MID-NOVEMBER 2007 WAYNESWORD :

NEWS, BUSINESS, SPORTS, & WEATHER, IN REVERSE ORDER…

“T-T-T-Talk about the weather…”
                           -- Dave Matthews: “So Much to Say”

                  October was warmer than normal up here right till the end—the kids were not freezing in their costumes on Hallowe’en, like it seemed we usually were, 4 decades ago—but now that the 11th Month is here, there is a definite chill in the air, and we break out the sweaters and fleece—though the parkas and gloves haven’t been located yet.

                  Cold air is a double-edged sword in upstate real estate—it makes it somewhat unpleasant to be out there schlepping from house to house, strolling around the grounds in biting winds, but it is also a bit motivational to certain buyers who want to get nested properly before the holidays, or buy before the end of the year for investment purposes, or to compete for the best deals on property when there is the least competition.   There are fewer casual, curious callers on property these days, but anyone ambitious enough to pick up the phone and show willingness to view property in these darkening days toward the end of the year is to be taken seriously.

                  When you are the agent making the calls to show property, the other good thing is that you are greeted with delight by the listing agents or their team members—“OH!
You have Buyers right now? Of COURSE we can arrange that…”  The Sellers are not in a position to play hard-to-get at this time of year—they will accommodate you quickly.

A SUBDUED, IF NOT STARK, COLOR PALETTE…

                  Though the peak season is definitely past by now,
in terms of color, the beauty now is in the clarity of the views when the leaves are down, and the starkness of the landscape before snow arrives to cover it all.  And there IS still some color—the dark scarlet of Burning Bushes, the stubborn orange of maples in wind-protected zones, and the persistent amber of oak leaves which rattle crispily sometimes throughout the entire winter season before relenting to new life in spring.

                  When I was evangelically selling solar products in the mid-80’s (roughly 20 years ahead of the time), November was considered the toughest solar month in the Northeast (with an average of about 31% sunshine during daylight hours), when the sun DOES shine, the views are still great up here.  Deer hunters appreciate the increased visibility in the woods and fields, and those who live near lakes or waterfront generally have unimpeded scenes once the leaves are out of the way.   On the urban scene, however, I still see multiple piles of dried leaves heaping like brown snowbanks along sidestreets in Lansingburgh and certain parts of Saratoga, before the monster vacuum machines suck them up for the compost repository.

BUT HOOP IS IN THE AIR, FINALLY…

                  The absolute best part of November, from my way of thinking, is that the real winter HOOP season is firmly underway—the NBA started for real at the very end of October, College Hoop had its Midnight Madness ceremonies, and High School Tryouts were underway by the first full week
of November, and complete by the time I write this.  Post-Thanksgiving Tournaments are only two weeks away, and the four month-long season that gets us hoop fans through winter
enthusiastically is fully underway.  While ESPN talk radio is still obsessing about NFL Football match-ups and baseball’s post-season free agent market, the guys I know and hang with pretty much confine themselves to discussions of Hoop Prognosis, centered around their favorite high school or college teams. 

          For the benefit of those reading this from other places, we now have 3 well-respected local collegiate programs to follow and admire--  Siena College (of Loudonville),  University of Albany (at the western edge of the State Capital City), and the College of Saint Rose, also in the heart of Albany.   Siena will be playing against perennially strong Syracuse on the road, and then goes against Stanford in a big-time match-up this month at The TIMES-UNION CENTER in downtown Albany.  The Great Danes of UAlbany—who made national waves in recent years with competitive outings against powerhouses UCLA (regular season) and a near-upset of UCONN in the NCAA Tournament—will be playing Duke on ESPN2 in mid-December, after a meeting with Siena at the TUC on December 1st.  And tiny St. Rose—a Division 2 Power—almost pulled off one of the upsets of the pre-season with a close loss to D-1 Syracuse just a couple of weeks ago. Guilderland’s Steve Dagostino, one of my favorite high school players to watch in the past decade, led the way with 17 in that game, and got a few national looks with video of him hitting 3-pointers against the Orangemen.    Hoop fever in this area seems more legitimate than ever.

BUSINESS NEWS, or, HOW REAL ESTATE STATS
CAN FOOL YOU…

         My colleague Sam Mitchell was checking stats for the MLS participants the other day, and was telling me where each of our active agents ranked on the list for this year’s production.   What was notable was that there were approximately 2600 local MLS Realtors who had been involved in at least ONE real estate deal in the current year, whereas there were over 4200 licensed agents throughout the
Greater Capital Area!  That means there were something like 1600 agents listed in the system who hadn’t sold one home yet this year—or at least had not gotten credit for closing one sale. 

         Are there really that many agents who carry real estate licenses who make NO money, and are agents in name only? It’s a tough time to enter the business, and some offices are loaded with names of licensees whom I have not yet met, still hungry for that first real estate transaction.  This is the kind of sobering information the real estate bureaucrats don’t tell aspiring agents when they are going through their initial licensing courses and training to take the State-mandated test.

         But there are other reasons why the stats may be misleading.  Perhaps certain agents are making a living simply showing rental properties, who don’t get involved in actual sales.  Others might have better-paying day jobs, who simply keep their real estate licenses alive “just in case” they stumble onto a possible deal.   Others keep licenses in order to be able to search the MLS for themselves, and to collect a commission on properties they buy themselves.  Others may be involved with commercial leases, or seeking out properties that are not even listed within the MLS system.  Who knows?  But I can tell you there are still several hundred others who have NOT seen a contract come to fruition yet, who probably thought it was going to be a whole lot easier to make money in this business than it was in 2007.

         Still other agents might be serving as a team member for one of the mega-producing Agents with other offices—these are the photogenic Team Leaders whose faces show up ubiquitously in prints and magazine ads, or on TV, who take numeric credit for all the people who work under them.  But that probably accounts for a couple hundred licensed agents at most, who choose to remain under the domain of a real estate mogul.  They are still getting paid, no doubt, but the statistics for their production all accrue to one person.   The consumer public does not always realize how that works, however, which is why it looks so daunting to hear that one person is doing 20 or 30 or 50 million dollars worth of real estate business—that reflects the cumulative work of 5 or 10 or 20 different people, not superhuman, but still an impressive amount of business. 

“Times Are Tough Out There Right Now, Wayne…”
The Real Estate Maven Told Me

          I wasn’t happy with my own position on the list till I realized that some of my sales hadn’t been counted— One old friend in the business from my days at RE/MAX used to tell me—“I don’t care if they report my sale, but I DO make sure they pay me…”   Still, in a business where agents competitively tout their “numbers” to a semi-gullible public, it matters to some people what your own statistics are.  But there are many ways the stats can be packed or manipulated, or left out altogether. 

          In my case, certain commercial sales I’ve been involved with were listed with CIREB (the Commercial/ Investment Real Estate Boards) and did not show up in the residential MLS.  There can also be cases where new construction sales are not reported properly—the listing agent for one large company might put herself down as having produced “both sides” of the transaction, even when the clients had requested the services of a Buyer Agent.  Some of the kings & queens of the local market do their best to keep THEIR numbers looking good in a down market, at the expense of the worker-bee agents who are involved in the Buyer’s half of the transaction.

          In one recent instance, in a dismissive manner, I was told point-blank that the Listing Agent and the Builder would grant me a slightly reduced “referral fee”—but that “Times are tough out there…” and that’s all they could do.  I had to laugh, as it was the real estate equivalent of Marie Antoinette’s “Let them eat cake…” when told the masses had no bread left.  At the upper end of the food chain, top agents are still not having any trouble pumping gas into their figurative Mercedes Benzes, but some are perhaps having trouble making their statistics look as good or better than the year before, which is the constant quest in any American business.  

         I would have more to say regarding cautionary tales of the subtle, self-serving practices of certain prominent Realtors in any local marketplace, but choose to save those stories for the time when I write a book regaling my real estate experiences, once I’m retired (if ever)  from this somewhat cut-throat business.  There is much more that can be related in fiction than safely told in an online blog in the middle of one’s career.

 NOW THE NEWS, AND HOW IT ONLY PAINTS THE SURFACE….

         There is trouble in Pakistan, ongoing agony in Iraq, an impossibly stupid pending premise for war with Iran, and all the normal economic indicators are gloomy, right?  The price of gas has risen 10% in the past month alone, and news of the weakening dollar, and the stagnant real estate market is constant.  One night’s worth of the Evening News with Brian Williams is all I can handle each month.  I must admit being refreshed in my view of that stiff and unruffled stuffed-shirt newsman when he appeared on Saturday Night Live in the past month.  The prime saving grace of a show like that is to lampoon everyone and everything equally—the Hosts these days mock their own images in humbling and hilarious fashion—whether they are named Bon Jovi or LeBron James or Brian Williams—to see millionaires, pundits, and highly-skilled people brought low with humility is certainly gratifying to the rest of us. 

         For an athlete, musician, or movie star to appear in comedic sketches is one thing, however, but there was something disconcerting about seeing Brian Williams playing a car mechanic or a failed game show contestant…especially since he was back at his “day job” as the face of NBC News a couple of days later, reporting grim stories.

         My recurring theme this year has been not to let the national news affect your daily life to the point where it incapacitates you.  I have been guilty of that in prior decades,
when I was convinced “the End was near,” and was proven wrong, over and over again, at least at the time.  

         Focus on the Microcosm of the economic spectrum in front of you, I tell my fellow-agents—the people who need your help right now, the people who have money to spend, or a property to sell.  That is all you can do, day-to-day, to defeat the gloom that prevails in the News, which will overwhelm you if you let it.  Let’s defy it in our own personal way—survive with humor and creativity, instead of devolving into brutal competitive nastiness and rancor, fighting for pieces of a shrinking market pie.  

         The Market at large will survive, and in certain pockets, thrive.  When I trust my own eyes, I believe that the greater Saratoga region is still one of the best places to live in America—for those who love the four seasons, who love the greenery and topographic beauty, who love clean air and abundant water flowing underground with clean streams above, and who love a healthy place to raise children and indulge in their own recreational life.  The faith in these things keeps me optimistic in this business on the “front-lines” of the economy—where people make real-life decisions about where to live, what to buy, how much to sell for, and what to invest in.
Let’s bless whatever business we’re in and place our energy into making it a positive experience in trying times. 

         Take care till next month…

 

                                                      Copyright Wayne Perras 2007

Posted Friday, November 16, 2007