Tuesday, July 25, 2017

How to Cope With the Summer Slow-Down in Real Estate


It's Summer...It's HOT... Where did all the Buyers Go?

Anyone who has been in Real Estate for any length of time knows how cyclical the market can be. Tax Time, Summer Vacations, Back to School, and Major Holidays can sometimes put the brakes on even the hottest markets. Coupled with the “roller coaster” effect inconsistent prospecting creates, and you have the perfect set-up for a few bad business months… (Where you seem to always be scrambling for prospective buyers and sellers).

Step One: To lessen the side effects of the normal cycles of the real estate market stay consistent with your prospecting and networking with your database. Only 20% of REALTORS have a system in place to manage their database … Only 5% use it consistently… This 5% has an average yearly net income over $200,000. Lesson #1 learned… Get a System…Lesson #2 USE IT!

Realtor Rescue Coaching implements a system appropriately named “THE FIVE”©. This is a simple to learn and utilize system of 5 different types of contact per day…  5 days each week. This equates to approximately 25 contacts per week of voice to voice, face to face, hand written notes, electronic communication, and breaking bread (lunch or coffee meetings).

For most this seems like a daunting number… I often get this response… “I have to contact 25 people each week??? Really Eddie…are you on drugs?” … (or some just look at me like I have 3 heads)… But I promise…it is really is much simpler than it seems.

Daily Scenario: You call a past client and invite them to Starbucks for coffee… 1 call, 1 coffee… after the Starbucks visit you send them a hand written note via snail mail thanking them for meeting with you (and again asking for referrals)… there goes your 3rd contact…

While at the grocery store picking up your dinner you see a neighbor and have a quick discussion about the swim meet at the pool and you ask them to remember you if they hear of anyone buying or selling ….there goes your face-to face and contact #4.

So all that is left is your electronic communique… Will any of you send any personal emails, or go onto social media after you have dinner? Yeah I thought so….BINGO there’s your “FIVE” for the day… Easy Peezy!   

Step Two: Is to get an accountability partner to hold you to your promise to yourself so you can reach your goal of 5 contacts 5 days each week. Also have a set of written goals for your transaction numbers and income for the next 3-6 months. Consistency is the key…your “easy button”… Your “partner” can be a spouse or significant other or another agent where you can hold each other accountable to your goals.

Step Three: “Aim Small and Miss Small”  Don’t aim at the whole target…pick a spot on the target and focus on it intensely… so even if you miss the small spot you were focused on, you will still be on the target.

Example…. Don’t focus on a goal of $100,000 in income… nor the 30 closed transactions needed to generate $100,000 in income… don’t even consider this equates to 2.5 monthly closed transactions … Do calculate the number of contacts you need per day to generate your income goal and focus on completing them each day. Even if you miss a few contact goals here and there… you most likely will still be on target at year end.

When the market slows down… it gives you more time to “speed-up” your marketing efforts. When everyone else is complaining about the lack of business…you will be shifting into a higher gear and waving to them in the rear view mirror… yelling…. STAY ALIVE WITH THE FIVE!!!!!

For more information on Realtor Rescue Coaching and “THE FIVE” contact


Eddie Brown © July 2017

 

Thursday, July 20, 2017

So the buyer for my new listing SAID they were paying cash.....

Can a buyer do a cash/loan switch-er-oo?

Release Date: 07/18/2017
Will Martin , Martin & Gifford, PLLC


QUESTION: In the latest version of the Offer to Purchase and Contract (form 2-T; copyright 7/2017), there’s a change in paragraph 5(a) I don’t understand.  Before the change, the buyer had to check whether they did or did not have to obtain a loan in order to purchase the property. Now the buyer has to check whether or not they “intend” to obtain a loan to purchase the property.  Why the change in wording?  Why does it matter whether the buyer says they don’t “have” to obtain a loan or they don’t “intend” to obtain a loan?  If they demonstrate they can pay cash, what business is it of the seller if the buyer ends up getting a loan?


ANSWER: First of all, we disagree that it doesn’t necessarily matter to the seller if a “cash” buyer ultimately gets a loan to pay for the property.  For example, assume a seller is evaluating two offers.  The first one is a “cash” offer and the second one involves financing.  The second offer is for more money, but the seller decides to accept the first offer because the first buyer demonstrates that they can pay cash for the property.  After the contract is signed, the buyer announces that they will be obtaining financing.  Although it’s true that the seller knows the buyer will be able to pay cash if there’s a problem with the loan, it’s also possible that had the seller known the first buyer would be seeking financing, they may have accepted the second offer for more money. 
The change will NOT prohibit a “cash” buyer from deciding to finance their purchase after contract formation, but it will prohibit a buyer who is acting in good faith from leading the seller to believe that they are going to pay cash when in fact they intend to get a loan. In our view, a buyer who misrepresents their intent to pay cash is arguably in breach of contract and subject to losing their earnest money deposit.  Of course, the buyer’s true intent may be difficult to prove, but it is hoped that the new wording will deter a conscientious buyer from using the loan representation in a way that is potentially misleading to the seller. 

NC REALTORS® provides articles on legal topics as a member service. They are general statements of applicable legal and ethical principles for member education only. They do not constitute legal advice. The services of a private attorney should be sought for legal advice.

© Copyright  2017. North Carolina Association of REALTORS®, Inc. This article is intended solely for the benefit of NC REALTORS® members, who may reproduce and distribute it to other NC REALTORS® members and their clients, provided it is reproduced in its entirety without any change to its format or content, including disclaimer and copyright notice, and provided that any such reproduction is not intended for monetary gain. Any unauthorized reproduction, use or distribution is prohibited.

Friday, June 30, 2017

Are Seller Property Disclosures Required For Condo Sales?

Release Date: 06/27/2017

Will Martin , Martin & Gifford, PLLC


QUESTION: I represent a buyer who is interested in making an offer on a condo I’ve shown him.  I’ve asked the listing agent for copies of the Residential Property and Owners Association Disclosure Statement and the Mineral and Oil and Gas Rights Disclosure Statement, but she insists that they aren’t required for condo sales.  When I asked why, she said there are two reasons: one, the law only applies to the sale of real property and the owner of a condo doesn’t own the property under the condo, and two, the law only applies to transfers of real estate where there are one to four dwelling units, and the complex where the condo is located has more than four units.  That doesn’t sound right to me.  What do you think?

ANSWER: We don’t think it sounds right either.  The law in question here is the Residential Property Disclosure Act (the “Act”).  Section 47E-1 provides that the Act is applicable to specified “transfers of residential real property consisting of not less than one nor more than four dwelling units.”  According to Section 47E-3, the term "real property" is defined as “the lot or parcel, and the dwelling unit(s) thereon, described in a real estate contract subject to this Chapter.”

Regarding the first reason the listing agent gives for her position that the Act doesn’t apply to condo sales, it’s true that the owner of a condo does not own the real estate under his or her condo in the same way as the owner of a single-family, detached home. However, they do own the real estate on which their condo is situated; it’s just that they own it together or ‘in common” with all the other owners in the complex along with all the other common areas.  Thus, in our view, the sale of a condo unit is a transfer of residential real property as that term is defined in the Act.

As to the second reason given by the listing agent for the inapplicability of the Act to this condo sale, it’s not the total number of units in the condo complex that determines whether the Act applies or not, it’s the number of dwelling units being transferred.  Since this potential sale is for one condo unit, the Act applies and the owner is obligated to provide both Disclosure Statements, assuming that none of the exemptions set forth in Section 47E-2 apply. 
 
NC REALTORS® provides articles on legal topics as a member service. They are general statements of applicable legal and ethical principles for member education only. They do not constitute legal advice. The services of a private attorney should be sought for legal advice.


© Copyright  2017. North Carolina Association of REALTORS®, Inc. This article is intended solely for the benefit of NC REALTORS® members, who may reproduce and distribute it to other NC REALTORS® members and their clients, provided it is reproduced in its entirety without any change to its format or content, including disclaimer and copyright notice, and provided that any such reproduction is not intended for monetary gain. Any unauthorized reproduction, use or distribution is prohibited.