View and download a printable fall schedule of all the courses I’m teaching: Fall 2014 Courses & Classes
Hopefully, most are at least aware of the elephant standing in the room even though he’s easy to ignore. We don’t like looking at him because he represents an area that can seem confusing and make him look even bigger than he actually is.
The Federal Emergency Management Agency continues to roll out revised flood risk maps that are dramatically impacting homeowners (existing and potential) and businesses. Another reason the elephant is easy to ignore is so far only seven county’s maps have been released: Cumberland, Hancock, Knox, York, Lincoln, Waldo and Sagadahoc.
The bad news is that flood risks are changing and flood insurance premiums are dramatically affected. The good news is that there are often options and alternatives, including subsidized and grandfathered rates which can be transferred to new owners. However, rates will still increase gradually over a period of years.
If you’ve been ignoring the flood risk elephant, it’s time to stop. A good place to start getting some basic understanding is a recent article published by the Bangor Daily News. Licensees can and should understand the issue as it relates to businesses, primary and secondary homeowners–both sellers and buyers. This is not an issue that should be reserved until closing.
Ultimately and at a basic level it’s not much different from other risks homeowners must face. There are parallels to homeowners insurance and title insurance–for licensees with clients, it’s about helping those clients manage risk. Just like other risks, another good place to start is by becoming familiar with those companies who provide the insurance necessary.
Aristotle said, “Education is an ornament in prosperity and a refuge in adversity.” You can’t lose by getting smarter!
Many associate brokers somewhat automatically take 21 hours of continuing education and renew their licenses time after time perhaps because they think, “I never intend to be a designated broker.” Of course situations can change quickly and there are probably more than a few DB’s who did not arrive in the position intentionally. But this course is about a lot more than being a designated broker. In the words of one student,
I learned so much from the instructor and other students… very interacting… it showed me what I didn’t know!
You’ll learn what you don’t know and gain a whole different perspective about the business of real estate. The course requirements established by the Maine Real Estate Commission changed significantly in 2013 and I am proud to be a significant contributor to the development of the course offered by the Arthur Gary School of Real Estate.
(I liked) the instructors approach to teaching with examples and (how) he encouraged lots of discussion during class.
This is truly a course about the practice and the business of real estate–not just law, vocabulary and theory. Upon completion of the course and two years practicing as an associate broker, students become eligible to apply for a broker’s license and are then eligible to fill the role of designated broker. But even if you have no interest in being a designated broker, you’ll want to consider taking this course. You’ll develop a new understanding of the business as we look at some of the management issues and opportunities that exist in the increasing complex business of real estate. You’ll learn about things like business planning, ethics, and risk reduction–topics only touched on briefly in previous licensing courses.
Walter is an excellent instructor! Can’t wait to take another class with him!
Many students have indicated that taking the course will help them build their personal real estate business as they apply sound management and business principles. They discover the benefit from exploring some basic training techniques and consider the role of policy in building their business as an individual as well as a company. How about “risk management” strategies? Are they ways to minimize your exposure to complaints and law suits as while practicing brokerage?
If you’ve held a broker’s license for a while, you might also consider re-taking the course as a refresher and see how much things have changed since you were licensed. As a reward for doing so, you’ll receive 18 hours of continuing education credit! (You’ll still need to take the current core course to meet the full CE requirements.)
The course is offered alternatively as a weekend course and weekday course each fall and spring in the Bangor area. Details for the next course are available on the Arthur Gary School or Real Estate website.
Of the three licensing courses one must take, this was by far the most interesting, the most useful and incited the most thought.
Please note: Courses offered through the Real Estate Institute may NOT be eligible for meeting the CE requirement for real estate licensees. According to the promotional material, the program has been submitted to the Maine Real Estate Commission for approval, but at this point (pending approval) you participate solely because you want to learn! (Do not confuse CLE credit with the CE requirement for real estate licensees.)
The Real Estate Institute is presented by the Real Estate and Title Section of the Maine State Bar Association and this year features a variety of 59 topics with 111 sessions to choose from. Most sessions are led by attorneys with a real estate or title background and many appear to have practical application to real estate brokerage. While licensees should not give legal advice, an understanding of the issues around things like abandoned roads, unwanted tenants, bankruptcy and foreclosure–the list goes on–can only serve to improve your ability to serve your clients more effectively.
This year the Institute is being held on September 12 (Friday) and September 13 (Saturday). For a complete list of sessions, costs, etc. view and download the Real Estate Institute 2014 Program Book.
Here’s a quote from a respected real estate expert. He’s unnamed because there are plenty of others making similar statements. “…many agents overlook is the benefit of sharing personally… on Facebook, via email, or on Twitter, writing from the heart about what matters to you can be more beneficial than pumping out stock reports about housing data.”
Well, firstly, I wish the experts would stop preaching this whole “sharing personally” sermon. Secondly, I suspect stock reports and housing data SHOULD matter to anyone in the real estate business.
I do not need to know how hard you are working, what time you are going to bed, that your cat needs to go to the vet, and how smart your kids are. The photo of the sandwich you had at the local bar is not something I’ve been waiting for with great anticipation. Many of your clients–and prospective clients–do not need this “sharing” either.
Some years ago I experienced a rather painful purchase of a brand new vehicle. Since I know the game that is played quite well, I’m afraid it was more painful for the salesman than me. He’d work up a price with trade and run to his sales manager to “get it approved.” Of course the manager would not approve it. My salesperson would return looking rather dejected to see if I would accept the higher counter offer. After about six of these trips, he said, “Well, at least you can see how hard I’m working.”
Because I was out of patience, I replied, “No, what you are showing me is that you’re not a very effective negotiator. I should be dealing with your manager. So here’s what we’re going to do. I’m going to give you my final number. If the boss doesn’t accept it, I’ll leave and you won’t have to work so hard.”
See, when you brag about how hard you are working, you might give some thought to the message you are sending. “I’m so busy!!” might mean your prospective clients better take their business elsewhere. I always wonder how these people who are so busy find time to announce it. A lot of people who think they are busy are really just unfocused.
At least bragging how about busy you are and how late you worked is about work. Sorta. What all this misses is a question of boundaries. Where does one draw the line between personal and professional? When it comes to social media, the question too often goes unasked.
Even more important is this: potential clients are, frankly, more interested in their own hearts than yours. If you’re serious about using social media to build a client base you might want to have a little sticker on your smart phone or whatever device you’re going to use. “It’s not about me.”
Maybe that housing data should be important to you–because you can bet it’s important to your prospective clients. (They may not know it is and they may not know why–tell them that.) You ought to know the questions on your clients’ minds–answer them before they are asked in a way that shows you deserve trust. Before you post something, ask yourself if the people you are trying to reach care.
Understand, this is not a plea for sterile, impersonal profiles and posts. It’s about balance, really–and setting some boundaries. Real estate, like many businesses, is ultimately about relationships and all relationships have a personal aspect. Think about who you want to attract and the most effective ways to do that. There’s some consensus that most of the social media platforms do not encourage critical thinking and discipline. It’s all about spontaneity and the good news is the bad news.
Oh–if you’re curious about how the car story ended–that hard working salesman came back with yet another counter offer. I thanked him, shook his hand and left. He caught up to me in the parking lot to tell me the boss changed his mind. After we completed the transaction, he remembered I’d said there would be a second purchase coming soon. He joked that I should give him a day’s notice so he’d be well-rested. Since this all happened before social media, he didn’t post how hard he’d worked that day.
What follows is the work of friend and colleague Jack Falvey–who many will recognize as the author of the “blurb” on the back cover of my book, Small People–Big Brains. Jack’s authoring this online investor program for Saint Anselm College… a free daily investor brief. See the bottom for additional information… try ‘em! The price is right and I think you’ll enjoy Jack’s style. As a bonus you’ll learn a lot! Subscribe here.
Real Estate Investment Trusts are mostly about big buildings.
Commercial real estate investment is best done as a group activity in order to spread risk. By owning multiple properties, each legally separated for liability purposes, a relatively safe element can be added to an overall investment plan. There are publicly traded REITs (Real Estate Investment Trusts), and there are REITs where investors of size can buy into a fund used to buy properties. The company managing this process operates as a Real Estate Investment Trust. They buy and sell properties that produce rental income for their fund shareholders. They charge the fund a management fee for this service.
Their expertise involves buying properties at desirable market prices that will produce steady rental income for their owners and that will appreciate over time. Acquiring mortgage funding for their purchases is part of the process. Private REITs cater to investment portfolios that seek a real estate component. These are often retirement funds or, in some cases, even sovereign funds.
Publicly traded REITs are stock exchange listed and report earnings, as do all public companies. Their product is real estate investment services. They perform according to their skill levels and the ups and downs of the capital and property markets.
They are, in effect, mutual fund companies that operate exclusively in real estate investments. They are highly specialized in what they do. The value of a property and its ability to produce income is a relative determination. There is considerable judgment involved in each transaction.
REITs prosper on their performance. They are captive to both capital and property markets. Because they are asset backed, they are considered to be more secure by some than investments in pure equity or pure debt opportunities.
Most real estate investors are merely buying their own home. Some buy multi-family homes. Some buy a number of multi-family homes. Some invest in a commercial property. All this is done for appreciation and potential rental income. On a small-scale, it makes sense to manage your own holdings. Scale all this up and REITs are what you have.
Investor Education Briefs is an online investor education program provided by the Institute for Politics at Saint Anselm College. It goes out each business day of the year at no charge. The editorial opinions of Jack Falvey, a Fellow of the Institute and a frequent contributor to The Wall Street Journal and Barron’s, are provided for investor education only and are not offered as financial advice. Anyone may enter or exit the program at any time. There are no tests or academic credits involved. It is designed as a free program which will recycle and be updated every twelve months. Subscribe here.
Fortunately, I’m able to see the humor in this question–I get it at least once a year from a do-it-yourself buyer or seller. “Where can I get a blank purchase and sale form that will protect my interests if I don’t want a broker involved?”
I usually manage NOT to answer, “Gee, I can’t answer that since you don’t want a broker involved and I am one.”
It’s a really tempting answer.
Why do we get requests like this, anyway? We’re quick to explain that some people simply “don’t want to pay a commission.” We’re quick to judge but slow to answer the questions that are hidden in that objection.
Coincidentally, I happened on an article that raised the question “Why do real estate agents still exist?” Using the over-worked (but applicable) analogy to travel agents, the article offered several reasons. Ironically, most of the answers were about agents, not customers or clients. One answer was that agents still exist because the Internet is making it possible for them to be more productive. A true statement, certainly, but also a bit self-serving and not particularly helpful to a buyer or seller.
I liked the question more than the answers. So let me ask my readers, “Why do real estate agents (licensees) still exist?” Don’t tell me it’s because we have the blank forms or the MLS, please. In fact, I’d like you to pretend you’re being asked the question by someone who doesn’t know much about the business of real estate. What are you going to do for me that I can’t do for myself given all the information at my disposal on the Internet?
If you think it’s an easy question to answer, you’re probably not trying hard enough. So let’s upgrade the question and pretend it’s being asked by someone who’s bought and sold property a dozen times over the past few years. What is your value to someone in that category? What can you do for that person that he or she can’t do?
Your assignment is to come up with a list of at least five to seven contributions (benefits) you can provide to that person that he or she can’t get anywhere else. Some generalities are okay, but specifics are a lot more powerful. A hint might be that it’s likely to be less about what you have to offer and more about what the buyer or seller needs in today’s economy and environment. The reason you need at least five to seven is simple–if your prospective client is (for example) a marketing and sales expert, your marketing program diminishes in value and importance.
If you want extra credit for the assignment, find somebody who will challenge your reasons and assumptions and maybe even argue with you. While this (arguing) is not a great technique to use with prospective clients, it can certainly sharpen your thinking.
And if you want bonus points and a sticker, answer this question: Why will real estate agents exist ten years from now?
When I sub at school, the kids are required to call me Mr. Boomsma. Most comply, although it’s not at all unusual for the kindergarteners to call me “Mrs. Boomsma.” The idea of a man teaching kindergarten is still a bit alien to most five-year olds.
You won’t have to call me “Professor Boomsma” but thanks to a collaboration between the Arthur Gary School of Real Estate and Husson University’s Center for Family Business, I’ll soon be teaching a Sales Agent Course at Husson that makes it possible for students to receive 3 hours of credit for a Business elective, PL 201 Real Estate Law, Paralegal elective or Open elective through Portfolio Assessment.
The course begins on May 27th, so you’ll need to act fast! You’ll find more information available on the Arthur Gary School of Real Estate website or by calling the school at 856-1712. To inquire about Portfolio Assessment to obtain credit for the course, please contact Marie Hansen, Dean of the College of Business, email@example.com.
The course begins on Tuesday evening, May 27th from 6 PM until 9:30 PM, then meets for three weekends–Saturday and Sunday from 8 AM until 5 PM. The final exam takes place on Tuesday, June 17 from 6 PM until 9:30 PM. Students are required to attend at least 90% of the scheduled class hours and achieve a passing course grade of at least 75% in order to qualify to take the required state exam prior to licensing.
If you haven’t been around long enough, you might not remember what life was like prior to the “Do Not Call List.” The actual label for this is the Telemarketing Sales Rule (TSR) and it first passed in 1995. Managed by the FTC (Federal Trade Commission), the rule has seen numerous amendments and, in good government fashion, complications. The essence of the rule is that telemarketers are required to check the “Do Not Call List” prior to making an unsolicited call. As with most laws, there are numerous exceptions, exemptions, and a fair amount of fine print.
Prior to the rule, life included frequent interruptions at all times of the day from a wide variety of folks trying to sell something. About the only way to cope was to simply hang up as soon as you recognized the call’s purpose. If I was feeling particularly feisty and had the time I would occasionally engage in what I called “terrorizing telemarketers.” The TSR has, thankfully, significantly reduced the need and opportunity.
But it hasn’t eliminated it. I’ve been receiving an occasional call from somebody name “Ohan” who is quite sure he needs to help me improve my social networking to build my real estate business. I’m a bit intrigued that he starts out by claiming he’s doing some research — that’s one of the exemptions used to circumvent the rule. Of course if you stay on the phone, you’ll discover the research is answering the question “will you buy my product/service.” Since I’d had the call before, I interrupted, so stated, and requested I be taken off his list of people to call.
He replied, “There is no list. I got your phone number from the Internet.” Then I made a tragic error. I didn’t hang up. Instead I replied, “Well thereis a do not call list and I’m on it. You need to stop calling me.”
Then it got really interesting. Instead of accepting the fact I had no interest in talking with him, he decided to convince me of how stupid I am. What a smart sales technique! The essence of his argument was that since I’d listed my personal cell phone as a business contact, he could legally call me since “business to business” calls are exempt. Now I will freely admit I’m not sure on this one… if I list my personal cell phone number as a way to contact me for business purposes does that give him the right to call? It might.
But it doesn’t give him the right to ignore my explanation that I’m not interested in talking with him. He actually said he was trying to “educate” me. I replied that he was wrong–he was actually trying to waste my time. With that, I hung up while he was still. He did succeed in thoroughly annoying me–at least briefly.
I’m now amused. Clearly he wanted to convince me he and his company know how to increase my business through social networking. What he did instead was demonstrate his own lack of basic social skills. This experience reminded me of yet another self-appointed social media and coaching expert who, when challenged on a statement she made in a meeting, informed me I don’t understand coaching.
Ben Franklin said, “Ignorance is its own defense.” So assuming I am uneducated and lack understanding I think it’s my right to be so and to remain so.
As long as we’re discussing my deficiencies, another thing I don’t understand is why anyone would think this sort of behavior is endearing and likely to result in a sale–let alone a positive relationship. There have been some interesting things written about how social networking is changing the way we view relationships. Who hasn’t noticed the tendency to speak one’s mind on Facebook–even to the point of insulting others? Maybe it does make sense that the social media experts (at least these two) believe annoying and insulting people is the way to go.
Thankfully, I’m not an expert on social media. I’ve always thought that having the legal right to do something doesn’t mean you should do it. Most businesses are relationship based. You won’t build much of a relationship with prospective clients by simply exercising your rights.
Footnote: I’m not suggesting we ignore the law! Violation of the TSR carries significant penalties in addition to potentially annoying prospective customers. The FTC has published a thorough online outline with clickable links that will help you understand complying with the Telemarketing Sales Rule.
One more thing to think about… are you involved in a transaction where access to the property involves a railroad crossing? According to the Maine Department of Transportation, unless there is deeded access, the property owner must have permission and an agreement with the railroad owner to cross. In the absence of this agreement the landowner could actually be considered guilty of trespass.
As with all rights of way and easements, this is not a particularly simple topic. Much of the information you’ll need can be found by downloading a pdf file from the Maine.gov website. Note these requirements apply not only to active crossings… you’ll want to consult an attorney who is familiar with the topic.