San Antonio's Rockstar Turned Realtor®: December 2009

photo courtesy of eflon

You'll need to do some homework.

In order for this post to make much sense, you'll need to read up first.  Please read Larry and Sheila Agranoff's post "Should We Even Respond To This One?" (a featured post from 12/21/09) - if you're not a member of ActiveRain, the post will not come up for you as it is marked "Members Only."  Be sure to read through the comments as this is what my post is based on.

So what would you do?

I hope you left a comment while you over there, but let me ask you this: did any of the comments you read through rub you the wrong way?  Do you think the commentors made excellent points or not?  Would you respond?  If so, how?

As I read the comments last night (I just re-read them this morning), I actually felt a little disheartened.  A few notes... First, I'm not here to tell anyone how to run their business or act like I know it all.  Second, I don't know the prospective client and any of the details of any other contact with them, I also don't know the Agranoffs, so I'm not sure what they're all about either.  Third, many of you have years more experience than me and I recognize I can sometimes be a bit idealistic.  Fourth, I am in no way implying that any particular comment is the problem or that Larry and Sheila shouldn't have posted this, in fact I'm thrilled that they posted it.  And lastly, I know there are times when it's best to walk away (I just had to do it recently).  Okay, now my disclosures are out of the way, let's get into it, shall we?

As you can see from my comment on the post, I don't think the answer is to cut off communication or end any dealings with the prospective client.  I'd even add a bit to my comment in terms that, I would probably see if they'd like to sit down and discuss real estate and their experiences (perhaps over a cup of coffee in a location other than an office).  I love to hear the consumers point of view and at one point in my life as I have pointed out many times on this blog, I disliked all Realtors®.  It only took one bad experience.  It also only took one good experience and a memory of a prior good experience to bring me back and wind up becoming one myself.

Realtors® (and non-Realtor® agents as well) and the industry have a bad rap with some segments of the population.  We know this as fact.  The National Association of Realtors® pours a lot of money into trying to change that perception.  We fight it everyday in our business.  We talk about it here and on blogs all across the internet.  We'd be foolish to deny that a rift sometimes exists and sometimes that rift seems a bit more like the Grand Canyon.

So (based on the post alone and no other knowledge of what has transpired between the two parties), we have a case of a prospective client who most likely has had some bad experiences with agents in the past and thinks we're all the same.  Are we all the same?  Do you run your business like I do?  Do you think and say the same things Larry and Sheila do?  The answer is probably yes and no.  We might agree on this or that, but have a complete opposite approach to something else.  As long as we're within the letter of the law, we can do our business how we please (and how it pleases our clients).

What disheartened me the most I think is the willingness of many of the commentors to make a judgment to get out rather than discuss anything with the home buyer.  I'm not dumb enough to think that every consumer will be won over by your explanations of why you're different from the other agents they have had experiences with, but I'm also passionate enough to give a damn about what they think.  I think we could all benefit from seeing this as opportunity, and not just for our own pockets, but for the overall standing of our industry with the public.  Sure, the efforts may crash and burn, but they also might just work.

The part that I disagree with most is the "answer with silence" style answers.  As if the public don't already think we're impossible to get a hold of and never return our calls.  This is a huge issue with consumers and I know we all miss a call here or there or perhaps even don't answer an email, but the more we do it, the more this perception will stick with us and tarnish our profession.  The consumer of today wants it now and it doesn't always happen that way, so I predict this will continue to be an issue no matter what we do to adapt our habits and make ourselves available or educate the consumer about how we operate (how do you tell a consumer how the industry operates, when we are all so different?).

We preach every day about educating our clients, yet in these comments, very few spoke of educating.  (By the way, we talk about educating clients so much at times, that I wonder if the consumer thinks we think they're all completely in the dark when it comes to real estate.  Not true, but based on some of the things I read about client education, I might get that idea.  I guess that's another post for another day.)  The prospective client in question (again, based only on the knowledge I garnered from the post) seems to definitely have had some problems with agents in the past.  So what's our answer to that?  Don't respond?  I say, speak to them, show them, help them understand the differences between the apparently incompetent agents they've dealt with in the past and you.  Treat them well.  Perhaps it will still not be enough and it will turn into a nightmare - if that's the case, then you may need to reconsider continuing down the client-agent relationship path, but to throw in the towel before it has even started?  I just don't see it as sensible or helpful to you or the industry as a whole.

I'd love to see Larry and Sheila post this again quietly in six month or a year from now.  No fanfare, no mention of it being a repost, just throw it up on their blog as if they wrote it in 2010.  But I'd like to see one difference.  I'd like to see them make it a public post.  I'd be willing to bet that some of the comments might not be the same.  Even though we all know it's not hard for a consumer to sign up as a member on ActiveRain so that they can read everything, I often wonder if some members forget that fact, as it seems "Members Only" posts tend to take on a different tone at times.

photo courtesy of Mispahn

No one ever said blogging was easy.

I haven't posted here tons recently.  For a guy who managed to dive right in to blogging, I feel like I've neglected my ActiveRain blog a lot recently.  Sure, there's been holiday parties, me tearing an ear drum, me pulling a muscle in my back, and the usual things that get in the way of our blogging activities (we call them "life"); but none of that usually stops me.  To be technical, none of that has stopped me either.

Lately, I've been concentrating a lot of my writing efforts onto my main site, www.RErockstar.com (as well as my simple as could be San Antonio photo blog using posterous).  I've also been plotting and scheming for 2010 and where I want my site to go and how I want my business to grow.  So here ActiveRain sits, collecting a bit of dust.

I still love ActiveRain and what it is, but lately I'm finding that it's not as consumer-centric as I'd like.  Granted, my posts vary from consumer-based, to agent-based, to fun and goofy at times, so the consistency is not quite there in one firm category; but I'm not seeing the numbers I would like to out of ActiveRain (my outside blog rarely turns up in Google, which concerns me and when compared to my main site, the numbers look even worse).  So, I'm going to step away from the keyboard for short spurts as I work out what direction this blog should take.

That doesn't mean I won't post, it just means that this place may continue to seem like a ghost town as I revamp all my decision making in preparation for the coming year.  I want 2010 to be my break-through year.  The one that you always look back on and say "that was the year I really started to become a real estate agent."

In the meantime, I will continue to visit and read as much as I can.  There is no doubt that there are some great writers out here and way more knowledge that should ever be contained in one place.  Keep doing what you're doing and enjoy your time.  I hope you all have built great business plans for next year and I can't wait to see what the market will be like through 2010.

FHA Loan Changes - Good Idea?

Yesterday, I re-blogged a post about FHA loans, originally written by Ken Cook, one of the lenders I really trust when it comes to FHA information and advice.  I had read his article with great interest, as any change in any lender's rules, regulations, or requirements - directly affects me and my clients.

I'm not a mortgage wizard, which is why I surround myself with the best lenders I can find - so that when I do have questions or my clients need more explanation of a mortgage issue, I can get them the answers or at least have them chat with the lenders I know.  I do try and stay up to speed on all the issues though and the new ideas about what to do with FHA loans in order to refill the coffers of the Department of Housing and Urban Development's FHA funds were the subject of Ken's post.

The problem is simple; with foreclosure rates skyrocketing, the FHA has had to pay out more and more insurance claims to the mortgage companies.  Part of every FHA loan is the mortgage insurance premium (both upfront and monthly).  The upfront mortgage insurance premium is paid (who would have guessed?) upfront at closing.  However, it is possible to roll that premium into your financing (so many people don't actually bring that cash to the closing table).  The monthly mortgage insurance premium is a monthly fee tacked onto your your mortgage payment.  Like other insurances, you're paying today, in case something goes wrong tomorrow.  In the event a home buyer defaults on their loan and the house is foreclosed on, the lender gets paid out of the FHA funds that are built up through the collected of these mortgage insurance premiums.

Now that we have that FHA primer out of the way (there's a lot more to it, but I didn't want to write a full post on how FHA works - we have other issues to discuss today).  On December 3, 2009, HUD Secretary Shaun Donovan appeared before the House Committee on Financial Services and announced that FHA's funds were getting uncomfortably low (they had dropped to 0.53% of outstanding loans, well below the 2% required by federal law).  After looking at some of the ideas that have been tossed around to cure the problem, I spent some time thinking about what's good and bad about those suggestions.

I would write it all out here, but the fact is, it's a rather long post (something you should be used to by now).  I think it might be one of my top 5 posts of all time.  I hope you'll take the time to read it and weigh in with your opinions.  I just spoke with a friend of mine who disagrees with me completely, so this could be interesting.  So, here you go...enjoy:

"An Open Letter To HUD About FHA Loans" at RErockstar.com

photo courtesy of Caitlinator

Thanks Ken!

As usual, Ken Cook, does a great job breaking down some of the latest expected changes to FHA loans.  I find it shocking that everyone ran around saying we need to help clear the inventory by extending and expanding the First Time Home Buyer Tax Credit and now they're thinking about making it tougher to buy a home.  So which is it?  I thought it was odd when they raised FHA down payment requirements from 3% to 3.5% while saying they needed to get the housing market moving again.  A jump from 3.5% to 5% will most certainly eliminate a larger pool of ready, willing, and able buyers.

Although the theory of "having some skin in the game" is a commonly accepted idea, this reeks of an attempt by Secretary Donovan to save himself at the expense of home buyers and possibly the housing market recovery.  When the federally mandated reserves started to slip, we should have been talking about solutions, not when they are 1.47% below where they should (the law requires the FHA insurance pool to be maintained at 2%, Secretary Donovan reported it was at 0.53%).  Maybe we should have learned a lesson from the banks that didn't notice how low their reserves were getting before then announced (seemingly overnight in many cases) that they were broke.

How does someone not notice these things?  Ugh.

Thanks again Ken!

photo courtesy of BenedictFrancis

I'm unhappy with Twitter.

Twitter recently introduced a new feature - a one click retweet feature.  For those that have been using programs like TweetDeck and Seesmic Desktop, this is nothing new.  I've long hoped Twitter would create a one-click feature for retweeting, as I do quite a bit of it on my RErockstar Twitter account.  I use retweets to pass on interesting information, follow up on someone's comment, and share real estate news with my fellow agents and San Antonio locals.

A few days ago, I tried the retweet feature.  I clicked the button and expected to see a message box appear with the familiar "RT @so-and-so blah blah blah" which I would then add a bit of thought to.  Instead, it just sent out the retweet.  It shared the information I thought was interesting, but didn't give me a chance to add my own thoughts.  Although it is sometimes hard to add in comments (usually placed between [ and ] to make it know that you're saying that) because of the 140 character limit, I do try to make comments as often as possible.  I want people to know why I choose to share this with them.  Otherwise I might as well just be broadcasting anything and everything.  That's not social in my view and the point of Twitter is to draw in a social element to the internet.

Imagine if I stood on a busy street corner and everytime someone walked by I told them something someone else had said to me.  "I'm free after 3:30."  " Agreeing with me is probably more reason to see a shrink." "Is it new or is it the one from the '80s?" "That's my usual spot on Wednesdays. I heard they might build one out in Helotes!"  (All of these were actual things said to me today.)  Would anyone walking down that street care?  Would any of my friends that passed by care?  I doubt it.

That's what the one-click retweet feature is like to me.  Senseless noise with no social interaction.  If you wish to retweet something I said, please add something to the conversation.  I'll appreciate it so much more.

image courtesy of my Twitter account and @LaniAR's tweets

ActiveRain helps me get quoted.

Late last week I received a call from California.  I had no idea what was waiting for me on the other end of the phone.  It was Jenna V. Loceff.  She explained she was a reporter for the North Bay Business Journal and wanted to speak with me a bit about social media and real estate.  In researching her article, Jenna, had a few mentions of Flickr and while googling away, she came across my article, "A stern warning (or lack thereof) - Flickr is watching you."  She asked me quite a few questions and I explained the whole story of what happened between myself and Flickr.  We then spent a few minutes talking about real estate and social media in general and parted ways.

On Monday morning, my tweet stream lit up with congratulations and links.  I wasn't even 100% sure what everyone was talking about and then, once the sleep cleared from my head, I remembered that Jenna had told me the article would be published on Monday.  I found the link in my Twitter stream and clicked on it.  There I was.  Quoted.  The best part is that the article focuses on California, but here I am, all the way in San Antonio being quoted.  The article is an interesting find, regardless of my appearance as well.  Just look at the chart within the article to see what I mean.

You can read the entire article, "Residential Real Estate: Agents, brokers venture into social networking" online.  Stop by and leave some comments.  Who knows, Jenna might find you next.