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This week the California Association of Realtors (CAR) released its 2008 Survey of California Home Buyers; the results do not come as a surprise to those of us with our finger on the pulse of the Southern California and Long Beach real estate market. 2008 saw more statewide home purchases than 2007; 69% of buyers state that lower prices, and 40% attractive interest rates, were the deciding factors in their purchase. 77% of first time buyers said that lower home prices were the reason they purchased homes.
The Internet has become the go to place for buyers beginning their home search and to find their Realtor®.
Buyers are spending more time and viewing many more homes and condos than in prior years. They are also spending a considerable amount of time searching on the Internet prior to contacting an agent; often as much as 2 months or more.
Barry Cunningham wrote a rather accurate depiction of the current state of affairs over on the Sellsius Blog. He explains that the survey revealed:
“96 percent of Internet buyers expected a response within four hours
or less…31 percent of the Internet group expected an IMMEDIATE response!
84 percent of participants ..let me say that again…84% of buyers
said that they considered the agent’s response time to be either a
“very important” or “extremely important” factor in their
After reading the results of the survey
Barry ran an experiment calling 20 Realtors on Friday morning and another 20 on Saturday morning. The results? 2 agents answered their phone and only 4 called him back. Yeah, that’s pretty bad. We agents are running into the same problem. Searching for homes for buyers often requires research and feedback from the listing agent prior to even considering showing a home. Just last week I was researching available homes with Mills Act status in 3 historic neighborhoods:
With none currently available on the market the next step was to search for homes that might qualify for Mills Act after purchase. I called 7 agents on Thursday and received 1 call back as of today. Sellers, pay attention here, these are your listing agents! My buyer lives on the East coast and was going to make a trip here to view these homes with the intention of purchasing one, he has to purchase, he is in a 1031 exchange and the clock is ticking. Your Long Beach homes will not be shown, he has cancelled his travel plans and will have to make other arrangements. One of the 7 of you was about to sell your home – not going to happen for now.
Barry asks if Real Estate Agents have given up. It appears to be so for some. I think some have and more will follow in short order, there just isn’t enough business to support the amount of Realtors with active licenses. One would think this alone is reason enough to be all over your business and jumping on those phones, but apparently it is not. I suspect that many of these agents have sought employment and cannot take real estate related calls if they want to keep their other jobs. But that leaves me scratching my head about the other 4 days the calls weren’t returned, so I guess I don’t have an answer here either. I’m stumped, which brings up another issue. If one of these agents listings go into escrow and the listing agent is gainfully employed elsewhere, how are they going to handle the barrage of paperwork and phone calls? Escrow and Title Companies as well as most lenders work Monday thru Friday, from 9 – 5. Do you know if your listing agent is available to handle the sale of your Long Beach home or condo? Are you sure?
Some agents consider themselves to be “listing agents”, others “buyers agents”. The truth be told we are agents that handle both buyers and sellers, these are just personal preferences. In the hot sellers market I worked with mostly sellers and some buyers. It wasn’t a choice, listings, when handled properly, are a lot of work, if you are carrying a lot of listings there isn’t a whole heck of a lot of time to be researching for buyers and for showing properties, handling the phone calls alone can become a full time venture. In the current market I find myself turning down most listings and working with more buyers. This year I have declined close to 80 listings. Why list homes that will not sell either because the seller wants more than the market will bear, is upside down or doesn’t have the funds to put the home into sell-able condition? It just doesn’t make sense when buyers have so many viable choices.
Does it sound strange to hear that a Realtor® is turning business away in this market? We are not just agents. We are business owners and as such need to make management decisions. Not taking listings that won’t sell is a very smart business decision. Listings cost a great deal of money and time to market when they are handled properly. Taking 80 listings that probably won’t sell in this kind of a market would likely lead to bankruptcy. I love what I do and will not jeopardize my business.
No agent understands contracts better than a highly experienced listing agent. They not only need to understand those contracts from the buyers perspective, they need to be in a strong position to protect their seller. Buyer agents with little contract experience on the listing side are often not strong enough to protect the sellers interests when they list homes. I love getting one of these as a listing agent when I am representing a buyer. Can you say lunch?
Buyers shopping today’s real estate market are looking to get the absolute most for their money. Who can blame them? When else will they ever have such an opportunity to purchase a lot of home for an amount they can afford? Purchasing long Beach real estate is not a game, it is an investment in your future. When prices are down it is smart to buy as much house or condo as you can handle comfortably. Buyers are taking their time and continuing to look around even after they think they have found the right home, often for several months, sometimes they will find an even better one. Who can blame them? It’s just smart business, it’s not just a home, it’s an investment.
The study said that today’s consumer is not satisfied with the performance of their real estate agent; 80% stating that their agent did not negotiate aggressively on their behalf. Barry says “Thats completely understandable since most real estate agents are not trained negotiators.” He’s right! Negotiating is not taught in real estate training. Either the agent has those skills coming in or they develop them – or not. Would you like to know what else is not taught? How to price your homes! Scary, isn’t it? We either have it, or we don’t. Barry is right when he states that negotiating is more than passing counter offers back and forth. There is a whole lot more to it before that contract is even written and all the way through to the close of escrow. The negotiating doesn’t stop until the deal is closed. Both buyers and sellers need to really get to know what their agent is all about before they begin to work with them.
In all fairness, some buyers and sellers have to own the responsibility for choosing the wrong agent to work with. Hey just because you or somebody you know, knows them doesn’t make them the right agent for you, and it doesn’t make them good at what they do. Hire smarter the next time.
Earlier this year Joel Singer, the Executive Vice President of C.A.R. invited me up to HQ to participate in a small round-table of Realtors® to discuss the effects of social networking on the real estate industry (there is a video on the CAR site as well, can’t locate it at the moment). 4 of us from around the state participated. While we all went about social networking in somewhat different ways, the one thing we all agreed upon was that if you don’t have a heavily trafficked blog site, and a very strong online presence, you are going to get buried in the very near future. Barry says we need a well marketed, SEO intensive Blog or website if we are to survive in this industry. He is right, I have been saying this for over a year and a half now. I have a few of those , they work, nuff said?
The consumer (buyers) are shopping on the Internet. Actually most of them are shopping on:
- Google, 40%
- Realtor.com 28%
- Yahoo Real Estate 8%
- Zillow 5%
- Specific home site 4%
- Craigslist.org 3%
- Unsure 13%
I’m smiling here. Having one of the strongest online presences in the Long Beach Real Estate online market kinda takes a lot of the stress off . 33% of the participants in the survey said that Real Estate agents sites were the most useful tool in their home search. Why wouldn’t they be? We know our market better than anybody else, we work it every day. The information on our sites reflects that.
Single property websites don’t work. Do you want to know why? Because they are website based and are new sites with new URL’s on them. It will take them months to ever be found, by that time either your home will have sold, be coming off of the market or going into foreclosure!
For Sale signs used to generate a lot of phone calls, especially on weekends. Not true any longer. Gone are the days of buyers driving around on weekends looking for open houses and calling on signs. Today’s buyer is sitting in the comfort of their own home shopping on the Internet, looking at pictures, videos and slide shows of Long Beach homes and condos they are considering. When they are ready, they pick up the phone and make an appointment to view the home. Yep, open houses are pretty much toast as well. Why would a buyer want to run all over town on your schedule when they can shop on theirs?
Barry wants to know what we (Realtors®) are going to do with this information. I have decided to pass it on to you, the Long Beach Buyers and Sellers. What are you going to do with it?
Please visit my Long Beach sites, Google loves them and I hope you will too!
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