I'd love to know the success rate of Realtors placing ads on craigslist. I know it's easy to put on, it's free and anybody can find it.
To me though it just seems a mess.
Why would you take even 5 minutes to put a listing in something that is virtually unsearchable by specific data such as bedrooms, baths, price and sqft? Most times Realtors don't even put on pictures. They are once again grasping at straws and shooting in the dark hoping to get that one call.
Focus people! Internet/MLS and Yard signs are no brainers. If people are on craigslist they are looking for a FSBO. They'd be on a local MLS search or Realtor.com if they were really serious about house hunting. They'd be driving around the area where they want to live. They'd be listening to their friends about new houses that just came on the market in areas they are familiar with.
Marketing is important and if done correctly will reduce the number of ridiculous lookee-loos and HOURS you spend talking to them. Be very specific about your targeted marketing, stay away from small percentage success tactics and stick to the basics. You'll save time and money.
If you get so big that you've got money falling out of your ears, go ahead... spend the time promoting your business in large forums to reach that extra level. Just make sure your methods and successes are already in place prior to it.
Jay Bowman, Broker
60 Day Realty
Louisville, KY
502.641.9169
Monday, May 26, 2008
Tuesday, April 29, 2008
Campaign of Letters
Ok... so I started a daily mailing campaign to test out an Expired/Canceled Listing letter I found on the internet.
Of the 100 or so I sent out, I expected a 1-3% call back rate.
No such luck. No calls and though I attempted to weed them out over 20 letters were returned stamped VACANT.
I even switched up the last batch I sent out by putting the company address label on the back of the envelope and placing a penny inside.
I should probably follow standard protocol by using non-flag stamps, odd shaped envelopes, avoiding putting my companies name on the return label (WHICH is to be placed on the back flap of the envelope) and just tucking the flap into the envelope. No licking.
Do you send out expired listing letters? Canceled listing letters? What do they say? Do you have a special trick to get people to call you? So many questions.
Of the 100 or so I sent out, I expected a 1-3% call back rate.
No such luck. No calls and though I attempted to weed them out over 20 letters were returned stamped VACANT.
I even switched up the last batch I sent out by putting the company address label on the back of the envelope and placing a penny inside.
I should probably follow standard protocol by using non-flag stamps, odd shaped envelopes, avoiding putting my companies name on the return label (WHICH is to be placed on the back flap of the envelope) and just tucking the flap into the envelope. No licking.
Do you send out expired listing letters? Canceled listing letters? What do they say? Do you have a special trick to get people to call you? So many questions.
Friday, April 25, 2008
NAR Statistics
I've had many discussions with many different Realtors about what sells houses. Realtors, ads, Open Houses... the list goes on and on.
After doing my research I found the National Association of Realtors 2006 statistics on how buyers found their home to purchase. I kept forgetting the blog name so I've decided to link to it HERE.
In 2006 the stats broke down like this:
36% Agent
24% MLS
15% Yard Sign
8% Friend or Relative
8% Builder
5% Newspaper
3% Knew the Seller
1% Homes Book or Magazine
less than 1% All Other Options
I look at these stats from two years ago and a few things immediately jump out at me. The MLS is what agents use to find property and it is readily available to the general public through many websites. I believe we can safely combine them together.
The MLS available through the internet is where 60% of home buyers found their home.
8% found the home through a friend or relative telling them about it. 3% found it by knowing the seller. Either way, the home was found by a middle man who was or knew the seller. Word of mouth about the listing moved the property regardless of channel so I group them together: 11%
Newspapers and the home magazine advertising combined make up a whopping 6%.
So with the adjustments this is the way I see buyers finding properties:
60% Internet/MLS
15% Yard Sign
11% Word of Mouth
8% Builder
6% Advertising in Periodicals
less than 1% All Other Options
To me, in this day and age, standard real estate no longer makes sense. 5-7% commission is charged to the seller when it is obvious that the internet, a yard sign and word of mouth from people sellers know will make up 86% of the reason a buyer will find a house.
Look at that again: 86%
Realtors pay yearly dues to belong to the various associations.
A yard sign costs... $60-$100 depending on quality?
Realtors don't control word of mouth.
Yet for a 6% success rate Realtors justify high commissions in ridiculous, aged, convoluted periodicals. I don't see a high rate of return on that. With this stat it only makes sense that the true reason Realtors advertise or do open houses is to pick up buyers while sellers pay for it. The sale rate is far to low for them to say otherwise.
Sellers still believe this form of advertising is important b/c Realtors say it is. I'm not sure which party is the less educated in the statistics.
Please someone tell me why a 6% commission is justifiable in this day and age. I would love to know.
Jay Bowman
Broker/Owner
60 Day Realty
Louisville, KY
60dayrealty.com
After doing my research I found the National Association of Realtors 2006 statistics on how buyers found their home to purchase. I kept forgetting the blog name so I've decided to link to it HERE.
In 2006 the stats broke down like this:
36% Agent
24% MLS
15% Yard Sign
8% Friend or Relative
8% Builder
5% Newspaper
3% Knew the Seller
1% Homes Book or Magazine
less than 1% All Other Options
I look at these stats from two years ago and a few things immediately jump out at me. The MLS is what agents use to find property and it is readily available to the general public through many websites. I believe we can safely combine them together.
The MLS available through the internet is where 60% of home buyers found their home.
8% found the home through a friend or relative telling them about it. 3% found it by knowing the seller. Either way, the home was found by a middle man who was or knew the seller. Word of mouth about the listing moved the property regardless of channel so I group them together: 11%
Newspapers and the home magazine advertising combined make up a whopping 6%.
So with the adjustments this is the way I see buyers finding properties:
60% Internet/MLS
15% Yard Sign
11% Word of Mouth
8% Builder
6% Advertising in Periodicals
less than 1% All Other Options
To me, in this day and age, standard real estate no longer makes sense. 5-7% commission is charged to the seller when it is obvious that the internet, a yard sign and word of mouth from people sellers know will make up 86% of the reason a buyer will find a house.
Look at that again: 86%
Realtors pay yearly dues to belong to the various associations.
A yard sign costs... $60-$100 depending on quality?
Realtors don't control word of mouth.
Yet for a 6% success rate Realtors justify high commissions in ridiculous, aged, convoluted periodicals. I don't see a high rate of return on that. With this stat it only makes sense that the true reason Realtors advertise or do open houses is to pick up buyers while sellers pay for it. The sale rate is far to low for them to say otherwise.
Sellers still believe this form of advertising is important b/c Realtors say it is. I'm not sure which party is the less educated in the statistics.
Please someone tell me why a 6% commission is justifiable in this day and age. I would love to know.
Jay Bowman
Broker/Owner
60 Day Realty
Louisville, KY
60dayrealty.com
Thursday, April 17, 2008
The "Please Wake Up And List With Me" Letter
On any given day in the city of Louisville there are roughly 10-20 Expired and Canceled listings. Before the Do Not Call list appeared in the world, I would be on the phone around roughly 9am to call these people to see what their intentions were and do my best in the 30 seconds I had to convince them that I was the only person who could sell their house.
Now it is a little more difficult to get a hold of people.
Many people are on the DNC list and even if they aren't you still have to comb THROUGH the list to get the number. Then you hope they are home, still have the same number or have a home phone at all.
That's why I'm relying on the good ol' US Postal service from here on out.
I've never been a big fan of shoving myself in people's faces to get a listing. I apply slight pressure, smile a lot and let them know the program I have can benefit them. If they are unable to see the benefits beyond that, that is their decision. I would chose to work with the people who, through careful thought and logic, would chose me and my company.
I found a letter on ActiveRain written a couple years ago by a man in Florida. He laid out exactly what he sent and says he gets a 1-3% success rate. To be honest, I think it could be better than that using a couple other techniques, but it was only the letter I was interested in.
So since last week, I've mailed out roughly 50 letters. Homemade letter head (looks cheap but will do for now), white envelopes, printed labels and handwritten addresses will hopefully entice people to open the letter.
I don't seal the envelopes. I just tuck the flap in. I stick a penny in each envelope to add an odd weight to the letter. If it moves in the envelope, hopefully it will further draw attention to my call to action.
Yellow Letter Campaign states that you should use "announcement envelopes" to send information out like this since it stands out amongst the other 12" envelopes, making it more likely to be opened. Use a commemorative stamp instead of the regular flag stamps and use red felt ink pen to write with. All these things help draw attention to your letter.
I haven't taken all these steps as of yet. Just trying to start to figure it out.
Do you send letters to expired or canceled listings? What is your success rate? What do you do that works? Please let me know in the comments!
Now it is a little more difficult to get a hold of people.
Many people are on the DNC list and even if they aren't you still have to comb THROUGH the list to get the number. Then you hope they are home, still have the same number or have a home phone at all.
That's why I'm relying on the good ol' US Postal service from here on out.
I've never been a big fan of shoving myself in people's faces to get a listing. I apply slight pressure, smile a lot and let them know the program I have can benefit them. If they are unable to see the benefits beyond that, that is their decision. I would chose to work with the people who, through careful thought and logic, would chose me and my company.
I found a letter on ActiveRain written a couple years ago by a man in Florida. He laid out exactly what he sent and says he gets a 1-3% success rate. To be honest, I think it could be better than that using a couple other techniques, but it was only the letter I was interested in.
So since last week, I've mailed out roughly 50 letters. Homemade letter head (looks cheap but will do for now), white envelopes, printed labels and handwritten addresses will hopefully entice people to open the letter.
I don't seal the envelopes. I just tuck the flap in. I stick a penny in each envelope to add an odd weight to the letter. If it moves in the envelope, hopefully it will further draw attention to my call to action.
Yellow Letter Campaign states that you should use "announcement envelopes" to send information out like this since it stands out amongst the other 12" envelopes, making it more likely to be opened. Use a commemorative stamp instead of the regular flag stamps and use red felt ink pen to write with. All these things help draw attention to your letter.
I haven't taken all these steps as of yet. Just trying to start to figure it out.
Do you send letters to expired or canceled listings? What is your success rate? What do you do that works? Please let me know in the comments!
Thursday, April 10, 2008
Ummel v. Little
phoenixrealestateguy.com reported earlier today that the jury in Ummel v. Little have sided with the agent.
This case, and the fact that the jury has sided with the agent, was HUGE.
In the whole mortgage meltdown there is one party, in my eyes, that is less culpable than buyers, banks and appraisers: Realtors.
As we all know it is a very inexact science in determining the value of a home. For Buyers to turn on their Realtor for incompetence is understandable. For a Buyer to scream b/c the house they bought is no longer worth what they bought it for is an unfortunate market reality right now. BUT to blame the Realtor for all that has gone wrong is ludicrous. The sellers listed the property, but in reality the buyers determine the value. Realtors are the facilitators.
It is our duty to make sure the Buyer finds the right property, understands the terms of the contract then we do a LOT of hand holding. We can help people understand why something is priced where it is, but we don't determine the price.
Am I off base here? What can we do to further defend ourselves?
This case, and the fact that the jury has sided with the agent, was HUGE.
In the whole mortgage meltdown there is one party, in my eyes, that is less culpable than buyers, banks and appraisers: Realtors.
As we all know it is a very inexact science in determining the value of a home. For Buyers to turn on their Realtor for incompetence is understandable. For a Buyer to scream b/c the house they bought is no longer worth what they bought it for is an unfortunate market reality right now. BUT to blame the Realtor for all that has gone wrong is ludicrous. The sellers listed the property, but in reality the buyers determine the value. Realtors are the facilitators.
It is our duty to make sure the Buyer finds the right property, understands the terms of the contract then we do a LOT of hand holding. We can help people understand why something is priced where it is, but we don't determine the price.
Am I off base here? What can we do to further defend ourselves?
Tuesday, April 1, 2008
An Open Letter To All Who Read
Hello all,
As you may or may not know I've been working in real estate off and on for the last 8 years. As I ventured further and deeper into wholesaling, rehabbing and renting property it only made sense to open my own company to manage this business.
60 Day Realty has been operating for some time, but not actively seeking business of buyers and sellers. That is changing however. 60 Day Realty's website went live yesterday at www.60dayrealty.com and is there for everyone to view. You can find a link to our Facebook, Blog and Twitter (where we notify you of the day's interest rate, important real estate articles and special deals).
As I got into real estate some time ago I asked a lot of questions why things were the way they were as Realtors were viewed as necessary evils by much of the public. My conclusion was real estate agents were afraid to allow buyers and sellers have the control in the relationship. To give them control was to leave Realtor's commission and power vulnerable in the Realtors eyes and that was unacceptable. It was also a fear based decision.
60 Day Realty has taken what buyers and sellers disliked most about Realtors and the real estate business and has attempted to eliminate it.
For buyers, we have instituted a 1% rebated toward their closing costs based upon their purchase price. So a $100,000 purchase would give a buyer $1000 at the closing table to apply to taxes, insurance, bank costs or interest rate reduction.
For sellers, we have eliminated long term contracts by listing homes for ONLY 60 day periods. If the seller wishes to continued their relationship with us beyond that, we will extend the agreement for another 60 days.
The biggest benefit to sellers however is the flat fee. 60 Day Realty will list and sell your home for a flat fee. The fee is based upon your sale price and is paid only if the house sells.
Let me give an example: If you were selling a $100,000 home, it is reasonable to assume that you will pay around 6% to a Realtor to do so. On a 50/50 split that would be 3% to the buyers agent and 3% to the listing agent. That is a $6000 commission.
If you were to use 60 Day Realty the total commission on a $100,000 sales price would be $4495. An estimated 3% to the buyers agent and $1495 to 60 Day Realty. The true beauty of this program is if 60 Day Realty sells the house without any other agent involved, the total commission would only be $1495. Either way you are going to save money.
If you have any questions about this please don't hesitate to contact us. You can reach me by email at jay@60dayrealty.com or at 502.641.9169.
Check out the site and please let me know if we can be any assistance!
--
Jay Bowman, Broker
60 Day Realty
502.641.9169
www.60dayrealty.com
As you may or may not know I've been working in real estate off and on for the last 8 years. As I ventured further and deeper into wholesaling, rehabbing and renting property it only made sense to open my own company to manage this business.
60 Day Realty has been operating for some time, but not actively seeking business of buyers and sellers. That is changing however. 60 Day Realty's website went live yesterday at www.60dayrealty.com and is there for everyone to view. You can find a link to our Facebook, Blog and Twitter (where we notify you of the day's interest rate, important real estate articles and special deals).
As I got into real estate some time ago I asked a lot of questions why things were the way they were as Realtors were viewed as necessary evils by much of the public. My conclusion was real estate agents were afraid to allow buyers and sellers have the control in the relationship. To give them control was to leave Realtor's commission and power vulnerable in the Realtors eyes and that was unacceptable. It was also a fear based decision.
60 Day Realty has taken what buyers and sellers disliked most about Realtors and the real estate business and has attempted to eliminate it.
For buyers, we have instituted a 1% rebated toward their closing costs based upon their purchase price. So a $100,000 purchase would give a buyer $1000 at the closing table to apply to taxes, insurance, bank costs or interest rate reduction.
For sellers, we have eliminated long term contracts by listing homes for ONLY 60 day periods. If the seller wishes to continued their relationship with us beyond that, we will extend the agreement for another 60 days.
The biggest benefit to sellers however is the flat fee. 60 Day Realty will list and sell your home for a flat fee. The fee is based upon your sale price and is paid only if the house sells.
Let me give an example: If you were selling a $100,000 home, it is reasonable to assume that you will pay around 6% to a Realtor to do so. On a 50/50 split that would be 3% to the buyers agent and 3% to the listing agent. That is a $6000 commission.
If you were to use 60 Day Realty the total commission on a $100,000 sales price would be $4495. An estimated 3% to the buyers agent and $1495 to 60 Day Realty. The true beauty of this program is if 60 Day Realty sells the house without any other agent involved, the total commission would only be $1495. Either way you are going to save money.
If you have any questions about this please don't hesitate to contact us. You can reach me by email at jay@60dayrealty.com or at 502.641.9169.
Check out the site and please let me know if we can be any assistance!
--
Jay Bowman, Broker
60 Day Realty
502.641.9169
www.60dayrealty.com
Thursday, March 27, 2008
Good Rule Of Thumb
I had an old client call me today to come look at his house to possibly sell it. He was looking to at least get a few grand out of the selling of it and he wanted to know what I thought.
I'll tell you what I told him. He bought it a year ago and if he's lucky he's going to JUST break even. The more likely scenario is he may owe money.
If you are buying a house, you should plan on holding it for at LEAST 3 years. Anything less than that and you are taking a big chance in the house having not appreciated enough to cover the cost of the agents commission.
If you're selling your home with a standard real estate company, you can look to pay around 6%. That means if you bought your house for $100k just a year ago, you're going to need to sell it for around $106,500 just to break even. And that doesn't cover the closing costs you paid to buy or sell it.
With 60 Day Realty's program, he will need to sell it for $104,500 to break even. A $2000 savings.
As long as his house is not overpriced or in poor condition, given an acceptable period of time we should be able to sell the house.
If you have any questions or comments please let me know!
Jay Bowman, Broker
60 Day Realty
502.641.9169
I'll tell you what I told him. He bought it a year ago and if he's lucky he's going to JUST break even. The more likely scenario is he may owe money.
If you are buying a house, you should plan on holding it for at LEAST 3 years. Anything less than that and you are taking a big chance in the house having not appreciated enough to cover the cost of the agents commission.
If you're selling your home with a standard real estate company, you can look to pay around 6%. That means if you bought your house for $100k just a year ago, you're going to need to sell it for around $106,500 just to break even. And that doesn't cover the closing costs you paid to buy or sell it.
With 60 Day Realty's program, he will need to sell it for $104,500 to break even. A $2000 savings.
As long as his house is not overpriced or in poor condition, given an acceptable period of time we should be able to sell the house.
If you have any questions or comments please let me know!
Jay Bowman, Broker
60 Day Realty
502.641.9169
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