Ronda Allen's Blog

As I predicted around mid-year 2008, the biggest trend in real estate in Prosper, Texas in 2009 was leasing of large square footage single family homes.  And, we missed a lot of opportunities to do even more leasing, as people tightened their belts to stay in their homes throughout 2009 or rejected the idea of leasing out their home.  

In 2009, there were 29 residential leases in Prosper, Texas.  They ranged in terms from just a few months to a couple of years.  And, we're entering 2010 very light on leasing inventory.  We only have 15 homes for rent across all price points.  Here's the breakdown:

Leases under $2500 per month:  7 homes

Leases $2500 - $5000 per month:  6 homes

Leases $5000 - $10000 per month:  1 home

Leases $10000 - $15000 per month:  1 home

You might wonder who would lease a home for $10,000 a month in Prosper, Texas?  Typically, it's someone moving to DFW from another state, where they are used to real estate costing a whole lot more than it typically does here.  But, as we've discovered in the last few years, that perfect candidate for leasing may just be someone who wants a nice home, but doesn't want to own it.  For example, we have a big hospital population in DFW.  There are surgeons and specialists who work on a contract basis to a variety of hospitals in different states or countries each year.  They don't typically buy homes in these places.  If their contract is long enough, many of them prefer to rent a home versus an apartment.  And, by leasing in Prosper, Texas, they can service hospitals in both Dallas and Fort Worth.  This type of freelance work is very lucrative, but the opportunities come up quickly, and those clients don't have the time or inclination to stay in one place, build equity, or put down roots.  They prefer a more spontaneous lifestyle and build their wealth outside of the real estate arena.

Even though the news on the housing front is trending toward a more positive note at year's end, the economic situation hasn't improved for much of the country.  So, although I was the first agent to document the trend toward residential leasing for Prosper, TX in 2008, it doesn't take any great stretch of the imagination to know that 2010 will be another year of great demand for residential leasing.  In fact, I'd go so far as to predict the next two years will be equal to or greater than the 2009 leasing figures in Prosper. 

As demand for leasing has risen, so have rents.  The renters are, in many cases, moving into a home that they intend to purchase when their current home takes a contract.  They are willing to pay for the flexibility to get into the right home in a tenant position, in order to avoid the expense of moving twice.  Don't close your mind to leasing.  Offer your home for sale or lease, and let the needs of the market determine which listing responds best. 

Have a blessed day!

Ronda

Hey, Realtor:  Pat yourself on the back and keep plugging in 2010!  It's the end of another year, and you need to take a moment to congratulate yourself.  You're still around!  You managed to dig in your heels and pull out enough business in 2009 to still be in this industry.  That's a real accomplishment!  Others around you dropped out, got other jobs, retired, or were pushed out due to low performance.  You're still standing!  Congratulations!!

Things are looking so bright, I gotta wear shades?
Now, as one of the last regions to drop and one of the first regions to spring back from the economic downturn of 2008, I wish I could tell you that the recovery period was quick.  But, guess what?  It wasn't.  2009, although steady in it's recovery in our North Texas (primarily Dallas/Fort Worth) region, was sluggish.  It reminded me of my second year in real estate - I had enough business to get by, but not nearly enough business to stay busy.  Surviving?  Yes.  Thriving? Not so much.  Master of my own destiny?  Maybe next year.   

The media! (or should I stay DUH media!)
Media attention is still up and down about housing.  Signs of recovery, for sure.  Housing starts up, for sure.  But, back to where we were in 2007 and early in 2008?  No way.  Not yet.  We have lots of people who would like to sell their home, but they are sitting on the sidelines, scared to even ask what their home might be worth (even though in our region, that fear is just about baseless and most of my clients are pleasantly surprised by their market assessment in North Texas).  We have a lot of people who would like to buy a home, but they are still fearful of the tightening of the lending industry by the big banks, and don't want to be told if they don't qualify to buy a home right now.

Go back to the start, do not collect $200 and try again!
Remember when you were a new real estate agent, and you had to use some pretty old-school methods to meet people who might want to buy or sell a home?  It's like that.  UGH!  I know.  But, the worst mistake you can make when you start to see your business looking better in your region is to think that the recession is behind you.  It's not.  Some of those sellers are going to find that the market does not embrace their home's pricing and marketing strategy.  Some of those sellers will blame you.  No, it isn't fair.  But, you've known all along that some sellers think we have a crystal ball in our possession.  They think we make way too much for doing way too little (if they only knew!).  Many of them don't understand that a home listing is a living entity that requires attention and tweaking.  There are a myriad of reasons that the marketing strategy may not be enough to get the home under contract - not the least of which right now are 1. a shortage of qualified buyers and 2. a saturated market.  Some factors are just beyond your control.  Try very hard not to take it personally.   You are going to do a whole lot of work for no money, and it's going to test your desire to stay in the business.  You do not deserve the year you are going to have in 2010.  Tighten your belt.  Do the best you can.  Find other endeavors to feed your soul each day, because real estate is going to beat you up.  You will be tested. 

Then, there are the buyers.  We went a long period of time where it felt like someone yelled 'FREEZE' in the real estate industry, and everyone stopped in their tracks.  Buyers who were previously fully qualified to buy were told by their lenders about new rules that kept them from getting a home loan.  Buyers who stepped forward to take advantage of the first-time home buyer tax incentives were told they either made too much, made too little, had too much debt, had no established debt, etc...  And, then there were the foreclosures and short sales that took so flippin' long that the buyer's just decided the wait wasn't worth it and backed out.  2009 was a national game of musical chairs being run by the big banks.  Every time the rules changed, another chair was removed.  As their Realtor, the buyers will break your heart.  You're going to try all sorts of ways, different lenders, grant programs, private investors - and still some of those buyers won't be getting a home.  Again, gear up for lot of pro-bono work.  Since we don't get paid until a home closes, you will get the shaft a few times in your efforts to help people. 

You gotta find the box to think outside of it.  Who took the box?
Think outside the box in 2010.  Start that blog you've been thinking about starting.  Answer some questions on trulia.com.  Re-vamp your website.  You're going to have time to fill.  Go back to old-school methods of meeting people who are looking to make a move.  Set a business day for yourself and work from a business plan, even if you have never approached your business in such a formal fashion.  And, add some community service to your work week, as it will help you sustain your spirit when you feel down when the media says things are great and your reality doesn't match the news.  Diversify your business.  If you've traditionally been only a listing agent, start taking on buyers, too.  Or, consider working leases.  Leasing has been a much larger portion of my business in 2009 than in any year prior.  You have to stay flexible to helping people with their real estate needs, no matter what those needs may be.  If it's leasing, because they have a new job, but cannot buy until a current home sells, then say 'yes' to helping them find a lease.  If you do a good job with negotiating their lease, they'll come back to you when their home sells and they can look to buy.  There are some books to help.  These aren't new.  Who Moved My Cheese! and The Fred Factor are two great books that you may already have in your library, but you need to get them out and read them again. Look for nuggets of knowledge, then apply them into your business plan.

Go into 2010 with an open mind, an absolutely furious work ethic, and a can-do attitude.  Break down your business plan to the smallest of daily tasks, and do those tasks with great consistency.  And, I'll see you right here next year!

Have a blessed day!

Ronda

Ask any good real estate agent, and they have dozens of stories of how a buyer may have hindered their own ability to buy the right home.  But, it makes my job easier when I explain the process of buying a home before write the contract, so the buyer can pick up on the time's when they are standing in their own way.  Here are three things I tell every buyer client:

1.  I know you have access to the internet, but I am more capable of finding your next home than you are. 

It's true.  The community is my office.  I know my office.  Only I have access to all of the data in the MLS.  You have bits and pieces of MLS data.  I know the builders.  I know their inventory.  I know that not every home that is available is found in the MLS.  I know sellers who aren't yet on the market, but who are getting their home ready for sale right now.  My job is to get to know the buyer well enough, and ask them enough questions, so that I know which homes fit them the best.  Any agent can tour buyers through 100 homes in an area and say 'pick one'.  A good agent will conduct a buyer interview and engage themselves in active listening, then take back the information gathered and locate the best homes for their client.

There are great sites out there on the internet.  And, I use them to market my listings.  I also use them to engage dialogue with prospective sellers and buyers.  Trulia.com, realtor.com, homes.com, point2homes.com, postlets.com, activerain.com, zillow.com, and many other home sites are useful tools of the real estate industry.  People don't turn purple or put a red rose in their lapel when they are looking to sell or buy a home.  These sites exist to give people a forum for stepping forward to get the assistance they'll need to make a successful move.

2.  I know we've only known each other for a short time, but I am asking for your trust.

This is a big one.  It's human nature not to be too trusting of strangers.  My job as a real estate agent is to connect with you and know as much about you as possible.  I'm going to ask personal questions.  Some of those questions may be uncomfortable for you to answer.  I bet by the time the transaction is over, I'll know you better than some of your relatives and most of your friends.  The good news is, that information is sacred.  You, me, and the lamp post, my friend.  Honesty and trust are what I ask from you.  And, I have a full Realtor Code of Ethics that I will share with you, to show all you gain in return.

3.  Don't presume you know the outcome before you've written the offer.

Agents are nodding on this one!  How many times have we heard buyer's say about their favorite house from a tour, 'I bet they won't come down to $x, so I guess we'll just keep looking'.  Price is typically the factor where buyer's make the most presumptions.  The second most common is the timing it will take for a seller to move out of a home.  The third most common, in my experience, are the sales term concessions or non-realty items that a seller may be willing to leave behind for the right deal. 

The whole point of a negotiation is to find the gain:gain.  This isn't a tug of war.  It's isn't win:lose.  It isn't a win:win, either.  Both parties have something to gain.  If they both gain, the deal will be done.  If they don't both gain, the deal is likely to fall apart.  What we're dealing with is investigating the common ground.  We need to know how close the home being sold is to the buyer's criteria.  The closer it is, the more likely that buyer is motivated to purchase that home.  Most buyers make some sort of compromise when buying a home.  But, any home that meets 85%-95% of their wish list is probably getting some serious consideration by that buyer.  Now, they're weighing their pros and cons, and seeing which factors are set in stone, and which ones might be negotiable.  There we have it.  Our common ground.  Knowing those negotiable factors and working to find the gain:gain. 

I believe most buyers and sellers think that the real estate agents really enjoy getting out to look at homes.  I believe most of those same people believe we spend our days on the golf course and that we really don't add that much to the process.  That is, until you meet a good real estate agent.  A good real estate agent knows their inventory.  We've been in a lot of homes.  The excitement for us is not in the day or two we get out to tour homes.  We already know which homes you are most likely to love and which ones you will likely turn down and why.  The excitement for us begins when we have a short list of homes and can begin the negotiation process.  Something inside switches into high gear and our true expertise comes into play.  Negotiating a real estate contract is very much like playing the game Operation:  One false move, and the buzzer goes off, and it's game-over. 

Have a blessed day!

Ronda 

When you enter the real estate industry, no matter what brokerage firm you hang your license with, you enter the world of the self-employed.  Freelance contracting is selling from a tight-rope, 50-feet in the air, with no net below.  It's scary. 

When you control your own destiny, it is very easy to become a control-freak.  You learn how to be everything - coffee maker, copy repair person, IT technician, selling agent, buyer agent, leasing agent, and advisor to everyone you know about anything even remotely related to real estate.  It's no wonder that we create an environment where we only rely on ourselves, and work all hours of day and night to build up our business.  Then, when you generate enough business that you can take time off for training, consultants begin telling you that you must offload administrative functions or you'll never be a top producer. 

They are, of course, spot-on in their advice.  But, there's that tight-rope again.  It gets scary again.  Can you trust someone else to do things the way you want them done, in the timing you want them completed, and will you be happy with the result?  Fear keeps you from making the move you need to make to take your career to the next level.  So, you put it off a while longer and hope you'll get so great at time management that you won't have to consider bringing in help.

Here we are, heading into another year, and you still haven't joined a team or found a way to offload tasks that could and should be done by others.  Long after the other agents have gone home, you are still on the computer working.  You don't dare try to figure out your rate of pay compared to your hours worked.  Here, you thought you'd get rich in real estate.  In reality, with your hours and expenses, you are quite possibly working for below minimum wage. 

Kick past the fear.  Shake off the presumption that your way is the only way.  It's time to make it happen.  To grow your business in 2010, you need to do three things:

1.  Join or form a team.  Most agents find they like to work on both the buying and selling side of the industry.  But, we all have a preference toward one side.  Personally, I like the strategy of the selling side, but the personal nature of the buying side.  A good 60/40 split, leaning slightly more toward listing homes, makes me the happiest.  I know agents who focus solely on one or the other.  But, I also know agents who focus on buyers because their own selling skills are weak, or listing agents who try to work corporate hours and don't like to leave their office to show homes to buyers.  Every agent is self-employed.  It's cool to find out what motivates you, or what you are best at, and to do that.  Being on a team allows you the flexibility to find that right split.  Set ego aside.  If the other agent has more listings than you do, they win.  Top billing goes to them.  You still have your listings, but you generate more leads as a team due to the cross-marketing that all those extra listings bring you.

2.  Get an assistant.  I don't care if the assistant is a friend, spouse, a rookie agent, or a hired aide.  When you are so tied to the computer that you can no longer get away from your desk to take on the task of finding sellers or working with buyers, you have no choice but to enlist some help.  To continue to burn the candle at both ends depletes your energy.  It makes you more tired.  And, if you are tired, you open yourself up to illness or being less than stellar at your job.  Thus, sellers won't pick you to list their home and buyer's won't want to work with you.  You will either run yourself out of business or you will become so exhausted that you go do something, anything, other than real estate. 

3.  Create a new day.  If you aren't tied to your desk anymore, then how are you going to spend your days?  Do you even know?  You gave good service, your business grew.  Referrals came in from your clients, and your business grew more.  You did it all and patted yourself on the back for attaining a certain level of success.  But, when someone else is handling the administrative tasks for you, what does that leave for you to do?  Plenty!  You begin networking with other agents in the area to get your listings sold.  You interview contractors to take on specialized tasks (I now offload all still photography, virtual tour panoramic photos, and graphics to a marketing firm) and train those contractors on how to meet your expectations.  You preview home and attend events in your community (rotary, chamber, builder, realty board, etc...) and build your knowledge base.  You investigate new online and offline marketing strategies and test them to weed out the ones that work from the ones that generate no results.  You take more time with each buyer or seller you encounter, as you are now focused on working with clients.  You are not distracted by the long to-do list being worked back at the office.  Your assistant has that under control, and is worth their weight in gold.  Those buyer clients like you more, as you are confident and can engage in active listening and actually show them fewer homes that more closely meet their criteria.  You convert more of your clients off phone calls, emails, tweets, or texts - because you make a better first impression.  (Yes - social media should stay with you, at least in the beginning.  Once you develop your style, a good marketing manager can take on many of the social media tasks, too.)  And, you have time to analyze trends and patterns developing around your listings, so you can tweak your marketing strategies and get more homes sold faster.  You, in short, finally become a real estate agent.

Don't leave 2010 to luck.  There were successful real estate agents all over the country in 2009.  They did things a little differently than you may have done them.  Go into 2010 with an open mind and finally taking that leap-of-faith to expand your horizons and grow your real estate career.  The only limitation you face is yourself.

Have a blessed day!

Ronda

All in all, 2009 wasn't a bad year for selling homes in Prosper, Texas.  The media would have you believe that it was gloom and doom all over DFW.  We certainly did see our area home sale prices drop about 2%, and we were selling homes at around the same levels where they were selling in 2007.  Honestly, there are so many regional markets worse off that we have NO cause for complaint. 

There are still some December pending sales missing from these figures, but I think you get the point of how well our year in Prosper really went when you see sales posted to the MLS as of 12-15-2009:

Homes sold = 200

% of that figure in the luxury home market (in DFW, that's $350,000 and up) = 44%

# of homes that had pools = 38 (that's 19% of our market - pretty high for homes with an average build date of 2005)

% of our home sales that were classified as "Z" sales (undisclosed sales price in the MLS) = 12%

An average home sale in Prosper fits this (very attractive) description:

Bedrooms = 4

Baths = 3.1

Garage = 3-car

Square footage of living space = 3719

Lot size = .72 acres

Sale price to List price = 96%

Days on market average = 172

Price per square foot = $98.07

Sale price = $370,561

There were some excellent deals for buyers to pick up in the first half of 2009, which was the tail-end of the economic downturn for our area.  Since Summer, it has been a steady improvement of sales in Prosper.  Luxury home starts and resale purchases are up, and sellers are holding more firm to their asking price that at this time last year.  The outlook for 2010 in Prosper is outstanding.  The formula for success is in place - great location, great schools, beautiful neighborhoods, nice lot sizes, tons of upgrades, area parks, waterways, and playgrounds, and reasonable prices. 

Welcome to Prosper - A Town Where Everyone Matters!

Have a blessed day.

Ronda

In mid-year 2008, we began seeing a trend toward leasing of homes in Prosper that came on quick as the recession hit DFW.  As I have been saying all year, the demand for residential leasing in Prosper in 2009 has been astronomical.  I predicted a strong year of leasing, reminded the residents of Prosper throughout the year when we had greater demand than we had supply of leases, converted some homes for sale into homes for lease, and advised residents that this was no short-term trend.  It will continue into 2010.  Now that we're at year's end, we can and should look back to ensure that the prediction was correct:

Current residential lease inventory (available homes in the MLS for North Texas in the Town of Prosper as of 12-08-09):

16 homes

Price range:  $1050/month to $11,000/month

Average asking price on a lease in Prosper:  $.75 - $85/sf for a 4-bedroom, 3 bath home with 3-car garage and lot size averaging higher than .25 acres.

Current residential leases pending full lease:

1 home

There is one 6-bedroom home on Chapel Hill that is currently in negotiation of a $2600 per month lease that took less than 60 days to receive an offer. 

Current residential leased properties that went into leased status in 2009:

53 homes

Lease range of homes:  $1145/month to $5,000/month

Average leased price of a home in Prosper in 2009:  $.70/sf

Why the trend toward leasing?  The recession is over in DFW, right?  Not completely.  We can certainly see that some areas of DFW were barely grazed by the downward trend in the economy.  Some areas briefly dropped between Fall, 2008 and Spring, 2009.  We saw steady improvement in home sales all year across the region.  But, some neighborhoods still maintain higher than normal foreclosure and short sale inventory that has yet to clear out.  But, even those areas are seeing thinning of distressed inventory (and at a pretty rapid pace, too).  So, why would the trend toward leasing continue?  Because a big portion of the buyer pool in Dallas/Fort Worth each year is made up of people moving from other parts of the country who have homes to sell before they can buy here.  And, where do our buyers come from?  Other major metropolitan cities with large corporate bases, just like us.  Chicago, Los Angeles, Seattle, New York City, Tampa, Houston, and San Francisco's Bay Area are major target markets for Dallas/Fort Worth's housing market.  What do all of these cities have in common?  Their housing market is still trending downward or just starting to settle.  The recession isn't over yet. Until we see those markets rebound, the trend in DFW's housing market will be a continued demand for residential leasing.  

If you are considering selling or leasing your home in 2010, the best advice I can give you is to list the house both ways and let the market dictate what works for them.  We've worked some pretty funky customized leasing arrangements in 2009 to make the situation work for both parties.  That's actually been challenging and exciting.  The strangest lease I did in 2009 was a 5-month fixed rate lease with a 7-month term of month-to-month leasing at a higher rate.  This allowed the tenant time to get through their purchase contract in California and then gave them time to decide whether to buy the home they were renting or time to view other home options during the back half of the lease.  The tenant ended up buying the home in the 4th month of the back half of the lease.  I believe it came down to the fact that they leased a house that they would consider buying, moved in, their family got settled into schools and the neighborhood, and the thought of moving again at the end of the year just wasn't that important.  A little flexibility by the 'seller/landlord' up front was rewarded with a purchase contract before the lease was up.  Pretty cool.

Have a blessed day!

Ronda

Every year, we see sellers debating whether to decorate for the holiday season.  If they do choose to decorate, they have to decide to what extent.  If they don't decorate, they may be making a critical error in the attempt to sell their home.

My opinion is that anything that draws attention to your home is a GOOD thing!  When we agents hold open houses, you don't see us choosing not to put out our open house signs.  We want people to look at the house and make a decision about whether they want to visit the home or not.  Same with the holidays.  It's a time of year when the weather in Dallas/Fort Worth is crisp and cool.  It's the perfect time of year to grab a coffee or hot cider and drive around neighborhoods looking at holiday lights.  People get a little voyeuristic at this time of year.  We attempt to peak inside as we drive by, if the blinds are open, and see that beautiful tree lit up inside.  It's dark earlier these days, so any light in a home captures our attention.

My philosophy on selling a home in the Winter months is that you should draw attention to the home every day, and work to extend the showing window on your home into the evening.  It is not a buyer's tendency (or agent's for that matter) to want to get out to show a home after dark.  But, when dark comes at 5pm, I don't know a Realtor in Collin County that won't get in their car for a 6pm showing in the Winter months.  There isn't much call for them, and we jump at the opportunity to stay busy in the 4th quarter. We don't typically show homes late into the evening around here, anyway.  We try to be courteous of the inconveniences that showing a home creates on the family trying to attract a buyer.  And, since our region is so heavily corporate, a lot (I would venture to say the majority) of agents work a traditional 9-5pm work day. 

Keep in mind that exterior holiday decorating when you are trying to sell your home is VASTLY different than how you might decorate in a non-selling year.  Skip the cutesy and stick to the traditional.  But, be different, so your home doesn't blend in with others on the street.  If everyone else is using solid white lighting out front, let your home be the one in color.  If they are on the roofline, yours could be in the shrubbery.  You aren't trying to blend in.  You are trying to stand out (tastefully).   Know your target buyer and try to appeal to them.  And, keep in mind that the decorations can be seen during the day, and realize what impression that leaves.  Nothing bothers me more than to drive in Prosper, or other parts of North Texas, and see deflated blow-up ornaments in a yard during the daytime.  What looks cute in the evening looks like a dog's breakfast during the day when we're showing homes.  Subdued, tasteful, minimal - these are your buzzwords for holiday decorating outside the home.

The interior of the home is where many people over-decorate for the holidays when they are trying to sell a home.  If a tree is put up, it should be in proper scale to the room.  There is nothing sadder than a Charlie Brown tree in a room with 18' ceilings.   And, if your home is one in Prosper with a huge foyer - especially the rotunda foyer that just begs for a holiday tree, consider having a tree in the family room as well.  People don't want to celebrate in the foyer.  That tree is all about show.  The big homes of Prosper, with large gamerooms, extended foyers, large family rooms, etc...just beg for multiple trees.  So long as the scale is correct and the trees don't become a distraction to buyers, it helps create a bond to your home and is an asset to have in the home during showings.

Let's note that many new construction models do not put up decorations for the holidays.  Many of the builders do run end-of-year sales incentive programs, but resale homes win out over new in December for warmth and appeal during the holidays.  It's easier to connect on an emotional level with that home.  All other times of the year, new construction models are the biggest competition to our resale home.  As is true with every buyer I've ever worked with, what begins as a logical home search turns into an emotional decision on their 2nd showings.  It all comes down to which house feels the most like "home". 

This isn't the year to put out every piece of holiday decor you own.  Your choices should be thoughtful.  Staging the house is critical no matter what the time of year.  Ask yourself, "will this piece help me or deter me from selling my home?"  Be honest with your answer.  If it isn't necessary, and won't really help, define it as unnecessary clutter, and pack away that precious family momento for next year in your new home. 

Above all in December, be a clean home.  Walk in your home and take a deep breath.  Does it smell clean?  Walk into each room, with particular attention to bathrooms, utility rooms, and closets.  Does it look clean?  If the answer is no, you have some chores to do.  No heavy scents like candles or sprays.  Just the scent of a clean, neutral environment.  Oreck carries my favorite cleaner for granite countertops, and it has the light scent of vanilla cake.  I use it in vacant properties and the light scent lasts for up to a week.  It smells fresh, clean, and familiar.  The reaction from prospective buyers has been very positive.  Failing to keep the home show-ready because of the convenient excuse of the busy holiday season means that your home is more likely to be passed over, and not purchased, this December.  When your home is for sale, there are two things that are just unforgiveable: 

1. An unclean home.

2. A seller-cancelled showing appointment.

December is a great month in DFW and traditionally, a tremendous month for home sales.  Be clean, stay available, and make wise decisions.  We may just gift you with a SOLD sign rider sooner than you think.

Have a blessed day!

Ronda