| Special Event – Steve Harney from KCM Blog Tuesday Jan. 31st 11:00 am PST | Noon MST| 1:00 pm CST | 2:00 pm ESTRegister Now REDX Tele-Seminar Handout Jan 2012 Steve Harney KCM Steve’s 20 year history of success began as a top performing residential Realtor before he steadily built his own 500 agent real estate firm. KCM Blog is a daily read at REDX because they are the industry leader in providing real estate professionals with a way to keep current with the ever-changing real estate market. More than just data, KCM delivers actionable knowledge and an understanding of the market to real estate agents to simply and effectively communicate key points to their buyers and sellers. January is about setting yourself up to have an amazing year. In this REDX Special Tele-seminar Steve Harney will discuss the most important trends in Real Estate and provide powerful breakdowns of what they mean to the agent, consumer, and broker. We want to provide REDX fans with an opportunity to:
If you join for the live call you can personally ask Steve Harney your questions. |
by THE KCM CREW on JANUARY 2, 2012
In 2011, we experienced one of the most volatile housing markets in American real estate history. Things we never anticipated happened. Events we were sure would take place didn’t. Today, we want to review the five headlines we think had the biggest impact in 2011.
1.) Interest Rates remained at historic lows
In order to help stabilize the economy in 2010, the Fed took certain actions which kept mortgage rates at or near historic lows (approximately 4%). Most felt this would be a short term tactic and once abandoned would result in rates returning to long term averages (6-7%).
However, the government has continued to support lower rates with the hope of fostering a recovery in the housing sector. The 30 year fixed rate mortgage (as measured by Freddie Mac) stood at 4.77% to begin 2011. A month later, it was over 5% and many, including us, believed this was the beginning of rates returning to normal levels. Instead, rates continued to fall ending 2011 at 3.91%.
The lower rates along with great prices have had a favorable impact on home affordability leading more buyers to enter the market.
2.) Sales up over 2010
At the beginning of 2011, we all realized that a year-over-year (Y-O-Y) comparison of home sales would not be a true “apples to apples” comparison as home sales at the beginning of 2010 were bolstered by the Home Buyers Tax Credit. Likewise, comparing home sales over the summer would not be a fair comparison as many sales in 2010 were dragged forward so that buyers could take advantage of the credit. However, many thought Y-O-Y comparisons would again be useful later in 2011 as the impact of the 2010 tax credit waned. Yet, the National Association of Realtors (NAR) Existing Homes Sales Report shows that over the last three months sales have increased quite nicely. The October and November reports each showed a Y-O-Y gain of in double digits and the December report gain was 12.2%. These numbers showed closed sales were increasing even though more contracts were falling through.
3.) Contract cancellation rate surges
Probably the most troubling trend to emerge in 2011 is that the number of sales contracts that are cancelled before closing has skyrocketed in the last year. The cancellation rate has jumped from 9% in August 2010 to 33% each of the last two months.
Some of the increase can be attributed to the higher level of difficulty in distressed property transactions. However, NAR also says cancellations are caused largely by“declined mortgage applications or failures in loan underwriting from appraised values coming in below the negotiated price.”
4.) Foreclosures were delayed
The robo-signing debacle of late 2010 caused a delay in many foreclosures entering the market. It DID NOT prevent the banks from continuing to put homes into the foreclosure process. The delays jut prevented banks from repossessing the homes and putting then up for sale as REOs (foreclosures owned by the banks).
For most of 2011 the banks and the state governments worked on a set of standards that would be enforced before a bank could repossess the house. They are currently working on a settlement to be paid for those homes that where foreclosed on without the proper paperwork.
As these procedures and settlements are completed, more and more of the backlog of distressed properties will come to market. Distressed properties sell at a discount. They will have a substantial impact on the prices of all houses in the region.
5.) Prices move up then down
Many experts expected prices to continue to slide downward as we entered 2011. However, a large inventory of distressed properties was held back (see #4). That turned out to be good news for prices as supply decreased throughout the year and demand increased in the second half of the year. That actually caused prices to ‘bottom out’ and ten nudge upward in the late summer and early fall.
As the foreclosed properties again began to enter the market in the last quarter, prices again began to slip. Most believe this downward trend will continue through the first half of 2012.
Thank you to the KCM Crew for letting us share this great blog.
This has been a red letter year for the REDX (no pun intended). We’ve hit so many new milestones of growth with the most notable being the amazing additions to our team, the release of the REDX Pre-foreclosure product, the High Octane upgrade (free to clients), and the 2011 Data Quality Study.
As we reflect upon everything that we’ve accomplished it is clear how the greatest achievements where in partnership with our clients, affiliates, and all of our business relationships.
We wish you all a very Merry Christmas and a Happy New Year.
The REDX
Guest post by Alex Charfen, CEO of the Charfen Institute and author of the Certified Distressed Property Expert® (CDPE) Designation
Once shunned by the majority of real estate agents, short sale listings are quickly becoming the hottest ticket in town.
With 1 in 10 homeowners not paying their mortgage—and Major Lenders predicting huge increases in short sale closings in 2012—savvy agents are finding new and creative ways to find and attract distressed property listings.
A great place to start your outreach campaign is a list of NODs. Notices of Default, or NODs, are legal notices sent by a mortgage servicer to a homeowner who is 90 days late on their mortgage. Subscribe to REDX’s Pre-foreclosure leads to access a list of NODs in your area.
With a few simple modifications, you can use many of the same marketing techniques with NODs that have yielded you results when prospecting for traditional listings. For maximum impact, utilize the following:
1. Multi-touch Approach
Don’t expect results after one call, mailing or door knock. The foreclosure process can take months, and many distressed homeowners will refuse to face the reality of their situation until their time has run out.
As with any effective outreach campaign, follow the “Rule of 7,” which states that the majority of prospects need to be contacted a minimum of seven times before they notice your message. Distressed homeowners, who are often in denial of their situation, may require even more touches. Stick with it; persistence is key when marketing to NODs.
2. Multi-method Approach
Not all homeowners will respond to the same type of messaging. A consistent but varied approach to outreach will often yield the best results.
Include the following elements in your NOD outreach campaign:
- Letter
- Postcard
- Free Report
- Door Knock with Flyer or Door Hanger
- Handwritten Note
- Foreclosure Avoidance Seminar Invitation
Be sure to include your contact info, including a website address where they can download informative resources (such as a free report with foreclosure avoidance tips) in exchange for their name, email and phone number. This will help you track the success of your outreach and enable you to follow up with interested leads.
3. Get in a “Saving” Mindset (not a “Selling” One)
Before you begin your outreach, get centered and set the intention that you are going to help the person you are contacting.
When you have a long list of NODs to tackle, it’s easy to forget there’s a real family on the other end, and they are probably going through one of the most difficult times in their lives. The threat of losing your home is frightening and highly emotional. Be respectful, and always set out with the intention of helping instead of selling.
Additionally, don’t imply that you know the homeowner themselves is in financial distress. For example, when door knocking say, “I’m out here today to let my neighbors know that if they or someone they know is behind on their mortgage payments and doesn’t know what to do, I am here to help.”
Now that you’ve connected with homeowners in your area who need help, make sure you’re listing their property the RIGHT way. Download our FREE report: The 5 Steps to Listing a Successful Short Sale!
Download now: http://bit.ly/redxitunes
Listen to a panel of hardcore REDX real estate professionals. They all use REDX, they help homeowners sell their homes when other agents couldn’t, when the property owner couldn’t sell it on their own, or when the owner was in distress. They love making a difference and they understand the day-to-day challenges of working in Real Estate. They also make serious money.
This REDX All Star panel answers live questions such as: how to cold call, what are good metrics, how to deal with bad phone numbers, how to handle objections and more!
All Star #1 – Robert
- Prior to using REDX, had 9 listings. Within 90 days of using REDX had 38 listings
- In 2009, business was mostly Buyer based and gross commission income was $63,000
- 2010 shifted focus to REDX expired listings, earned $153,00 and worked approximately 20% less
All Star #2 – Ken
- Prior to using REDX, in 2004, made $70,000
- Currently tracking to make $250,000
- Average listing inventory 20 homes
- Will close approximately 60 sales this year
All Star #3 – Alex
- Reactivated 3 months ago on REDX
- Listed 16 properties in the last 2 weeks
- Goal is 100 active listings by March 1, 2012
- Tracking to make $220,000, $150,000 of that is from expires
