Black Thursday and a Half

   

Now with online shopping, big-box retailers are getting a jump on their sales by opening early; like Thursday afternoon at 5:30 PM early. What is wrong with this picture? Black Friday shopping isn't supposed to start on Thursday after dinner! So let's call it black Thursday and a half.

I hear the voice in my head already beginning the " when I was a kid" phase of life, kind of like what I use to hear when I was a kid from the elders. However, it wasn't long ago when people would have their Thanksgiving dinner then go camp out in the parking lot of Best Buy, waiting for the doors to open at 4:00 A.M. the next morning It was tradition for most people to wake from their food coma and go shopping to get the biggest deals of the year.

Hoards of people would pack every mall and one could spend half the day looking for a decent parking spot. Places like Central Mall, Walmart, Best Buy and Kohles were the places to shop, and people were not always full of cheer as they would all grab for that last sale item.

It was never my favorite thing to Black Friday shop. As I got older and had a choice, I would just forego the shopping altogether. I don't do well in crowds anyway. Which is why I was relieved with the advent of technology, shipping, and Amazon. I can shop online, get better products, better prices, convenient delivery, and no crowds.

I can't help but feel a little guilty though. The brick and mortar stores are clearly suffering as they make an attempt to change with the times, and this Black Thursday and a Half situation is indicative of that.

The Rambling Realtor: Real Estate Auctions

The Rambling Realtor: Real Estate Auctions: Real estate auctions are becoming more popular as people search for quick ways to sell a property. Similar to a personal property auction, a...

Foreclosed Real Estate

My Thoughts on Foreclosures...

As a person who sells real estate, I think its common to have potential clients who are investors in real estate.  One of the first things these investor clients will ask for are of course, cheap property and the first reaction is to go to auctions and foreclosures.  Are these types of properties really the best and least expensive way to go?  Ive got a few thoughts.

How Foreclosures Happen

A foreclosure is a property that a bank has to take back to primarily to non payment.  Sometimes people go through hardships such as losing their job, death of a spouse, or maybe the person just quit paying the note for one reason or another.  The bank has to secure their asset so they have to start the process of foreclosure.  This process can be expensive and take a long time involving attorneys and the court system.

The Banks and The Bidding War  

Once these properties are ready to market, a specialized broker in foreclosures will assess the property, take the photos and create a brokers price opinion for the bank.  The price will then be determined by taking the brokers' price opinion and knocking several thousand dollars off which makes it extremely appealing to those seeking a deal.  If it's a hot property then you can expect several people to make an offer on it.  The banks usually won't look at any investor offers at the beginning of the listing, they look for owner-occupants for the first 7 to 30 days depending on the bank.  

As soon as investors can start bidding on these properties, the banks will never look at the offers one at a time like general real estate practice.  They will set another date maybe after a week to look at all the offers, so they will tell you to make sure you put in your highest and best offer, and since there's multiple offers it's expected to be over asking price.  How much over?  The potential buyers will never know how much, and if they really want the property they might overpay for it which is what the banks are wanting.  The objective is to create a huge surge of interest and get everyone competing against each other to make the highest bid.  

Property Conditions

If you can imagine, the process of foreclosure means having the previous owners removed from the property whether they are willing to leave or not.  Most of the time people don't want to leave the property, and won't take responsibility for not being able to pay their mortgage.  They will get upset, blame the bank and destroy the property.  I have seen properties with copper piping removed, doors removed, holes in the walls, amongst other super frivolous things people can do to feel better about having to vacate.

Is The Buyer Getting a Deal?

To have a client really like a property, and then trying to explain the " highest and best" situation, and trying to guide people what a good offer to make can be a challenge.  It's preferred that the buyer not get emotionally invested, and make a logical decision about how much to offer based off local comparable listings.  As long as the buyer is good with the offer and is willing to walk away if the offer isnt high enough, is ideal.  Really, I try to find people good deals outside of auctions and foreclosures just because of all the competition there is to get these deals.  

Other Options for Getting a Decent Deal in Real Estate

A savvy and well connected real estate agent or broker will know how to find deals through past or current clients.  They can also determine what listings have been on the market for a long time, and could then try to negotiate a bargain for the buyer client.  Sometimes, or a lot of times a seller will over price their property with the mindset of " ill take less".  The "ill take less" method does not work anymore as buyers are becoming more savvy and less willing to look at over priced property, but thats a whole new conversation for another blog post.  Find a connected agent in your community to find a good deal for you.  There is less competition, and if you are patient you can often times find a better and less stressful option than seeking out foreclosed properties.

Real Estate Auctions

Real estate auctions are becoming more popular as people search for quick ways to sell a property. Similar to a personal property auction, a real estate auction is conducted by an auctioneer with a real estate license to call for bids. The highest bidder of course, will win the auction.

Buyers should always come to the auction financially prepared to buy the house, and some money is due the day of the auction if you're the winning bidder. This money is a buyers premium, which varies from brokerage to brokerage, but is always stated in any advertisements.
This is also a benefit to the person selling the property, because it saves them from paying broker commission.
Homes at auction are sold " as is, where is, with not warranty or guarantee" . Which means that what you see, or not see, is what you will get. Liens and various other issues could possibly exist with the title so it is important to do your do diligence before purchasing at house at auction.
There are various reasons why houses sell at auction. The state can seize property for back taxes, divorces, bankruptcies, probate, or people who just need to dispose of property are good examples. Sometimes, depending on the rate of the buyers premium, these homes can be acquired for a fraction of market value.
If you are interested in finding out more about Real Estate auctions feel free to write us an email, or subscribe to our list below
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Indie Brokerage

What is an Indie Brokerage

I had to look into this, and i found a blog about it. It is the opposite of a franchise brokerage, according to this blog on Inman Connect.

This article had spoken to me. It had summed up everything I had been going towards with Fort Smith Real Estate Company. So I would like to share the concept.

He was speaking about conglomerates buying smaller brokerages, which we've seen in Fort Smith recently.

They do this to gain market share, and take experienced agents instead of cultivate new talent. Of course the franchises provide perks to their agents and a lot are very successful, yet they never felt like a good fit for me.

Why choose a small brokerage?

Boutique, or indie type brokers often come with their own style, niche, clientele, skills and knowledge that are valuable to the communities they serve.

Indie brokerages are less commercialized. We sharpen our skills through educating ourselves, gaining experience, and developing relationships. We are focused on taking care of our clients, and informing them on their decisions, not forcing them in one direction or another.

Big brokerages are sales and quota driven. They train their agents on sales pitching, objection handling, cold calling, door knocking etc; which is great for those who like that type of training. But it's always reminded me of a car salesman.

Client centric, or sales driven?

The clients, either buying or selling, are about to make one of the biggest decisions of their lives. Brokers and agents have influence over their clients as a trusted professional, so if the agent was sales driven instead of client centric what could be the outcome?

It's no wonder why the public would see Real Estate brokers and agents in such a skeptical way, where the integrity of the profession is questionable and money driven.

Agents can concentrate on quality over quantity, with a primary mission of building relationships and delivering personalized results rather than just achieving volume numbers.

Brilliant.

After all of these years, I have finally found the niche for my business. This is the model I will stand by for my company, and this is how I will train the agents in my firm.

We will be conduits of information to our clients, which will let them have control over the outcome. Thank you, Troy Palmquist, for your excellent blog and saying everything I've wanted to hear.

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