YEARLY HOME SALES WRAP-UP
Price, price, price!
2011 year-end review of Wisconsin housing.
Why this should be your mantra in today’s market.
February 2012 $5.00
When the Price is Right,
the Property is
Almost Sold >> View Details on Page 6
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table of contents
february
2012 |
vol.
28, no. 5
24 6 features 6 16
16 articles
When the Price is Right, the Property is Almost Sold Make that sale! All the tips you need to correctly price a home to make a successful sale.
Short Sale Survival: Part Two
The conclusion of a two-part series to help REALTORS® face short sales head-on in 2012.
24
Legislative Debates Mining Bill
26
WRA Board Endorses Scott Walker for Governor
4 11 13
A look into the specifics of the bill and its impacts on the Hurley Iron Mine.
The WRA Board of Directors voted to endorse Gov. Scott Walker in the upcoming 2012 recall elections.
wisconsin real estate magazine
26
|
february 2012
19
Home Sales Stabilize in 2011 as Median Prices Fall A year-end review of 2011’s Wisconsin housing.
Uncovering the Truth: Buyer Agency Confusion be gone: tackling the five most common buyer agency urban legends.
Best of the Legal Hotline: RESPA Rules Questions and answers touch on RESPA rules and how they impact education promotions, referral fees and much more.
Three Important Words: Price, Price, Price!
This should be your mantra in the current market! Learn why in this month’s Sales Tip.
1
News
inside the wra
with mike theo
Top News Stories in and Around the Industry United Way Honors the Stark Family for Service to Community United Way of Dane County
Wisconsin Receives Millions to Ease Foreclosure Crisis
substantially increase funding for rental assistance, particularly help for working families.
Finding the Property Tax Sweet Spot Milwaukee Business Journal (WI) (09/30/08)
NAR Releases Free FHA Toolkit United Way of Dane County recognized the Stark The state of Wisconsin is due to receive nearly $39 Wisconsin REALTORS® Association (10/30/08) Family with the 2008 Tocqueville Society Award million in federal funds to stabilize neighborhoods for outstanding service to the Dane County and stave off a spate of abandoned homes. According NAR and the WRA are eager to help you meet the community and United Way. The to HUD and Gov. Jim Doyle, the funds are separate 011 was a tumultuous year, but it ended very government organizations, current challengesweof developed the troubleda economy. We Tocqueville Society Award celebrates from approximately $9.2 million the government is uniquely and historically in city oneofrespect: Property blueprint for change that advanced a set of novel and acknowledges people or families, awarding the Milwaukee, where the foreclosure know that you need resources that can help you taxes, for once, stayed the 9.9 same. ideasthe for reforming Wisconsin, which included how such as the Starks, who have made rate isnearly currently percent. HUD is awarding close transactions, and you need them at little or no to find the property tax sweet spot. a major impact on the quality of funds via its Neighborhood Stabilization Program, According to the respected Wisconsin Taxpayers cost. NAR has just released an all-new FHA Toolkit life in Dane County through their exceptional service under which almost $4 billion is being allocated to Alliance (WTA), property tax local bills and increased an averagefor of the justredevelopment The reforms online we proposed notyou have for FREEmay to help getbeen clientsperfect, the financing and commitment to the community. state governments Bill Malkasian 0.3 percent statewide this year; that’s a huge improvement over but they were the right discussions focused on the right It is of abandoned and foreclosed houses. they need in a credit-strapped environment. WRA President
2
the past decade, where annual property tax levies increased City Housing Authority Receives In fact, Not between 2010, Just1982 for and Personal 100-Unit Grant an average of 4.4 percent. Sites: Milwaukee Journal Sentinel (09/25/08) Pabst,tax Georgia net property levies increased every year – Anymore as much as 12.4 Connections
issues. The reforms included significant reductions in one of the most comprehensive toolkits NAR has Wisconsin’s over-reliance on property taxes to fund schools ® ever produced, andalso it’s available all REALTORS and local governments. They includedtoefficiencies in right now by visiting the link below. They also have Minneapolis-St. Paul Business Journal (09/29/08) Grayson, percent in 1982 to as little as 2.3 percent in 2005 – except for local government management and delivery of services, The city of Milwaukee’s housing authority is due Katharine pageadministration, called “NAR Helps Yourevenues Navigate year,Hope 1996.VIInmoney that year, the net levy actually decreased 9.4 consolidationlaunched of schoola new district new to receive $6.7 million inone federal ® thewill year that state adopted the two-thirds to replace thetheproperty new tax incentives for economic to build 100 new housing percent. units. TheThat 100was units St. the Paul, Minn.-based REALTOR Teresa Boardman Current tax, Economy” where you can find dozens of be constructed in a 2.5-mile area of andschools, will include says aFlickr, othertaxes social networking funding which shifted large Facebook portion ofand school development,great and new funding operations for the products andand resources, like the FHAuniversity Toolkit, 29 public housing and from affordable rental units; sites make it easy to meet people whosystem, might to name just a few. For details on the Wisconsin Way’s local property taxes to the state. for free or at a steep discount. Visit www.Realtor. nine affordable housing units for income-eligible eventually become clients. While many professionals Blueprint for Change, visit www.wisconsinway.org. org/NARHelpsYou for links to these great programs This priced, year’s nearly flat propertyare taxusing levy isthese very sites good to news indeed families; and 62 moderately open-market make business contacts condominiums. HUD Secretary Steven owners C. Preston companies use them to conduct background for property and for and housing affordability in Wisconsin. Now more than ever, we need big ideas for big reforms. and products. comments, “Milwaukee’s It’s housing authority has checks recruit new workers, want hopefully sooner rather than later, Wisconsin will move particularly noteworthy that thisorrare phenomenon wasmany the simply Someday, demonstrated it has the result leadership to lead and statetobudget connect with people similar interests. of a very difficult introduced by who Gov.have Walker past recall elections, politicalGoing unrest and partisanAlbeit gridlock Home Loans Strong, a and revitalize neighborhoods and andadopted transform lives. According to Boardman, “The hard dead. It focus on real reforms like those we recommended in last summer, which balanced a massive $3.6 billionsell is eventually Bit Tighter, in Area Cities like Milwaukee change and grow and need to doesn’tspending work door-to-door, it doesn’t work on state budget by significantly cutting and placingand stricter the Wisconsin Way - especially those long overdue reforms to Wisconsin State Journal (10/17/08) Balousek, Marv revitalize housing to make sure many aren’t priced social networks.” On Flickr, Boardman connected limits on property tax increases. our antiquated system of over-taxing real property. It’s time to out.” Milwaukee is one of a half-dozen housing with a fellow photographer who eventually used her Despite the ongoing crisis,taxpayers, property change the false choices that pitnational parents,credit teachers, authorities nationwide toBut receive servicesowners, to purchase home. while new goodHope newsVIfor property the acombination of local officials, government employees, and professionals say mortgage money businesses remains available grants. state funding cuts and property tax caps places real pressure homeowners throughout against onesouthern another. Wisconsin It’s time fortomajor homereforms buyers Foreclosures Push Rents Higher, on Frustrates local governments that provide vital services to property Wisconsin forward.Ron Steinhofer, manager of Housing Study Delay Squeezing Low Income Families that will movewith solid credit. owners, such as police and Minnesota fire protection, garbage collection, Advocates Public Radio (MN) (09/21/08) Olson, Dan Marshall & Ilsley Bank’s regional home lending road maintenance, Milwaukee Journal Sentinel (10/07/08) Williams, Scottsnow removal, and park upkeep as well as In Minnesota’s Twin Cities, a wave of home group, states, “There’s plenty of money for home other services that add to the quality of life most homeowners Two years after promising the Milwaukee metro foreclosures has pushed more people and businesses consider important. Moreover, the cuts and capsinto the rental loans out there. It is slightly more difficult to qualify area’s first major housing study in three decades, apartment sector. The result is an intensifying createRegional real fiscalPlanning problems for K-12 schools, the quality of which Theo than two or three years ago, but if you have a good the Southeastern Wisconsin demand on Minneapolis and St. Paul’s rental Mike housing linked to the of housing in a given area and Commission (SEWRPC) is is stilldirectly struggling to get the quality stock, so much so that the vacancy rate is very low credit score, a good job and a down payment, money vicehope versa.theYetstudy the stricter levy were Without effort launched. Proponents will and caps rents are on necessary. the rise. This, in turn, means lowis available.” Steinhofer adds that banks still are them, state funding reductionsincome could working have resulted significant serve as a catalyst for improving affordable housing familiesinface higher monthly rents making loans via such programs as Fannie Mae opportunities throughout property the city’s But taxsuburbs. increases. even though their income hovers at unchanging commissioners have yet to assemble an advisory levels. Since 2005, the Twin Cities apartment ® as REALTORS , how do wevacancy balancerate thehas need to keep committee to oversee the So research or set a specific dipped fromproperty 7 percent to closer to taxes, as well homes, affordable - withAverage the need to adequately timetable for conducting the survey. PhilasEvenson, 4 percent. monthly rents over that same the commission’s executivefund director, otherand issues our said schools our vital time local span services? In other howrising to more are up more words, than $25, keep getting in the way. The do delays we findhave the frustrated property tax sweet than spot? $850. The St. Paul-based Wilder Foundation housing advocates the most. Bethany Sanchez, recently reviewed income data for several Twin Cities The WRAMilwaukee spent threeFair years participating a project called thefound that the vice president of the Metropolitan counties. The in organization’s research Housing Council, laments,Wisconsin “It’s beenWay a long time thatnumber to answer exact question. The effort created of people in those markets paying too much coming.” The Pewaukee-based commission a comprehensive set has of proposals to revolutionize the way tax, from around for their rental housing will we double not conducted a comprehensive of housing 70,000 to a whopping 140,000 by 2010. spend review and invest in Wisconsin. Alongcurrently with a coalition of diverse patterns since the 1970s. organizations, including the teachers Some say a partial solution would be for the U.S. union, county and municipal
government to reverse course on housing policy and
2
wisconsin real estate magazine
|
february 2012
and Freddie Mac. Furthermore, credit standards remain about the same as they were six months ago,
meaning that qualified home buyers can get loans if they have the proper income verification. On the downside, banks have been less willing to make loans with higher loan-to-value ratios. In addition, conventional financing without a down payment has indeed disappeared. However, 100 percent financing is still available with Veterans Administration and Rural Development home loans.
www.wra.org/wrem
Real Estate
Wisconsin Real Estate Magazine™ is published by the WISCONSIN REALTORS® ASSOCIATION. Trademark issued pursuant to Wisconsin state statute; federal trademark is pending.
notes from the wra
Rob Keefe, Chairman rob@rkeefe.com Renny Diedrich, Chairman-Elect rdiedrich@coldwellhomes.com
College Scholarships Available The selection process is now under way for the 2012 Wisconsin REALTORS® Foundation REALTOR® Children’s Scholarship program. This program awards college scholarships to children of WRA members. The foundation is offering 10 scholarships in the amount of $750 each. The deadline for submitting an application is March 9, 2012. The application is available online at www.wra.org/ChildScholarshipAppl/?terms=scholarship or by contacting Sandy Bolgrihn at Sandyb@wra.org.
Steve Lane, Treasurer lanes@firstweber.com Michael Theo, cae, President mtheo@wra.org Editorial Staff:
WRA Nominating Committee Seeks Candidates Michael Theo
The Nominating Committee is seeking applications for the positions of 2012-2013 Executive Committee Vice President, NAR Director and WRA Board of Director Regional Representative. Please note that the number of openings for Regional Representative is determined by the membership as of February 28, 2012. The application deadline is March 15, 2012.
Publisher
Robert Uhrina Managing Editor
Lauren Bizorik
REALTOR® and Government Day 2012
Joe Leschisin
Take a stand on issues that impact you! REALTOR® & Government Day is your opportunity to help shape laws that affect you. Every year, hundreds of REALTORS® from across the state assemble to demonstrate the strength of the real estate industry and to meet with state legislators to discuss issues such as property taxes, land use, property rights, license regulations and more. Gov. Scott Walker will be our keynote speaker.
Senior Designer Wisconsin Real Estate Magazine, USPS 597-850, ISSN 1548-0526, is published monthly by the WISCONSIN REALTORS® ASSOCIATION, 4801 Forest Run Road, Ste. 201, Madison, WI 53704. Periodical postage paid in Madison, WI and additional mailing offices. An annual subscription rate of $5 is included in membership dues and a copy is mailed to every paid REALTOR® and affiliate member of the association. Nonmember subscription rate: $60. POSTMASTER: please send address changes to the WISCONSIN REALTORS® ASSOCIATION, 4801 Forest Run Rd., Ste. 201, Madison WI 53704-7337.
Mark your calendars now for February 29, 2012! Registration is free to the first 500 registrants and $20 thereafter.
Permission to reprint or quote any material from this issue is hereby granted, provided the Wisconsin Real Estate Magazine is given proper credit in all articles or commentaries, and the WISCONSIN REALTORS® ASSOCIATION is provided with a copy of any reprint.
D Y 2012
FEBRUARY 29 | MONONA TERRACE | MADISON
WRA Member Benefits
Advertising of third party products and services herein does not imply endorsement by the WRA unless specifically stated. Furthermore, the WRA does not endorse, approve, or otherwise warrant the accuracy or legality of any information or content contained in advertisements. Any questions regarding advertising policies should be directed toward the editor.
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GOVERNMENT
REALTOR
Editor
Subject to change.
|
february 2012
3
news monthly wisconsin housing report
Home Sales Stabilize in 2011 as Median Prices Fall
View all housing statistics at www.wra.org/housingstatistics
By David E. Clark, Economist, C3 Statistical Solutions
> WISCONSIN HOUSING STATISTICS MONTHLY ACTIVITY - DECEMBER 2011
YTD-2011
YTD-2010
% Change
107,021 51,512 $132,000
125,208 51,392 $141,000
-14.5% 0.2% -6.4%
Median Price DEC-2011 DEC-2010 % Change
Existing Home Sales DEC-2011 DEC-2010
% Change
$130,000 $146,330 $120,000 $110,000 $99,700 $100,000
1,387 702 411 682 234 365
17.4% 9.2% 0.7% 16.6% 0.9% 5.8%
Statewide
DEC-2011
DEC-2010
% Change
New Listings Closed Sales Median Sales Price
4,439 3,784 $120,000
5,625 3,399 $135,000
-21.1% 11.3% -11.1%
Region Southeast South Central West Northeast Central North
T
“Remember that home sales were pushed into the first half of 2010 due to the Federal Homebuyer Tax Rebate program, so we expected the first half of 2011 to look weak and the latter half to look stronger by comparison,” said Rob Keefe, Chairman of the WRA Board of Directors. “What is encouraging is to see monthly home sales continue to outpace last year’s levels,” he said, noting that home sales in December were 11.3 percent higher than December 2010.
The WRA’s report said other economic factors impacting the housing market also showed signs of improvement. “We are seeing some promising signals in the state labor market,” said WRA President and CEO, Michael Theo, who noted that the statewide unemployment rate dropped more than a half percent over the last two months to 7.1 percent in December. “We are actually seeing private sector job growth in excess of the lost local government employment for 2011, and with net job growth outpacing the growth in the labor force for the year, the rate of unemployment has been falling,”
Regionally, sales were typically within 5 percent of 2010 levels. The strongest growth in home sales was found in the Southeast region where existing home sales rose 3.4
wisconsin real estate magazine
-13.9% -5.0% -5.7% -10.2% -8.5% -9.1%
percent over the previous year, followed by the North region where sales grew 2.1 percent. Sales in the Northeast region were even, with an increase of 0.1 percent with last year, but sales were slightly lower, down 1.2 percent, in the South Central region. Finally, annual sales dropped 4.8 percent in the West region, and fell 6.1 percent in the central part of the state. Median prices for the year were below 2010 levels in all regions of the state, with prices falling between 3.6 percent and 5.5 percent in five of the six regions. In contrast, the Southeast region dropped 9.1 percent over the period.
he Wisconsin real estate market improved in 2011 with home sales totaling slightly above 2010 levels, according to a year-end report released by the Wisconsin REALTORS® Association (WRA). Sales of existing homes for 2011 were 0.2 percent above 2010, and the median price of homes fell 6.4 percent to $132,000, according to the report. Monthly trends in home sales ran well above 2010 levels throughout the second half of the year.
4
$151,000 $154,000 $127,250 $122,500 $108,950 $110,000
|
february 2012
1,181 643 408 585 232 345
said Theo. “If home sales are to continue to grow, we will need more robust job growth going forward, but a falling unemployment rate is a welcomed sign,” he said. Another bright spot in the WRA’s report showed inventories of unsold homes dropped to 12.5 months of supply in December, which is the first time it has been below 13 months since the WRA began tracking inventory levels in May 2010. In addition, the Wisconsin Housing Affordability Index, which shows what percentage of a median-priced home a buyer with the median family income can afford, stood at 269 for December 2011, up from 230 in December 2010. “The Wisconsin housing market is still very much a buyer’s market, and the decline in median prices in December combined with 30-year mortgage rates below 4 percent has pushed affordability to very high levels, which is great news for buyers who qualify for mortgage credit,” said Theo. For more information, contact David E. Clark, Economist, C3 Statistical Solutions Office phone: (414) 803-6537
www.wra.org/wrem
national housing report news
NAR Economic forecast for 2012 by nar research
This monthly summary forecast table includes actual and predicted movement in the GDP, consumer prices, home sales, home prices, housing starts, mortgage rates and more. To view more detailed information, please visit www.realtor.org/research/research/reportsstatistics.
summary forecast table 2011
2012
2013
4.26 million
4 .44 million
4 .62 million
New Home Sales
305,000
351,000
506,000
Housing Starts
599,000
702,000
986,000
$166,100
$167,300
$172,600
New Home Price
$223,400
$227,000
$235,800
GDP Growth
+1.8%
+ 2.6%
+ 3.2%
Payroll Job Gains
+1.7 million
+ 2.0 million
+2.4 million
Fed Funds Rate
0.1%
0.1%
0 .3%
30-yr Mortgage
4.7%
4 .4%
5.4%
Home Sales
new home sales
Housing Starts 2500
In thousand units
In thousand units
2000
1000
Single-Family
500
1000 500
2005
2006
2007
2008
2009
2010
2011
0
2012 2013 forecast forecast
2005
2006
2007
2008
2009
2010
2011
2012 forecast
2013 forecast
median home price
existing home sales 8 7 6 5 4 3 2 1 0
Single-family starts
1500
1500
0
NHS
2000
In million units
300,000
History
250,000
Forecast
200,000 7.08
2005
6.52
2006
150,000 5.02
2007
4.12
4.34
4.18
4.26
4.45
4.62
2008
2009
2010
2011
2012 forecast
2013 forecast
wisconsin real estate magazine
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february 2012
100,000
New
5
When the Price is Right,
the Property is
Almost Sold
By Alexis Bolin, ABR, CRS, CRP, SRES, SFR
In today’s shifting market, many agents are struggling to get their listings sold as prices drop, time on market increases and list-to-sell price ratios take a beating.
H
ave you ever had a listing expire without selling? Do you ever feel like you will expire before some of your listings sell? Are the average days on the market for your listings in a six-figure category? If you answered “yes” to any of the questions above, you may be due for a pricing refresher. And here it is! Below are everyday tips to assist you in getting the right price from the very beginning.
1. There is a definite psychology to proper pricing. Pricing is both an art and a science that takes knowledge of the market and an innate ability to properly analyze sales data. Your job is to help sellers understand the advantage of setting a reasonable asking price. Start by asking these questions to discover the seller’s motivation:
•
Month’s supply of inventory; Absorption Rate.
•
Average days on the market in MLS, in that area of town, in that subdivision.
•
Average Sold Price.
This information can be extracted from your MLS statistics, or you can outsource like I do. Consider using a product like Real Market Reports; I get a report each Monday for the areas I work, and then I use it on my listing presentations to keep my sellers updated on the market.
3. Help the seller understand the benefits of setting the right price.
•
Why are you selling?
Of course sellers always want more money for their home, and the best way to get more money is to price the property right in the beginning. Some of the benefits of proper pricing are:
•
How soon do you need to sell?
1.
•
Are you value?
New listings create a buzz in the real estate community. The right price attracts more agents to show the house.
2.
The right price generates more calls and Internet inquiries.
•
What is your priority? Getting your price? Or whether or not the house sells?
3.
•
What is your game plan if, for some reason, the house doesn’t sell?
Homes sell closer to their asking price during the first few weeks that they are on the market, causing them to sell for a higher price in a shorter time.
4.
Fewer mortgage payments mean less interest paid, which means more money in the seller’s pocket!
5.
The right price creates a sense of buyer urgency. Buyers will think your home is a great deal compared to the others on the market!
6.
The right price places less hassle for the seller to keep up the home for showing(s).
7.
It is better to sell the house now as the real estate market is fluctuating, and prices may go down even more.
8.
The longer the house sits on the market, it’s likely for buyers to think that something is wrong with the house.
9.
Keep your ultimate goal in selling the house in mind. Normally, the goal is to move on with your life and into your new area or new home.
willing
to
price
your
home
at
market
Sellers should give you permission to tell them the truth. Ask them, “I can tell you what you want to hear, or I can tell you the truth about the market and the pricing; what do you want me to do?” Be hard on the market and soft on the people. Establish common objectives for the selling process.
2. Know your numbers. Be prepared to interpret the current market so sellers can make intelligent pricing decisions. Handle pricing objections by answering with facts, data and logic that support your point. Be sure to highlight these details: •
Active listings versus pending sales.
•
Number of new listings each month versus last month and last year.
•
Active listings versus sold listings.
wisconsin real estate magazine
10. You never get a second chance to make a good first impression.
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february 2012
7
4. Become an expert in scripts and dialogues. Learn the answers to the most common objections.
5. No matter how good the marketing, an overpriced home can’t sell.
All sellers say the same thing: “We are in no hurry! We aren’t going to give it away.”
Most agents spend more time with sellers presenting their marketing plan than they do determining proper pricing. Instead of working to get the seller to set the best market price for their home, many agents believe that they will be successful in selling the house because of the condition along with their market savvy and skill. Hope is not a sales strategy, nor does it sell homes!
Sellers always feel that their improvements will add value to their home. Improvements add to the property in two ways: they make it more salable, and they make it more showable - but improvements don’t make it more valuable. The question for your sellers is simple: do you want your home to sell, or do you want your home to sit on the market? Use this football analogy to explain the importance of being in the market to sell - not just on the market. Ask: •
How many players are on a pro-football team? … 53
•
How many players from each team are on the field? … 11
•
How many players from each team are sitting on the bench waiting their turn in the game? … 42
•
Do you want to be one of the 11 players in the game to score or one of the 42 sitting on the sidelines with no opportunity to score?
Becoming one of the 42 players sitting on the sidelines is what can happen when you overprice your home for the seller. You and the seller both lose the opportunity to score.
8
wisconsin real estate magazine
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february 2012
Many sellers with an overpriced home usually are surprised that their home does not sell with the first listing agent. These sellers are quick to place blame on the listing agent and the agent’s lack of good marketing for the lack of a sale. They never imagined that it didn’t sell because it was overpriced. Sellers feel that marketing is the answer to a sale. If only we would advertise their home in the New York Times, sellers think, a good buyer will see the ad and pay full price for the home. Most sellers are somewhere inside “Never Neverland,” and we’re responsible for bringing them back to reality. An unsold, overpriced listing negatively impacts your profitability. It costs time and money while it delivers no revenue to your business. The situation only gets worse the longer the listing languishes on the market. Remember this line: “Mr. or Mrs. Seller, my job isn’t to control the market; it’s to interpret it so that you can make an intelligent decision.”
www.wra.org/wrem
Some sellers are determined to sell their home at a particular price; they have a price in mind and don’t want to stray from that price - no matter the message that buyers tell them by giving them no offers! Telling potential clients the truth is important. It isn’t easy to tell a seller that their $200,000 home is overpriced by $40,000, and it’s not easy to tell them that their home needs new paint, carpet and other repairs if they hope to sell in this millennium!
An unreasonable seller’s comments about your inability to sell the
The Code of Ethics- Article 1 -3 says, “REALTORS® in attempting to secure a listing shall not deliberately mislead the owner as to the market value.” Print a copy of this, and put it in your listing presentation to explain why you don’t over- or underprice listings.
priced listing is money in the bank!
If you take an overpriced listing, you give the seller false hope, and taking this listing may give you a bad reputation in your community for not being able to sell the house.
6. Sellers fear that agents will underprice their home. Experience shows that buyers will not let a seller price their home too low. They recognize a well-priced property and almost always bid the price back up. Show your sellers why setting the price just below market value will increase buyer interest, generate more showings and result in multiple offers - they only get one chance to make it right. Don’t get so involved in the process of winning the listing that you forget to ask yourself if it is smart business to take the listing, and on what terms?
home can cost you future business and ruin your local reputation - not to mention all the time invested and marketing dollars you spent. If you take a listing overpriced, the seller obviously is a better salesman than you! It’s more important to have listings that are salable. A “sold” sign and a satisfied customer are our best sources of advertising! A well-
In the end, we are judged by our results. Either the home sold or it didn’t. Both the seller and the public judge us by our performance. How do you want to be known in your marketplace?
Alexis Bolin has been in residential real estate for 33 years. Currently a broker-associate with ERA Legacy Realty in Pensacola, Fla., Alexis has closed over 100 units per year, was ERA’s Number One Agent Nationwide three different times, and is a popular speaker for real estate events like CRS Sell-a-bration.
7. Ask yourself serious questions before taking a listing. 1.
Are the sellers motivated to sell? What is their sense of urgency?
2.
Is this home in salable condition?
3.
If not, what can be done to improve the salability?
4.
Are the sellers willing to make the improvements or price accordingly?
5.
What are the positives of the home? What are the negatives?
6.
Are there any structural items that need to be addressed?
7.
Will identified negatives be addressed by the seller prior to listing the home?
8.
Will the seller agree to price the house within the neighborhood comps?
9.
Will the seller list with you, at your commission rate and terms?
If answers to most of these questions are “No,” don’t take the listing. Keep these three “don’ts” in mind: •
Don’t work with sellers who won’t price it right.
•
Don’t work with sellers who won’t make the necessary repairs or cosmetics to get their home sold unless they compensate the deficiencies with price.
•
Don’t let your seller get penalized for starting out at a price that is too high for the current market. wisconsin real estate magazine
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Uncovering the Truth: Buyer Agency The Fourth Installment in a Series of Articles Dispelling Real Estate Myths
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Urban Legend #1: Being a Buyer’s Agent Means Automatic Procuring Cause.
ver the years of teaching and speaking about buyer agency, I have learned one thing: it has a polarizing effect, similar to Number 4 with Packer fans or the reality TV Kardashian family. Without a doubt, buyer agency keeps the conversation interesting.
The Truth: In terms of procuring cause, the pressing question is: who caused the buyer to make the offer that resulted in the sale of the property? There is no one act which determines procuring cause - it can only be answered by a full and knowledgeable consideration of all the facts of the case. The broker who can show an uninterrupted series of events that resulted in the successful transaction with the actual buyer will be the procuring cause of the sale.
Before beginning, let’s review the basics. First, to be a buyer’s agent, you must have a signed WB-36 Buyer Agency/Tenant Representation Agreement. The buyer is then your client and you can provide them all the duties that only a client receives: negotiation, loyalty, information and advice, and disclosure of material facts. The WB36 generally may be used to create a client relationship to help a buyer find a property to purchase or a tenant to rent.
A buyer agency agreement does not supersede or dictate procuring cause. Often Arbitration Panels will consider the actions of the broker that caused the purchaser to reasonably conclude that the broker had lost interest or disengaged from the transaction, otherwise known as abandonment. In other instances, a purchaser, despite reasonable efforts by the broker to maintain ongoing contact, may seek assistance from another broker. The panel will want to consider why the purchaser “abandoned” the first broker and whether that broker engaged in conduct that caused the purchaser to terminate the relationship, known as estrangement. This can be caused, among other things, by words or actions. Panels will want to consider whether such conduct caused a break in the series of events leading to the transaction and whether the successful transaction was actually brought about through the initiation of a separate, subsequent series of events by the second broker.
When you strip down buyer agency to its bare bones, it’s a buyer’s opportunity to have an agent provide them opinions and advice regarding the properties covered under the agreement. When the buyer asks, “how much should I write the offer for?” a buyer’s agent can respond with a specific number or advice. This is in contrast to an agent working with a buyer customer, who can only respond in general terms, such as, “submit your best offer.” It’s all about the client relationship the buyer agency contract creates. However you personally feel about the WB36, just like all things polarizing, there are several urban legends surrounding it. We’ll review the top five.
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By cori lamont
Urban Legend #2: In the offer, buyer’s brokers are prohibited from asking for the seller to pay their fees. The Truth: A buyer’s broker may ethically suggest or recommend that the buyer ask the seller to pay some of the buyer’s broker’s entire fee pursuant to Article 16 of the Code of Ethics and NAR Case Interpretation #1612. The buyer may condition the offer upon the seller paying the buyer’s broker’s fee on behalf of the buyer as a seller’s expense at closing. When drafting offer to purchase provisions, buyer’s brokers should specify whether the amounts being paid pursuant to the offer are in addition to or are in place of the compensation offered by the listing broker. Language in the offer where the buyer directs the buyer’s agent to disclaim the MLS offer of compensation is a good start, but that language alone is not enough. The buyer’s broker should advise the listing broker directly, preferably in writing, if the buyer’s broker is waiving off the compensation offered by the listing broker. Otherwise, the buyer’s agent could be paid a double fee - once by the seller based on the offer to purchase language and again by the listing broker through the MLS. The buyer’s broker also must have been authorized by the buyer in the WB-36 to accept compensation from the owner or the owner’s agent to comply with Wis. Admin. Code § REEB 24.05(1).
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“When you strip down buyer agency to its bare bones, it’s a buyer’s opportunity to have an agent provide them opinions and advice regarding the properties covered under the agreement.”
Urban Legend #3: You don’t have to be a buyer’s agent to work with a buyer when the property is aN FSBO. The Truth: Wis. Admin. Code § REEB 24.025(2) states, “Licensees may not provide brokerage services to a client or a customer without an agency agreement authorizing those brokerage services. A licensee who acts as a subagent may do so under the agency agreement of the principal agent and the subagent is not required to have a separate agreement.” If there is not a buyer agency agreement or a listing contract, then the licensee cannot be involved in the transaction. The licensee would need to persuade one of the parties to enter into a listing or buyer agency agreement. As a side note, a licensee may not enter into an agency agreement just to draft the agreement between the parties because it would be considered the unlicensed practice of law. The drafting must be incidental to the practice of real estate. If the parties to the transaction have come to an agreement about the terms of the purchase of real property, they should be referred to legal counsel to draft their contract. The broker must provide brokerage services besides just drafting the offer; this would include services such as inspection of the property, disclosure of material adverse facts and negotiation of the contract terms.
Urban Legend #4: A buyer cannot fire a buyer’s agent. The Truth: Buyers have the power to revoke a buyer agency contract at any time. This is because an agency contract, such as the WB36, is a personal service contract based upon a special relationship of trust and confidence in the broker. When a buyer directs a broker to stop searching for property, the broker
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must obey the instructions. In the WB-36, the buyer can terminate only by delivery of written notice. See lines 197-204. The power to revoke, however, is not a right to do so. Canceling a buyer agency agreement may violate the broker’s rights under the contract. In that event, the broker may demand compensation for the damages sustained as a result of the cancellation. The broker’s damages, in general terms, might include reimbursement for expenses incurred by the broker, such as the cost of mileage, other out-of-pocket disbursements and a reasonable amount for the broker’s time and services.
Urban Legend #5: The Buyer’s Agent is required to give a copy of the Broker Disclosure to Client form to the listing broker. The Truth: The buyer’s agent is not required by license law to provide the listing company with a copy of the Broker Disclosure to Clients, which is contained in the WB-36. The buyer agency agreement is the contract between the buyer and buyer’s broker; the buyer’s agent is not required to produce a copy of the buyer agency agreement for the
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listing broker. The buyer’s agent discloses the buyer agency status on first contact with the seller or the seller’s agent and then reconfirms that on line 1 of the offer when the offer is drafted. Wis. Admin. Code § REEB 24.08(8)(a)2 & (c) provides: “Licensees acting as agents of potential buyers of real estate used or intended to be used principally for one to 4 family residential purposes, who are negotiating directly with the seller or who are aware that the owner of the real estate has granted another licensee the exclusive right to sell, shall notify the seller or the listing broker, as applicable, of the licensee’s buyer agency relationship at the earlier of all of the following: a.
The first contact with the seller or the listing broker where information regarding the seller or transaction is being exchanged.
b.
A showing of the property.
c.
Any other negotiation with the seller or the listing broker. (c) Offers to purchase and option contracts. Licensees shall reconfirm, in the offer to purchase or option contract, whom the licensee represents as an agent in a real estate or business opportunity transaction.”
The buyer’s agent may, as a courtesy, have the buyer complete a Broker Disclosure to Clients form, but this is not required. The agent may consult with the broker because some companies, although they may not compel a copy, have negotiated independent company-to-company agreements whereby the brokers agree to submit a copy of an agency disclosure for all customers and clients. Cori Lamont is Director of Brokerage Regulation and Licensing for the WRA.
www.wra.org/wrem
best of the legal hotline with debbi conrad
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ongress enacted the Real Estate Settlement Procedures Act (RESPA) in 1974 to protect consumers in the home buying process. RESPA is now administered and enforced by the Consumer Financial Protection Bureau (CFPB). Settlement service providers, including real estate agents, with questions about RESPA should e-mail the CFPB at CFPB_RESPAInquiries@ cfpb.gov. REALTORS® are most familiar with Section 8 of RESPA, which prohibits anyone from giving or accepting a fee, kickback or anything of value in exchange for referrals of settlement service business related to a federally related mortgage loan. Settlement services are services provided in connection with a closing, including services relating to the buyer’s loan, title insurance, closing documents, appraisals, credit reports, property inspections, hazard insurance, surveys, property taxes and, of course, real estate brokerage.
Affiliated Business Arrangements When writing offers on another company’s listing, can the buyer, upon the buyer’s broker’s recommendation, request that the seller order title work from the buyer, upon the title company affiliated with the buyer’s broker? Real estate brokers and agents are permitted to own an interest in a settlement service company, such as a mortgage broker or title
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insurance company. The referral of a party to a broker’s affiliated settlement service provider is not considered an illegal kickback or unearned fee under RESPA if the following conditions are met: a.
The broker making the referral has provided each party receiving the referral with a written disclosure in the format of the Affiliated Business Arrangement (ABA) disclosure statement. The required content of the ABA disclosure statement is found at Appendix D on the United States Department of Housing and Urban Development (HUD) website at portal.hud.gov/ hudportal/HUD?src=/program_offices/housing/ramh/res/ resappd. A copy of the mandatory ABA Disclosure Statement also can be found on page 16 of the February 2005 Legal Update, “Common Practice Pitfalls,” at www.wra.org/LU0502.
b.
The broker making the referral generally cannot require any party to use any particular provider of settlement services.
c.
The only thing of value that is received from the arrangement is a return on an ownership interest or franchise relationship.
d.
The affiliated company must be a bona fide, stand-alone business with sufficient capital, employees and separate office space, and must perform core services associated with that industry.
After the broker gives the buyer an ABA disclosure statement, the
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cont’d
buyer may agree to draft the offer to state that the referred title company will prepare the owners’ policy of title insurance. The ABA disclosure statement also serves to fulfill the disclosure requirements under Wis. Admin. Code § REEB 24.05(3).
Choosing the Title Insurance Company The broker believes that the buyer can select the title insurance company for the owner’s policy, but the listing agent is insisting that the seller can choose because the seller pays for the policy. Where is the statute that says the buyer may choose the title company? The seller’s obligation in the WB-11 Residential Offer to Purchase is to give evidence of title in the form of an owner’s policy and pay the costs thereof. Unless the offer names a specific title company, the seller may be free to choose. RESPA rules prohibit a seller from conditioning the sale of property on the use of a certain title company. The WRA contacted HUD’s RESPA office for clarification regarding whether a buyer would lose his right to choose the title insurance company if he drafts the offer without specifying a title insurer and later decides that he wants to choose the title insurance company. HUD responded that they do not provide advisory opinions. However, the correspondence cited section 9 of RESPA, which does not allow a seller, or the seller’s agent, to require a buyer, as a condition of the transaction, to purchase the owner’s title insurance from any particular title company. To avoid any ambiguity or conflict, a buyer who wants the seller to provide title evidence from a particular company should draft the offer to specify the title company that is to furnish the owner’s title insurance policy. If the offer does not name a particular title company, the RESPA prohibitions against sellers making the offer conditioned upon the use of a certain title company appear not to apply, thereby allowing the seller to select the title company.
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Referrals of Non-Settlement Services A local home painting business wants to pay a referral fee to agents who refer painting business to the company. Is this legal? Under RESPA, painters generally are not settlement service providers so this particular type of referral is not subject to RESPA, provided the painting is not rendered as part of the closing and not paid for on the closing statement. Wis. Admin. Code § REEB 24.05(3) provides, “A licensee acting as an agent in a real estate or business opportunity transaction may not recommend or suggest to a party to the transaction the services of another individual or entity from which the licensee may receive compensation for a referral or in which the licensee has an interest, other than referrals to other licensees for real estate services under s. 452.19, Stats. unless the licensee, prior to or at the time of the referral, discloses the fact that he or she may receive compensation for the referral or that he or she has an interest in the individual or entity providing the services.” If this referral to the painter is made in the context of a transaction, then the broker must follow this rule and disclose that he will receive a fee from the painter. If the broker is not acting as an agent and the referral occurs outside of a transaction, then it is not subject to license law. It may be prudent, however, to disclose the referral fee in all cases to avoid any possibility that a transaction may later occur with the party. This disclosure need not be in writing, but an e-mail or other writing would be recommended if the referral were to a party in a transaction.
www.wra.org/wrem
Distributing Lender Financing Information A builder/broker is building and selling homes in a local community. A local bank put together a flier detailing the payments and other information for purchase money loans under various available loan programs. This is intended for use as a sales piece, but the bank said that they couldn’t put their name on it due to RESPA restrictions. May the builder/broker use the flier as a handout? The NAR Frequently Asked RESPA Questions provide the following insight into this issue, online at www.realtor.org/ LetterLw.nsf/pages/0305respaQ&A: “11. Can brokers and agents accept from lenders and distribute to prospective buyers flyers containing financing information? For instance, at an open house, may a lender provide flyers that offer closing cost calculations for various down payment scenarios, to be distributed by brokers and agents?” “Distribution of such flyers provided by lenders does not violate RESPA. The information gathered is consistent with the real estate agent’s responsibilities to his or her client to facilitate the sale of the property and no separate benefit flows to the agent from the lender. The agent may not, however, accept from lenders flyers which also promote the listed property, since that would result in the lender bearing a portion of the agent’s advertising expenses, which are the agent’s responsibility.”
Education and Promotions Is it legal for a settlement service provider, such as a title insurance company or a home inspection company, to sponsor continuing education (CE) for real estate agents? It depends on whether some of the expenses an agent would otherwise bear are defrayed by the affiliate member. Sponsorship of CE may be a RESPA violation because members normally have to pay a fee to attend such programs. CE credits are necessary for agents to maintain their licenses, and agents normally have to pay for CE. A free class for CE credit offered to real estate agents by a settlement service provider may be seen as a thing of value in exchange for the referral of settlement service business. RESPA does allow settlement service providers to conduct normal promotional and educational activities that are not conditioned upon the referral of settlement service business and do not involve the defraying of expenses otherwise incurred by persons in a position to refer settlement service business. Thus the title company may offer free education to the agents so long as it is not CE. This is based on the NAR FAQ at www.realtor.org/LetterLw.nsf/pages/0305respaQ&A.
May a mortgage company cater the food offered at a broker’s open house tour? If the mortgage company came to the lunch and provided a short presentation regarding interest rates and loan programs, the payment would likely be permissible as an educational and promotional activity. Furthermore, if the mortgage company prominently displayed a sign indicating its sponsorship of the lunch and distributed brochures during the open house, the payment would likely be permissible. A rule of reason should be applied. If these activities or materials are present, a casual lunch of sandwiches for brokers could reasonably be a permissible marketing cost. See the NAR FAQ at www.realtor.org/LetterLw. nsf/pages/0305respaQ&A.
For further discussion of RESPA, see the November 2006 Legal Update, “RESPA and the Real Estate Broker,” at www.wra.org/LU0611.
Debbi Conrad is Senior Attorney and Director of Legal Affairs for the WRA. wisconsin real estate magazine
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Short Sale Survival: Part Two By tracy rucka
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“A “short sale” is the term most commonly used in real estate to refer to a situation where the proceeds from the sale will not satisfy all the liens on the property and to pay closing expenses, possibly including the broker’s commission.”
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ast month, we looked at listing potential short sale properties. This month, we consider ways to facilitate successful short sale transactions and support the seller through the short sale process.
A “short sale” is the term most commonly used in real estate to refer to a situation where the proceeds from the sale will not satisfy all the liens on the property and to pay closing expenses, possibly including the broker’s commission. Other times, the total of all liens on the property exceeds the value of the property or what the property can bring on the market. When there are many liens on the property, the different lien holders sometimes negotiate with the owner and agree to take less than the full amount owed rather than suffer the expense and delay of a foreclosure or other litigation. When there is no more room to negotiate with lien holders, either the seller must bring cash to the table or the transaction will fail. Whether a seller will qualify for a short sale is a case-by-case determination to be made by the seller’s lender. REALTORS® will act as the intermediary guiding the transaction to a successful closing. In any given short sale, the broker may not only be communicating between the buyer and seller but may also be in communication with all the players: appraisers, inspectors, lien holders, judgment holders, homeowner’s associations, condominium associations, legal counsel, tax advisors, loan servicers, mortgage investors and mortgage insurers. The broker may review the WRA Addendum SSL and Addendum SSO with the seller to educate the seller about the short sale process.
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www.wra.org/wrem
Short Sales
visit www.realtor.org/government_affairs/short_sales_hafa. Fannie Mae, Freddie Mac, and some other lenders have similar programs and may be willing to set some sale parameters in advance – the seller will need to ask the lender.
Negotiating the Offer When working with a seller, keep in mind that an offer is accepted when the buyer and seller have agreed to the offer. The accepted offer is then submitted to the lender or the investors for approval of the short sale. Successful transactions will occur when the terms of the accepted offer meet lender criteria for short sale approval. It is important to have qualified, patient buyers drafting offers that will put the seller in the best position to get the short sale approval. The broker can prepare the seller for success before any offers are presented by completing a sample HUD-1 closing statement. Remind the seller that the numbers are preliminary and will be subject to change. Some sellers are less than candid, and additional fees often seem to appear that must be paid to close the transaction. One source of confusion is when a seller who was current with mortgage payments stops making payments after the property is listed. The payout will be higher than expected since it includes the missed payments and any penalties. If there are third party negotiators, attorneys or tax advisors in the transaction, know in advance how they will be paid for their services, and be sure that all title fees, unpaid utility bills, homeowner association fees, condo fees or assessments, document delivery fees and repair costs are included. The preliminary HUD 1 gives the seller and lenders a succinct snapshot of the closing expectations. Making it as accurate and complete as possible will minimize surprises when final closing documents are prepared. If the sample HUD-1 is incomplete, the seller may be required to pay unanticipated costs at closing to meet the contractual obligation to the buyer per the offer.
HAFA and HAMP The Home Affordable Modification Program (HAMP) is a program to assist homeowners to avoid foreclosure by modifying their loans. The Home Affordable Foreclosure Alternatives Program (HAFA) sets forth a uniform process, uniform forms and, perhaps most importantly, firm deadlines for short sales. If the seller qualifies for HAFA, the seller can obtain pre-approved short sale terms before listing the property. If a borrower/seller expresses interest in a short sale to his or her loan servicer and is eligible, per the basic HAMP criteria at makinghomeaffordable.gov, the seller will receive a standardized Short Sale Agreement (SSA) that will give the seller the list price or the net sales proceeds amount acceptable to the servicer and set a maximum limit on closing costs. To find out if the seller qualifies, the seller may contact the Homeowner’s Hotline at 1-888-995-HOPE or wisconsin real estate magazine
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Know the Lender and Know the Process The role of the broker is to be an intermediary between the seller and the lender, making sure that all information is complete, timely and provided to the appropriate parties. It is crucial for a broker listing a short sale to determine who has the authority to approve the short sale and if an online approval program, like Equator, will be used. Since its launch in 2009, over one million short sales have been initiated through the Equator EQ Platform used by Bank of America, Wells Fargo, ASC, BSI Financial Services and Nationstar Mortgage. If the seller’s loan is with these lenders, the broker should set up an Equator account and view online tutorials to prepare for the short sale process. The Equator portal automatically checks for HAFA eligibility and includes third party contact authorization forms. In Equator, all documents are transmitted online – no more faxing – and securely stored .For more information about Equator, visit www. equator.com/home/index.cfm/solutions. Broker emphasis in this early stage focuses on organizing seller information such as financial statements, tax returns, pay stubs and bank statements, in proper formats. If tax returns are needed, the IRS form 4506-T Request for Transcript of Tax Return is available at www.irs.gov/pub/irs-pdf/f4506t.pdf. Brokers also must be vigilant in watching the particular lender’s timelines and keeping files active.
Determining Home Value Scheduling timely BPOs or appraisals is a key step required for lender approval of the short sale. Some lenders have valuation timelines, so watch that the BPO does not expire to keep the short sale moving through the program.
Investor Decisions The lender may not be the actual decision maker in the process; instead an investor may make the final decisions. The broker may work with the lender to determine who will be making decisions and the standards that will be applied. A lender or investor typically considers the value of the property, mortgage insurance, second liens and closing costs to calculate the bottom line for approval or disapproval. Instead of refusing an offer flat out, the investor may require the seller to make a cash contribution or enter into a promissory note, or ask for a purchase price increase.
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Possible Debt Forgiveness One of the most important factors for the seller to know is whether the lender(s) will waive any deficiency or pursue the deficiency after the transaction closes. The broker must take caution to not give the seller legal or tax advice regarding any deficiency. For income tax purposes, the discharge of debt is considered income to the taxpayer. The Mortgage Forgiveness Debt Relief Act of 2007 generally allows taxpayers to exclude up to $2 million of forgiven debt, or $1 million if married, filing separately, on their principal residence from income, provided the discharge is due to the decline in the home’s value or the taxpayer’s financial condition. A seller always should be referred to his or her tax advisor or the IRS for advice concerning the tax implications of a sale or foreclosure. There is also a helpful two-page brochure available at www.irs.gov/pub/irspdf/p4705.pdf that can be printed and provided to the seller. Visit www.irs.gov/individuals/article/0,,id=179414,00.html for more information.
Homebuyer Tax Credits Similarly, if the short sale seller asks about the repayment of any homebuyer tax credits, this also is a matter for their tax advisor. For 2008 credit information, see www.irs.gov/taxtopics/tc611.html; for 2009 or 2010 credit information, see www.irs.gov/taxtopics/tc612. html.
Communication The bottom line is that short sales take time. Regular contact with the seller and buyers can go a long way to show the broker’s engagement to help complete the transaction. Even though the decisions are being made by third parties and are out of the broker’s control, keeping the buyer and seller informed will minimize blame on the broker if the deal does not result in a sale.
Short Sale and Broker Risk Brokers may want to review their errors and omissions insurance policy to determine what short sale services are covered or excluded. Services outside the scope of brokerage generally will not be covered. If the broker gives legal or tax advice or interprets a lender approval letter, the broker may incur liability with no E & O coverage. The broker must resist temptation and not give the seller legal or tax advice when the lender approval letter arrives. Just because short sale sellers protest that they have no money for an attorney does not magically give the broker a free pass to give legal advice.
Another potential for a short sale fraud scenario occurs when a straw buyer purchases the property and flips it back to the seller or allows the seller to rent back the property with the intent to sell back at a later date. Most lenders today require affidavits from the parties confirming that the transaction is in fact arm’s length, and reject any deals where brokers or family members are buyers, or there is a plan for the buyer to lease the property back to the seller or a quick sale flip of the property. Information about combatting mortgage fraud with arm’s length affidavits is available on the Freddie Mac website at www.freddiemac. com/singlefamily/news/2011/0906_ala.html.
Resources
Potential for Short Sale Fraud
January 2008 Legal Update, “Short Sales - A Risky Business,” online at www.wra.org/LU0801.
The Subordinate Lien Holders
National Association of REALTORS® Short Sales: Tips, Tools, and Resources Web page at www.realtor.org/ realtors/short_sales_tips_tools.
Brokers and sellers must be cautious of mortgage fraud traps that arise when short sales head toward failure. For example, if the parties pay a junior lienholder additional funds outside of closing, that can constitute mortgage fraud. The best defense is to assure all payouts are included on the HUD-1. A request to close with an incomplete HUD-1 is a mortgage fraud red flag.
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Flipping and Lease Backs
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Tracy Rucka is Director of Professional Standards and Practices for the WRA.
www.wra.org/wrem
Realtor® sales tip
Three Important Words: Price, Price, Price! Many are familiar with the phrase, “location, location, location.” But given the current market, I’ve replaced those critical words with “price, price, price.”
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ooking good and smelling good as well as inviting curb appeal are all crucial elements to any sale. But pricing the home to sell is what often brings buyers through the door. And choosing the correct price is both an art and a science.
increase as the owner may lose a good deal of the investment equity that had built over the years. Follow these three steps with pricing: •
The seller wants the highest price, while the buyer wants the lowest. The only way the property will sell at the highest price possible is if the buyer agrees to the property’s value - and if a bank is involved, the price will need to be substantiated by a current appraisal to reflect what the buyer is willing to pay - or no sale.
Determining, Setting Price We have three important tools to best determine market value: CMAs, appraisals and our market knowledge. Real estate may be global, but property values are still very local. And that’s why we’re such an important element in every transaction. One of the most accurate ways to determine price is to include the market influences that impact price, such as the supply of homes versus demand, the condition of the local economy, and home appreciation rates. These three factors vary in every market. An attractive initial listing price, based on fair market value, is important. You never get a second chance to make a good first impression. Remember that lesson that Mom taught us? Pricing greatly affects the number of attracted buyers. And properties almost always gain the most attention when their listings are new to the market. There are no “do-overs” in the game of real estate. The mistake of overpricing or underpricing the property can have significantly opposite effects and disadvantages. While overpricing makes the seller more comfortable about negotiating down, it also makes the property less appealing to prospective buyers who may be the best match. Underpricing will draw many buyers, but the chances of regretting the sale will wisconsin real estate magazine
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First, consider each seller’s personal situation. Do they wish to sell as quickly as possible? Do they have all the time in the world? To coordinate the right strategy and to meet the seller’s needs, clearly understanding the seller’s motivation is crucial. Learning the motivation(s) for both the buyer and seller is one of the most important things we do; no matter how good we are, if they lack motivation, the transaction will not close.
•
Second, ask the seller to look at their home through the buyer’s eyes. The sentimental value they place on the property has no value to buyers; only what they see - as opposed to feel - will convince them to meet the asking price. Encourage the seller to put in the effort to improve the condition of the property so the accurate price can be set.
•
Third, evaluate the competition. Similar homes for sale in the neighborhood are a great barometer. Compare the property and evaluate the way other properties are priced. The competition may be doing it right, or you may learn that they are overpricing their home … information to use to your advantage.
Marketing Challenges and Pricing In real estate, it’s no secret that you must be priced right to attract potential buyers. But what about marketing and exposure? If price were the only key to selling, real estate would be easy. Price is not the only factor in a successful sale; pricing, location and condition, along with marketing to reach qualified buyers, are critical as well. Also critical is the Internet as most buyers nowadays will make first impressions online, so february 2012
By marcus wally
your listings being prepared for online viewing is imperative. Staging and redecorating, along with the use of professional photography in listings, are great tools to make your first impressions lasting impressions. The second marketing challenge is distribution. Who drives internet traffic? While online presence is great, will your property be viewed by all potential buyers? You must develop a strategic marketing plan with search engines to ensure your property’s exposure in all of the right places. Local exposure is no longer enough with the growing use of technology in real estate! As you know, the price is always the very best marketing tool, but reaching the largest pool of buyers through marketing will ultimately increase your statistics and guide your listings to successful sales. And we don’t just want listings in the drawer - we want them to sell and move out of the drawer! Ultimately, the seller chooses the listing price based on their understanding of the data. We must help sellers understand that they can’t list and sell for more than a buyer is willing to pay. Commit to giving customers an honest valuation in hopes of keeping their heads out of the clouds on price … and the results will tell the tale. And that makes pricing the home right both an art and a science. Marcus A. Wally, MBA, is an active Florida REALTOR® in St. Augustine, Florida. Marcus is the founder and broker of New World Realty, which also manages coaching and facilitation of education classes around the world. Marcus earned his MBA from the University of North Florida in Jacksonville. He can be reached at (904) 669-1081 or by e-mail at marcus@newworldrealty.com.
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product showcase
Pricing Resources from the WRA Tools to Sharpen Your Pricing Skills By Nichole Mickelson
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any variables must be taken into consideration when defining a selling price for a property. To truly know your property, you have to understand a few key factors: where the property’s value comes from, your target market and how to position the property to them. The WRA publication library has a selection of books ranging from understanding basic home construction to evaluating how to overcome possible deterrents.
commercial appraisal. Appraisers are licensed professionals who research public records, review zoning maps, and get sales information about similar properties to help determine value. Using a real estate salesperson with insight into the value that a house may be appraised for is an added benefit for any seller or buyer. Use your additional real estate appraisal knowledge to give yourself a niche in the market. To learn more and to order, visit www.wra.org/PUB1745.
other specialists. Visit www.wra.org/PUB2763 for more.
How to Sell Your Home in Any Market
Realty Bluebook How to Get Started in the Real Estate Appraisal Business If you want to educate yourself on the process of determining property value, consider How to Get Started in the Real Estate Appraisal Business; a real estate appraisal book full of real-world insight to residential and
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wisconsin real estate magazine
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In its 33rd edition, the Realty Bluebook has been a standard for reference since 1966 and is widely considered to be the definitive on-the-go resource for real estate agents and investors. Organized into five tabbed sections of financing, selling, risk management, tax information and checklists for all types of transactions, Realty Bluebook has been compiled by authoritative real estate resources and reviewed by qualified legal and
february 2012
This book examines some of the biggest mistakes sellers make when putting their home on the market - such as poor staging and incorrect pricing or improper marketing – and how to address them. Learn to overcome location challenges and determine which functional issues in your house might be keeping buyers away. Through a step-by-step process, this book examines the home sale process and determines possible areas that can improve your odds of selling. To learn more and to order, please visit www.wra.org/ PUB1778. For more information on WRA products, visit www.wra.org/Products. Nichole Mickelson is the Business Services Assistant for the WRA and oversees numerous WRA products.
www.wra.org/wrem
2012
APPRAISAL CONFERENCE
March 13-14, 2012 Tuscany Suites and Casino
Kalahari® Resort & Convention Center Wisconsin Dells, WI
Courses Include: • 7-Hour National USPAP 2012-2013 Update (7 hours)* • UAD: Coping with the Aftereffects (7 hours) Join us for CE in sunny Las Vegas in March 2012! You won’t find a better way to complete CE and catch a break from Wisconsin’s winter weather. Make plans now to join us in Viva Las Vegas.
real estate continuing education www.wra.org/CE-out-of-state
• Residential Style & Design (7 hours) • Real Estate Statistics Without Fear (3.5 hours) • Anatomy of a House (3.5 hours) Courses submitted for Wisconsin Appraiser and Assessor CE, Michigan and Minnesota CE. *Approved course.
www.wra.org/AppraisalConference
education
Wisconsin Real Estate Continuing Education Wisconsin real estate licensees must complete 18 hours of CE before renewing their real estate licenses, which must be renewed by December 14, 2012. To complete the 18 hours, licensees complete six three-hour courses and successfully pass the corresponding exams. The six courses consist of four mandatory courses and two elective courses. Visit www. wra.org/cecourse for a complete list of course options. Mandatory Courses (Licensees must take courses 1 through 4.) Course 1 - Listing Contracts Course 2 - Offer to Purchase Course 3 - New Developments Course 4 - Business Ethics (fulfills NAR’s QET requirement) Electives (Licensees must take two of the following.) Elective A - Short Sales and Foreclosures Elective B - Environmental Matters Elective C - Other Approved Forms Elective D - Financing
Illinois Changes Real Estate License Requirements Do you hold an Illinois sales or broker real estate license? If so, please note that Illinois licensing requirements have changed. No longer will there be a salesperson license; only a broker license for selling/non-managing broker or managing broker. Licensees must transition to a new broker license type by the April 30, 2012 renewal date. Through a partnership with the Illinois Association of REALTORS®, home study courses for transitioning from salesperson to broker or broker to managing broker are now available for purchase through the WRA’s website at www.wra.org/OutofStateLicensee. No transition course is required for licensees holding a broker license who wish to remain selling brokers. However, they must complete 12 hours of Illinois continuing education prior to April 30, 2012.
Sales Pre-license Course March 5-9; 12-14, 2012 Wisconsin REALTORS® Association To obtain a real estate license in the state of Wisconsin, you must first complete 72 hours of approved education courses, such as our sales pre-licensing course. Second, you must pass a state-administered exam. The WRA is offering an eight-day accelerated 72-hour sales program on March 5-9 and 12-14, 2012 in Madison. For more information, visit: www.wra.org/salespl
Broker Pre-license Course April 23-25, 2012 Broker pre-license education will increase from 36 to 72 hours, effective July 1, 2012. Also on the horizon is a proposed change to job experience requirements to become a broker. Under the proposal, Wisconsin broker applicants would be required to show two years of documented experience as a real estate salesperson within the four years preceding application. This course covers contracts, trust accounts, escrow and closing statements, personnel business ethics, fair housing, specialty areas and more. Completion of sales pre-license education and passing the real estate sales exam are prerequisites. Completion of the Broker Pre-license Course, passing the broker exam and receiving the broker’s license fulfill the 2011-2012 Continuing Education credits. Fore more, visit www.wra.org/Broker_career.
wisconsin real estate magazine
Tuscany Suites and Casino | Las Vegas, NV Grab your suitcase ... this isn’t your typical CE! Break away from the winter blues and join us for CE in sunny Las Vegas in March 2012. With many CE courses to choose from, the Las Vegas Strip and sunshine, this is an educational opportunity you won’t want to miss! Make plans now to join us in Viva Las Vegas.
2-Day ABR Course March 21-22, 2012
Wisconsin REALTORS® Association
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Out-of-State Continuing Education March 5-7, 2012
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february 2012
Wisconsin REALTORS® Association Do you like working directly with buyer clients? If so, this course is for you! You’ll discover how to represent buyer clients with the same level of service that sellers enjoy. You’ll also learn about methods for bulding your buyer representation business. Complete two of the three days required for the ABR designation and fulfill nine hours of the 2011-2012 Continuing Education with one course. Visit www.wra.org/ABRcourses for additional information.
www.wra.org/wrem
Course Schedule
Visit www.wra.org/CourseSchedule for full schedule. Sales & Marketing Management Date Course Location Thru 3/7
*Plus books
** early registration applies two weeks prior to the start of the course.
March 21-22, 2012
2-Day ABR Course
Madison
$250
After 3/7
A.T.D.
$260
$280
***Wisconsin CRS Members receive a $20 discount # Appraiser section members receive a discount
Conference and Conventions Date Event/Course
Location
March 5-7, 2012 March 13-14, 2012
Real Estate Continuing Education
Date
Course
February 14, 2012 February 16, 2012 February 29,2012 March 1, 2012 March 2, 2012 March 5, 2012 March 5, 2012 March 6, 2012 March 7, 2012 March 7, 2012 March 7, 2012 March 8, 2012 March 9, 2012 March 15, 2012 March 22, 2012 April 4, 2012 April 5, 2012 April 11, 2012 April 11, 2012 April 18, 2012 April 18, 2012 April 25, 2012 April 25, 2012
2011-12 Courses 3 & 4 Marinette 2011-12 Courses 1 & 2 (Commercial) Milwaukee 2011-12 Course 3 Sheboygan 2011-12 Courses 1 & 2 Woodruff 2011-12 Courses 3 & 4 Woodruff 2011-12 Elective A & C Woodruff 2011-12 Courses 1 & 2 Las Vegas 2011-12 Courses 3 & 4 Las Vegas 2011-12 Electives A & C Las Vegas 2011-12 Elective A & B Brookfield 2011-12 Courses 1 & 2 Rothchild 2011-12 Courses 3 & 4 Rothchild 2011-12 Electives A & B Rothchild 2011-12 Electives A & B Madison 2011-12 Courses 3 & 4 La Crosse 2011-12 Courses 1 & 2 (Commercial) Appleton 2011-12 Electives A & B La Crosse 2011-12 Courses 1 & 2 Duluth, MN 2011-12 Courses 3 & 4 (Commercial) Appleton 2011-12 Electives A & C Marinette 2011-12 Courses 3 & 4 Duluth, MN 2011-12 Electives B & C Duluth, MN 2011-12 Elective A & D (Commercial) Appleton
2011-12 Electives: Elective A – Short Sales & Foreclosures Elective C – Other Approved Forms
Appraisal Continuing Education
Date Course
March 13-14, 2012
Pre-License Available online! sales training program
Date
The 2009-2010 real estate continuing education is still available through On Demand, DVD and Self-Study Booklets: 1 – Listing Contracts Course 2 – Offer to Purchase Course 3 – New Developments Course Course 4 – Buyer Agency Agreements Elective A – Risk Reduction Elective B – 1031 Exchanges and Exchange Opportunities Elective C – Condominiums D – Landlord/Tenant and Property Management Elective E – Financing Elective F – Broker Supervision Elective
QuickStart
Out-of-State Continuing Education Appraisal Conference
Tuscany Suites and Casino, Las Vegas, NV Kalahari Resort, Wisconsin Dells Location
Price Call (715) 735-0547 (800) 279-1972 $27/m; $40 nm (920) 457-7908 (800) 279-1972 $27/m; $35 nm (800) 279-1972 $27/m; $35 nm (800) 279-1972 $27/m; $35 nm
(800) 279-1972 (800) 279-1972 (800) 279-1972 (800) 279-1972 (800) 279-1972 (608) 785-7744 (800) 279-1972 (608) 785-7744 (218) 728-5676 (800) 279-1972 (715) 735-0547 (218) 728-5676 (218) 728-5676 (800) 279-1972
$27/m; $35 nm $27/m; $35 nm $27/m; $35 nm $27/m; $35 nm $27/m; $35 nm $27/m; $40 nm $27/m; $40 nm
$27/m; $40 nm
Elective B – Environmental Matters Elective D – Financing
Appraisal Conference
March 5-8; 12-15, 2012 April 5-8; 12-15, 2012
Course Sales Prelicense Course Broker Prelicense Course
Location
Kalahari Resort, Wisconsin Dells
Location Madison Madison
Member price $325* $260*
Non-Member price $325* $280*
* Plus books
www.wra.org/QuickStartOnDemand
wisconsin real estate magazine
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february 2012
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Legislative Debates
Mining Bill O
n December 8, 2011, the highly anticipated “mining bill� legislation, AB 426, aimed at streamlining the permit process for iron mining, was introduced in the state Assembly. The mining bill has received considerable interest by the media and legislators because of its impacts on the approval process of a proposed mine near Hurley, Wis. that would add thousands of jobs and millions in tax revenues to the state and local economies.
should not be subject to the same approval process as copper and zinc mining because iron mining does not present the same environmental threat as copper and zinc mining. Specifically, iron mining does not use chemicals to separate the iron from the rock, and thus water quality is not impaired by the use of acid or other chemicals. While opponents have raised concerns about specific provisions in the bill, they have not yet argued that iron mining should be treated the same.
Background
Overview of the mining bill
Generally, Wisconsin mining activities fall into one of two categories: metallic and nonmetallic. Metallic mining operations, such as copper, zinc, gold, lead and iron, are regulated primarily by federal and state law. Nonmetallic operations, such as rock quarries and gravel pits, are regulated at the county level. While nonmetallic mining operations are common in Wisconsin - with approximately 2,500 to 3,000 in operation today - metallic mines have not operated in Wisconsin since 1997.
As indicated above, the mining bill creates a different, more streamlined permitting process for iron mining. Specifically, the bill does the following:
Under current Wisconsin law, all metallic mining activities are regulated in generally the same manner. In other words, the current permit approval process does not differentiate between ferrous minerals, such as iron, and nonferrous minerals, such as copper and zinc. One of the key issues related to the mining bill is whether iron mining should be subject to a different permit process than other metallic mining operations. Proponents of the mining bill argue that iron mining
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By tom Larson
wisconsin real estate magazine
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february 2012
1. Limits time: Shortens decision-making timeline to 360 days, but establishes clear environmental standards that must be met. 2. Wetlands: Allows current wetlands on the property to be filled, but requires mitigation at a 1 to 1.5 ratio. 3. Permit timelines: Establishes specific timelines for requesting additional information from the permit applicant and completeness determinations by the DNR. 4. No contested case hearings: Contested case hearings for iron mining permits would be prohibited, and legal challenges would be allowed only after the permit is approved. www.wra.org/wrem
5. No extra permit conditions: The DNR’s authority to put extra conditions on the mitigation of wetlands would be limited. Currently, the DNR must issue a water quality certification before a federal permit can be issued. In the bill, if the DNR found that mitigation offsets adverse impacts from iron ore mining, the DNR could not impose any additional conditions. 6. More money for Wisconsin: Sixty percent of the net proceeds occupation tax on iron mining would be deposited into the state’s general fund, with the remaining forty percent going into the investment and local impact fund. Currently, all the net proceeds tax revenue, which is garnered from net income of sale of ore or minerals, is put into the investment and local impact fund. Most of that money is distributed to counties and municipalities where the mining occurs. 7. Caps the cost to conduct an environmental impact study: Permit applicants would be charged a fee equal to the DNR’s costs for evaluating a mining project, but the fee would be capped at $2.0 million.
Impacts of the Hurley Iron Mine While the mining bill only addresses the permit approval process and does not actually approve any mines, the Hurley mine has become the focus of the bill, and most of the arguments in favor and against the bill are related to the mine. So far, the proposed mine has received tremendous support because of the possible impact on jobs, the economy and tax revenues in both northern Wisconsin and in other parts of the state. Supporters of the bill have indicated that the mine will create the following number of jobs: •
300+ construction jobs
•
700 long-term mining jobs
•
An additional 2,000 service and transportation-related jobs
state and local revenue over the 50-year life of the mine.
In addition to the direct mining jobs, experts maintain that the new mine would have a multiplier effect in creating two to three jobs in other industries in Wisconsin. For example, two of the nation’s premier mining equipment manufacturers, P&H Mining and Bucyrus, are located in southeastern Wisconsin. Many of these jobs will reportedly have an average pay and benefits equal to $80,000 or more per year. In addition to creating jobs, the mine will also increase state and local revenues. Experts estimate that the mine will generate over $600 million in the 12-county region of northern Wisconsin. Moreover, the mine will reportedly create approximately $17.5 million in annual wisconsin real estate magazine
“So far, the proposed mine has received tremendous support because of the possible impact on jobs, the economy and tax revenues in both northern Wisconsin and in other parts of the state. ”
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february 2012
Opponents of the Hurley mine, however, argue that significant environmental damage could occur if the mine is approved. They are specifically concerned that the sizable mining operation, which will be 22 miles long and 1200 yards at its widest point, could harm valuable wetlands, groundwater, scenic beauty and wildlife. The bill was passed by the state Assembly on January 26th and now will be considered by the state Senate during the next two months. If you have questions on the mining bill, please contact Tom Larson (tlarson@wra.org) at (608) 240-8254. Tom Larson is Vice President of Legal and Public Affairs for the WRA.
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legislative
By joe murray
WRA Board Endorses
Scott Walker
for Governor T
he WRA Board of Directors voted to endorse incumbent Governor Scott Walker and Lieutenant Governor Rebecca Kleefisch in the upcoming recall elections in 2012, assuming the Government Accountability Board (GAB) certifies the required signatures to force the election. The WRA board’s decision followed unanimous recommendations from the WRA Political Strategy Group and the Trustees of the REALTORS® Political Action Committee (RPAC) to provide financial support.
On the Issues Gov. Walker has been a strong supporter of REALTOR® issues as a lawmaker, county executive and now as governor. Here’s a partial list of Walker’s support on WRA issues. •
1993 to 2002: In the legislature, Walker had a 91 percent voting record on WRA issues.
•
2002 to 2010: As Milwaukee County Executive, Walker supported REALTOR®-backed issues regarding economic development, budgets and taxes, abandoned property, landlord-tenant and sick leave policies.
•
2010: As a gubernatorial candidate, Walker indicated his support on a WRA candidate questionnaire on issues such as taxes, free speech, spending restraint, development costs, property taxes, economic development and job growth.
•
2011: As governor, Walker has supported and signed into law the following WRA priorities:
The Walker Record The decision to endorse Gov. Walker in the 2012 recall election is different from the decision to endorse him in the 2010 gubernatorial election in one significant way: the WRA board didn’t wait to see who his opponent will be or to compare that candidate’s record to Walker’s; this is the process used in “normal” elections. But the recall election is not normal in any way, and Walker’s outstanding record on real estate issues and his strong support among the WRA membership is consistent with the 2010 decision to endorse his candidacy. The WRA has no position on the issue of union collective bargaining rights, which is the main basis for the recall election. A close examination of Walker’s record on real estate issues illustrates the points.
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◦◦
Property tax freeze.
◦◦
Elimination of farmland conversion fees. www.wra.org/wrem
◦◦
State tax deductions for contributions to health savings accounts.
◦◦
Creation of a new Real Estate Examining Board.
◦◦
Revisions to restore balance in local landlord-tenant laws.
◦◦
Quality REALTOR® appointments to the Real Estate Examining Board and to the Natural Resources Board.
◦◦ •
Repeal of stormwater management rules (NR 151).
2011: Also as governor, Walker supports pending legislation in regards to: ◦◦
Presumptive approval of DNR permit applications.
◦◦
Wetland mitigation.
◦◦
Rule revisions regarding the siting of wind turbines to protect private property rights.
The WRA endorsement in 2010 and 2012 is based on real estate-related issues. While other, non-real estate issues will certainly be important considerations for individual REALTORS®, the board’s recommendation is based on business issues critical to homeowners, property owners and REALTORS® in Wisconsin. Considering those issues, the Board of Directors determined that Gov. Walker’s record on WRA issues is superb.
REALTORS® Support Walker Prior to any potential WRA endorsement in a gubernatorial election, the WRA commissions a professional survey of the membership to determine their opinions and preferences. The survey for this election was conducted by Public Opinion Strategies (POS), a nationally recognized polling firm the WRA has used for over 15 years. The internet survey was sent to every REALTOR® in Wisconsin, with 1,217 responding. It was conducted November 14-18, 2011, and is highly accurate, within a 2.8 percent margin of error. The survey found overwhelming support by REALTORS® across Wisconsin for Gov. Walker: “Should the Wisconsin REALTORS® Association endorse a candidate in the governor’s recall election?” Over half of wisconsin real estate magazine
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Wisconsin REALTORS® think the association should endorse a candidate, with four-in-ten definitely agreeing. Total Endorse
56%
Total Not Endorse
44%
WRA members strongly support endorsing Scott Walker. “If the Wisconsin REALTORS® Association decides to endorse a candidate, should they endorse … ” Total Walker
61%
Total other
18%
Total undecided
21%
“Do you agree or disagree with the following statement: This recall election of Governor Scott Walker isn’t necessary; voting on Scott Walker’s job can wait until 2014 when he is up for re-election.” Most WRA members strongly believe a referendum on Walker’s job as governor should wait. Total Agree
71%
Total Disagree
25%
“Do you approve or disapprove of the job Scott Walker is doing as Governor?” WRA members overwhelmingly support Walker, with over half strongly approving of the job he is doing. Total Approve
69%
Total Disapprove
31%
Walker’s job approval is positive across the state: Milwaukee DMA Total approve: Total disapprove:
72% 28%
Madison DMA Total approve: Total disapprove:
55% 45%
Green Bay/Appleton DMA Total approve: 77% Total disapprove: 23% Wausau/Rhinelander DMA Total approve: 73% Total disapprove: 27% West DMA Total approve: Total disapprove:
73% 27%
No potential Democratic challenger to Gov. february 2012
Walker receives more than 26 percent of the vote. “And thinking ahead to the recall election for Governor here in Wisconsin, for whom would you vote if the election were between … ” Walker Falk Walker Erpenbach
66% 24%
65% 22%
Walker Barca
65% 21%
Walker Obey
65% 24%
Walker Barrett
64% 26%
WRA members think Wisconsin is heading in the right direction and are more optimistic than they were just a year ago. “Generally speaking, would you say that things here in Wisconsin are going in the right direction, or have they pretty seriously gotten off on the wrong track?” Right Track
65%
Wrong Track
35%
Walker’s positive job approval among WRA members was overwhelming and clear. After a difficult state budget battle, a bitter state Supreme Court race, and nine historic state Senate recall elections that generated record spending levels of $44 million, REALTORS® in Wisconsin believe Wisconsin is heading in the right direction and support Walker in this year’s recall election. Clearly not all members will agree with the board’s decision, and as always the WRA respects the right of members to disagree and support a candidate of their choice. However, it’s clear that a sizeable majority of WRA members support Scott Walker and the WRA board’s decision to endorse him again in 2012. The governor’s record on real estate issues and his strong support from the membership merit this endorsement. More to come as the campaign unfolds! Joe Murray is Director of Political and Governmental Affairs for the WRA.
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techhottips
View more posts at www.techhottips.com
Technology Tips & Tools for the Real Estate Professional
Tech Hottips writers are Amy Chorew, a nationally acclaimed real estate technology trainer and Kim Wood, a Philadelphia-area REALTOR® involved in both real estate and technology coaching.
Cure a Low Battery with Zagg If you feel like you constantly run out of power on your smartphone and/or tablet, and if you’re always on the search for a power source, look no further. Your digital experience just got extended by this amazing portable power source. No more getting on your hands and knees looking for a wall outlet! ZAGGsparq 2.0 is the standard for on-the-go charging. For busy sales people, this device carries four complete recharges for most smartphones. The ZAGGsparq 2.0 recharges with a standard outlet and provides two USB ports for powering mobile devices. It’s perfect for everything from cell phones to your tablet. No more carrying spare batteries. Try it today at www.zagg.com.
People in Your Computer Meeting people online can expand your database; consider focusing your efforts on the local level. Do you recall networking exercises that you may have learned and participated in while at a meeting? If so, those exercises probably stressed the importance of finding something in common with people you meet. Remember the connection and the sense of community that you feel when you meet someone new with similar interests? Well, you can feel that same connection online … a social platform is out there for nearly any interest or hobby! Meeting with people with similar interests can be easy on the Internet. Do this by focusing your online activities on your interests and your locals – the people who live in the area in which you practice real estate. The key is to meet face-toface with those locals after you’ve built that online relationship. These sites, for example, are based around a common interest:
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•
Daily Mile: This social platform for workout buffs allows users to upload personal exercise and fitness goals as well as workouts. People can also comment and share with each other.
•
Flickr: This popular photo-sharing site is a place where people can upload their photos - hobby photographers as well! – and leave comments on pictures. You’re sure to find powerful groups on Flickr where you can find locals hanging out.
Take Your E-Marketing to the Next Level! E-mail marketing continues to have one of the highest measurable returns of any online marketing channel. Electronic newsletters are a valuable way to deliver news to today’s consumer. Many companies make this process simple by providing ready-to-use templates for newsletters, allowing you to send different messages to various lists of contacts such as buyers, sellers, past clients, agents and more. Whether you choose to send long newsletters filled with information or short and sweet ones, these serve as an opportunity to connect with your database and keep your name in front of your contacts. And as with all of your online marketing, be sure it is permission-based and that you are in compliance with the CAN-SPAM Act. These online marketing programs are all very easy to use with various pricing plans. I have experience with them, and since they all have pros and cons, you may want to start with a trial account and play around a bit.
•
Foodspotting: This is a gathering place to recommend and comment about food and dining.
MailChimp has a free plan, and in addition to newsletters, it allows for you to subscribe people to an RSS feed with permission. For example, your “buyer” contact lists receives a copy of your blog posts categorized for “buyers.”
•
Ravelry: For crafters of yarn, Ravelry offers a place to share projects and network among other crafters.
iContact and Constant Contact both have trial periods before you have to pay. They both have a wide range of templates to choose from.
As you can see, there are many with great diversity depending on your interests. You can’t be everywhere at once, so focus on the websites where you can add value by engaging with others in your area.
Don’t fret if you see a few people unsubscribe; this will happen. Just focus on the users that do open and read your news. You can review who exactly opens, reads and clicks in each of the newsletter’s report area.
wisconsin real estate magazine
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february 2012
www.wra.org/wrem
WHAT MAKES A CENTURY 21 AGENT? HERE’S oNE WoRd: GUSTo. A fEW MoRE WoRdS: dEpENdAbiliTY, KNoW-HoW ANd dEfENdER of YoUR dREAMS. MAYbE THAT lAST oNE WAS ovER THE Top. bUT WE’RE oK WiTH THAT. CENTURY 21 AGENTS. SMARTER. boldER. fASTER. ®
C21.CoM © 2011 CENTURY 21 REAL ESTATE LLC. ALL RIGHTS RESERVED. CENTURY 21® IS A REGISTERED TRADEMARK OWNED BY CENTURY 21 REAL ESTATE LLC. AN EQUAL OPPORTUNITY COMPANY. EQUAL HOUSING OPPORTUNITY. EACH OFFICE IS INDEPENDENTLY OWNED AND OPERATED.
What is our WHEDA Advantage ? ®
Peace of mind. Your first-time home buyers have built-in peace of mind with a WHEDA Advantage loan. WHEDA Advantage loans include job loss mortgage payment protection, a benefit that pays your customer’s mortgage for up to six months in the event of involuntary unemployment within two years of loan closing.* Income and purchase price limits apply and home buyer education is required. To learn more, go to www.wheda.com/Realtors. WISCONSIN HOUSING AND ECONOMIC DEVELOPMENT AUTHORITY 800.334.6873 ■ www.wheda.com
*Some exclusions apply. See a WHEDA participating lender for details.