Someone asked me how I have been able to sell $40 million worth of real estate this year.  I jokingly said, “I am not participating in the recession”.

Everybody knows that the recession has affected all of our business; at this same time last year I had sold more than I have at this point. 

I received a call from a client yesterday and asked how his business was.  He said that he had his best year ever.  I asked how he did that.  He said he canceled all of his subscriptions to newspapers because when he read them all he read was bad news.

As someone once said, “If if wasn’t for bad luck, I would not have any luck at all”.

I picked up The Island Packet several days ago and on the front page the headlines read, “Deficit to top $1.5 trillion”, “Former Clerk Smith pleads not guilty to embezzlement charges” and “SAT scores decline at three area schools”.  This news was really depressing. 

I have always believed in the contrariety opinion – buy when nobody is buying and sell when nobody is selling.  If this is true – now is a great time to buy.  There are some unbelievable real estate deals available because most clients watch the mainstream news, they read the paper and hear all the doom and gloom. 

As I have said over and over again, we still have 12 miles of beautiful sandy beaches on Hilton Head and I do not think that is going to change.

One of the agents in my office ran some interesting numbers yesterday; home sales from January 1st to August 26th for the last five years in different price ranges.  Sales have gone from 1,320 to 760 to 694 to 538 to 322. 

Dropping from 1,320 to 322 sales in this time period is a pretty drastic drop.  What does this mean?  When broken down by price range, the top end seems to have been affected the most.  Homes over $3 million went from 47 sales in 2005 to 9 sales in 2009 – wow – this is quite a drop!

I was flipping channels on my television and there was this guy advertising this book for $19.95 on making fortunes in a bad real estate market.  I watched him for about 10 minutes. 

The more I listened to him, I realized that now is a good time to make fortunes in real estate and every point he made was very, very valid.

However, I think he is really missing the point of why people buy real estate.  You can gain and lose fortunes in a lot of things.

Real estate is one of the only investments I know of that the whole family can get a lot of good out of.

For example, eight years ago we bought a house in the mountains that we use as a mountain getaway.  Jane spends a lot of time up there during the summer.  The kids enjoy it, Jane likes it, and when I get up to it I enjoy it.

The most important thing I made in this transaction were the memories and something the kids have absolutely enjoyed and Jane has loved.

That is why I say I think this guy is missing the point.  The reason most people buy real estate is not to make money (even though most people have, except for the people that bought in 2004 and 2005) but the reason they do it is it something the whole family can get a lot of use out of. 

I encourage my clients to buy for what I call the right reasons.  I think what we really need to concentrate on is why the whole family can get a lot of use out of having a vacation home on Hilton Head Island, South Carolina.

Boy, was I shocked when I was flipping through The Wall Street Journal and saw where Reader’s Digest had filed for bankruptcy.  The article went on to explain that for the past three decades they had gone from 18 million copies a month to less than half that now.

I think what this shows is a trend away from print media.  This is also true in the real estate business.

On Hilton Head Island, we have seen the number of calls we receive from our print media dropping to virtually nothing while the number of calls we receive from websites like Realtor.com are growing each month.  It seems that more and more of the American public are getting their news online and not in written word. (more…)

I recently had someone ask me what it was like to be the #1 Realtor on Hilton Head Island for 20 years in a row.  I simply replied that it means absolutely nothing.  Being #1 means nothing if I do not deliver for the people I am working with.

Real Estate clients sometimes have unrealistic expectations about what their Realtor can accomplish.  Any good Realtor will try to lay all the cards on the table and explain what he or she can do to help a client put the odds in their favor – finding the right property or getting their property sold.

You pay for advice; for bad advice you pay dearly.  That is why it is important to have a Realtor who really understands the market – not a part time Realtor who is just practicing on you.

This is true in any profession.  You would not want a medical doctor practicing on you – you would want someone who is an expert in their particular field.  Why would you want someone who had just read an article on how to do something.  If you were having major heart surgery, you would want to know if that particular surgeon had done this procedure before.  In the medical field they have to serve an internship.  Unfortunately, in real estate, an internship for some real estate agents simply means taking a 2-week course.

As I told my friend the other day, #1 means nothing unless I am #1 in your book.

I laughed at this story; one of the agents in my office was talking to a prospect yesterday about his house.  The prospect said he wanted to list the house at $900,000.  The agent had done a comparative analysis and market research on the home and said that the most they could ask for the house was $799,000. 

The seller said that he needed $900,000.  The agent went through everything and told him how Realtors and prospective agents look at what is listed and what has sold.

After they had discussed all of the comps, the seller said something I thought was very funny.  He said “I need a naive agent”.  He wanted an agent who did not know all of this stuff and would be excited about listing my house at $900,000.  The agent replied, “that would be fine, they could list it all day long, but I can assure you that in today’s market nobody is going to pay you that much”.

The seller thought if he found an agent who did not know what the house was worth, they would be excited to have a listing and they would work hard to get it sold. 

Unfortunately for this seller, it does not work that way.  This seller needs a naive buyer, and in today’s market, this does not exist.

Last week in The Island Packet, the headlines on the front page read, “Island Tourism Picking Up: Real Estate Still Slow”. 

At first glance, that might not make sense to people.  But for those of us in the business it makes a lot of sense.

It is the same reason that sometimes auto part stores do well in a recession; people don’t buy new cars, they fix up existing cars.  Remodeling contractors are doing well because people are not buying new homes; they are fixing up existing homes. (more…)

I was watching a Sportscenter special recently on the basketball career of Michael Jordan.  The commentator referred to him as a “go to guy”.

I have often thought about how that relates to real estate.  The commentator was saying that when the game was on the line, the Chicago Bulls wanted the ball in Michael’s hands. 

Michael was known as the #1 Basketball Player of his era because he was the best and you had a better chance of him scoring than anyone else.

That is how I look at the real estate business.  It is not really important who is #1 other than the fact that they have the best chance of getting your property sold or finding the right property for you because they have the best knowledge and the most expertise in their field. 

I once had a client tell me, “If I was a betting man, I would bet you on”.  I really appreciated that comment because I understood what he meant.

Real estate is a major investment for most clients and is not something to be taken lightly.  When selecting an agent, you want to make sure you are working with someone who is a “go to” person – someone who can get the job done when the game is on the line.

I assume that is true in other professions.  I have several clients who are specialized medical doctors.  I know if I had a specific problem, I would want to go to one of those particular doctors depending on the situation.  I think there is a “go to” person in every field.

My goal on Hilton Head Island is to be the “go to guy” and help my clients with all their real estate needs.

There was a recent article in The Wall Street Journal that talked about how property sales were picking up.  Boy, were we all excited about that!

Three days later, an article came out stating, “high end homes frozen out of budding housing rebound”.

We who work in the “resort market” know that most of our properties are considered “high end” and we realize that inventory drives prices.  We also realize that the real estate market has not rebounded on the high end as much as it has on the low end.  I’m not really concerned about this long term because if the lower end market picks up, eventually the high end market will pick up.  It is what I call “trickle up” instead of “trickle down”.

A seller of a $200,000 house will probably buy another house.  If he goes out and buys a $400,000 house.  The seller of the $400,000 house might go out and purchase a $700,000 house.  And so on.   You can see why we are excited to see things picking up even though it might take a while to occur.  I just wish it would be sooner rather than later.