Real Estate Success for 2011

Since the last Quarter of 2005, our US Economy has been in a wrestling match with itself.  The most effective hold has been the "Strangle Hold" being applied by the Real Estate Market.  I feel foolish and humbled when I go back and read some of my predictions from 2007-2009, where I figured we must be coming out of this thing... and that recovery surely must be around the next corner.  In retrospect, that was frustrated wishful thinking - not prudent, thoughtful analysis.  I mean, who knew that we'd be into this thing five full years... and still be unsure where the light is at the end of the proverbial tunnel?

Here are some insights that I believe, as a Real Estate Professional, I must be in tune with, in order to continue to be successful in this "new reality" - and eventually break through as recovery comes:

1. Ordinary effort will not be rewarded.  In a hot market, most everyone can stumble into a few sales.  To be a great agent, "good" isn't good enough any longer.  We have to commit to an extraordinary selling and/or buying experience for our customers.  It's what gives birth to our lifeblood - Referrals from satisfied customers!

2. It's got to be "Mission Focus," not money focus.  Some transactions in our "short sale" world might not ever close.  The banks are making decisions with a calculator, not their hearts.  We have to know what we can control and, more importantly, what we can't!  We have to focus on getting up early and immersing ourselves in the process of doing the right things daily for our customers.  We must maintain faith and confidence that this will work most of the time.  If we focus on the mission, the money will come.
3. Effective Communication is critical.  The "sales process" has changed forever.  Twenty five years ago, my first office broker introduced me to real estate sales with this classic offering: "Here's your desk and here's your phone.  Good luck, Frank, you're on your own!"  Well, thank God for my twenty years of experience as a US Army Officer.  I knew there was more to it than that!  Today, I've got to be the master of information.  I've got to know my market - cold!  I've got to be able to provide a true learning experience for my customers and instill confidence, so that they can feel good when following my advice.  If I say, "You are $50,000 over-priced," I've got to be able to back that bold statement up, don't you think?  Web sites, blogs, email, texting, smart phone, facebook, twitter... are all just the tip of the iceberg to come.  Providing customers and future customers with daily talking points keeps us engaged, until the need for action arises.
4. Re-read my post on this blog from 11/23/10, "Goal Setting for Realtors, Buyers and Sellers."  What it boils down to is that to be effective over the long haul, you've got to be a goal setter, trend setter, and pace setter.  Without goals and a plan and schedule to achieve them, we're all in a crowded shipping lane with no rudder.

(Inspiration for this post comes from a terrific trainer, Steve Harney, and his January 2011 Quick Tips)

Real Estate and the US Military

 

  Well, it's the end of 2010... a "real estate year" I'd like to forget (or at least replace) - You know, like how the professor would let you take a test and have it replace your lowest grade?  I feel like I've been in the ring for 5 rounds (2006, '07, '08, '09, '10) with Mike Tyson in his prime.  The good news is that I'm still standing... and he's getting tired from punching me:-)

We spent the day Wednesday on board the USS Gettysburg at Mayport Naval Station in Jacksonville.  She is a 9,500"+" ton, nearly 600 feet long, 55 foot beam, 33 foot draw Guided Missile Cruiser.  A real bruiser of a US warship, with a crew of over 30 officers and 330 sailors (men and women).  As a 20 year US Army Veteran, it was great to get a backstage look at the Navy.  Talking to the men and women on that ship reinforced the fact that we have good people protecting our interests.  The ship's Captain, in his opening remarks, said it well.  He referred to our military forces (as well as community law enforcement and fire/rescue personnel), as "those who run TO the emergencies of life, rather than AWAY from them."  I liked that and it sums up a boat load of emotion.

It really got me thinking about that part of my life, blended with my second career as a Real Estate Broker.  Here's the rub... Many civilians, over their careers, use the build up of home equity as a significant part of their retirement nest egg.  Perhaps they bought a starter home when newly married for $100,000 and over the span of 30-40 years "moved away and moved up" maybe 4 times.  Then, in their 60's, their current home is worth $600,000 - very plausible in many parts of the country.  As a sales agent and broker in Fairfax, Virginia for 15 years, I helped a lot of corporate types, as well as FBI, CIA, Secret Service, etc. and a lot of Government senior executives.  When they moved, as a necessity of their job, they got a "relocation benefit package."  If the market was in a down cycle, Big Brother picked up the difference!  They couldn't lose!

Not so for the military men and women at the Pentagon, Bolling Air Force Base, Fort Belvoir Army Base, Quantico Marine Base,  or Norfolk Naval Base.  Nope, if they took a chance and bought a home... and got transfer orders in a down market, they basically had two choices:  1.  Sell at a loss, or  2.  Turn it into a rental property and not be able to buy a home at the new duty station.  I know I had myopic vision on this, yet I always wondered why those in harm's way got a lesser deal than those in the less harsh realities?

Anyway, we won't solve that here.  And as we cut costs to reduce the national debt, I doubt we ever will.  It's Christmas now and our forces are deployed in many places, where hateful, radical elements wish them harm.  Thank God for their sacrifice and dedication.  I wish for peace like the next guy, but the reality of human nature says it will never happen.  It is their selfless duty which makes this a great place to live.  In most of the world, home ownership is not possible...

"Flagler County, FL Waterfront Homes - 2010 Recap"

     I know it's only December, but here is a recap of waterfront home sales for the first 11 months and 2 days in Flagler County, FL for 2010.  Areas include the Palm Coast, FL zip code 32137 and Flagler Beach, FL zip code 32136.  "Waterfront" is defined as "On a Saltwater Canal, the Intracoastal Waterway (ICW), or the Atlantic Ocean."  This does not include fresh water canals, golf course ponds, ocean views, marshes, etc.  These homes were "on the water."

For all of this year, there were only 109 such sales.  In the heyday of 2001-2005, it would not have been a stretch for this number to have sold in just one month!

                                                          Here is a statistical summary of these sales:

• Sales Prices:   
• High = $1,000,000 (on the ocean)
• Low = $150,000 (on a canal)
• Average = $320,000
• Mean = $280,000

• Average price/square foot = $148

• Average Days on the Market = 198

• Type of sale:
•  Total sales = 109
• "Normal" = 73 = 67%
• Foreclosures = 11 = 10%
• Short Sales = 25 = 23%

• Number of sales, by month:

• Jan = 3
• Feb = 4
• Mar = 5
• Apr = 10
• May = 10
• Jun = 14
• Jul = 13
• Aug = 10
• Sep = 13
• Oct = 16
• Nov = 10
• Dec =  none yet... (Hey, it's only the 2nd!)

All I can say is "Holy Cow, Mama!"  A $280K Median... and $320K Average price for a Florida waterfront home?!?  If you were here in 2000-2005, you are scratching your head now.  At the 2005/early '06 peak, canal LOTs were in the $300Ks!  ICW LOTs were $495K-$750K!  And Oceanfront LOTs were over $1,000,000!  If you want waterfront... GET IT NOW... or be telling your grand kids about how you should have... back when it was cheap!