About Lauderdale County, AL

Tuesday, March 24, 2009

REALTORS Welcome, Solutions for Slow Markets Offered

Today I'd like to talk to all the real estate agents out there. You know who you are. You're probably working for some broker of some conventional real estate company. You're probably experiencing a slow real estate market right now, and you might even be to the point where you need a part time job just to make ends meet. Its tough out there right now, and I wouldn't blame you one bit if you're re-thinking your career as a real estate agent. What can I do to use the skills I already have to make some extra money? At Home Grown Real Estate, we've got some interesting propositions for you that just might help you in this slow market.

First of all, I'd like to tell you that I understand exactly where you're coming from. During college I sold real estate to pay the bills, and it seemed to be either feast or famine in those days. Some months were covered up, and some months were bone dry. These days many Real Estate Agents are experiencing more famine than feast. So I bring to you a list of solutions that Home Grown Real Estate can provide to you as you try to wade through this tough market.

Solution #1 - Profit Share for Recruiting
We've seen this one done before. Companies like Keller Williams Realty and Exit Realty are successfully turning their agents into recruiters, because when their recruit makes a sale, they get paid too! At Home Grown Real Estate, we offer exactly the same type of recruiting incentive. If you bring in someone to Home Grown Real Estate, every time that individual makes a sale, you'll get 10% of the company's portion of that commission.

So, let's do the math: You recruit Joe into the company, and Joe has a 70%/30% commission split, and he sells a house for $200,000. That means that Joe walks away from closing with $4,200, the company brings in $1,800, and of that $1,800, you get a check for $180. Now, $180 may not sound like big bucks, but if you multiply that times 5 people you've brought into the company, that's an extra $900. And an easy $900 too! All you did was invite him to come work at Home Grown Real Estate.

Solution #2 - Become a Construction Consultant
The great thing about Home Grown Real Estate is that our sister company, Harmony Building and Construction is available to do all of our repairs, remodeling, and new construction. This allows us to offer one more service to our clients and one more reason to keep in touch with them. At Home Grown Real Estate, our agents become Construction Consultants for Harmony Building and Construction as well. What this means is that you can also "sell" the construction company's services and be paid a commission for the projects that the company is awarded. Imagine that you've just sold a house to the Smiths, and they realize that its going to need a little work done to it before they can move in. You discuss with them the different repairs the house needs, fill out a work order, and our estimator will come and give them a price. If the company is awarded the job, you'll get paid 3% commission on the price of the job.

So, let's do the math. I just got us a $2,500 flooring job the other day. That means upon completion of the project and collection of payment, I will receive a check for $75. Now, $75 doesn't seem like much, but if it is a $15,000 remodel job, I'll receive a check for $450. Now, that's not bad money! Most good agents will help their clients figure out what repairs are needed to a house, and will help them select a contractor, so why not get paid for doing it? History shows that when real estate sales are down, remodels are up. Why not bring home a portion of that, too, while you're waiting for your listings to sell.

And just to be clear, this is not an illegal kickback or finding fee or anything like that. You will be a construction consultant of Harmony Building and Construction, and as such are entitled to compensation if you generate business for the company in which you work. For more information, I refer you to THIS article from the Alabama Real Estate Commission website regarding gifts, rebates, and kickbacks, particularly the final paragraph of the article.

Now, I've gone over two extra ways you can earn money aside from your own real estate sales. I know of no other real estate company that can offer you this. And the best part is, we're locally owned and operated, so if we see that one approach isn't working so well, we have the flexibility to change things as we go!

If you feel like this is the right thing for you, please speak with one of our agents or contact me if you have any questions.

Joshua Pettus
President and Associate Broker
Home Grown Real Estate

http://www.homegrownrealestate.net

http://homegrownrealestate.blogspot.com

Monday, March 23, 2009

Website Fun

I've been working on our company website for about a week now. Things are going better than I anticipated. It won't look like a million bucks, but I think it will be functional enough, and reflect some of the more innovative ideas I've had about what I want our website to be. One of the cooler aspects of it, is that since successful real estate agents and companies successfully network themselves within their sphere of influence, I felt that we needed to take full advantage of the different social networking websites out there if we're going to make a dent in the existing market. The problem with conventional advertising, such as newspapers or real estate magazines, is that its very expensive (you could easily spend thousands of dollars a year advertising in printed publications) and its very slow. By the time your ad gets printed and into the hands of the consumer, the information is outdated... prices can change, properties can sell, and if they print the ad with a mistake, you're just out of luck for another month! Another issue is that you have very little control over what gets printed. The last time I had an ad printed, I gave them all the pictures and text to my rep, and I assumed that everything was going to look professionally and neatly done. What actually got printed? All the colors were off, the pictures were blurry, there were typos that I didn't put in my description, and when I asked them to put in some sort of decorative horizontal line, they put in this really ugly green and white "barber shop striped" pole looking thing that made it look rediculous. On top of all of that money and time spent, I didn't get ANY phone calls from the ad whatsoever. Before that I advertised an open house in Huntsville in the local newspaper there, and ended up spending the day alone in the house.



So, what's a Realtor to do? You've got to advertise, but if its really expensive and in the end it doesn't work, then what's the point? Fortunately for me, I'm young, and have basically grown up in the internet age. All of those in my "sphere of influence" are wired in with laptops, Blackberries, and Facebook. Rather than joining the garden club or mailing postcards, I can post an update on my profile or Twitter page, and the rest of my world sees it. In order to take advantage of all this technology (which also just happens to be free), I've incorporated THIS into our company's website:


This little section on our site which took me an hour or two to put there will turn our website into a real estate social networking hub. Look around at other real estate companies' websites... you won't see anything like this. Sure, you'll see agents on Facebook or MySpace, but this is just one more thing that we feel makes us one step closer toward the Blue Ocean I spoke of in my previous post. Let me know what you think.

Joshua B. Pettus

President and Broker

Home Grown Real Estate

http://www.homegrownrealestate.net

http://homegrownrealestate.blogspot.com

Saturday, February 28, 2009

Blue Oceans, Nintendo, and Real Estate

So, while the rest of my classmates in college were off drinking, partying, and doing the normal irresponsible college kid stuff, I came across an interesting book entitled Blue Ocean Strategy. How did I find out about this book? To be honest, I learned about it from Nintendo! I am an avid video game player, and love all things Nintendo. One day I happened to be following the speech of Nintendo of America's President Reggie Fils-Aime, and Reggie introduced a new business concept to me that day: blue oceans. I said, "What the heck is a blue ocean?" Well, I'll tell you.

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Here are a couple of definitions for you to chew on for a moment:

A blue ocean is uncontested market share that has never been touched, neither has it even been considered part of the market.

A red ocean is the bloodied waters of current market share. It is the consumers out there that companies are currently fighting tooth and nail to get to buy their products.
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About the time of Reggie's speech, the book Blue Ocean Strategy began buzzing around the business marketing strategy world, and it piqued my interest. And it interested me because I saw what Nintendo was about to do with this strategy. They were about to introduce to the world the Nintendo Wii which we have all seen revolutionize the industry of video gaming, opening up previously untapped market share to an industry which was historically only for (predominately male) kids, teens, and college nerds. With the Blue Ocean Strategy, I saw Nintendo about to make the biggest comeback in video game history... from a dismal third place with the purple (yet, so lovable) Gamecube to an overwhelmingly first place spot with the Nintendo Wii, which even after a couple of years on the market, continues to dominate every region it is sold in and still stays consistently sold out in every store across America.


So, before we get into real estate, let's observe what Nintendo did. Because this change wasn't all about sticking older people and women in their ads. It was about price point, getting rid of what was not adding value, and focusing on what does ad value. Basically, they attacked the market with the least expensive game console of all the video game companies out there. In order to do that they did away with the high-def graphics that video game companies have been trying to one-up each other with for years, and they added a unique control scheme that added much more fun to the game play and could do away with the large, many-buttoned, and more complex controllers of the other competitors. In so doing, they were able to grab the attention of all people, young and old, male and female, thus opening up many market sectors that had never been targeted by video game companies. They have single-handily disrupted the entire video game market, and it will never, ever be the same again because of what they've done. The result: your grandmother buys a Nintendo Wii. She is part of that vast blue ocean of previously uncontested market share just waiting for something to come along that even she can participate in.


Now, back to real estate. In my previous blog, I uncovered some of the concepts we are going for with our company. These concepts are radically different from anything else out there. We are basically opening up a company that can easily take care of all the needs of your property. We're not just there to sell you the house, we can expand it for you, fix it for you, and then sell it for you when you're ready to move on. This opens up a whole new market in real estate that is largely ignored... those who aren't necessarily in a position to currently buy or sell. Historically speaking, when real estate sales are down, remodels and add-ons are up, thus giving us a virtually recession-proof real estate company. What this means is that I establish a client and can stick with them for the entire time they own their home as a partner alongside them, making sure that ALL their needs are met regarding that property.

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The two main business strategy models currently out there are:

1. to compete with price

2. to compete with quality.
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The common thinking out there is that you can't combine the two. You have to choose one or the other, price or quality, but not both. I argued with one of my professors while at UAH that it is indeed possible to compete on both of those terms. He had never read The Blue Ocean Strategy. The Blue Ocean Strategy gives us a model in which we can in fact do both. We now offer one more service to the public, which gives us another way we earn income, which means we can be more flexible with our commission and still stay profitable. Therefore, we can still offer high quality services, flexible commissions, all the while adding one more service which adds value which the client wants and needs.


I think the old saying fits: If you always do what you've always done, you'll always get what you've always gotten. We are competing against real estate agents and companies who have been at this game for decades fighting over the same red oceans doing exactly the same things. Hopefully with our concepts, we'll make all that bloody scrapping and fighting over your business meaningless.


The subtitle of the book Blue Ocean strategy is "How to Create Uncontested Market Space and Make the Competition Irrelevant." Hopefully we're on our way.


Let us know what you think!


Joshua Pettus
President and Broker
Home Grown Real Estate

http://www.homegrownrealestate.net

http://homegrownrealestate.blogspot.com

Friday, February 27, 2009

First Post! Home Grown Real Estate - Buy It! Sell It! Fix It! Build It! Exciting new real estate company concepts!

I come before you today to let you know a little about me, a little about what I do, and a little about what I have learned in Real Estate. There are so many different real estate companies out there with thousands of agents doing all the exact same things, so let me let you in on a little secret... I'm a bit different. I think, act, move, and work (and probably smell) a bit different than most people in real estate.

We just started up our new real estate company last summer, Home Grown Real Estate. Most of our time has been spent getting things up and running. Its been an interesting adventure so far. I quit my full-time sales job at an established company to pick back up in real estate where I left off when I took that full-time sales job. I worked for Keller Williams Realty in Huntsville, AL, which got me through school at UAH. I got my BSBA in Business Administration, and am in my fourth year in real estate. I also have my Broker's l.icense in the State of Alabama, where I am a member of the Shoals Area Association of Realtors, and the Huntsville Area Association of Realtors.

So, what exactly do we plan to do with this new company? To put it simply and concisely, I want to disrupt. I want to shake it up a bit. Real Estate sales can be a boring, stale place, filled with frail little old ladies with plastic faces and lots of make-up. While we have seen some changes in the real estate industry, as far as company concepts, things are relatively the same. You hire a person to stick a sign in front of your house and then hopefully, they sell it. Sure, the internet has helped in the search for properties, but as far as the services a real estate company can offer, little has changed.

Our concept is pretty simple. We started out buying, remodeling, and selling properties. We do all the buying, all the selling, all the remodeling ourselves. So, we started up a separate construction company on the side to begin doing work for the general public. Then we thought, well we're good at construction work, and we've got the marketing prowess of a real estate company, why not use that to our advantage!
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So, with us you can:
1. Use us as Buyer's Agents, and help you find the right property for you, whether it be commercial, industrial, residential, etc.
2. Use us to sell your property, meaning we help you stage the home, schedule showings, advertise... the usual seller's agent stuff.
3. Use us to build a new home. With our sister company, you can come to us, tell us what you want, and then within our company build you what you want. We can even help you find the right land that you need.
4. Use us to remodel your existing home. Now, this is something that is different, which provides, what we feel, to be the total care package of real estate. These are tough economic times, and not everyone can afford to buy a new home when their existing home gets small or outdated. This can be from a small, minor repair, to a large addition! _____________________________________________

So, number three and number four are big differences. Sure, there are lots of builders who sell their properties themselves, but very few real estate companies that build houses themselves. And I don't know of any real estate company willing to go remodel your bathroom for you! Some would say that this is outside the scope of interest for a real estate company, but we look at this unique concept as a way to provide a necessary service to our clients out there, while also giving us an edge over our competition.

Why would you hire our guys vs. Joe Fix-it down the street? Well, Joe's probably a nice guy, but does Joe know what projects add value to your property and which do not? You can spend a lot of money fixing up your home and still add little to nothing to your home's value. That can be an expensive mistake to make, which could hurt your bottom line when you get to the closing table.

Also, let's say you're getting ready to sell your house, but you've got to fix a few things before your property is ready to be shown to potential buyers. We are set up to take your punch-list of things to do, and knock them out as quickly as possible, and keep things priced as competitively priced as we can.

Another scenario, let's say you're buying a house, but you've got to do some fixing up before you move in. We've got you covered there as well! We can do anything from patching the smallest holes, to complete remodels.

Hopefully, this year you will see us grow as we try our best to bring in more agents. We would eventually like to expand this concept to other markets. For now though, we're only serving North Alabama, including the Shoals Area, Athens, Decatur, Huntsville, Madison and surrounding counties and cities. Please let us know if there is something we can do to serve you better!

Thanks for your support, and hope you all enjoy the blog!

Joshua Pettus
President and Broker
Home Grown Real Estate

http://www.homegrownrealestate.net

http://homegrownrealestate.blogspot.com

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