Real Estate in the Buff (ington Building)

Clarksburg Newsletter

2011-03-10T15:59:00.000-08:00

Open publication - Free publishing - More clarksburg

Real Estate in the Buff(ington Building): Clarksburg Area Supply and Demand Chart February 2011

2011-03-10T08:35:00.000-08:00

Real Estate in the Buff(ington Building): Clarksburg Area Supply and Demand Chart February 2011

Clarksburg Area Supply and Demand Chart February 2011
Here is the Clarksburg Area supply and demand chart for February 2011. The Red lines are the active homes, blue under contract, and green are sold. The absorption rate is determined by the number of homes on the market and the number of homes selling that month.

Clarksburg's absorption rate for Feb 11 is inline with the Montgomery County numbers. Since this report only looks at resale home, the new home numbers need some attention as well. We are seeing the new home activity spike in recent weeks.

On February 19 and April 2 our New Home Info Center will be open from 10-2 at the RE/MAX Clarksburg Office (23214 Brewers Tavern Way Clarksburg MD). It is a great way to get ALL of the builder information in one spot.

Now is the time when savvy sellers and buyers make their moves.

Absorption Rates:

February 2011 12.7% absorption rate

February 2010 18.1% absorption rate

February 2009 5.7% absorption

Monthly Supply of Inventory for Montgomery County Feb 2011

2011-03-10T07:42:00.000-08:00

Monthly Supply of Inventory Chart

Here is MSI chart for Montgomery County MD for Feb 2011. MSI is Realtor lingo for "how big is the inventory of homes for sale". Look at it this way, if no other homes came on the market, how long will it take to sell all of the homes currently available. That is MSI.

Most experts say that 5 months is the equilibrium point. More than 5 months, its a sellers market, below 5 its a buyers market.

MSI for Montgomery Co Feb 11 is:
3.2 months

What I Learned about My Real Estate Business from Running a Marathon

2011-01-20T06:32:00.000-08:00

On Oct 31, 2010 a very large item was crossed off my "bucket list". I ran in the 35th Marine Corp Marathon, 2500 years after the legendary runner Pheidippides ran from Marathon to Athens. The experience taught me a lot of things, but most important it reinforced habits and characteristics in my business.

Coaching:

Marathon-Last year I would have said there weren't any sports more solitary and simple than running. I started training in June by myself. About a month in, I realized that I was lost. I wasn't sure how much to train, when to train, where to train, or what to train. It wasn't until I spoke to one of my wife's friends who has run several marathons (we will call her Coach) that I could wrap my mind around the task at hand.

Problem: I was never sure how long or often to run.

Solution: Coach gave me a weekly schedule of runs.

Problem: I could never carry enough water in a bottle for my long runs,

Solution: She told me to wear a Camelback water backpack.

Problem: I got tired on long runs.

Solution: Take Powerade Gel packets every 6 miles.

Problem: My feet would chafe against my socks.

Solution: Glide.

When it came time for the marathon, I went looking for more advice online. I was bombarded with advice (sometimes conflicting) about supplements, equipment, length of training runs...you name it. I got worried so I called Coach. Every question I posed, she repeated one question.

Me: Should I use an electrolyte patch?

Coach, "Did you use one in training?". No.

Me: Should I take Gel packets every 3 miles?

Coach: "Did you do that in training?" No.

I quickly began to realize that 4 months of training was to get your body ready for what to expect on race day. Therefore give your body exactly what it expects on race day. The advice was invaluable.

Real Estate -Real estate can be a very solitary profession. No one will go on the appointments for you. You also have so many options on how to run your business that it can be extremely complicated. The best advice is to get advice. Not just any advice. Find a trusted partner, who knows your business personality and is willing to listen. The right coach/mentor/manager can help your career.

Divide and conquer:

Marathon-No question about it running for 4 plus hours is hard work (mental and physical). An hour into the marathon I crossed the 6 mile mark, I was hurting, there was still 20 miles and 3 plus hours to go. At that moment, a runner behind me yelled, "Great! We only have 10 2mile runs left!". I instantly understood what he meant. This big task can be broken up into smaller more manageable parts. At the 13 mile marker, we were half way home. At mile 17, single digit miles left (9). During training, my wife and I did a 5 mile run along the Chesapeake Bay. It was an effortless scenic run. So at mile 21, I thought back to that run. "5 great miles". This enormous challenge (26.2 miles/4+ hours) became a handful of doable tasks.

Real estate-You too can break down a real estate career into daily activities. How do you sell 20 homes in one year in real estate? Its simple...Daily tasks. Make 3 phone calls, write 3 personal notes, mail one marketing piece to a client, and meet with one client for lunch. The daily tasks will accumulate into weekly appointments. Those weekly appointments will turn into monthly closings. We tend to complicate the business at hand. Keep it simple, but keep it consistent and success will follow.

Goals:

Marathon-Last year, if you told me to go run until I couldn't run anymore I would probably run for 30 minutes then quit. Without a bigger picture, it is hard to get mind and body in sync. 10 months ago I gave myself a goal. On Oct 31, 2010 I will run (not walk) 26.2 miles. I had a singular focus: finish the Marine Corp Marathon. Running 25 miles wasn't going to do it, nor would running 26.2 miles on November 1. One day, one distance. Throughout my training I was able to modify the time I thought I would finish the marathon. Initial I hoped to finish in 4 hours, a month later it was 4hours 30 minutes. The week before the marathon, I felt I could run it in 4:20. Then after I stubbed my toes and strained my calf, 4:50 was my new time. When the alarm clock rang at 5:30 am on Oct 31, I knew exactly what I had to do. At the beginning of the race when runners ran by me, I knew I had to set my own pace and not try to chase them. At mile 20, when it seemed like everyone around me began to walk, I knew I was not going to walk, no matter what. My goals became personal laws that I had to abide by and live within.

Real estate-Goals work hand in hand with your daily tasks. One is pointless without the other. Create goals and stick to them. We tend to give up on our goals too soon because they do not come to fruition immediately. Agents tell me they want to work with more listings next year, or more buyers, or relocation clients. You need to be prepared that your consistent efforts may not produce results for up to 18 mos.

Injury:

Marathon-I hurt my left calf the week leading up to the marathon. I was worried, anxious and somewhat depressed. 4 months of training, entry fees, time away from my family, weekends sacrificed...Was I NOT going to run? My wife answered the questioned succinctly, "You are going to run and finish this marathon." She had to say it a couple times during the week, but those simple words became my mantra. As soon as the race started, my calf began to hurt. I looked up and there was a US Marine running with a shirt that said "Pain is weakness leaving the body". I envisioned that the pain of my calf was actually making me stronger. It sounds crazy, but I got my mind to convince my body that the pain was actually making me run stronger.

Real estate-Bad things happen and they happed when we least expect it. Sometimes it seems like they happen at the worst time or they pile on. Many bad things are unavoidable. What is avoidable is focusing on those "injuries". Surround yourself with positive people, read a good book like Raving Fans or Energy Bus, find inspiration from others...

Days off:

Marathon-One of the most critical parts of training is NOT training. Your body needs time to recover. Muscles need to recoup as well as your mind. Training everyday without breaks can make you HATE running.

Real Estate -I hear fellow Realtors brag that they haven't had a vacation in 5 years. A rested body, mind and soul is a productive one. The opposite is true as well. An overworked, tired, and depressed Realtor is not one I would want to work with.

Fans/Support:

Marathon- I carried little inspirations from my children and wife with me. Before I left the hotel room the morning of the race, my 4 yr old son rolled over and kissed my arm. He said that it was a "running kiss". When I was hurt, I would think about those "running kisses". When I was tired I would think about my 2yr old riding in the jog stroller for some of my training runs. When I was uncertain about finishing, I would think about my 6yr old daughter wanting to run a marathon with me someday. The best part of the Marine Corp Marathon is the finish. There were thousands of screaming spectators, US Marines lining the road, and of course my family.

Real Estate-My business has been built almost exclusively on referral. When you do good work and earn the respect of your clients, they will want their loved ones, co-workers and friends to work with you. You need fans in your business too.

Life is all about perspective. It is not until we push the limits of what is possible that we uncover strengths and skills we never knew existed. Don't let arbitrary barriers stand in the way of your ambition, dreams and goals.

Olney Community Room at the Buffington/Remax Building

2010-12-14T13:18:00.000-08:00

Renters Beware

2010-08-27T09:04:00.001-07:00

I would first like to thank Terry Hogan at the Olney Gazette for listening to my concerns and writing an article about this problem. Please read the following article about Craigslist scams on rentals:

Real estate agents are warning residents to use caution when using Craigslist to search for houses to rent, saying some of the properties they are trying to sell have ended up on the online site as rental properties.

A Montgomery County Office of Consumer Protection official says he is aware of this type of scam and warns users to be careful when using such Internet sites.

Attempts to reach Craigslist for comment were unsuccessful.

Denise Fox, an Olney Re/Max agent, said she listed a house for sale in a Mount Airy senior community on several websites, including Craigslist.

She said someone used the pictures she had posted on her listing and posted the property as a rental property, "listing it for a ridiculously low price to make people want to act quickly."

Although she did not list a second property in Frederick on Craigslist, it appeared online as a rental, she said.

She said people began driving up to the house, looking to rent it. She eventually placed a sign in the front yard stating that the property was not for rent and the Craigslist ad was a scam.

She said both incidents were similar — the person posing to rent the property said he had to leave the country quickly and therefore was unable to find someone he trusted enough to leave the key with. After receiving an application, complete with personal information, and a security deposit, he would make arrangements to send the key.

"I believe they must be getting money out of this, because they continue to do it," she said.

She said her clients, especially the couple living in the senior community, were shaken up by strangers knocking on their door.

Fox said she likely will continue using the free, online classified site.

"I will carefully monitor it, and if any of my listings show up I will flag them, and Craigslist will pull them immediately," she said.

Michael McGreevy, branch manager at Olney Long and Foster, said agents in his office also have found their listings and photographs as rental properties on Craigslist, and the listings typically follow the same scenario — hot property; need deposit quickly; will send the keys overnight.

"At least once a month I have an agent come tell me that they are getting phone calls for one of their listings that was listed as a rental on Craigslist," he said.

He said the problem has been going on for more than a year, but has become more pervasive during the past six months.

Joe Buffington, manager of Olney Re/Max Realty Centre, said the company has asked its agents to monitors Craigslist carefully.

Buffington said that if something is too good to be true; it probably isn't.

"You need to find out who you are renting from and who owns the house before you hand over any money," he said.

Eric Friedman, director of the county's Office of Consumer Protection, said that although the county does not have a lot of reports of this type of scam, it is aware of it.

"You just have to be careful," he said. "Craigslist is like the wild, wild West, as is eBay. A lot of good things happened in the wild, wild West, but there were also a lot of pitfalls. You never know who's at the other end of an online transaction."

He said all rental properties must be registered with the county's Department of Housing and Community Affairs, and landlords must be licensed.

Post Credit Deadline...Whats Going On?

2010-05-12T07:48:00.001-07:00

If our real estate company is any indication of the real estate market post credit....

Things are going to be OK. So 12 days into the world of "no credit" real estate, we have created 13 new contracts (about 1/day). The credit was a very helpful and good thing, but it wasn't the only reason to purchase a home. Jobs and good interest rates are by far and away the 2 biggest incentives for buyers.

I don't believe that these 13 buyers were procrastinators, nor do I think they were unaware of the credits available if they had only put in their offers 2 weeks earlier. These are buyers who are making LONG TERM decisions based on a multitude of factors. That is a great sign! Sure $6500/$8000 is a lot of money, but its not enough incentive for buyers to buy the WRONG home. And that is OK.

Lessons from Roger Bannister

2010-04-23T10:45:00.001-07:00

"Mind over Matter", "Be a thermostat not a thermometer", "Act don't react". These are all a few of my favorite quotes. And they revolve around the mind's ability to make our body do things that other folk's bodies cant', won't, shouldn't, couldn't...

Sir Roger Bannister is immortalized in history as the man who broke the 4 minute mile barrier. It was such an amazing accomplishment at the time. Within 3 years of breaking the record, 16 other atheletes did it as well. What Sir Bannister did was free people's mind. No longer could people say, "Sub 4 min. IMPOSSIBLE".

In the real estate business I see the exact same thing. Our industry, economy, and society constantly create obstacles to the way business has been done. Conversely, the industry, economy and society constantly create opportunities. So what are we going to focus on? What can't be done or what CAN be done?

Competition is good but Competence is better

2010-01-27T07:08:00.000-08:00

There are some debates out there about raising the bar for real estate professionals. I run a successful real estate brokerage with very professional agents who are good at what they do. Furthermore, my business model relies on my ability to grow and attract talent to our company. So the more agents who can get their license, the better off I will be. Right? WRONG!!! But the more agents consumers can choose from, the better off they will be. Right? WRONG!!!

Between 2002-2006 our industry went through a major growth spurt. Real estate became a very attractive profession for some very unprofessional individuals. Some will argue that the easier it is to obtain a real estate license, the more competition their will be in the marketplace. Therefore, the consumer will get the best price for service and everything else will be fine.

Here is what really happen: Due to massive competition some buyers and sellers were able to save on real estate commissions upfront. However, many of these buyers and sellers are feeling the pain of a massive long term financial mistake. This is what we call penny wise and pound foolish.

Yes competition is a great thing. However, many consumers trust that the local licensing boards have set the bar high enough that any real estate licensee they choose, will be a good one. The current market situation is showing everyone that not all real estate licensee are experienced and equipped to represent their clients properly.

So lets correct the assumptions: The more COMPETENT agents consumers can choose from, the better off they will be. Right? Absolutely

Gettysburg Address

2009-09-11T06:55:00.000-07:00

A good friend forwarded me the Gettysburg address just after 9/11. It was written during a seminal period in US history when the existence of our country was in peril. Again on 9/11 our existence was called into question. Abraham Lincoln summed up why it was important to persevere in the face of tragedy.

"Four score and seven years ago our fathers brought forth on this continent, a new nation, conceived in Liberty, and dedicated to the proposition that all men are created equal.

Now we are engaged in a great civil war, testing whether that nation, or any nation so conceived and so dedicated, can long endure. We are met on a great battle-field of that war. We have come to dedicate a portion of that field, as a final resting place for those who here gave their lives that that nation might live. It is altogether fitting and proper that we should do this.

But, in a larger sense, we can not dedicate -- we can not consecrate -- we can not hallow -- this ground. The brave men, living and dead, who struggled here, have consecrated it, far above our poor power to add or detract. The world will little note, nor long remember what we say here, but it can never forget what they did here. It is for us the living, rather, to be dedicated here to the unfinished work which they who fought here have thus far so nobly advanced. It is rather for us to be here dedicated to the great task remaining before us -- that from these honored dead we take increased devotion to that cause for which they gave the last full measure of devotion -- that we here highly resolve that these dead shall not have died in vain -- that this nation, under God, shall have a new birth of freedom -- and that government of the people, by the people, for the people, shall not perish from the earth."

Abraham Lincoln

Don't Call it a Seminar...Its a Give Away

2009-04-30T11:53:00.000-07:00

Every year I somehow catch the "world famous" Bride Dash at Filene's. For those of you who may not know, this is when Filene's department store in Boston discounts their bride's dresses to the ridiculous for one day. Brides and their entourage storm the racks grabbing whatever they can carry. It is a spectacle. However, the pure relief of a bride who just saved $4000 on a dress comes right through the TV.

With that in mind, lets switch gears. The real estate world is going through a similar type of situation. Rates are ridiculously low, there is an $8000 credit for 1st time homebuyers (or those who haven't owned a home in the last 3 years), and the inventory of homes is deeply discounted. But like all sales, this too will come to an end.

If you ever considered purchasing real estate, now might be the right time. We have held 2 home buyer seminars at our office. We had about 35 attendees the first event and 25 folks last night. Come out to RE/MAX Realty Centre on June 3 from 7-9 if you would like to find out if now is the right time.

2008-10-27T11:06:00.000-07:00

Waiting for the Bottom and Other Stupid Ideas...A True Story

I hear over and over again from agents, clients and customers that they are "waiting for the bottom" of the real estate market before they decide on one of their largest long term financial decisions, the purchase of a home. Here is a true story of "waiting for the bottom"...

I have been working with clients for many years now trying to find the "right" property. They know exactly what they want and that is a very good thing (Clients Who Know What They Want and Why I Love Them is a blog for another day...I digress). This spring we started honing in on a couple properties that met every criteria we have been searching for. They had been saving money at a feverish pace and had built a large nest egg close to $200k. However, a little birdy told them that the real estate market had not hit bottom yet and it was not a good time to buy. "Wait till the market hits rock bottom and you can get a real deal". They heard this mantra over and over again at church, work, in print, on line, and on TV. All of these "experts" must be right, they thought to themselves.

So they put their $200k of hard earned money into a "sure thing"...the stock market. The "experts" at church, work, in print, on line, and on TV said nothing negative about the stock market because their field of expertise only extended to real estate. It was settled, "Hold off on purchasing a home that we would live in for 10-15 years to "wait for the bottom" and put all of our hard earned cash in the stock market to gain value."

I got a call last night. The $200k is now $110k. The first words out of his mouth was, "if I had put that money in a house, I would have AT LEAST had SOMETHING to show for it." They have outgrown their 3 bedroom house, they no longer care about "the bottom", but they can no longer qualify for their next home.

They thought of their long term asset (real estate) like a short term asset. Waiting for the bottom is a great strategy when you are trying to buy something to sell tomorrow. With a long term investment, purchasing at the bottom isn't as critical as picking the time to sell at the top.
So all the experts who cautioned my clients on "waiting for the bottom" but did not give such counseling when it came to the stock market...Shame on you.

A Real Estate Analogy...

2008-09-15T12:59:00.000-07:00

So I'm watching the mountain bike finals for the Olympics a couple weekends ago. The TV commentator says, "When dealing with a technical course, one where passing is almost impossible because of the narrowness of the trail, you must ride with the fast riders. If you get caught with a slower pack of riders you will never be able to catch up. The fast riders keep pushing each other while the slower groups keep getting in each others way."

It is along the same lines as, "you play better golf with better golfers.", but most agents don't realize that the opposite is also true, "you play worse golf with bad golfers". I talk to a lot of agents everyday about the companies they work for and the agents around them. Most successful agents succeed in spite of their companies and the agents around them. However, are they reaching their true potential? In a market place where the margin of error is so very slim, you need all the support you can get. Who are the pace setters in your business?

Lessons We Can Learn from Michael Phelps

2008-08-19T13:34:00.000-07:00

There are 3 (and only 3) keys to success and they all start with the letter A. Aptitude, amplitude, and (most important) attitude. Sports creates so many great analogies because the results can be so clear and concise.

Aptitude- Michael Phelps had the god given ability to swim fast...No question about that. However, there are many other good swimmers who have better physical traits, but they are not great. Why?

Amplitude-No matter how much god given talent Phelps has, he had to jump in the pool every day and train. Showing up seems like the easiest part of the success, but consistency is vital to greatness. But even showing up doesn't guarantee greatness. Why?

Attitude-Above all this is the most significant key to success. Phelps had to dream that he would be able to set the record. Without that goal, getting out of bed at 5am to swim in the same boring pool, every morning, would have been near impossible. Consider this, Phelps had the worlds largest bull's eye on him. Phelps could have caved in mentally with all the pressure the media and competition placed on his shoulders, but he didn't. Why? Because he dreamed that he would win.

Big Real Estate Company v. Small Real Estate Company...Why not both?

2008-07-14T12:12:00.000-07:00

Whether you are looking to list your home, buy a home, or even start a career with a real estate company...you have choices. Recently I heard a debate about the merits of a small company over a large one. Here is how it went (the names have been changed to protect the innocent):

Agent Napoleon: We have hands on training and management. That means our clients get PROFESSIONAL service.

Agent Rasputin: But we have more tools and resources. That means our clients get MORE services.

They both were right...So why not get both? If you search hard enough you can find real estate companies that provide the high touch service of a small company PLUS the resources of a large international one. Here are a few factors to identify:

1. Find out how much high level training is done on site. Not just prelicensing and contract review, but hard core business development and skill sharpening. The higher level training is what separates the good from great. Keep in mind, even Tiger Woods has a coach.

2. Where are the broker/owners? Are they available? Active? Ask to speak with them. It can be easy for a leader to make decisions when they are isolated from the results. Many onsite owner companies are held to a higher standard of accountability because they are more accessible.

3. Last but not least, what is the power of their brand. Some of the franchise companies offer international exposure as well as aggressive local marketing. Many clients are coming from outside of the local area and may not be familiar with the local brands.

Do You Spend Money Advertising Your Listing? Attraction Vs Satisfaction

2008-06-17T12:43:00.000-07:00

Why are you doing it? Sounds like an obvious question, but if you don't understand your true purpose you are likely to spend money foolishly. Spending money to cause a property to sell has a very small chance of success. As a rule, you should never spend money to cause a property to sell! You can't compel a market response. There are however value reasons to advertise a property. The two most effective are attraction and satisfaction. Are you advertising to attract potential buyers and new listings to your business? Are you advertising to satisfy your seller's expectations? If the purpose is lead generation, it should be pre-planned, tracked and the response measured over time. Know your return on investment on every 'attraction' dollar you spend. Satisfying your seller's expectations should also produce leads for your business, if it doesn't it is money poorly spent. Your advertising budget should be set in advance.When a seller calls to ask "what are you doing to get my property sold?" running another ad is not a proper response because it will not compel a market response. Always stick to your marketing plan, it worked for all your other clients right? A seller's motivation may change and their patience with the process will often become short, explore the changes in motivation and take the appropriate professional response to create a successful result for your client and your business. Take charge of the situation! Take charge of your career.

I have solved the National Foreclosure Issue-Pres. Bush please call me.

2008-04-21T11:55:00.000-07:00

Currently we have many folks who are facing short sale/foreclosure who want to keep their homes but can no longer afford the new payments, so they come on the market as short sales/foreclosures. With each one of these cases coming onto the market, the overall situation only gets worse for the person selling after them and in the big picture, the national economy which will have to "clean up" the mess. So what do we do...

First, do the homeowners want to stay in their homes? If yes, then we need to find out what can they afford monthly payment wise under an FHA program. That will be the new loan amount. (Let me stop and explain a little more) They owe $400k, we refinance them to a new FHA loan amount which they can afford, $300k. (The new loan amount would have to be a minimum of 70% of the previous balance.)

So now what do we do with the $100k short fall? Instead of having a foreclosure to sell or a large short, the bank will be able to write the "bad debt" off their books and hold a $100k note. When the people go to sell the home a later date they will still owe that $100k back to the bank. Time will help the process. Currently, it is a race to foreclosure.

So the banks get to clear non-performing loans out of their portfolio, the real estate market will be much more stable with 1/3 to 1/2 less homes on the market that are foreclosures or priced for foreclosures, and the tax payers do not have to pick up a huge tab on a loan bailout.

Don't Read This Blog If You are Buying a Home Right Now!!

2008-03-21T14:12:00.000-07:00

Why?

Because you are one of the many people who are taking advantage of one of the best real estate markets in recent times and you don't need any of the advice I have.

WHAT!!

That's right. Interest rates are at historic lows, home prices have dropped, and the number of homes to chose from is at a historic high. Econ 101, when is a good time to buy? When everyone is selling.

TRUE.

This is not a market for everyone. However if you are a first time buyer, move up buyer or an investor, take a look at the marketplace objectively.

First time homebuyers have "nothing to lose". Rents are increasing, while home values have come down considerably. Many loan programs have become restrictive, however the once in a lifetime interest rates are an awesome incentive.

Move UP buyers are those who are selling in a lower price range and buying into a higher price range. First you must understand that your current home value has probably dropped about 10% in the last 12 months. However, the home you want to purchase has probably gone through the same depreciation. For example, your $400k home dropped $40k in value. Your dream home at $900k dropped $90k. So the move up buyer just added $50k in equity.

Investors...Remember, Its a Wonderful Life. Mr. Potter bought while everyone was panicking. Sure we don't strive to be Potter-esque, but he was a smart enough to understand when there were great market opportunities.