Speaking of Real Estate
One of the big challenges of real estate markets today is moving renters that want to buy into the homeownership column. Renters wanting to buy is the first step, but they have to come up with a downpayment and that’s where many are stymied. The job market is key, because everything starts with the availability of good paying jobs. Of course, a good paying job in Columbus, Ohio, is not the same as one in New York City.
NAR Research looked at renters’ ability to buy and identified the top 10 metro areas in the United States where a high percentage of renters earns more than they need to buy a home at the area median sales price. Not surprisingly, almost all of the metro area were in the Midwest and South, because in those areas, the gap between what people earn and what homes cost is narrower than it is in the Northeast and West.
Among the top 10, three are in Ohio: Columbis, Dayton, and Toledo. In these markets, almost 40 percent of renters earn more than enough to buy a median-priced home.
NAR looked at other criteria, too, and found that these markets were dynamic enough that jobs were being created.
Other top ten markets include Little Rock, Ark., St. Louis, and Atlanta. A couple were in Florida. Only one market, Ogden, Utah, was in a region other than the South and Midwest.
NAR’s research on these top 10 markets is one of the stories in The Voice for Real Estate news video for the week of August 15. Another story looks at tightening lending standards for commercial real estate by banks. For developers and investors, bank tightening will be felt especially in smaller markets, because it’s in these markets that bank lending is most important; in big cities, the lending options are more varied.
The video also looks at the rise of women in commercial real estate, among other statistical shifts the industry is seeing. The percentage of women among the newest practitioners in the field has almost doubled, which means the share of women could be quite a bit higher down the road, as those getting into the business now start gaining more experience, taking on bigger deals, and attracting more women to the profession.
Another story looks at NAR’s involvement in a recent White House conference on drones. NAR talks a lot about drones, something whose commercial use might seem remote to many real estate practitioners right now. But there’s a reason for NAR’s intense interest in the topic. It’s a new technology and it’s been important for NAR to work with the Federal Aviation Administration now, while it’s writing rules on the commercial use of the devices, to ensure the point of view of REALTORS® is represented. Given how important drones are likely to be for real estate marketing in the future (and also for appraisals, home inspections, and insurance adjustment, among other things), it’s crucial the rules be written in such a way that REALTORS® can use them, or work with companies that operate them, within a reasonable regulatory environment. As it is, the government’s commercial drone rule comes out in just a few weeks, so the issue is moving into the here-and-now.
Another issue NAR has been into quite a bit lately is wire fraud, because it’s a growing problem in real estate (downpayment are a tempting target), and the video points you to a notice you can include in your email signature line to remind consumers about precautions to take before sending sensitive information by email. The notice was written by NAR Legal Affairs and it’s an easy way for you to play a part in the broader effort to combat fraud. If one person is protected from sending money to a criminal in the mistaken belief it’s a title agent, a lot of good has been accomplished.
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Ginni Field was aghast at the tragedy that befell a family friend in the last year and a half. The man, a veteran who fought alongside Field’s father in World War II, died with nothing — no money, no home — after he was taken advantage of by his son. The son had convinced his war-hero father, who was in his 80s, to transfer the deed on his home to the son, who then neglected to pay a single bill on the property. The home went into foreclosure, and the father lost everything. “This poor man, who fought in the Battle of the Bulge, had to move to Florida and live with his daughter because he had no money,” says Field, GRI, SRES, a real estate professional with Mike Chiesl Group in Carlsbad, Calif. She contends the emotional toll of the experience led to the death of her family friend. “He died a pauper.”
This type of abuse in real estate, where family members seize on their aging, sick, or incapacitated elders to take control of their property, is happening more and more, says Field, an SRES instructor who works almost exclusively with elderly clients. In the last 18 months, she’s seen about five examples in her community similar to what happened to her family friend. “It’s the most I’ve ever seen or heard of in this kind of time period,” she says, adding that victims of elder abuse in real estate are almost always 80 years old or older.
One in five seniors falls victim to financial abuse, whether that’s by family members or outside sources, and only a fraction of those cases are reported, according to a 2015 Consumer Reports article. Real estate fraud is a part of that abuse. So as a practitioner, what’s your role and what should you do if you sense your elderly client’s family is trying rip them off in a real estate transaction?First, Get Educated About Elder Abuse
In most cases, real estate professionals are the only ones who see abuse happening in real estate transactions, Field says. Because many elderly people are too embarrassed to report incidents in which family members attempt to take advantage of them to friends or authorities, you’re probably the only witness. So you need to know what to look for.
Field suggests consulting with the elder abuse division of your local police department — before you become involved in an incident with a client — and asking them what signs of abuse to be aware of as it pertains to the elderly in real estate fraud. One thing you’ll learn, Field says, is that if you’re the only witness, filing a complaint anonymously isn’t always the best course of action. You may need to be willing to go on the record if no one else can.
Barbara Fairfield, ABR, SRES, a practitioner at NextHome Gulf to Bay in St. Petersburg, Fla., who also teaches SRES courses, advises contacting other organizations to learn about elder abuse resources:
- ElderCare.gov, run by the U.S. Administration on Aging, will help you find state and local resources for elderly people who need help.
- Elder-AbuseCA.com can help you contact ombudsmen in your community who can give you advice on reporting incidents of elder abuse.
- PreventElderAbuse.org, the website of the National Committee for the Prevention of Elder Abuse, can offer you tips and resources for what to do if you suspect elder abuse.
“We can see if there are issues,” Fairfield says. An elderly person living with clutter, or if they’re unkempt, wearing wrinkled clothes, always have the shades pulled down, or have rodents in the house — those are all red flags that they are in hiding from someone, Fairfield suggests. When she sees someone living in these conditions, she knows it’s time to have a conversation about whether their family is involved in their lives and their real estate decisions — a conversation you should have with any elderly client anyway, she says.
“At this phase of their life, they can’t afford to make a bad financial decision,” Fairfield says. “So I’m going to ask them why they are selling, and I want to make sure isn’t anyone in the background pushing them to sell.”
A surefire sign that intrusive family members may be trying to take advantage of your client is if the client says they don’t want anyone knowing about their decision to sell, Field adds. “My alarms go off when someone says, ‘This is completely my decision.’ That tells me that they don’t trust family members. I don’t pursue that line of questioning any further, but I’m going to ask, ‘If there’s any kind of issue, how do you want me to handle it?’ And then I’m going to confirm that in writing.”Deal With Suspicious Family Members
You have to remember who your client is. If they have children who are attempting to mettle in the transaction — maybe they request to be present at every showing or by their parent’s side at every meeting with you — and your client has expressed that they don’t want them involved, you have to learn how to politely yet forcefully get them to back off. That’s why it’s helpful to have your client’s wishes in writing.
“I’ve seen agents being accused of interference by the kids, who want to control their parents,” Field says. “You have to be brave enough to be really blunt and tell the family members that they are not the owners of the house. ‘I need you to understand that my job is to protect my client.’”
You also should be prepared to suggest alternative options if your client seems to be being pushed into a sale by family members, Fairfield says. It may be the case that they could stay in their home with a reverse mortgage, which could supply the funds for retrofitting their property with safety features, making repairs they can’t perform on their own, or bring in home healthcare providers. You want to help them remain as independent as possible and reduce their risk of having to depend on a family member who seeks to control them, Fairfield says. “We’re all about options for these individuals, not just about listing their property.”Know If You’re Right for the Job
Not all agents have the right temperament and personality to work with the elderly, Field says. Many older clients require extra time to make decisions or extra explanation to understand their options. If they’re facing a tough situation with family, they need someone who won’t try to rush them through the process but who will be a guide for them. “Working in the senior market takes someone patience, empathy, and kindness,” Field says. “If you’re not the right person, find another niche.”
Fairfield says that for many older sellers, it could be their last real estate transaction. So that requires that you give it more importance and be willing to help them through difficult personal challenges with family if need be. “If you’re always focusing on your wallet, you’re focusing on the wrong thing,” she says.
Stop and ask whether anyone besides the seller has an emotional or financial stake in the sale of their property. That will speak volumes about whether you should be wary of intrusions on the transaction and if you’re prepared to handle them. “There are some people who haven’t spoken to their children in years and aren’t going to start now,” Fairfield says. “You want to know something like that so you can decide both whether you’re willing to deal with that kind of baggage and whether that could pose a problem down the line with the sale.”
Above all else, be prepared to step in on your client’s behalf if their family starts threatening the transaction and their best interests. “If you don’t do anything, you watch someone get everything taken away from them,” Field says.
Nanny cams are popular with parents today. The tiny, easy-to-hide devices help parents keep tabs on their kids while they’re away. State privacy laws differ, but for the most part, you’ll want to let buyers know upfront if there’s a chance they’ll be captured on one of these or other types of surveillance devices while they’re in the house.
The key issue is expectations of privacy. If you’re inside someone’s home, you have a right to expect a certain amount of privacy; if you’re outside—say on a public sidewalk—you can’t always expect the same level of privacy.
In a similar manner, if you’re recording a phone conversation, privacy expectations are relevant. People expect a phone conversation to be private, so you’ll want to let them know beforehand if you plan to tape the conversation as a way to keep accurate notes or for other reasons.
These types of privacy issues are a top story in the latest Voice for Real Estate news video from NAR. The video shares excerpts from a recent video by NAR’s Legal Affairs division on what you need to know about surveillance cameras when you’re showing a house or recording a phone conversation with customers.
The video also looks at how much easier it’s going to be for your clients to get FHA insured mortgage financing for their condo purchase. Congress just passed an NAR-backed bill that makes financing available even if only 35 percent of the units in a project are owner-occupied. That’s down from a 50-percent owner occupancy ratio, a significant change that can make a big difference in a buyer’s ability to get a loan. Also, a project can have more space set aside for commercial use, a change that will be particularly helpful as more developers design projects that mix housing with retail space.
Other stories in the video look at NAR’s effort to curb accessibility lawsuits in commercial real estate and a meeting NAR hosted on Capitol Hill two weeks ago to flesh out ideas for making housing more affordable to low- and -moderate income households and to reduce homelessness.
Access The Voice for Real Estate.
If you’re trying to figure out how Facebook Live can expand your marketing efforts, why not try using it to broadcast a showing of one of your listings? Real estate professionals are just beginning to explore Facebook’s livestreaming functionality as a way to better engage with their audience, though you should be aware of some of the security threats a live broadcast can pose. But we can safely say that Leigh Brown, ABR, CRS, broker-partner at RE/MAX Executive Realty in Charlotte, N.C., knocked it out of the park when she took her Facebook Live viewers on a tour of a foreclosure she’s selling.
It wasn’t just a video property tour — which, by the way, drew nearly 7,000 views. (That’s a lot of potential buyers!) Brown’s live broadcast served triple duty as an educational piece for what buyers should look for in foreclosures, a behind-the-scenes look at what her job is like, and a marketing tool for her listing. And, of course, there’s plenty of that trademark quick wit Brown has become known for industrywide.
“My plan is to be accessible and real — no big surprise there for anyone who knows me — and to make sure consumers get what they want, which is a glimpse into the world of real estate,” Brown says. “I won’t do Facebook Live on every house, just sporadically to keep [my social channels] from getting too repetitive. This house has a story, though, and pictures would not adequately tell it. It was also a chance to answer questions I had been receiving from prospects in a way that is honest and relatable.”
Brown says she received four offers on the home after her live showing, which aired July 6. The video above is a YouTube upload of Brown’s Facebook Live post, but here’s the original on her Facebook page.
Need more tips for improving your skills and upping your real estate game? We’re all about helping real estate professionals reach greater success, which is why we dedicated the July/August issue of REALTOR® Magazine to lists upon lists of helpful ideas for improving your client relationships, avoiding ethical dilemmas, spreading your brand on social media, and more. To add to that, REALTOR® Magazine hosted a Facebook Live event on Monday (watch it above), and we called in five Chicago-area practitioners to play a little game of musical chairs — or as we called it, “musical tips.” The person left standing had to offer their best tips on a range of real estate topics. We had plenty of laughs, and with more than 6,000 viewers tuning in to share their own tips, we got plenty of interesting ideas!
Here are 10 of the best tips we gleaned from the five participants of our Facebook Live event.On Growing Your Referral Network:
“Use social media to your advantage. People give me testimonials and tag me in posts.” —Moses Hall, Ani Real Estate
“After doing a deal, we do things like ‘coffee is for closers,’ so our cooperating agents get Starbucks.” —Catherine Holbrook, Americorp Real Estate
“Do everything you can do, do it consistently for a period of time, and naturally, your sphere of influence will grow.” —Mo Dadkhah, Main Street Real Estate GroupOn Engaging With Open House Visitors:
“I try to pay attention to details, so if I see someone wearing a [Chicago] Bears hat, obviously they’re a Bears fan. So I try to gauge conversation in something their interested in, and hopefully they will open up a little bit.” —Hall
“People are more eager to work with you when you leave them alone for a little bit and give them their space.” —Holbrook
“A lot of people have unread emails, but not a lot of people have unread text messages. I ask people if I can get their phone number to say, ‘Hey, thanks for coming to the open house. Let me know if there’s anything else I can do to help.’ This creates more interaction than an email.” —DadkhahOn Pricing a Listing Correctly:
“I tell sellers if we have been in the market for two weeks and there are no showings, it’s overpriced. Or if we have had 10 showings and no offers, it’s overpriced.” —Stephany Oliveros, CIPS, CHI Properties
“I am a firm believer that you can list at whatever you want to list at, as long as it makes pretty good sense. But you might not get that appraised; so why not list the number that would appraise?” —Lindsey Schendel, Newman Realty
“I think in this market, if something has been listed for more than two weeks, it’s time to have a conversation with your client to renegotiate price. I coach agents to take a market analysis and send it every 15 days to their client, just to keep them educated on what’s happening with the market. If you ask them to reduce the price, I think you need to give them some evidence as to why. So if you’re doing everything you can with your marketing, and you list it at the same price as a neighbor and it’s not selling, I think you should make adjustments to the price so you can sell it.” —DadkhahOn Market Comps:
“I do include currently listed properties, but I cushion it. If a property is currently listed at a specific price, it might still be over market value, so I wouldn’t advise my seller to look at that price. They may say, ‘My neighbor listed at this,’ but that’s direct competition. … I try to study the demographics of the area and the type of buyer, so when I’m working with an investor, we can strategize and know what to expect with specific offers.” —Hall
Vince Coley of property management software company AppFolio talks about ways to replace your software without disrupting workflow in an upcoming webinar.
Here’s how AppFolio sets up the webinar:
“If your property management business has been through a software transition before, you know that change isn’t easy. But if you are losing precious time and money to outdated systems that don’t work with your business, you might need to change faster than you would like. In fact, if you are hesitant to make necessary changes to your business your competitors are likely outgrowing you already.
“Join AppFolio Director of Implementation Vince Coley for strategies on positively transforming your business without negatively impacting your workflow. Vince and his team have helped thousands of your peers transition their businesses out of old technology, saving them hours a day and countless dollars. This is a webinar you won’t want to miss.”
The 60-minute webinar is Thursday, July 28, at 2 p.m., Eastern.
- Setting measurable goals to assess your business practices
- Helping your team navigate business changes
- Conquering hurdles in implementing software systems
- Motivating your team to adopt new processes
The webinar is sponsored by AppFolio, providers of web-based property management software, and promoted by REALTOR® Magazine.
Past AppFolio webinars:
In the aftermath of the tragic June 12 shooting at Pulse nightclub in Orlando that killed 49 people — the deadliest mass shooting in U.S. history — one local REALTOR® opened his heart and his properties to bring victims and their families some comfort in mourning. Now his efforts have inspired the Orlando Regional REALTOR® Association to join the call.
Christian West-Howard, a real estate agent and property manager with Capital Homes, Inc. in Boca Raton, Fla., offered several rental properties he owns free of charge to victims’ families who needed to stay somewhere while they searched for and recovered loved ones after the shooting. He also worked with local hotels to donate rooms, and the combined efforts provided more than 250 family members with free temporary housing, according to ORRA. His original post on Facebook spreading the word of his support was shared more than 30,000 times.
Last week, ORRA announced it would dovetail with West-Howard’s efforts by donating $25,000 toward assistance programs for survivors of the shooting to help them housing-related needs. ORRA says the money will go toward:
- Rent and mortgage assistance for survivors who cannot work because of their injuries.
- Securing housing for family members who are moving to Orlando to care for victims.
- Providing accessibility features and relocation services for survivors who are moving away.
- Retrofitting victims’ homes with wheelchair-accessible equipment.
“I am awed and humbled by Christian’s take-charge response to this tragic event that has impacted our entire community, and proud to call him a fellow REALTOR® and ORRA member,” ORRA President John Lazenby said in a statement. “The entire ORRA Board of Directors is pleased to become a part of an Orlando REALTOR®’s resolve to help with the housing needs of those in our community who are enduring such unimaginable challenges.”
West-Howard said in the statement that he’s proud his fellow REALTORS® are standing alongside him to help the community. “I’m grateful that my REALTOR® organization has stepped up for the community, and I believe ORRA’s involvement will make a real difference to the survivors,” he said.
Anyone wishing to help the continued relief efforts for survivors can also donate to the City of Orlando’s OneOrlando Fund.