This is why we have to work harder...

Today starts the Coldwell Banker 10-Day Sales Event, an out-of-the-box campaign to try and bring buyers and sellers together at a time when the real estate market is on the verge of tipping back toward strength. We all know that home affordability is getting better, we certainly know inventory is up and we are learning more and more that buyers can find deals in this particular marketplace.

So Coldwell Banker CEO Jim Gillespie gets asked to speak with national news giant NPR for their "Marketplace" show that runs (at least locally) in the morning.

Here is what they produced instead...
http://marketplace.publicradio.org/display/web/2008/10/06/coldwell_price_slash/

Needless to say, we have our work cut out for us. Even if you don't have a single house participating in the 10-Day Sales Event (and we have 176 of them at last count) that you use your time over this period to help dispel the rumor that buying a house now is an impossibility.

The "Bailout" - what exactly does it mean?

Hopefully in your comings and goings as Realtors you see people who want your take on the markets - whether they be the financial markets, the mortgage markets or the real estate markets. Being able to have a good answer to basic questions is a key to holding up your image as a professional people can consult with when they need good advice.

So with that in mind it is important you have an answer for "the bailout". What is it? How did it come about? What impact will it have upon me if I am buying/selling a home?

The hard part now is to answer it as a professional and not to let the politics we are all hearing get in the way. After all, the reason our clients are coming to us is that they want a better understanding of the facts - not the politics.

So here is the Reader's Digest version of what happened and what is happening...of course I welcome any comments from people who want to expand on what I am saying or challenge the facts.

It starts when the nation's mega-banks decided to buy up loans from lending institutions that didn't do their homework when they qualified the borrower. Most of these loans (called Alt-A or "liar" loans) were made in states where speculators thought they could buy a property and flip in a few months for extra cash. Unfortunately, because there were so many of these properties available and because the legitimate lenders were being more cautious with their funds, the prices began to drop and the investors were left with properties they couldn't reconcile financially and so they walked away from them. Now the mega-banks weren't getting any money back on the loans they purchased, which meant they couldn't put more money back into buying up new mortgages (or when they could they were being very cautious), which ultimately meant the lenders weren't able to make more loans to "legitimate" buyers.

Without getting too technical, the mega-banks have holding requirements that they have to adhere to with the federal government, plus they have their own businesses to run. When you don't have money coming in, and the money coming in you have to keep in the bank, it is hard to run your business. Eventually, it comes time to just close the doors.

Closing the doors at the local hardware store hurts the people who own the hardware store, maybe the two or three employees they have and the vendors who sell stuff to them. Certainly it is painful, but in the overall economic sense it doesn't bring things to a halt. When a mega-bank closes its doors, however, now the pain is greater. Not only are the employees hurt, but all the businesses that rely on that bank's line of credit also have to shut their doors. Now the products we rely on for day-to-day living can't be made, because the people making them can't buy the raw materials when their line of credit dries up. For real estate professionals, what that means is that the mortgage companies that make loans based on their expectation that a mega-bank will buy that loan have to stop lending too. Essentially, things come to a screeching halt.

In steps the government. They recognize that a slowdown (or worse yet a complete stop) of production doesn't do anyone any good so they offer to buy up the "toxic assets" of the mega-banks. This is the bailout. Supposedly, what this program will do is give the mega-banks the capital they need to stay in business, extend credit to small businesses and most importantly, buy more mortgages made to "legitimate" borrowers. This is the key to your success.

If more working capital is made available to the mortgage markets, that money is going to be put to use buying homes. That means buyers who may not have been able to qualify in the past may suddenly find themselves eligible. Buyers who are still paying rent may suddenly find they can get that 80/10/10 loan they weren't able to get a few months ago. All this "new" money in the system hopefully can drive buyer behavior (much like when Clinton announced his home ownership initiatives in the 1990s that launched a new wave of buying).

Now combine the possibility of new money with a tax incentive for first-time homebuyers and there is real optimism on the horizon. Let's hope it plays out that way, because after all there is still politics involved.

Another reason why you should blog

OK so you know you should blog, and you know you should do it about the listings you have. But you still don't becasue after all what benefit will it get you? Will people notice the house as a result?

Here is a great article from the 1000 Watt Blog that may provide some insight. Think about if you keep a blog on each of your listings and update it regularly?

http://www.1000wattblog.com/2008/09/interesting-too.html

Making your way on Facebook

Wow, sorry it has been so long since I posted last - things have been very busy as we get ready to launch another round of new interactive initiatives.

While I was gone, however, everyone went and found Facebook. Pretty amazing, actually - before the summer started most Realtors thought Facebook was something you saw in the library, now many of you are posting yourselves up there for all the world to see.

The trick is to make it work for you. Facebook is not a shopping cart; nor is it an all-message system like you have with your voice mail. No, Facebook is like a cocktail party; everyone is there, they want to talk to you, but they don't want to talk to you if you are just going to quote boring statistics and repeat the company line.

The largest growth in subscribers for Facebook is people between 34-50, so there is business that can be done - the trick is to do it right. Find people you know and start a "real" conversation about the weather, their hobbies, anything but real estate. Can't find anyone? Go join a group or two where people have interests similar to yours...and start from there.

Whatever you do, don't just sign up for Facebook, post your 20-year old Realtor photo, slap your lisitngs all over and then try to make friends with everyone who lives in a 200-mile radius. I guarantee that is a recipe for disaster.

OK, that's enough for now - Facebook conversations will be a part of this blog for some time to come.

Hear Social Media Specialist Chris Brogan discuss real estate

Real estate needs help understanding social media. That is a given. Most of the terms used are completely foreign to Realtors, especially Realtors who haven't wanted to "embrace the internet" for some time now.

Listen to this great radio interview that social media specialist Chris Brogan did for the real estate radio program Real Estate Radio USA. It is a long interview (about 25 mins) but is well worth it - he gives some great suggestions (and maybe some new vocabulary terms) to Realtors of most every skill level.

If you are a savvy web agent, pay attention to his talk regarding TwitterSearch, which based on my limited research has some real possibilities here in this market. If you are new to the whole social media concept, listen toward the end as he gives ideas for "testing the waters"

http://www.realestateradiousa.com/blog/podpress_trac/web/11913/2/chrisbroganep178.mp3

The campaign to clean up those profile messages

Now that we have launched the new version of CBHearthside.com, the public once again has the ability to search for agents by name or by office. (The photo is a screenshot of the Lahaska office, picked at random).

Obviously this is very helpful to the public and is already increasing our web site traffic. Unlike old sites, however, when the user pulls up an agent, there is a paragraph of information written right next to the photo - sort of an "about me" they can quickly read before moving on.

Well, if you search your office you will undoubtedly find just what I am finding - that everyone still has the same message! Needless to say the consumers aren't going to find that very helpful at all. More importantly, it is not sending the message you want to send to your customers that you pay attention to the internet!

I am launching a campaign to update profile messages before Labor Day. Each of your administrative assistants received an email today with detailed instructions on how to change both the profile paragraph AND the welcome message at the top of your microsite (if you haven't seen a microsite yet, click here for a sample). Right now, only people with administrative access can change the pages (hopefully down the road we will develop a tool so you can change them yourself) so if you WANT to update your page (why wouldn't you) just send an email to your admin with new text.

Please keep in mind a few things when changing your profile message or your welcome on the microsite. First, they are meant to be short. Don't exceed the size currently on the screens (about 40 words for the microsite, about 85 words for the profile). Second, be sure to put them in the proper tense - I recommend the microsite be in the first person (meaning you speak as yourself and use the "I" instead of "he or she") and that the profile message be in the third person (meaning you speak as if you were talking about yourself and use "he/she" instead of "I")

Also - if you see that your profile or microsite doesn't have a photo, that should be corrected too. Send the photo to your admin who will see that it gets filed correctly and sent to me for posting.

What's Your Sign?

I am reposting this from Trulia's blog, thought you may all find it interesting (and also make you proud).

http://www.truliablog.com/2008/08/07/the-other-big-blue-goes-web-20-and-may-have-hit-a-homerun/

Note that the first comment was from our own Stef Hahn - someone else staying on top of the Web 2.0 landscape. Way to go Stef!

Of course, if you go to Facebook to see what they are talking about, be sure to join the Coldwell Banker Hearthside group!