Insight into Pagosa Springs through the eyes of Chris Liverett (aka PagosaRE Guy)
Here is a video compilation of the February Full Moon Ski and fun races at The Ranch Community this past weekend. I did not make it, but I am going to be sure and sign up for the next one! If you want to be informed of future events like this give me your email and I will put you on the Pagosa Springs Facebook Page so that you can get community updates. (The video gets good at min 2.5)
Now that the clocks are put in such a position to maximize sunshine there is a creeping sense of Spring in the air. I have started making the list to re-organize my garage and get the pencil sharp for a flower-bed-planting session. Just like this weather change brings about a restlessness for increased outdoor activity, it also spawns home sellers to present their homes to the public for purchase. The season change always brings about an increase in home listing activity for REALTORS.
I found myself in conversation this weekend with one of my clients that has a 35 acre piece for sale. We were having an on-line discussion about a new year strategy. As I was giving out the methods in which I use to gain my clients listings the most exposure, I thought about one that many times goes un-discussed but that is a very powerful way to have your home known by the real estate pros and have it make a lasting impression on them…The REALTOR Caravan Tour.
Every Tuesday morning, barring an overdose of snow, a group of REALTORS who belong to the Pagosa Springs Area Association meet at the PSAAR office with info in hand and a singular desire of the minds- To inform and be informed.
The Caravan tour is designed to allow listed homes in a predetermined area to be pre-viewed for exposure, and critiqued for marketability by participating brokers and agents. It is a wonderful opportunity for us to brag on our clients homes and point out all of the attributes that are found within. In return, we are able to get a professional panel of active real estate agents to give direct feedback of their opinions, and constructive criticism which may lead to creative solutions to help sell our clients homes.
For the individual agent, it is a remarkable way to help keep us up-to-speed on the inventory in a very memorable way.
If you are reading this and are trying to sell your place here are a few ideas that may give your home a little more staying power in the minds of the tourer’s.
In general have your place in good showing shape and take away all possible curb appeal negatives. Anything that can be done to positively bookmark your home in the minds of the Caravaners is a plus- be it with sight, sound, taste or smell. Ask your agent to make sure your home gets on the Caravan tour and then take some time to consider the feedback. This can be a productive way to get a good grasp on the market position of your home so that you can make necessary adjustments to obtain the end result…a successful sale!
I am not sure that the general public understands the way in by which REALTORS® get their business and are paid. I don’t mean that as an insult to anyone. Before I bought my first house or obtained my real estate license I was definitely in that category. I often get sideways looks when during conversation someone finds out that I am not a salaried employee of my broker, and that I indeed do not get a paycheck until I successfully help someone buy or sell real estate. Additionally, there is a lack of understanding when it comes to who pays who upon the closing of a property, or there are a lot of people out there who simply don’t care. During the Christmas break I ran into one such confused couple.
While entering a Mexican restaurant/Sports bar/Karaoke club (got to love small town conglomerates) I received a call about one of my listings in Pagosa Lakes. The lady on the phone and I begin the home buying question answer routine….”Who’s the builder?” “What are the taxes?” “Is the plumbing copper or poly?” “How big is the lot?” ” Is it 2 baths or 2.5?”- I reached into my mind to remember the details of the property and also gave her advice on 2 other homes in that subdivision and a place in one other area. During the conversation she dropped a few hints that she had been in a house or two, so I asked her if she was working with another REALTOR®. She said that she had been shown a home by an agent but that she was not committed. During that showing she had picked up a flyer and called another REALTOR®, and also picked up my flyer and called my office and spoke with Jon my associate. Now she is talking to me. For those of you keeping count, I am the 4th real estate professional (that I know of) that this couple has been in contact with in 48 hours!
Let me be clear hear. Without proper paperwork between a customer and any broker, the sky is the limit in communication with different real estate agents. She did not violate any ethical rules. I am a firm believer that there are ethics, and then over and above that, THERE IS THE RIGHT THING TO DO. Let’s take this beyond the theoretical and dive into the practical.
3 Reasons to be loyal to your real estate agent
1- By building relationship your needs and desires are known.
Flying through the ranks of agents without giving proper time to any one person severely depletes you chances of truly having your needs understood. Anyone who has spent a week previewing homes with a single agent knows this. The homes being shown on day 3 more than likely fit your needs a lot better than the first 3 homes you were in. Each feature that you like or dis-like is mentally bookmarked by a good agent, and put into the decision making process for future choices. It just makes sense that you would not want to re-set this process of relationship building over and over.
2- The commissions are the same.
This is a big factor with many. Here is a simple breakdown of how real estate commissions are paid.- Someone selling a home contracts with a Listing Broker to help them sell. There is an agreement of commission percentage between the two parties. For my example we will use 6%. That means probably 3% goes to the Listing Brokerage and 3% goes to the Selling Brokerage, assuming there are 2 agents involved. If there is only one agent involved there is still a 6% commission paid. Sometimes a Listing Broker may give a discount for services if he or she is handling both sides of the transaction. This would be done with the Buyer’s permission. Usually the commission is paid by the Seller. That means, as far as commission goes, it makes no financial difference to use an agent to go to bat for you while purchaseing a home….which takes me to my next reason-
3- By having a REALTOR® work on your behalf you have an advocate in the process.
By choosing an agent that you can work well with and sticking with them, you will have a professional to help you in every step of your home purchase. It’s not just about working through price and signing on the line. It’s negotiation, understanding offers, counter offers, purchase contracts, lending, inspection issues, addendums and disclosures. It’s having the research savvy to quickly and with certainty find out about taxes, land information, utility issues, county records, liens, parcel history, sales history and survey information. It’s having the experience to know about HOA issues, special assessments, CIC documents, the ever-changing price of utility services and the many many named fees of our beloved water and sanitation service!
This is just 3 of the many ways that it benefits you, the buyer, to find a trustworthy agent and give them that trust to help you in your home buying process. Seek out an individual who has character, knows the area in which you are looking and you find easy to communicate with. Then lean on them as your agent and let them know that you believe in them. Working this way, you will discover far better results than dialing the number printed on every sign you pass or flyer you pick up.
How much money have investors in real estate lost due to the bust in the housing market? I hear talk about “investment loss” and (with the voice in my head) wonder on what these discussions are founded. Maybe we put a little too much stock in media sensationalism instead of taking a look at the the facts.
Examining a short time back into history will give us more perspective on this subject. An investor who bought a property five years ago in Miami, FL would be ahead by $200,000 today. The gain would be $150,000 in Las Vegas, NV. In our town, you would see a gain of $84,000 on an average home in the Pagosa Lakes area if you chose to liquidate now after having owned it since 2003. Take a look at my article last week, Real Estate Comparison for 2007, to see similar comparisons. According to data compiled by the National Association of REALTORS® , the United States as a whole is ahead by $54,000 on the five year mark. Only people who bought in the peak of the market and are forced to sell quickly face a potential loss. That loss on average would be one to two percent. Real estate investors who plan to hold for a reasonable period of time are still in very good shape.
The rate of appreciation in Pagosa Springs from even one year ago yields modest returns in all categories of properties except for a 20% median “loss” on partial acreage lots. Let’s discuss this supposed loss for a moment. If you have a small acreage lot in the Pagosa Lakes area for sale today you will receive on average $40,000 gross. That may seem like a loss compared to the fact that in 2006 you may have received $48,000 for the same piece of ground. Let’s add a little reality to this discussion and call a spade a spade. By definition, an “Investment” has an element of maturity. The word investment is defined as “The purchase of an asset for example, real estate or shares in order to produce income, or to produce capital gain on resale/maturity.” (According to www.homepath.com.au/help/glossary/) On the other hand, you can Google definitions for the term “speculation” and find that they are riddled with scary little words such as- risk, hope, anticipation, narrow and my favorite phrase…”Safety of principal is a secondary factor.” In a sentence, those who choose to speculate in real estate for the short term, may be burned.
Let’s re-focus on our small lot investment for one last moment. In 2003 a raw land lot in the Pagosa Lakes area would bring on average $12,714, and now in 2007 somewhere around $40,000. Four years = $27,286 total net. Break that down and annually and you have $6,822 per year minus holding and closing costs on a principal investment of a little less than $13,000. Let’s see- 54% annually ROI for four years straight…not to bad. We may never see this dramatic of a return again, but for this moment in time, this is the type of profit that is possible.
The housing market will remain our bedrock investment through the ebb and flow of current and future real estate cycles. It will continue to produce funds to help us through braces, college tuition, weddings, and retirement long after we have clicked the X on our browser and forgotten what has been written in the sensation-seeking story of the moment.
Search for homes at ChrisLiverett.com
Location: Pagosa Lakes
If I’ve heard it once, I’ve heard it a bazzillion ( which according to encarta.com is an actual English word, but not a real number) times: “I want to leave a little room to negotiate in my listing price.”
I can provide statistical evidence that those who choose to list their home with “a little wiggle room” never have to worry about the grueling emotional task of negotiating a lower price- because they never sell.
In my world, the world of real estate, we have a classification of these types of listings: They are known as expireds and withdrawns. This usually means that they are priced out of reach of where the buyers are biting.
A quick look at the past 30 days from our Pagosa Springs MLS system reveals this truth. Our area has 1817 properties for sale; 108 of these went under contract; 62 went into settlement or were sold; 143 came off of the market by either expiring or being withdrawn. Twice as many properties came off of the market with unsuccessful sales than that closed. Granted, many of these properties were re-listed with another company, but it still points out that many sellers are expecting unrealistic returns on their real estate investments in the midst of a buyer’s market. Once the sellers have switched companies, it is almost always associated with a price improvement. In the words of Jerry Driesens “I want to be the last person to list your property, not the first.”
The sellers who choose to look at the market with discernment and realistically place their home in the market become “former” owners and move on with their lives. Many times to realize their investment profit and capitalize on great value by purchasing other properties in the current market. Here is a recent example:
I received a call from a client who wanted to “move” his property. During our discussion he said “this is the bottom of where I am willing to go”. Soon enough I found a buyer who like any consumer wanted to see some comparable sold homes before he purchased this one. At this point, when showing him comps, it was easy to realize the value based on those numbers. It was a realistic price, not a “steal”, but a fair market value. We did NOT negotiate a single penny. The buyer purchased at asking price because of the value. The property did not sale in the months before because their was “negotiating room” on top.
Leaving negotiating room when pricing is the same as placing your home on the top shelf of the candy isle just out of reach. It’s not that your home is not desirable, its just that buyers are deterred by all of the homes on the shelf right in front of there nose within easy reach. If you price right , actually you don’t have to come down at all. Many homes in our market are selling for the asking price. These are houses belonging to sellers who dared to meet the buyers in the market instead of hoping that the buyers would come up out of the market to make an offer.
Close doesn’t cut it in a competitive market. Close only counts in horseshoes and hand grenades. Forget about nudge room, fudge factor, or wiggle space. Place your property on the market at the right price- then hold your line. If a buyer wants closing costs- negotiate upward. There is always a good market in any market. This is found at the precise point where sellers focus on price and condition rather than a personal bottom line. Sometimes making several base hits is a lot better than a single home run.
All real estate is local. I did not coin this phrase although I believe it to be very true. David Lereah gets the credit for this as the title of his book published earlier this year. I hear quite often that “the national market is ___ ” fill in the blank, when at any given time you will find individual market conditions all over the spectrum across our nation.
It is however wise to look at any LOCAL market and understand it for what it really is. Currently Pagosa Springs has receded from the enormous boom that it has experienced for several years. It is important to know the reasons why we are in a slight buyer’s market, “no two times or places are created equal”. Our slow down is primarily a problem of over-inflated inventory with a hint of consumer nervousness. Both of these factors mind you can change very quickly. This is not the case for some parts of the nation ie. Detroit’s decline due to the decrease of automobile manufacturing or Denver’s sluggishness as a result of the massive over-stretching of sub-prime lending to the young tech industry buyers. Colorado resort towns are still seeing outside secondary buying power very strong. Interest rates are good and nothing has changed substantially to make Pagosa any less desirable place to live or vacation. So how can you sell your home in our LOCAL market right now?
If you are currently in a selling position there are many things that you can do to increase your chances of a successful home sale:
Price reasonably
Without this in place you WILL NOT sell your home. There are simply too many options out there right now. The goal in this market has to be to separate yourself from the crowd and this starts by being educated on current SOLD inventory and pricing accordingly. There are ways that consumers can find this out. Sold homes are public information, but sometimes it is difficult to find out this information without doing a lot of research. On my website, chrisliverett.com, I offer an option that lets you get specific sold property emailed to you. I am sure that their are other Brokers that do the same.
Stage
What can you do with your paint colors, furniture arrangements, accessories etc. that can set your home apart. This is so often overlooked by homeowners that are accustomed to the look and feel that their home has had for years. You must think about the first impression that your home gives when a person walk into it for the very first time. Could it have less furniture that would give a small space a larger feel? Are there unnecessary item on the bar that become a distraction? Ask your real estate broker for his or her advice on this subject, or better yet, hire a professional home staging service to help you stage your home. Statistically a few hundred dollars will make you thousands.
Creative incentives
Think outside the box. Are you selling a condo or a vacation home? Offer 2 annual passes to the hot springs at closing. Have a home on the golf course? Provide a membership with x country skiing passes. There are a lot of professionals that scoff at this but the name of the game is to have your home stand out from the rest and every thing that can differentiate in this market is a plus.
Show improvements
Give your Realtor® copies of all improvements to the home and any guarantees for anything like a new roof, furnace, or hot water tank. Having these things for your Realtor® to talk about during a showing can fill any dead space in a conversation with positive attributes about your home.
Quick showing time
If at all possible have an immediate showing time for your home, and keep it clean. Most real estate professionals will do everything they can to project showings a day or several days in advance. This is not alway possible in a town like Pagosa. Many times Mr. and Mrs. buyer blow into town and hit the ski slopes, fall in love with our town , and call the first Realtor® they see asking to look at homes “after lunch”. As a home seller, you may find this annoying, but they may also be the ones to write the check for your home.
Choose the right Realtor®
There are a lot of us out here to choose from. The longevity of any given Realtor® in this town can range from 25 minutes to 25 years. We have part time agents, full time agents, overtime agents, independent agents, large firms, small firms and all shades of personalities and experiences. These are all good things that make up a fun and diverse group of professionals. You should choose one that YOU can work with but ANY AGENT worth his commission should be able to answer some basic questions for you. How many comparable homes have sold this month in my neighborhood? What are the average days on market? What listing price puts me in the top 15% of homes like mine. None of us can shoot from the hip completely accurate on questions like these, but with todays technology we should be able to answer these and many other questions like these within a short amount of time.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
I recently made an agreement with Pagosa Daily Post, an online news source that is among the top in our part of Colorado, to write for them on a regular basis. I will be providing them with a weekly “Real Estate Related” article.
Click here to see my first article, The Rich Idiot Real Estate Investor , and check back at the beginning of each week to view new articles. Be sure to pass it on to anyone who might be interested!
If you know me at all you know I am a Googlepheene. I use Google in my Real Estate Business and my personal life. Especially the mapping attributes that Google is doing so well.
For instance. I am planning a bow hunting trip into the San Juan’s at the end of September. The duration will be 6 days, and we will be camping several hours from anything. So a few days ago as I am trying to explain the strategic location of my proposed camp, (I would normally include a link here to the area, but if I told you….then I would have to kill you.) I said in an impatient tone “I’ll just Google (Earth) it and send you a link”. My friends in amazement could see every detail of terrain, trails, Forest Service roads, lake , stream and meadow of a place that they had never visited. They have become educated on the terrain from the comfort of there armchair!
For business Google Earth is invaluable to get the idea of a tract of land across to a client or potential customer. This I have known for a while. What I did not know, is that more and more of the general public have caught on to the GE application and are savvy enough to use it the way it was created.I usually just send a jpg or snapshot via e-mail so that the recipient can see a static image. The result is quite amazing.
Here is a real life example of a small lot that I listed this weekend. 56 Short Drive, Pagosa Springs Colorado. It is found in Pagosa Highlands Estates. A small established subdivision near Hatcher Lake.
When taken in comparison, it is quite striking how effectively you can get the image across.
I sent these images to a potential buyer, and to my pleasant surprise he said…”Send me the Google link. I’ll pull it up and see how far it is from National Forest and amenities”.
This is very encouraging to me as a real estate practitioner. I am always on the look out for the best technology that will convey an accurate picture to someone half way around the globe. It seems that this type of technology is finally catching on with the masses, and with that familiarity comes more and more powerful tools for us to speak to our audiences with.
