Viewing by month: August 2009

Real estate and ethics

Demanding ethical behavior from people is not a big ask, regardless of which industry you work in, what walk of life you come from, or who you work for or with. I’ve posted before about some of the less than flattering stereotypes that real estate agents have garnered over the years, and sadly due to the actions of some less than scrupulous individuals, deceit and lack of ethics have come up on occasion. But in order to be successful in real estate, how you conduct yourself and your business must be based on ethics.

  

Sadly you can’t force people to be ethical and this rings true for real estate agents, like anyone. If you manage real estate agents, you will know that to be ethical, they must realise the importance of ethics, and this is vital in building trust in relationships. Very few vendors or buyers want to work with a real estate agent they don’t feel they can trust, and ethical behaviour eliminates that fear. In this sense, a strong show of ethics can be one of your most profitable strategies.

  

Ethics are intrinsically linked to a person’s morals and a person’s perceptions of what is right and wrong and good or bad.  Being ethical, and ultimately being successful in business, isn’t a new concept either. Dating back to Ancient Rome, philosopher and statesman Cicero encouraged business people to revise their thinking and believed that real success comes from not from trickery and deception, but from moral goodness, in both thought and action.

The problem is, you often can’t tell at first who is and who isn’t lacking in ethics. The deceitful agents look just like the honest ones on the surface and are often charming, considerate and knowledgeable. But bad behavior in business has a tendency to come back to bite you on the behind, and when it comes to real estate, it’s imperative that real estate agents stop thinking about who is right and start thinking about what is right, and ethics will be what guides you down the right path.     


0 comments | Posted by Charles Tarbey on 31/08/2009 at 9:36 AM | Categories:

GFC solutions

I thought since today is Friday I’d write about something incredibly serious to take us into the weekend. Namely the GFC and our current recovery from it. Because I’ve just been reading about this and it’s relevant to the real estate market, and since the weekend is a time to chill out I thought I’d purge my stressful thoughts here so I can skip to the pub after work with a clear head.

  

We all know that the real estate market has been in recovery mode since the financial crash towards the end of last year. We also know that the United States was hit a lot harder than we in Australia were, for which we are grateful, but which also provides us with some learnings in regards to how things which everyone thought were fine and dandy can go so terribly wrong.

  

And this is where I begin. I was reading about Wall Street’s new plan to recover from the bad debt and dodgy mortgages that have been dragging the financial markets down since everything went pear shaped. Basically that plan, and what’s now happening is investment banks have started to repackage old mortgage securities and sell them as new products. The problem is their plan seems to be a lot like what got the banks into this predicament in the first place, but then there has always been merit in that saying “history repeats itself”. An economics professor in the USA has admitted that the scenario has a touch of déjà vu about it, but that at the end of the day the strategy could actually help end one of the more stubborn problems of the GFC.

  

In layman’s terms, what happened first time around is that when home prices skyrocketed, banks bought risky mortgages and packaged them with solid ones. They then sold these as top-rated bonds, and with an abundance of investors clamering for the product, lenders provided even riskier mortgages, even for people who couldn’t actually afford them. They could do this because they would get packaged up and end up as a AAA rated bond. When the bottom fell out of the market it was pretty much impossible to tell what these packaged bonds were worth, and with buyers knowing some of the bundle was worthless, they didn’t want to pay full price. Ay carumba!

  

Banks are now trying to find a solution, one of which involves really good bonds getting bundled with those that are not so great and the banks give them AAA ratings meaning they’re a safe investment. Sounds familiar doesn’t it! The difference apparently is that unlike when the real estate market was booming, investors now know what they’re buying, and there’s also a guarantee. Those buying into the super risky bonds agree to take some of the risk from those buying more safely. The safe investors get paid first, and the risk takers lose money first – it comes down to maths. Of course there are still risks and some are the same as the first time around, but with the banks still suffering from the recent crash, it’s likely to take much longer for that to happen.



And that’s enough brain boggling real estate investment talk for a Friday! I feel much better.
  
1 comments | Posted by Charles Tarbey on 28/08/2009 at 9:46 AM | Categories:

The art of negotiating

For many people the thought of negotiating can result in a cold sweat and even contemplating saying anything other than a straight “yes” is simply not an option. But to be a good salesperson or marketer, which is essential in this little game of real estate, you’re going to need to be able to master different sales negotiation skills. Good negotiating skills will prove invaluable not just in business, but in many aspects of your life (especially at those night markets on your next holiday!) and can act as your weapon against difficult customers or vendors. In today’s environment of heightened competition, you need to be a keen negotiator in order to close current deals and secure future ones.

  

An important step in becoming a great negotiator is learning how to say no. Not just handy in negotiating, but handy in so many aspects of life –shame I haven’t yet mastered it when it comes to being offered more wine or cigarettes. When you’re dealing with customers, saying no can be incredibly difficult, especially when you like the person you’re turning down. It’s often easier to act like you need to consult someone else to make it appear like the decision is actually somewhat out of your hands – like saying “I’ll see what I can do.” This also doesn’t really work when you’re your own boss, as many of us in real estate ultimately are, and if you know that ultimately the answer is going to be no, it’s better to get to saying it sooner rather than later. What did I say about procrastination yesterday? It also applies here. So many lessons, such a small blog! Amazing!

  

Another important skill to have is the ability to build rapport. In real estate, this is essential. You’re dealing with a highly personal, often highly emotional product and sale, and the people you deal with want to be at ease with you and feel like they can trust you. Even if you have the best commission rate in town, if you rub people the wrong way and pretty much everyone prickles at the sight of you, you may not be doing as much business as if people enjoy your company. When people feel they relate to you, your chances of negotiating are much better, and if you do have to say no as mentioned above, they’ll probably take it a lot better. In a nutshell, learn to be nice.

  

Part of this is being a good listener, another key skill in negotiating. Lots of people think they’re listening when they’re actually just keeping an ear out for a pause so they can jump in. Listen to and actually hear what your customers are saying. Listening shows respect and amazingly it even tells you what people want and think! As much as real estate agents can have going on in their heads at any given moment, it’s important to focus on a customer, whether a vendor or potential buyer, to help your negotiating prowess and powers. Maintaining eye contact with the person you’re talking to is a very good way to ensure you’re actually listening. Staring off in the distance is highly likely to encourage your mind to wander the same way.

Negotiation skills are an asset to everyone, not just those of us in real estate. And for those of you who are customers, having the ability to negotiate in your own right will pay off in many aspects of your life, not just in regards to securing your dream home.





 


3 comments | Posted by Charles Tarbey on 27/08/2009 at 9:00 AM | Categories:

Dealing with procrastination

There’s a little term that starts with P which refers to something most of us embrace wholeheartedly more often than we should. Amazingly it’s not Pinot Gris, although the frequency with which I embrace that P comes pretty close for me. I’m talking about procrastination. We all do it. We put things off that we shouldn’t and we wait days to do something that could have been done straight away. We wait and hope the task magically disappears although we know full well it won’t. We get the guilts and tell ourselves we’ll get to it when we just have time, or when I just finish this, and only when it’s absolute crunch time do we force ourselves to just get on with it. And usually the thought of whatever it was we were putting off is actually worse than the job or act itself ends up being.  


Procrastination is a curse that few of us seem to be free of. The funny thing about it is, all of us know how bad it can make us feel, but it still doesn’t stop us from returning to it time and time again. Hmm, I see another link with the Pinot Gris there…but I digress. Procrastinating reduces opportunities, messes with progress and often sets us up for failure, or at least a result that is well below what we could have achieved had we not doddered around wasting time for so long.

  

Working in real estate, many people find there is no exception to putting off what you should be doing right now; I’ve posted about it before. Making the phone call to break bad news, or tell a customer that there is no news on the sale of their property. Meeting up with a difficult client – there are lots of things real estate agents can procrastinate about, but in the enlightened words of author William James, "Nothing is so fatiguing as the eternal hanging on of an uncompleted task."

The problem with most tasks that end up being subject to procrastination is that there isn’t an immediate perceived negative outcome or risk. That’s why we leave them to the last minute – only when we realize the paperwork fairy isn’t going to magic away what we’ve been putting off for days and we could risk a client if we don’t suddenly pick up the slack, do we jump into action. But imagine all the niggling inner voices you could silence or the peace you’d have if you really did stop procrastinating and just knocked off that job you’re dreading. It makes you wonder why we don’t. But I’ll think about that tomorrow.

 


0 comments | Posted by Charles Tarbey on 26/08/2009 at 9:09 AM | Categories:

Real estate basics

Everywhere you look there are conflicting reports and opinions on the real estate market. Some say it’s a great time to invest in real estate, others say to stay away. Some say the first home buyers are the only buyers, others say investors are starting to go head to head with this group. But as I have said before, regardless of which opinion you listen to, if investing in real estate crosses your mind at all, you need to take into account what a big decision it is, and buying any property requires planning, setting financial goals and looking at the type of lifestyle you want.

  

Once you’ve taken stock of your situation, if you come to the conclusion that you have the time, finances and lifestyle that lends itself to managing a real estate investment, you’re halfway to making it happen. But there are still a few real estate basics to take into account.

  

Most of the time, it’s wise to buy your own home first – the one you’re actually going to live in. Most people agree that as well as giving you a roof over your head, purchasing your home teaches the true cost of property ownership – things like financing and fluctuating market conditions and the impact on your property value. If your situation allows it, the first home you buy could become your first investment property if instead of selling to move, you rent the property out instead. The one exception to the buy your own home rule is for those people living at home, or in another situation where the rental costs are incredibly low. If you can rent below market value it’s probably wise to stay put and buy investment property with all the money you’re not spending on rent.

  

Another point to take heed of I have spoken about before – education. I can’t stress enough how important it is to know what you’re doing when you’re looking at buying real estate. Research and read and speak to people as much as you can. Get professional help and advice to assist in your decision making, and learn about the market. Leave no stone unturned in your quest for real estate greatness!

 

Like any investment, there are likely to be ups and downs in the life of your real estate portfolio, and some experts say you should have an exit strategy in place. I’m not so sure about this because if you do things right, do your homework and don’t put yourself in a position that you are unable to sustain, you may not necessarily need one. I read a great quote recently from a real estate investment advisor, who says if you buy right and have a long term plan for your real estate investment, you shouldn’t need an exit strategy. In his words, "When you've got the goose that lays the golden egg, be satisfied with the golden egg.” 


0 comments | Posted by Charles Tarbey on 25/08/2009 at 9:50 AM | Categories:

Real estate in the online world

In the not so distant past if you’d mentioned real estate and the internet in the same sentence people would have thought you were crazy. For a long time many even in the industry thought the two had nothing to do with each other. But how things have changed! Not only do the majority of home hunters head online as their first port of call to search available properties, but the majority of agents are now realizing the importance of optimization through activities like blogging, tweeting, creating a facebook or linked in profile – the list goes on.

  

Although I don’t profess to be an online guru by any stretch, as I get more and more involved with how the internet and real estate work together, I have become increasingly interested in how people search for real estate and property through the likes of Google. One argument that comes up often is the use of longtail keywords or general terms. At first glance, it would make sense that all the real estate agents are vying to rank highly for broad terms like real estate. But the more I learn about the crazy place that is online, I realize that it can be more rewarding to go after a very specific keyword or set or words or terms rather than it is to fight it out for something more general.

  

Obviously one of the biggest arguments against longtail keywords is that they can become so specific that a much smaller group of people are likely to search them. So the reverse is true for more general terms – more people search them more often, and one thing I know about branding is that you want to be in front of as many people as possible, as often as possible. So both options have merit. But sadly, not many organizations have big enough budgets to ensure they constantly appear for the general terms, and that’s where the longtail words start to make more sense – at least for me.

  

I believe that the more specific someone is when they search, the more serious they are, making them a more genuine prospect. And when it comes to buyers and sellers, that’s an ideal lead for a real estate agent. Someone searching very broadly for real estate in Bondi for example is less likely to be as close to buying as someone who searches for a 3 bedroom, 2 bathroom apartment in Bondi. When people know what they want, more often than not, it’s easier to assist them. So even if those longtail words are only searched ten times per month as opposed to the general searches that may take place ten times more frequently, that’s ten genuine, serious buyers or sellers that ended up talking to you because you gave them what they wanted.

And for many, optimization is such a new part of business that the way I look at it, it can’t hurt to try either way.    
0 comments | Posted by Charles Tarbey on 24/08/2009 at 9:45 AM | Categories:

Real estate truths

I’ve mentioned before how important honesty is in the real estate game. I’ve also blogged about stereotypes linked to certain professions, and that sometimes telling the truth isn’t right up there when people think of real estate agents. When it comes to the people I work with at Century 21, I am confident in saying this is a myth. I like to tell the truth, and the people I work with do too. In fact, it’s not a choice. Honesty is the only option.

  

This doesn’t mean that telling the truth is fun, because often it’s not. It’s not great telling an owner that the sale of their house fell through, or that the feedback from an open home was less than positive. I do believe the truth can be delivered tactfully enough to make it easier to hear, but at the end of the day, the truth needs to be told for everyone’s sake.

  

However, it would seem not everyone is big on the truth. Some people who pride themselves on always telling the truth often don’t want to hear it for example. Many of us are guilty of this. At times, the truth does just totally suck. Maybe yes, your bum does actually look big in that, or maybe yes, your home really does smell of dog, but at the end of the day these types of responses are possibly what people actually need to hear.

  

When it comes to buying or selling a home and things aren’t panning out in an ideal fashion, telling the truth can end up causing hurt, disappointment or can shatter the illusions someone has about a particular kind of house, and it’s understandable (although not acceptable) that this is why the truth is sometimes stretched. Vendors sometimes don’t want to hear, or believe how much their home will actually sell for. A buyer may not want to hear that the home they’re convinced they can buy doesn’t actually exist in their price range, or their ideal suburb. But still, the truth is something that they need to hear.

One of our Century 21 real estate agents was recently referred to in the editor’s letter of a national magazine for this very reason. The editor was expressing her shock at the disarmingly honest nature of her real estate agent, who did in fact tell her that her house smelled like dog, and that the outside of the property needed to be updated before she could possibly show any potential buyer through. Despite the editor’s initial misgivings, truth prevailed, and the property sold and the vendor nationally praised her agent for everything – including telling the truth.  


0 comments | Posted by Charles Tarbey on 21/08/2009 at 3:02 PM | Categories:

The joy of garage sales

One thing that often accompanies a move to a new home is getting rid of things you decide you no longer need. Some people throw everything straight out, others take bags of unwanted items to charity stores or drop points, and others endure the pain of the garage sale.

  

Amazingly, garage sales are becoming more and more popular amongst homeowners. Considering many are still finding the current economy a tad bumpy, many buyers and sellers are finding it makes better monetary sense to sell what they no longer want rather than throwing things out, giving stuff away, or paying to store unwanted items somewhere. I often find once you put something into storage you forget you have it anyway, and when the time comes to retrieve it you end up wondering what you were thinking when you decided to keep it.

  

I find the whole business of garage sales highly amusing, probably because I have never held one myself, and I’m sure if I did I wouldn’t consider it so funny. Based on the horror stories that accompany many a yard sale, the chances of me venturing down this particular path of selling remains slim, and I’ll stick to selling real estate I think.

  

From what I can gather, people always show up to garage sales earlier than you tell them to, and if you’re not set up they’re prepared to knock on your door and ask when you will be. Buyers criticise your stuff loudly to their companions to give themselves some haggling ammunition, and then bargain with you over items that are marked at $1.50. What I don’t understand about that whole process is, if it’s so bad, why would they want it at any price? As I said, the whole concept baffles me. But, I am clearly in the minority as holding and attending garage sales is big business and consumes many a person’s weekend. With this in mind I thought it may be pertinent to provide a couple of small tips to make the process less horrendous than it already appears to be.

 


Firstly, treat your garage sale like any business exercise. You may think this is a silly notion, but it has merit. Check with your local council to make sure there are no restrictions or guidelines relating to garage sales so it doesn’t get shut down. Check out your competition, too. If there are frequent sales around your area (apparently some people do this regularly!) go have a look so you can see how things are laid out, how they’re run etc. If your neighbours are nice, they may even give you advice!



Secondly, figure out where you’ll be holding the sale. This may sound like common sense, but if there’s no clear indication of where your sale area begins and ends, you may find yourself fighting off people who take a shine to your incredibly new and expensive outdoor furniture.  


 

Also spend some time considering what you actually want to sell. The more you have on display, the more people you’re likely to attract and the more chance you have of getting rid of your stuff.  Price some items cheaply to offset the more expensive things you’re pitching, and make sure your price tags are clearly visible.

And finally, promote your sale! Even consider your local paper to attract your local hardcore sale attendees who leave and breathe these events. On that note, I’ll be thinking of you as I sleep in past those 6.30am knocks on the door from the really eager buyers wondering why your stuff isn’t out yet.



of Canada this summer, make sure you have lots of plastic sheets handy to throw over your goods and wares when that sudden thunderstorm arrives!
 


6 comments | Posted by Charles Tarbey on 20/08/2009 at 12:31 PM | Categories:

Mistakes in real estate

I blogged yesterday about how important it is to keep a sense of humour when it comes to business because it shows your human element, and it doesn’t mean sacrificing your professionalism. Thinking about this made me realize something, and that’s although people want you to be human, they seldom accept that you make mistakes. Interesting concept isn’t it!

  

At Century 21 we pride ourselves on being real estate experts, but that doesn’t mean each and every one of us is perfect or immune to mistakes. I’ve posted on this topic before too. Human error is everywhere – I am sure that’s the reason I end up with so many speeding fines, for example. But seriously, when you are taking on the role of a professional service for someone else, in the case of Century 21 it’s selling someone else’s home, everyone expects you to already be perfect, and as if that’s not enough, they then want you to improve on that.  

  

In our day to day activities, everyone knows that people make mistakes, and everyone accepts that they personally make mistakes, regardless of how much it smarts to admit it. The problem about making mistakes when you’re selling someone’s home is that there is usually an emotionally invested person (or persons if you’re really lucky) there to tell you just how big a mistake you made. 

  

The best real estate agents are those who acknowledge when they’ve made a mistake, and know how to correct it – quickly. It’s natural to want to do everything right, and this is heightened when you are working on behalf of another party and you are accountable to more than just yourself. Admitting you are wrong, or that you’ve done something wrong, takes a lot of self-confidence, and this is absolutely something you want from the person selling what is likely to be your biggest asset.

Learning to recover from your mistakes, and improve as a result of them, is a key component to being a successful real estate agent. The worst thing you can do is dwell on a past mistake, because it’s likely to cloud your view of what you should now be focusing on, and is more likely to lead to another one. Don’t let your past mistakes get in the way of doing the right thing by your customers in future. Your clients are people too, and they (hopefully) have made their own mistakes so will be tolerant of yours (to an extent.) It’s easy to forget to return a phone call or run late for an appointment, but admit your errors rather than downplaying them or pretending you’ve done nothing wrong. Hey, you could even throw in the humour element I spoke about yesterday and chances are your customers will end up respecting you even more.    


0 comments | Posted by Charles Tarbey on 19/08/2009 at 10:20 AM | Categories:

Serious business still requires humour

There’s a line about life being too important to take seriously, or something in that vein at least, and it’s an interesting thought to apply to work. Working in real estate, we’re dealing with what is an incredibly important decision for many people. With this in mind, of course you need to approach your employment in the real estate industry with professionalism, but I’ve learned that sometimes you don’t have to be so serious to be taken seriously.

  

Having a sense of humour is an incredibly important part of personal interactions and most people respond well to someone who can make them laugh, or who is at least capable of eliciting a smile. The corporate world is renowned for training employees to behaving in a certain way, and some employee manuals I’ve seen even outline how to behave down to what I consider to be fairly ridiculous levels. So when you start your own business, like our Century 21 franchises have, it can take a little while to work out your own style of doing things. But realizing you can be yourself – and not so serious – means you’ll end up doing business with likeminded people who want to work with you because of you, and the great things you can offer.  Of course you still need to run a successful business, and if your personal brand of humour is based around prejudices and sarcasm for example, chances are people may not warm to that, and you should probably stick with being serious.

 

Even if you join an international network like Century 21, you are still your own brand within that, and your potential customers will either connect with you, or they won’t. A big internationally recognised brand may get your phone to ring, or the people to your door, but it’s your responsibility to keep them there and close the deal. Humour can be a big part of this – at the end of the day yes, your customers want professional service and a real estate expert, but they also want to deal with a real person. And nothing makes people warm to you faster than the ability to make them smile. Or selling their home in 24 hours, of course.   


1 comments | Posted by Charles Tarbey on 18/08/2009 at 9:56 AM | Categories: