Fall Schedule of Real Estate Courses

 Posted by at 3:39 pm
Jul 252011
 

Here’s a list of real estate prelicensing courses I’ll be teaching in Bangor this fall. Note that there are additional options and dates available… this list includes only the courses I am facilitating.

Sales Agent Course

The state of Maine requires that a person pass both the 55 hour Sales Agent Course and a state exam with a grade of 75% or better in order to qualify for a sales agent license. This Sales Agent Course covers all of the material required by Maine License Law and Rules. The course starts on Thursday, September 7th with most classes scheduled on the weekend. For additional information and the exact schedule, visit the Arthur Gary School of Real Estate website or call the office at 856-1712.

Associate Broker Course

The state of Maine requires that a Sales Agent pass the 60 hour Associate Broker Course with a 75% or better in order to qualify for an Associate Broker license. This Associate Broker Course covers all of the educational material required by Maine License Law and Rules to qualify for an associate broker license. The sales agent will also have to complete the  required “Documented Field Experience Form.” The course meets on Wednesday starting on September 28th. For additional information and the complete schedule visit the Arthur Gary School of Real Estate website or call the school at 856-1712.

Designated Broker Course

This 45 hour course covers all the educational requirements that are necessary to apply for a broker license. To qualify for a broker license the applicant must apply to the Maine Real Estate Commission and show proof of having passed the Designated Broker Course. The applicant must also have been licensed as an Associate Broker for 2 years within the 5 years immediately preceding the date of the broker’s license application submission. Classes meet on Monday starting on October 17th. For additional information and a complete schedule, visit the Arthur Gary School of Real Estate website or call the school at 856-1712.

 Education, Real Estate Business  No Responses »

Can I Succeed in Real Estate?

 Posted by at 8:44 am
Jul 252011
 

As an instructor of pre-licensing courses, I’m of course intrigued and interested in the future of my students… I’ve not done any scientific analysis certainly–partly because success is one of those spongy terms that people actually get to define for themselves.

My sense is that many of the students who go on to acheive some level of success (defined here as staying at it for more than a year or two) do have some common characteristics:

1. Most have at least SOME experience in a service oriented job working with the public… waitressing, hair styling…they’ve learned a service mindset and how to deal with the public.

2. Most have a large degree of self-responsibility… they realize that success and failure are not things created by the brokerage company or employer. They have trouble whining.

3. Most have a decent sense of self-awareness. It may not always be accurate (“Will there be much math? I’m bad a math!”) but they are at least thinking about themselves and their skills. (As an instructor, one of my greatest joys is watching a student discover he or she can do something they thought he or she couldn’t.)

4. Most are almost obsessively curious… they WANT to know things well beyond the requirements for any state or course exam. I will always remember the returning licensee who matter-of-factly cited a large number of closings his first year. He later cited an equally large number of continuing education credits he’d earned even though they weren’t required. Gee, you don’t suppose there’s a correlation here, do you?

5. Most (particularly in the current market) are not dependent on real estate income for their survival. (My prophecy to future sales agents is ” the biggest mistake you will make is to not have money because it will make you stupid.”) Maybe a more accurate way to describe this is that most have a value system that forces them to put their clients’ needs first consistently.

Some would say you have to be an entrepreneur, but there is a difference between being self-employed and being in business and, at some level, successful people come to understand this… what I find interesting is that some  alumni start out being self-employed and end up with a business. But I also know licensees who’ve been at it for a lot of years who are really still just self-employed–they leave the business to the agency/brokerage, ride along, apply their social and interpersonal skills and make a living. I’m not sure one approach is right and the other is wrong.

Can you succeed at real estate? For most the answer will be “yes,” once you determine how you will define that success.

Many recent students have said that they think it’s a great time to get started. They understand that while the market is tough, that also means they will have to truly earn the business and they’ll have time to learn and develop at a slow and deliberate pace. That makes a lot of sense if you think about it. We might illustrate this with a “learning to drive” example. Would you rather get spend some time in class before getting behind the wheel or jump into a car that’s already traveling down the road at 50 miles per hour?

Classes are starting this fall!

 Education, Real Estate Business, Uncategorized  No Responses »

Time to Lower the Price?

 Posted by at 7:41 am
Jul 132011
 

We’ve had our property on the market for a while and there’s been very little interest. How long should we wait before reducing the price?

Tough question, and maybe not the correct one to be asking. The first question I’d ask is whether or not your property is priced properly–at or near market value. Assuming it is, I’d look at recent sales activity in your town/market. One way to do this is to calculate what’s called an “absorption rate.”

Let’s say there are currently 75 residential properties on the market  and in the past six months there have been 26 sales… statistically speaking there is a 1.44 year supply of inventory.  So if you’re priced correctly and your property has been on the market for a couple of weeks… well, calm down. In that situation, unless we get ahead of the current 75 listings, it could take a year and half for your property to sell.

Reducing the price is only one of the ways to get ahead of everybody.  There’s a lot of emphasis on price these days, and the tempting conclusion is to think the price sells the property. What sells the property is locating a  ready, willing, and able buyer. So the real question we need to ask is “how are we going to find a buyer?” Part of that consideration is “are we priced too high to attract a buyer?” If you’re close to market/appraised value, the answer is “probably not,” so sit tight.

(Bear in mind market value can change very quickly and you should be revisiting your price position regularly. And don’t forget that market value is both science and art.)

The exception to this is when a property ends up priced so low a buyer can’t resist it. I remember years ago my mother came from shopping once with a container of “drip” grind coffee. We pointed out that she didn’t have that kind of coffee maker and she replied, “But it was so cheap I couldn’t resist it!” That’s an example of price “creating” a buyer. 

So price may “create” a buyer. But you still have to ask yourself “How many buyers can I create by reducing to an irresistable price?” Remember that if you only consider price you are competing with foreclosures… and that IF you can create a buyer with an amazingly low price that buyer STILL needs to either have the money or the ability to borrow it. I have a couple of low priced properties that generate frequent calls. Most of the calls start with “will the owner finance?” Guess we didn’t create a buyer after all–or at least not a qualified one. Would you be surprised to learn that another question is “Is that price negotiable?”

If you make it all about price… it will be all about price! Sell your property, not your price.

 

 Home, Market Information, Real Estate Business, Selling Real Estate  No Responses »

Your Face on Facebook

 Posted by at 7:24 am
Jun 142011
 

I’ve reported before: I’m not anti-Facebook, but I’m also not a huge fan, either.  Yes, I have a page. But I do not use that page to discuss my business or my clients. I’m also fairly sure the world isn’t all that interested in my daily activities, what I had for breakfast and any other personal drama. I don’t fault the developers of Facebook for making this possible. My larger “complaint” is with users who somewhat blindly accept the technology without understanding the ramifications of what they do and say. Here’s an article reprinted (with permission) from a weekly newsletter published by Oakley Signs and Graphics. If it doesn’t scare you it ought to make you nervous.

Privacy Alert: Facebook Photo Tagging

Opt-out of Facebook’s face-recognition software now.

Recently Facebook began using a face-recognition algorhythm to try and “find” you in photos your friends have taken and posted online. Once Facebook thinks it’s found you, it recommends your friend “tag” you in the photo. Being tagged in a photo associates your name with the photo (and even links to your Facebook page, once tagged).

This might not sound like a big deal… until a friend happens to upload a candid picture of you unwinding that you’d rather not have pasted all over the internet.

The good news? You can opt-out of this setting. For a video tutorial on how to turn this “feature” off, check out this original article by Whitson Gordon on Lifehacker.com:

http://lifehacker.com/5809657/how-to-stop-facebook-from-automatically-tagging-you-in-photos

(end of article)

Ironically today’s Bangor Daily News is carrying a story about a scam in Maine involving somebody who seems to have a fair amount of personal information about the people he’s calling… Gee, I wonder where he’s getting it?

 Education, Real Estate Business  No Responses »

Couple Forecloses on Bank!

 Posted by at 6:02 am
Jun 092011
 

No, the headline is not a mistake. Turnabout IS fair play. It seems that Bank of America (BAC) foreclosed on the wrong house in St. Petersburg Florida–a house which had been bought for cash and had no mortgage. The homeowners spent some 18 months trying to convince BAC of their error, racking up attorney’s fees and other costs in the process.

Ultimately, BAC admitted the error. But in yet another example of the sorts of fiascos surrounding the foreclosure business, they failed to pay the homeowners the court ordered costs. Ultimately, the homeowners went back to court and “foreclosed” on BAC’s branch office in Naples–a judge agreed to allow them to seize bank assets for the unpaid debt. They and their attorney showed up at the branch office with a moving van and a court order. Apparently the branch manager was “visibly shaken” by the order, but BAC found a way to pay up within hours.

If you are currently involved in a short sale or foreclosure, you’ll want to read the entire article. An important piece of this fiasco is that the homeowners bought the home as a foreclosure. There is some speculation that their names got “transposed” during paperwork. This is not the first time things like this have happened. It’s a wonderful story of man biting dog, but it’s also fair warning to anyone involved in foreclosures or short sales.

Read USA Today’s version of the story.

 Buying Real Estate, Financing, Home, Real Estate Business  1 Response »

QRM…Qualified Residential Mortgage Requirements

 Posted by at 7:35 am
May 252011
 

Amid the entire current flap, you’ve probably heard some noise about legislation to change the QRM (Qualified Residential Mortgage) requirements. As I understand it, the change would mean:

  • Certain mortgage types would be eliminated
  •  You would need to put a minimum of 20% down
  •  You would need a minimum 690 FICO score
  •  The ratios of income to both the mortgage payment and overall debt would become much more conservative (28% and 36%)

This has caused quite a stir and a certain amount of “the sky is falling” hype. Even the National Association of Realtors has issued a “call to action” requesting REALTORS ask members of congress to defeat this legislation. I’m not so sure that’s a good idea.

First, we need to understand that this doesn’t mean only those who meet the criteria above are going to get a mortgage. There will still be programs available for people who don’t; they’ll just be a bit more costly in terms of interest rates and other costs. (And why shouldn’t lenders be able to charge more for higher risk loans?)

Second, we need to learn the lessons of history. Relaxed borrowing standards are partly responsible for the mess we’ve been in. Accuse me of over-simplification and I’ll probably plead guilty, but let’s not ignore the fact that a ton of “bad loans” were made At least one source reports that delinquency rates are 2 to 2.5 times higher for “non-QRM” loans.. We can debate the reasons, but this seems to be a bit of an effort to set a standard that suggests mortgages should be made to people who can afford to make the payments and have some equity in the balance.

I think that makes sense.

For a slightly different perspective, let’s assume you have your property listed for sale and I’m your agent. Let’s also assume you don’t have a mortgage on it… maybe it’s a second home or piece of land. A buyer approaches us with an offer to purchase but asks for owner financing. No problem, right? He’s offering full price! You’ll get to charge interest…

So far I’ve left out one important detail. When the buyer made that offer I asked him why he was requesting owner financing. He replied, “Well, I just lost my house to foreclosure and can’t get a mortgage.” (Believe it or not, I’ve had this happen more than once and the buyers often don’t “get” the fact that if the bank isn’t going to loan them money, the seller probably won’t either.)

“Ah,” you say. “Let’s make the deal. So what if he can’t pay? I’ll just take the property back and keep any payments he does manage to make.” Before we make the deal, here’s an easy assignment. Call an attorney and ask her just how easy it is to foreclose and how much it costs. Oh, and did I mention that after you finally manage to foreclose Continue reading »

 Financing, Market Information, Real Estate Business  1 Response »

Where Have All the Buyers Gone…?

 Posted by at 3:06 pm
May 212011
 

Okay… would you like to play the numbers game again? The Maine Real Estate Information System issued a press release recently informing us that for the month of April, unit sales of single family homes was down nearly 24% over the previous year. Part of the explanation for this huge drop was that last year’s numbers were “skewed by the homebuyer’s tax credit…”  Obviously, that’s a tough statement to disagree with but it does raise the question “by how much of the decrease can we blame on last year’s tax credit?”

Opinions are easy and it’s mine that last year’s tax credit for the most part rewarded people who were intending to purchase a home anyway and probably succeeded in “condensing” those transactions into a tighter time period. (In other words, if we’d left things alone most of those sales would have taken place anyway—just not necessarily at the time they did.

In another attempt to rationalize the downward sales trend, lenders are coming under fire because lending standards have become stricter and “frustrating.” Again, that’s a tough statement to disagree with, but it wasn’t too many months ago everyone was blaming lenders for not having strict enough standards.

Speaking of standards, here’s an interesting observation from the Real Economy Watch by Stephen Cook:

For the month of April, 45% of foreclosed properties were damaged and not inhabitable without renovation. Because mortgage financing is generally not available for foreclosed properties that need major repairs, investors often buy these properties for cash. Fifty-five percent of damaged foreclosed properties were bought by investors in the month of April, while only 27% were bought by first-time homebuyers.  (These are national numbers, not Maine.)

Maybe I’m not asking the right people, but I’m not sure why or how we should fault lenders for not making loans to people who might be considered “poor risks” on properties that are considered poor risks. If there’s an explanation Continue reading »

 Buying Real Estate, Market Information, Real Estate Business, Selling Real Estate  No Responses »

Cheap Maine Land!

 Posted by at 7:16 am
Apr 252011
 

An “inside joke” among Maine REALTORS has always been out-of-state buyers who call or email asking about “cheap Maine land.” A few years ago I developed a trade show exhibit that involved a bucket of dirt, a scoop, some plastic bags and a sign that read, “Cheap Maine Land-five cents per scoop!”

Whether property is on the market due to foreclosure, short sale, or just a desperate seller, price is now an important aspect of nearly every transaction.  While buyers can find some real bargains, all too often there’s just too much emphasis put on the bargain at the expense of common sense and basic diligence. Sometimes it seems like it’s not about buying a home or property, it’s about getting the lowest possible price.

Some things haven’t changed.  Common real estate logic used to be “location, location, location.” That logic really hasn’t changed. Property values are still dramatically impacted by location both at the macro and micro level.  Unless your goal in life is to live in a cheap home, you ought also to be looking at neighborhoods, school districts, infrastructure, local economy, amenities, etc.

But you aren’t going to live there you say? I recall getting an excited call from a Boston-based buyer back when one of our local towns lost a major employer. He explained that he’d heard you could buy homes there for “pennies on the dollar” and he wanted five of them. When I inquired of his long range plans, he explained his intention was to turn them into rental properties and garner a great return on his investment.  He hadn’t, of course, considered who he was going to get for tenants.  I occasionally have to explain that my “job” sometimes is to talk people OUT of doing things.

There is something to be said for “at this price I can’t afford not to buy it,” but there still needs to be some caution—especially when dealing with vacant homes that can deteriorate quickly.  Again, logic suggests that you should determine the true cost of owning the home you are considering. A professional home inspection will do that by reporting issues that should be addressed immediately and some that will require attention over time.

It’s strangely ironic that in an earlier market one could sometimes stifle interest by pricing a property too low. Buyers would suspect there was something wrong and avoid considering it! This was also a time when buyers would often require prodding and pushing to do the research and make decisions. Buyers were afraid of making a bad decision. Now it seems like many buyers are afraid to purchase because the price might go lower. A bad decision at a rock-bottom price is still a bad decision!

 Buying Real Estate, Camp, Home, Land, Market Information, Real Estate Business  No Responses »

Your Tax Dollars at Work

 Posted by at 8:27 am
Apr 232011
 

One of my favorite real estate news aggregators is Real Estate Economy Watch. A recent post revealed the somewhat shocking news “The federal government spent about $244 billion on housing-related grants and tax expenditures in fiscal year 2009, or roughly $2,085 per household…” That is, it seems to me, some serious money.

One of my good friends opines that we’d fix a lot of our tax problems if we did away with withholding from paychecks and instead required people to write out a check every week. Using his logic, according to this study, your household is contributing (writing out a check) to the Federal Governement every year in excess of $2,000 in support of the housing industry. You have a right to ask what you are getting for it.

Of course one of the fundmental realities of federal spending is that it’s all but impossible to get an accurate handle on where the dollars go…  but the cited study cited offers some interesting comparisons.  To whet your appetite, federal spending on housing is about ten times comparable spending on energy ($212 per household). You might want to read the article in its entirety and then access the study. They are your dollars.

 Real Estate Business  No Responses »

Tell it like it can be?

 Posted by at 6:56 am
Apr 192011
 

Scott Leavitt of Oakley Signs & Graphics, Inc. sends out a weekly newsletter to customers that is both helpful and thought-provoking. In today’s issue he quotes Robert Orben, a magician and comedy writer from the early 1900′s. “We have enough people who tell it like it is. Now we could use a few who tell it like it can be.”

He uses this  as a springboard to suggest those of us who work in the real estate market can and perhaps should impact buyer and seller confidence and thereby “help” the market improve.  As one who prides himself in “telling it like it is” I found his suggestions more realistic than the organizations who want me to put on my rose-colored glasses and parade down the street shouting, ”It’s a great time to buy! Things are getting better!”

Since I don’t have a brass band at my disposal, I especially liked his rhetorical question, “So, as a real estate professional, is it your duty to simply report the market conditions, or should you be helping buyers and sellers see how it can be?”

To my way of thinking, “how it can be” must include a healthy dose of realism. I suppose given our current economic state it’s easy to have too much realism and not enough “can be.” But as I think back over the various times I’ve reported statistics and market conditions I think I’ve done so with a fairly consistent observation that the statistics don’t create our future; we ultimately create our future and the statistics.

It is interesting, for example, that the most recent Sales Agent Class I’ve taught has a higher enrollment than the last year or two’s average class size. We can debate whether or not this is an indicator of the market but I do know this: Many of those students are creating their future. They have a plan, have identified a niche and are going to create an opportunity for themselves.

Should I buy? Should I sell? Should I get a license and get into the business? How you determine the answer to those questions may be more important than what the answer is. Leavitt refers us to an article in Forbes Magazine. that offers a positive (but conservative) outlook. Understand it’s fairly technical and reading it may make your eyes glaze over. But it contains some great examples of how one’s view of the world can influence one’s future.

Do you want to buy? sell? get into the real estate business? If the answer is “yes,” you may be thinking about how it could be! Think some more. Success always comes when preparation meets opportunity.

 Buying Real Estate, Market Information, Real Estate Business, Selling Real Estate  No Responses »
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