Hiring Your Close Friends and Family to Buy or Sell Your Home

Think about this for a minute. The population in the State of California for 2010 is estimated at 37,206,000. The California Department of Real Estate currently claims that there are 475,714 licensed Real Estate agents and brokers. So … on average, 1 in 78 persons living in California is a licensed Real Estate professional.
YIKES!!! This means that there is a very high likelihood that you, and everyone else in California, personally knows a Real Estate Agent. Perhaps, the good news is that, when you need a Real Estate Agent to help you to buy or sell a home, you likely have a friend or family member who is available to take the money from your wallet.
While you contemplate the above statistics and at the same time, think about that friend or family member, consider that not all of the licensed Real Estate Agents are active in the business, nor are many actually good sales people. Also consider that The State of California does not require any training what-so-ever in selling, to qualify for the Real Estate Sales Agent exam. I would estimate that at least 70% of the currently licensed agents, work full-time in some other job as a primary source of their income, and only work Real Estate as a part time endeavor – I would guess that they make their part-time Real Estate commissions waiting for people like you.
My business partner and myself have made a personal and financial commitment to dedicate the time, energy, and money to seek professional sales training and coaching. We are investing tens of thousands of dollars in our continuing professional development so that we can improve our selling skills, and to learn new techniques for selling houses – your house. Every month, we travel to the offices of a well-respected coaching firm known widely throughout the Real Estate industry, and spend several days, so we can improve upon our skills. We have also chosen to invest a significant amount of money in hardware and software to upgrade our telecommunications system that allows us to prospect for potential buyers and sellers directly, and as a result, build up a large network in the market.
So … consider a few of the following questions as it regards your friend or family member. (1) Do you absolutely have to sell your home, or are you just looking to do them a favor. (2) Do you prefer to have someone selling your home who is an objective third party, and one who has a high regard to protect your equity and interests. (3) As for buyers, do you want a trained Real Estate Agent to represent you in the negotiation process, or will you be satisfied at the possibility to overpay. (4) Does your friend or family member truly have the devotion and drive that you need for pursuing your interests, and will they tell you the truth. (5) Will you be prepared for the heartache of a distanced or severed relationship in the event that your friend or family member causes you to lose money, (6) Has your friend or family member upgraded their professional training and skills in such a way as to earn their commission.
So ... before singing that contract with your close friend or family member, consider the longer-term impact. Hopefully they will understand, and value your relationship above that of a commission check.
Contact us soon - and let us help you to sell or buy your home, and to move onward with your goals.
Charles M. Schevker (CPA)
DRE # 01875556        
Broker Associate
Prudential California Realty                                                                                                             (858) 449-8250
1299 Prospect St.
La Jolla, CA. 92037
http://www.San-Diego-Cal-Homes.com
http://www.linkedin.com/in/charlesschevker

Do it Yourselfers - What's Up With That? (Part 2)

If you have the time, please read my previous blog about buyers who feel compelled to search for their own homes, and eliminate the services of a qualified real estate agent.

As for sellers (FSBO – For Sale By Owner)

Oh, ok, so you want to save the typical 6% commission that is charged by real estate brokers who market and sell your home. Ok, I understand that.! Oh but wait – you say that most real estate agents simply take a listing, hammer a “for-sale” sign on your front lawn, and then stop back 2 months later at the close of escrow to pick up their fat commission check. Ok, I understand that!  

Instead, you take things into your own hands. You sign up for some internet website, search for recent home sales in your neighborhood, and then the click the button that says “calculate your home’s value”. Dang, that was easy – and now you are definitely convinced that you do not need a real estate professional? Mazel tov to you!

Now … what is your next step in this brilliant action plan of yours? Well ... maybe you go to Home Depot to get a “for sale” sign and hammer it into your front lawn. You might also take a few bad photos, put them along with a puffy description of your home, place ads in the local newspapers, and upload same to a website specifically designed for you - the FSBO. And then what Mr. / Ms. Genius – you wait, and wait, and wait. This is called passive selling.

You see … the problem at this point is that, you are only appealing to 2% of the buying population, and even at that, these people are typically not the type of buyers you want to attract. This means that potential buyers who, for valid reasons of their own, do not want to buy homes through the conventional process in the structured marketplace, and now, they are answering your ads. They are looking to prey upon those FSBO’s (YOU). These buyers, typically have some financial insufficiency, and they will be expecting you, the FSBO, to help make up for their deficiencies. For those of you whom have tried to sell by yourselves, how many offers have you received? Ok, so what! Now of those offers, how many were qualified offers? Were any from buyers who needed your financing assistance via seller-financing agreements? Were any of your offers from investors (experienced and inexperienced) who are only interested to find properties that hold future potential (for them) - homes that they can purchase at a price significantly lower than market, and then fix-up to rent or flip, and then generate a profit margin, at your expense.

Did I mention that FSBO’s generally sell their homes at 27% less than agent-assisted sales (http://www.realtor.org/library/library/fg006). You do the math, but I would prefer to capture that 27% increment and pay a real estate agent their 6% commission – that’s an additional yield of 21%. Consider that, a For Sale by Owner is much like a “garage sale” or “flea market”, whereas a sale by a real estate agent is like a Macy’s or Nordstrom. Real Estate brokers work hard to bring buyers and sellers together for the purpose of trading real estate in a free market. Consider, you probably cannot make a stock trade without some assistance of a Stock Broker, who, in their own trade, also bring buyers and sellers together.    

Ok! So, I admit that not all real estate agents will work hard to market and sell your home. Many are only interested to get your listing (so beware if your agent agrees to take your listing at a reduced commission rate). This is called lazy selling. They build a weak reputation for themselves by listing as many homes as possible with the hopes that they sell by the grace of god, all-the-while creating a poor public image for otherwise ethical and highly professional agents. Please understand that by marketing your home via a real estate agent, like us, your home can be exposed to a much larger and wider network of qualified buyers - those who can clearly vision the value that your home represents to them, and those who are ready, willing, and capable to buy. Generally speaking, by (1) marketing your home to the network of other real estate agents via what we call “broker caravans”, (2) exposing your home via the professional Multiple Listing Services, (3) holding open houses to the public, and by (4) aggressively prospecting for buyers via door knocking and phone calling, we can expose your home to the 98% of the market.  This is called proactive selling!   By proactively exposing your home to a broader market base, and targeting our efforts to find buyers who are ready, willing, and capable, you are more likely to get a higher price than if sold by yourself, and, the length of time to sell, will likely be shorter.

If you cannot definitively articulate the answers to the following 4 questions, then I urge you to seek a professional real estate agent to help you to sell your home.

1.    What is the value of my home in today’s market?

2.    What is the defined action plan for selling my home?

3.    How long will it take to sell my home?

4.    What is the cost to sell my home?

Contact us soon - and let us help you to sell your home and to move onward with your goals.

Charles M. Schevker (CPA)
DRE # 01875556         
Broker Associate
Prudential California Realty
1299 Prospect St.
La Jolla, CA. 92037 

For Search By Buyers (FSBB)

So … you sit at home looking at the internet or thumbing through your latest electronic gizmo, searching through all of those Real Estate websites in a quest to find a new home for your family. Mazel tov! Why should you use a great real estate agent when YOU … Mr / Ms multi-tasker are convinced, that YOU, can do it better than a professional. And oh by-the-way, you are so proud to think that you do not have to pay a commission as a do-it yourselfer. Well, unless you are an electrician, you probably would not consider installing underwater lighting in your swimming pool, or unless you are a mechanical engineer you probably would not consider installing a solar panel system on your roof. So, why are you taking a huge risk by trying to find and buy a house on your own.

Here are a few more things to consider. (1) The internet websites mostly obtain their information from the professional Real Estate Multiple Listing Services, so, their information is often filtered, less accurate, and less timely. (2) A Real Estate agent is likely to do a much better job at calculating a CMA (comparative market analysis) by adjusting the comparative property features to those of the subject property, versus an internet site that will calculate a simple mathematical price per square foot. (3) In today’s complex world of contracts and disclosures, it is comforting to have a real estate agent who can represent your interests from the beginning to the end of closing. (4) And, gee I almost forgot … in most cases, the selling agent’s commission is paid via the listing broker and from the seller’s proceeds of sale – not from the buyer.

But hey! Who am I to convince YOU not to waste your time and money. Why not just sit on the internet, click and “add to cart”, add appropriate taxes, shipping and handling costs, and wait for UPS 7 day ground to deliver. Good luck with that!

Don’t you just hate to waste time? How many hours of frustration are you willing to endure before you will trust a REALTOR® to help you to search for, and to buy a home. The process is so simple… why do you resist – (1) let’s have a discussion so that I clearly understand your motivation and your housing preferences, (2) let us sign the necessary disclosure and buyer-broker agreements, (3) let me recommend a lender for you to meet and receive financing pre-qualification, (4) let me search and select only the top 3 homes that meet your pre-qualification range and those that match the most of your “must-have” needs, (5) let me preview the homes for you in advance, (6) let’s schedule appointments for us to view the selected homes, (7) let’s sign a contract, and negotiate the deal if needed, (8) pack up your boxes and move to your new dream home.

Contact us soon - and let us help you to sell or buy your home, and to move onward with your goals.

Charles M. Schevker (CPA)
DRE # 01875556         
Broker Associate
Prudential California Realty    

(858) 449-8250
1299 Prospect St.
La Jolla, CA. 92037 

http://www.San-Diego-Cal-Homes.com

http://www.linkedin.com/in/charlesschevker

Buyers in Today's Real Estate Market Need To "Pull The Trigger"

Yeah, sure - there is great concern and uncertainty about the economic recovery, and especially the recovery of the real estate market. As we talk to hundreds of buyers weekly,  we are amazed at how many buyers say things like, "we are searching for a bargain", or " I have been looking for the perfect house now for 5 years", or I am waiting for the market to hit bottom". Oh my God, and there are oodles more quotes not worthy to publish.

Like so many others, I cannot accurately predict the future of the real estate market. I can say with absolute confidence - there are some fantastic houses out there in San Diego, and many represent great values. Forget the short sales and foreclosures - see us about helping you to make an offer on your next home. Hey! What are the likely outcomes - (1) your offer is accepted, (2) your offer is rejected, (3) your offer is countered by the seller, and the negotiation begins.

OK, so we are in a "down market". Don't overlook that there are some great deals waiting for you, and a down market can work to your advantage - buy "up" in a "down market" . Don't wait for interest rates to rise or supply/demand to shift balance... Just "pull the trigger", and do it soon! When the market recovers, you will likely have purchased a home with built-in-equity. Ask yourself ... why am I willing to waste precious time waiting for the perfect timing, when I could be living my dreams NOW.

Contact us soon - and let us answer all of your questions and concerns about real estate, and let us help you to achieve your goals.

Charles  M. Schevker (CPA)
DRE # 01875556         
Broker Associate
Prudential California Realty
1299 Prospect St.
La Jolla, CA. 92037