As someone who has been in the real estate business on Hilton Head for the past 29 years I have to ask myself this question daily. Markets are ever changing. We have to ask our self, “Are we adjusting with the market?”
The example I think about is the stock market. To think that you would call your stockbroker and direct him to sell your ABC stock for $80.00 per share is absurd. It might have been worth $80.00 a year ago, but it might be worth $90.00 today or it may be worth $40.00. What you always ask your stockbroker is what is ABC worth today. The same is true for real estate.
It is important to realize that one agent does not make the market. The market is made by buyers and sellers. Our job is to interpret the market.
I recently had a seller say to me, “All you are trying to do is lower the price to where it will sell.” I told him he was correct. I told him I was trying to find the price at which his property would sell. I do not know what that number is. However, I do know what that number is not. We had his property listed at $599,000 for 6 months and had not had a single offer. That should tell us something. What we need to do is find out where we are today. It doesn’t matter where we were in the past.
I recently had someone tell me that I had set the price on their home. I told them I set the price based on the market conditions at that time. However, the market conditions have changed. That argument doesn’t hold water because you would never call your stockbroker and say, “You’re the one who told me it was worth $80.00 per share.” He would say it was worth $80.00 the day I told you that, but market’s change. I think we forget this and need to be reminded daily that the market changes.
As some of you know, the United States Congress passed by a vote of 219 to 212 the recent cap-n-trade bill.
Nobody really knows exactly what is in the bill yet because last Friday morning when they voted on it 300 pages were added to the bill. Very few of the Congressmen took time to read the bill.
My concern is, how does it affect real estate.
Saturday night I received a phone call from my sister, Congressman Marsha Blackburn (R7) and she was talking to me about how it affected real estate. I asked, I am a Realtor, why do I not know this? Why didn’t the National Association of Realtors send out emails to all of it’s members. The obvious answer is that they did not know it either. We have received some since then and they are trying to determine how it affects real estate.
My concern is that there will be federal qualification for contractor’s inspectors. The Government cannot say which contractor you must use except for the fact that they must be certified in energy efficiency in order to meet new codes (Section 202F).
That is just another way for the federal government to have more power over real estate and building.
One particular section of code of concern to me is 201F. It states that if the state or local government fails to enforce the new codes, the Secretary of energy can enforce them on their own and require inspection fees to cover the cost. That sounds like a lot of fun.
Section 299A states that appraisers will be required to be certified in energy efficient home improvements for home value.
There is also a provision that allows the Secretary of HUD to override any contracts.
I think it all goes back to how you feel about the government; if you think the government can be more effective at running private enterprise, then you probably think the cap-n-trade is a good deal. On the other hand, if you think that private enterprise will normally do a better job than the government then you probably think it is a bad deal.
We all need to learn more about this. If we ran our business by making decisions when we did not know all the details we would have been out of business a long time ago.
I received an email yesterday from a client that said that real estate prices are down 17.1% nationally for the last year. Even though I appreciate his sending me that information, I took it with a grain of salt.
I really don’t care what happens in Omaha, Shreveport, Phoenix or Seattle because those markets really don’t affect us. I think that we all make the mistake of trying to generalize the real estate market - it cannot be done. Read the rest of this entry
Last week we had 40 homes go under contract in the Hilton Head Island MLS; three in Sea Pines Plantation, two in Forest Beach, one in Palmetto Dunes, one in Folly Field, one in Palmetto Hall, one in Indigo Run, one in Windmill Harbour and three in Hilton Head off plantation areas.
The sales in Bluffton were as follows: thirteen in Bluffton off plantation areas, two in Moss Creek, one in Belfair, one in Rose Hill, one in Berkeley Hall, four in Sun City, one in Hampton Hall and one in Hampton Lake.
We also had nine villas and six lots go under contract.
Yesterday Jane and I were on our way back from the mountains. At noon, we stopped in Columbia at Rush’s - our favorite bar-b-que hangout. We always stop there when we go and come back from the mountains.
When we got off the interstate, I noticed that there were two guys holding signs promoting business on the exit. I thought it was interesting to “think outside the box”. Obviously these businesses are slow and they are doing everything they can to try and stimulate some business.
I don’t necessarily think that you will see me standing on highway 278 with a sign promoting a house for sale, but it might not be a bad idea! Maybe I need a sign that says “Buy Now, Great Values” or “We are having a 30% off sale!” I was impressed that these businesses were willing to go the extra mile to try and get the business.
We are continually trying to get the business at the James Wedgeworth Team. We ask ourselves every day if there is a marketing idea we have not tried before. We are trying to reach outside the normal areas of where our buyers come from. This is why we have been doing promotions in Europe.
I recently listed a piece of property where the sellers had it priced quite a bit above what the comparative market analysis showed that the property was worth. We had shown the property time and time again and most every prospect that we showed the home to said that the house was overpriced.
When I talked with the seller they kept telling me that I was not trying hard enough. They kept coming up with ideas, mail outs, and more advertising to try and get their property sold. In other words, the reason their home had not sold had nothing to do with the price they put on it, but the lack of effort that James Wedgeworth was putting forth to get their property sold. Daily, I would get a phone call from them suggesting another marketing idea. Read the rest of this entry
A very experienced real estate agent once explained this to me, and the more you think about it, the more sense it makes.
When a house first comes on the market, a lot of agents will call people and tell them that the property is a great value, is in good condition in a great location with a great price. The agent tells you that you better go and take a look at the house before someone else sees it, and sometimes they think they should make an offer before anyone else sees it because it would be such a great house for them. Read the rest of this entry
I recently went on a real estate listing appointment on Hilton Head on a home that had been listed with another agent for about a year. When I sat down to go over what was going on in our market, the owner of the house said that the one thing he knew for sure was that there was nothing wrong with the price on his property. I asked him how he came to that conclusion. He said that he had it on the market for about a year and I have not had a single person offer me less than what I am asking, so obviously everyone who has looked at my house thought it was priced correctly. Read the rest of this entry
In Estill, South Carolina - a small town where my farm is located, a guy was telling me about a conversation he overheard at the local restaurant. Two farmers were talking about their tractors; farmer A preferred one brand and thought it was a much better tractor and farmer B preferred another brand. When I heard about this, I laughed because I deal with that every single day in the real estate business on Hilton Head.
It is what I call pride of ownership. A person loves their house - they think their house is worth more than anyone else thinks it is worth because they are the ones that spend the most time there and it means the most to them. Read the rest of this entry
This week marks the 31st annual Week of Champions event on Hilton Head Island.
The Week of Champions is a non-profit volunteer organization that pairs more than 40 atheletes to work with children - golf, tennis, baseball, basketball, football and more.
For more information on the Week of Champions along with a schedule of remaining events please visit The Island Packet or WeekofChampions.com.
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