Steve Crossland - Austin TX Real Estate

Every now and then I wander into some online Realtor Forums to share and trade ideas, see how markets are doing in other places, and see if I can answer questions or learn something new. The most disturbing thing I come across regularly is the misguided mindset of so many Realtors about their role as an agent. Most recently, this came up again around the issue of real estate inspections and whether or not we as agents should recommend specific inspectors to our buyers.

One agent posted "I offer them the Yellow Pages or to use a recommendation from a friend" to find an inspector. God help us all.

Why would a professional real estate agent hold this lame position? First, her Broker's attorney may insist upon it. It's a risk avoidance issue. Agents accept greater risk when we put ourselves on the line with specific recommendations for inspectors, lenders, vendors, etc. I understand that viewpoint, but I think it's a copout. What it says is that the agent is more important than the client. That it's more important for the agent to protect herself legally than to provide better than mediocre service. Whose interest is being served by that, and what does it say about the agent who follows this approach? It says that you the client are not very important.

Sylvia and I do recommend specific inspectors to our buyers, and we absolutely DON'T want our buyers randomly picking inspectors from the Yellow Pages. I also attend the inspection and estimate the repair costs of items noted on the inspection report. I then advise and educate the buyer about which items are normal and expected versus items for which we should seek remedy or cost offsets from the seller.

In other words, I'm in it up to my elbows with the buyer during the inspection process. What am I supposed to do - hide out in a coffee shop during the inspection and tell my buyer to call around for some bids if he wants to know how much a new water heater and a roof repair will cost?

Most competent real estate attorneys will tell me I shouldn't be this involved. But I think the risk and liability in mine and Sylvia's transactions is reduced by our greater involvement, not the other way around. So I don't listen to the attorneys because I have no desire to be a "do nothing" Realtor who avoids questions and doesn't provide information for fear of being sued. I instead choose to provide a high level of service to our clients. I choose to be a "Fiduciary" instead of a "Functionary".

This difference between a Fiduciary and a Functionary is spelled out on pages 96 and 97 of The Millionaire Real Estate Agent book.

The chart below outlines the differences.

Who would you rather have working for you. A low skill, narrow focused dolt who is so unsure of himself and those he recommends that he won't even provide a reference for an inspector? Or would you prefer an experienced agent who operates on a higher level? Before you hire one, try to determine which they might be.

The book also notes:

"For the very best real estate agents there is a level of service they provide that goes beyond their purpose and value proposition. It is the commitment they make to the buyer and seller to act as a true fiduciary - to place their client's interests ahead of the interests of all others. Even their own. ...

Interestingly enough, a fiduciary can easily do functionary work, but a functionary cannot easily do fiduciary work. Top agents understand this and, as a result, work really hard to provide fiduciary services to all their buyers and sellers".

Every real estate client deserves, and should demand, the highest level of service not only from Realtors but from everyone with whom you do business. We demand this of our vendors, on behalf of our clients, and we're not bashful about what we want and expect. If they don't deliver, they are removed from the list of people we use and recommend. One strike and you're out. If you screw something up for our client, you better fix immediately without any flack or arm twisting, or we'll fix the problem ourselves and you'll receive no further referrals from the Crossland Team.

So, when we tell a buyer that we have some very good inspectors who will do a great job for them, we mean it and we stand behind it. When we send a buyer to a specific lender, that lender better perform, or they are off the Crossland Team vendor list. When our virtual tour guy says the tour will be ready by Friday, and we've told our seller we'll have the listing up on Friday, that virtual tour better be ready, or we'll be looking for another company to use. Same with home stagers, plumbers, carpet cleaners, painters, etc.

Should we demand anything less? Should you demand anything less?

We expect a Fiduciary level of service from everyone we do business with. We can't function at a high level for our clients unless we surround ourselves by other fiduciary-minded people who are willing to be held accountable to a higher standard that the industry norm.

When you hire an accountant, do you want one who just plugs your numbers into Turbo Tax and prints out your tax return a few days later? Or do you want a fiduciary-minded accountant who will ask a lot of questions, dig around in your numbers, and look for ways to reduce your tax liability?

When you visit your doctor, do you want one who comes in to say hello for a few minutes before he leaves you to the nurses and heads to the next patient? Or do you want one who asks a lot of questions about how you're doing, your lifestyle, exercise, eating habits, your kids, etc?

Ladies (and maybe some men), when you get your hair done, do you want your stylist to just go through the motions and give you a standard cut? Or do you want her to really look at your face, your complexion, skin tone and color, ask what you do for a living, and make suggestions about the style and cut that will compliment you most?

And when you ask your Realtor for the name of a good inspector, do you want to be directed to the Yellow Pages and told to ask your friends for a referral? Or do you want the name and number of one or more good inspectors with whom your Realtor has positive past experiences and stands behind 100%?

The number of residential single family home sales in Austin took a 28% dip for Oct 2008 compared to a year ago. The number of "Not Solds" (expired or withdrawn) took a big jump also, to 59% of all listings that departed the Austin MLS in October. These are grim numbers, but the remaining metrics that we track are again holding up pretty well nonetheless. In short, fewer homes are selling, but the ones that do sell are fetching prices near or or above last year's sales. Most sales currently are for homes selling below $200K.

Let's look at the breakdown:

· Number of homes sold is down 28% (was down 14% last month) from 1,717 Oct 2007 to 1,227 Oct 2008. Last month (Sept) saw a decrease in the slowing of sales, but this month (Oct) headed back the other way again. I think the remainder of this year is going to be very slow as well.

· Average list prices in Austin were up 1.16% over the same month last year to $259,128.

· Average sold prices in Austin were down 0.29% over the same month last year to $247,687.

· Median sold price was up 5.46% to $195,000.

· Average List to Sold price ratio is 95.58%, down from 96.42% the same month last year.

· Avg sold price per square foot is down 2.13% to $115 compared to $117 a year ago in October.

· Avg days on market is up 4 days (6.15%) from 65 last year to 69 this October.

· Median days on market is up 7 days (16%) from 43 days last year to 50 this year.

• Number of "Not Sold" (exp or withdrawn) is up 29% over the same month last year, to 59% of all removed listings compared to 46% for the same month last year.

The stats outlined above are shown in the chart below.

The Year-to-Date figures through Oct 2008 tell a similar story, though less pronounced than Oct. See the chart below:

Let's look at the breakdown of sales by price range, and we'll see that 52% of all sales in Austin for October were in the sub $200K price range. Stunningly, there are 503 listings priced at over $1M, yet only 14 in that price range sold in Oct. The $1M price range in Austin is grossley over-supplied at present.

So what's in store for November and December as we ride out the end of 2008? I suspect that sales activity will come to a grinding halt. Removed listings (expired or withdrawn) may top 70% for December as sellers finally give up and pull listings for the holidays. I haven't researched past stats, but I can't imagine we've ever had a month in which 70% of listings departed the Austin MLS unsold, so it's not a fun prediction to make, but we'll see.

Realtor.com has a nice iPhone specific url that allows you to view real estate listings from your iPhone. I'm not sure what percentage of U.S. listings are fed into Realtor.com, but I would be suprised if it isn't most of the major metro area MLS listings. And they are all at your finger tips with your iPhone.

Reality Check OK, so what? Big deal. Who cares?

What problem is solved by having access to nearly all of the Realtor listings in the U.S. through an iPhone? Why not just go home and log in from your web browser if you want to surf listings?

Well, I'm with you. I'm not impressed with "gee wiz" technology just for the sake of technology, but I can think of at least two ways in which this technology benefits me personally and professionally.

First, it's not uncommon to be showing houses to buyers, and they ask about homes we drive by that are not on our list. This happens all the time. Normally, if it's not on our showing list, it's because it didn't fit the parameters of the search, or I eliminated it for some other reason. But I don't always know or remember at the moment the question is asked.

If there are flyers, we get one and find out the price and specs, but flyer boxes are usually empty, and sometimes the price isn't printed on the flyer (because the agent wants you to call and ask, so they can convert you to a "buyer lead".

I can also call the agent number on the sign, but what do you think the chances are that the call will be answered? Not good. Realtors hardly ever answer their phones.

So instead, now all I have to do is enter a quick search and pull the listing up, complete with pictures and basic details.

The screen shot above is the home page you'll see if you visit iphone.realtor.com with your iPhone. Let's walk through more screen shots and see if this is cool and useful, or not. Oh, and I'll get to reason number two of why this isn't a complete waste of time eventually, but for now, let's just see what you can do with Realtor.com and an iPhone.

This next screen shot is what you see after tapping the "Find a Home" menu item on the home page.

You can enter a city and state, but if you know the zip code, it's quicker and easier to just use that.

Enter any price requirements, along with bedrooms and baths, and click search. I left the price info blank and simply entered a search for homes with at least 4 bedrooms and at least 3 baths. If you are logged into Realtor.com with a user account (free for anyone to sign up), you can click the "save this search" box and create a library of saved searches. Let's see what we come up wit

h on our search.

This is what you see on the search results page. You can save a listing, click the blue arrow to move to the next group of 10 results, or tap a listing to see the details page. But if browsing for a specific property, this page provides the basics at a quick glance. Let's ch

eck out 9408 San Lucas.

This is the listing details page. The public comments are not included, but instead some generic data pulled from the MLS listing. There are three tabs to choose from - Details, Photos and Contact.
Here is the photos tab. Unlike a lot of mobile MLS feeds, Realtor.com doesn't skimp on the photos. We get all 12 photos, the limit allowed in the Austin MLS, but there is a catch. If the listing agent is not paying the $71/mo. for the "enhanced" service at Realtor.com, then your listing will only display 1 photo. This sample listiing is one of ours, and we do pay the additional fee, though I'm not happy about there being an additional fee, but we want our listings to show all photos to online viewers at Realtor.com.
Here is the larger photo view. On your iPhone, you can arrow through all the photos (if there is more than one), or click the 'x' to return to the details view.
The last tab is the contact tab. This is where you can see the listing agent contact info. If the agent doesn't have the "enhanced Realtor.com package, you only get the name and number. Otherwise, you see a photo of the listing agent, and I suppose we should have a logo there. I'll look into that.

OK, reason number 2.
I hate to admit it, but I'm a real estate junky. Whever I visit another city, whether on business or on vacation, I like to drive around and look at houses. Most recently I did this in Lake of the Ozarks Missouri, where we spent 7 days on vacation.

On our second to last day there, when Sylvia and the girls were off doing girl stuff (spa, manicure, facials - they are so spoiled), I headed out for a half day of tooling around the lake, visiting open houses, pulling flyers, and checking things out. I didn't have an iPhone then, but if I'd had one, I would have been able to use the "Homes Nearby" feature to gather information about the homes I saw while driving around.

The "Homes Nearby" feature at Realtor.com requires that you enter two cross streets, a city and state, and will produce a results list similar to the one shown above for the regular search. You can also limit the search result by entering bedrooms, baths and a high and low price.

So, if you already have an iPhone, this is another benefit and feature available to you. I wouldn't run out and buy one just to see listings on my phone though. I've had my iPhone for 10 days now, and I'm not yet convinced that the additional ownership and data plan costs are offset by any notable productivity increases, but I'm still learning how to use it after having a Treo for three years.

I was evaluating some Property Management software recently, which was still in the “beta” stages of development. Beta software is commonly thought to be ready enough to function, but is expected to have undiscovered bugs and flaws, and may not be ready or stable enough for production use. I decided against this particular software because it has shortcomings and limitations I cannot live with.

I started thinking of some of the many past encounters we’ve had with what I would call “beta version” Realtors. These are freshly minted, green agents who have passed some testing requirements, such as passing the real estate exam and completing basic training classes, but have not yet been proven as stable and reliable in a “production” environment.

Now all they need are some beta testers. Like beta software, many of these beta agents will never achieve the level of maturity and stability required to move into full production release status. They’ll never become Version 1.0. But they will be tested by some users (clients), with varying results, before the market spits them out. Some will pass the test and become great agents, but they still have to be tested first.

Buyers and Sellers, will that beta tester be you? And is it a good idea to use a Newbie Agent to help buy or sell your home in Austin?

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Steve Crossland
Austin TX
www.CrosslandTeam.com