all the furniture moved out and stored and then, rent “staging furniture” and have that moved in only to move it out after the house sells and then, move in the new owner’s furniture? Now doesn’t that sound ridiculous?

Most people have a few good quality pieces of furniture. Just leave those pieces in place and move everything else out. The less, the better and remember, smaller pieces make rooms look bigger!

Chotchkies!
Get rid of them!
Get rid of all clutter and nick knacks!
And NO personal, family photos...buyers don't want to see YOUR family.
They want to picture THEIR family living in this house.
Well, that's all the hard stuff.

Now have fun with imaginative stuff...

Staging the interior to create that WOW effect!
And don't forget those wine corks!

Why BLOG?

Alan Pursell — Tue, 01 Feb 2011 18:25:00 GMT

Here's a great one...I've been using email for 41 years! WHAT?
It's true! I was a programmer in 1970 and we used the "SEND" command in TSO quite often.
It's just one line at a time and it only goes to those other programmers that are signed on, but it WAS email (sort of).
Email today is much better, but it goes away after awhile and it's limited in size.
Then, there's Facebook...fun, but it also goes away after a while. It just not very good for longer text messages.
Twitter? Now that's only for small little Tweets, as it were.
Then, there's a BLOG (it stands for WebLog, if you didn't know)
But that says it all...it's a LOG...a permanent record of whatever you say.
It can be controversial, long winded, even provocative...and it's all yours...
and it's always there for others to enjoy and learn from and comment on.
There are also quite a few search mechanisms that find your BLOG based on keywords that you designate.
So, if you have good content and popular keywords defined, your readers will come to you!
You can get famous or even go "viral".
That opens door to jobs or growth for your business.
So, BLOG on, and let 'er rip!
Above all, have FUN!

Buy or Rent?

Alan Pursell — Tue, 01 Feb 2011 00:53:00 GMT

Humm...there's a question! How about "stability or insecurity?" Maybe "A future for your family, or everybody's on their own?" Perhaps "Owning something Real, or owning nothing Real?"
Buying a house is not just a shallow question of interest rates or appreciation or down payment or shadow inventories.
Owning Real property has traditionally, for centuries, been your family's legacy.
Somehow, over the years, we all got swayed into thinking that Real Estate is just another investment.
It's so much more than that!
It's your identity, it's your power, it's your independence.
When you own your own house, you are in control.
You can add-on, you can remove walls, you can paint, your can customize.
Or, would you rather be subject to some landlord's approval, and then later on, be evicted?
Yes, you CAN get evicted, even in SAN FRANCISCO ;-(
As for the investment aspect, yes, values have dropped over the past few years.
12% down on average in San Francisco give or take, depending on which area.
But, that's not like 50% in the central valley, or 80% in Detroit!
WHY? because this is GREAT place to live. Everybody likes it here and there will always be strong demand!
Therefore, the market WILL bounce back. It may take several years. But, you gotta live somewhere, right?
9 times out of 10, your mortgage payement can be less than rent payments!
So, I say, don't hesitate!
The sooner you get in the game, the more your will accumulate...not just equity, but LEGACY!

A Peace of Bernal Heights

Alan Pursell — Fri, 17 Jul 2009 00:58:00 GMT

They say that real estate value improves with altitude.
If this is true, it is certainly true with Bernal Heights.

Up here on the quaint narrow streets of Bernal Heights, all the hustle and bustle of the city below is lost to the serenity and peacefulness of this beloved hill.

One doesn't really have a good appreciation of one's surroundings and the natural aspects of the geography unless you attain a good focal point from which you can view the surrounding hills, valleys and city. A little altitude can do that for you.

It can also affect your weather. Bernal Heights is actually part of the famed "Banana Belt". This is a term given to the Noe Valley, The Mission and the Bernal Heights areas where the twin peaks hill serves as a natural barrier for the onrush of fog on a typical summer's afternoon and evening.

One of my favorite relaxations is to walk my dog to one of the many local parks or just sit on my roof top and watch the sun setting into the soft pillows of fog, illuminating and enlightening the end of a perfect day and the promise of a brand new one tomorrow.

To own a piece of this peace has got to be one of the most sought after goals of real estate.