Phoenix Arizona Real Estate Blog, presented by ...

Nov. 9, 2006 - Why Didn't My House Sell?

Sep. 27, 2006 - Yes, we're still here

One of the great things about real estate is the flexible schedule. One of the not-so-great things is the lack of a true day off at any point in time. Have cell phone, will travel. And one of the not-so-great things about me is once I get my hands on one of these true days off, it so disrupts my routine that it takes a couple of days to get to get going again.

While I haven't been writing I definitely have been working. And one of the biggest results of the last few days is a new listing strategy, a zig while everyone else zags.

The trend this year has been for agents to ask for longer and longer listings - minimum four months for some, six months for others. I've done the same, to be honest, as I followed the crowd. But I realized over the last few days the time has come to try something different. And so I'm shortening my listing period.

Beginning this week, I am offering a 45-day listing period to prospective sellers. All of my regular marketing still will take place, from the for sale sign to the flyer box to the virtual tour to the direct mail, blast e-mails, Internet advertising and even a possible broker open house, if the location's feasible. All that's different is the listing period.

In addition, my sellers will hear from me twice a week minimum, either via phone or via e-mail. Sometimes I might even have news to pass along. And lastly, I promise to be available 8 a.m. to 8 p.m. Monday through Sundar, except for Friday's where I'll need to shut the phone down starting at 7 p.m. If you don't reach me, I'll be back in touch in 59 minutes or less. It's just that simple.

Why the shorter listing period? Because I've found more and more sellers growing dissatisfied the longer their home is on the market, particularly with agents who don't follow up over a lengthy listing period. I'm not going to be one of those agents. By shortening the listing period, the sellers are free to move on if their home doesn't sell in 45 days (more on this in a minute) and there's only more incentive for me to work harder earlier in the listing and to make sure that my sellers are completely satisfied, even if I don't have that offer quite yet.

Can I guarantee every house will sell in 45 days? Of course not, though I believe my marketing plan combined with a reasonable pricing strategy will lead to a sell in most cases. But I also have every intention of fulfilling all of my clients' demands on the service side that even if we haven't sold at the end of the 45 days, they'll be willing to give it another 45 days to get the sale done.

And leave no doubt I want the sale done ... I only get paid when my sellers do, when the house is sold and the deal closes.

We'll get back to more regular entries tomorrow, once I'm done with a couple of listing appointments and free from the Pioneer Elementary School book fair.

(c) Jonathan Dalton, 2006 / Jonathan Dalton's Arizona Homes

Sep. 14, 2006 - Does Your Agent Go All In?

The provocative headline is solely for the benefit of my wife, as there's virtually no other way I would be able to get her to read this post. And since she loves me primarily for my writing, I need to keep her entertained.

I've been debating this topic for a while, not so much whether to write about it but how to write about it. The final catalyst was a conversation with a friend of mine regarding a non-real estate related matter ... I had used my negotiating skills to resolve a dispute. As she put it, "this is why you're such a good poker player."

Oh, if only I was. I wouldn't need real estate anymore and instead could head to Las Vegas and become a poker pro - or at the very least move my daytime "office" to Casino Arizona.

Still, while I'll never turn pro, some of the skills I use (or not use depending on the session) in poker have come in handy in real estate - keeping my composure, remaining neutral and negotiating.

Negotiating? Absolutely. A hand of poker is nothing more than a negotiation, albeit one between two or more parties all of whom have incomplete information. To make up for the lack of information, players rely on other signals - tells (unconscious mannerisms in certain circumstances) are the most commonly cited, but betting patterns are equally as, well, telling.

I'm not going to go into detail of something I have only cursory knowledge of, but suffice it to say there are some general rules poker betting follows. Likewise, there are some general patterns that appear in most real estate transactions.

The buyer will make an offer below list price, most often with the hopes that the seller will meet them in the middle. They are attempting to initiate a reaction based on their action. The same takes place at a poker table over and over again.

At the same time, both buyer and seller are making their decisions knowing only what they hold and what common cards they share. In real-estate terms, the buyer has his loan and his motivation, the seller has their price and their motivation, and the common cards could be viewed as the house.

Where a poker hand diverges significantly from a real-estate transaction is in most cases, win-win is an optimum situation in real estate. Both clients walk away happy - their goals have been achieved and they are moving on with their life with a smile on their face. There is no win-win in poker - even a chopped or shared pot is viewed more as lose-lose.

Poker players routinely deal with adversity - poor cards, recovery from unlucky situations. And likewise, a real-estate professional needs to deal with adversity in a calm manner. We don't have the luxury of going off the deep end if termites are found or an inspection repair request in longer than expected. We have a job to do ... and in many cases, we have the opportunity to alter the outcome through our actions.

I'm not suggesting you start your agent interviews at the local casino when you're buying or selling. Nor would I suggest you be concerned the commission earned is all being donated at an area poker table.

But it might be worth asking an agent you're thinking to sell your home whether they're willing to go "all in" and risk everything to make that sale happen. Better that than someone who will "fold" at the first sign of trouble. 

(c) Jonathan Dalton, 2006 / Jonathan Dalton's Arizona Homes

Sep. 7, 2006 - Craigslist and Pandora's Box

I fear I may have opened Pandora's box to some degree yesterday when I mentioned that the buyers who purchased a listing of mine in Peoria found the home on craigslist. I already imagine the unrepresented sellers (nee FSBOs) adding this success as further proof that real-estate professionals are superfluous to the real-estate transaction.

In truth, what this situation represents is a buyer finding the proverbial needle in a haystack. Yes, my clever description (thank you ASU school of journalism) and great photos helped pique readers' interest to where they wanted to view the property. (And I've had more than one response so far.)

There are two factors working against craigslist as a viable alternative to the MLS. First, the format for the site is somewhat less than user friendly. Entries are posted as they come in and sorted only by day. You've got a handful of words to differentiate yourself from the crowd, and that crowd only has limited search capabilities. Unlike the IDX-powered MLS search on my site, visitors to craiglist cannot search by price. They can't really search by city, at least not unless the city's been entered correctly in the searchable portions. They can't specify how many bedrooms they may need, how many bathrooms or a host of other characteristics. Instead, visitors must sift through the hundreds of listings and hope to find one that matches their criteria, much less many.

Second, human nature gets in the way. Many homebuyers, even though they are working with real-estate professionals who presumably are searching on their behalf, continue to search independently. They find a property and then notify their agent to have them look in the MLS, schedule a showing, etc. (As an aside, if a buyer lacks confidence in their agent's ability to find the right house for them, they probably ought to reconsider the agent with whom they're working.) But the bulk of buyers let their agents to their jobs and find the houses for them. And agents aren't searching craigslist, largely due to the aforementioned search limitations.

There also is an issue with compensation - if you read my post about NAR President Thomas Stevens' explanation of the MLS, you already are aware that one of the key components of the MLS is the offer of compensation to cooperating brokers. For unlisted properties in craigslist, compensation only comes a) if the seller is willing to pay a brokerage fee or b) if the buyers have signed a buyer broker agreement and agree to pay their agents' fee. Adding 3% (or whatever the agreed upon brokerage fee) to a sales price, closing costs and down payment often can price a potential buyer out of a home, making the craigslist home a non-viable option unless they choose to enter into the biggest purchase of their life without any professional representation.

At lunch today my broker squirmed slightly when I mentioned craigslist, at least initially, as it could some day pose a threat to the MLS. But as we discussed the matter further, he and I (as well as the others at our table) agreed craigslist, like the MLS, is only as effective as the overall pricing and marketing plan for the home. And from the standpoint of a listing agent, any forum that conceivably could put a house that I am marketing for my sellers in front of a potential buyer is a wonderful thing even if it's not a panacea.

(And yes, for those who have been reading along, I really like the word panacea. Almost as much as my wife likes the word woeful - don't ask; I can't explain.)

(c) Jonathan Dalton, 2006 / Jonathan Dalton's Arizona Homes

Sep. 6, 2006 - Pricing success

Marketing and pricing go together in real estate like love and marriage of song, though they haven't been the subject of a song in large part because neither marketing nor pricing rhymes with carriage.

All the marketing in the world will not help sell a listing under market conditions such as those here in Phoenix, where there are 34,000 single-family homes currently for sale, if the home is overpriced. Price the home correctly, however, and a little marketing will go a long way.

Such was the case for my current listing in Desert Harbor in Peoria -- the home was put on the market Friday at a competitive price for the subdivision and the area. Five days later, we received an offer on the home. My expectation is we'll have a contract by day's end.

The marketing had just begun ... the Just Listed mailers still were a day away from being sent. But a little bit of marketing goes a lot farther when the house is priced on the leading edge of the market.

Of course, such pricing strategy isn't for everyone - if someone has a longer timeframe to move, or is comfortable with the idea of strangers walking (or not walking, if priced too high) through their home for a few months, then by all means join the homes in the middle of the pack.

But for those serious about selling, the leading edge of the trend is the place to be. As they say in the stock market, the trend is your friend. Fighting against the trend and holding out for 2005 prices in 2006 simply won't work.

The key is to read the signs ... if there's plenty of traffic coming through a house, the price likely is correct. If there's no traffic, then pricing is the most likely cause. This is one of the main reasons I don't compete with price on a listing presentation - price isn't up to me to determine. The market will decide what a home may be worth.

(c) Jonathan Dalton, 2006 / Jonathan Dalton's Arizona Homes