Monthly Archives: February 2012

Real Estate Isn’t Fair: There’s No Longer Anything to Buy

If supply and demand rules everything, then please tell me what is going on with the market right now. 

The calendar year started with a ten-year low in inventory, 3285 listings for sale. Instead of seeing a build up in inventory in January, inventory actually dropped to 3157 listings by February 1st. This sometimes happens, where January is the doldrums and not much is going on in either the buying or selling side of things. Things usually start happening in February and get rolling in March.

Well things started happening in February, but it wasn’t a build up of inventory. As of this morning there are 3161 listings (patio home and single family combined) for sale. An increase of four units in a traditional inventory-build month. This has happened before, in 2002, inventory levels were almost identical and sale rate was almost identical. Average and median prices were also similar. And February ended up lower than January in terms of inventory. 

The part I find crazy is the sales rate: Last week when I ran the check on Tuesday, there were 1551 “contracted” listings (pending, under contract, under contract short-sale and first-right of refusal contingent on buyer’s listing closing). Six days later… there are 1742. If you throw out the short-sales and contingencies, there are 1325 pending and under contracts. That number is similar to a summer-time figure in 2007. But in summer 2007 there were 7000 listings to choose from. There are less than half that many now. 

I had a buyer scoff at the concept of anyone paying over asking price for any property on Friday. Well, I’ve been involved in 20 written offers since December 1st. I have put together less than half of those. Thirteen have been multiple offers. 

I’m not saying the market has recovered. I’m just reporting what’s going on. 

Real Estate Isn’t Fair: Part II, Power of the Pen

Real Estate is ultimately a customer service profession.

Customer service has many descriptions (no, there is not one single definition, and no, “the customer is always right” is not the definition). Like a weird Supreme Court decision, “you know it when you see it.”

  • Customer Service is repeatable.
  • Customer Service is Durable (there’s that word again).
  • Customer Service is meant to deepen a connection and increase loyalty. This is very different from “brand-awareness”.
  • Customer Service succeeds when it makes the recipient feel 1.) heard 2.) understood 3.) worth attending to 4.) worth keeping 5.) kinda remarkable (or better).

What does this have to do with real estate not being fair?

I got two pieces of snail mail today. Two. That’s about as many pieces as I’ve received all year (amazing how big companies like ERA Shields get spammed with print mail, and little boutiques like Selley Group get nothing generalized. More on that later). Both were from peers in the real estate industry.

One was a recruitment letter. It was on cheap paper. It didn’t have the company indicated on the return address. The business card was ugly. All it spoke about was the stats of the real estate company. It addressed me as “Dear Benjamin” (no one calls me “Benjamin” unless they don’t know me. I use “Benjamin Day” on my business cards because Ben Day Consulting in Boston dominates SEO and the Re/Max Properties Front Desk always – ALWAYS – thinks Ben Gay is setting up a showing when I leave off my “jamin”) so instantly I knew this was circular-file material. Except I kept reading. Not only was it not concerned at all with me, it was obsessed with them. It was NOT oriented around any of the rules of  how customer service succeeds, not one. The only thing “remarkable” was that it made me feel like my special purpose in life was to have a pulse and a NRDS (our REALTOR ID #) to occupy one of their cubes. As long as I had a pulse and a NRDS, that’s all they needed. Who cares what I need?

Worse, I knew Hannah received one last week. So if I got mine this week, I knew I was a tier 2 candidate. I mean, who wouldn’t want Hannah Parsons over Benjamin Day (I’m totally serious, the former is much easier to broker!)? But I used to recruit agents, I did this stuff (I have the scrapbooking paper to prove it!), and when one company goes out on patrol for agents, EVERYONE you could want knows about it within a day. So you better hit all the good ones at once. While this letter was far from flattering, I already knew they had a first wave of “choice” agents that they thought were most recruitable, and I was not in that group. Save the best for later? No. It does not work that way.

The second piece of mail I received today was a handwritten thank you note. From Lee Bolin. Lee owns Saddletree and Symphony Homes. He has for 15 years. My clients said of Lee “I want him to be my Daddy, I love that guy.”

"I _____ Bigger than you, Ben. And, Thanks for bringing your people by"

Lee is like a friendlier version of Jack Palance’s Curly.

Lee wrote me a handwritten note. And mailed it to me. The dude has no email address. But he has the power of the pen.

Now you tell me: when one of these companies is involved in future real estate transactions, which one has my attention? Which one has the greater opportunity for success? Which one is more durable? You tell me. I think the answer is pretty obvious.