SAN DIEGO MORTGAGE AND REAL ESTATE

Sliding Down to 4.5% Mortgage Rates On the Bailout Playground

San Diego mortgage rates are ready to slide down to 4.5%, fueled by the confirmation of the rumor about the Fed's intervention into mortgage-backed securities markets:

The Federal Reserve on Tuesday announced that it expects to begin operations in early January under the previously announced program to purchase mortgage-backed securities (MBS) and that it has selected private investment managers to act as its agents in implementing the program.

Under the MBS purchase program, the Federal Reserve will purchase MBS backed by Fannie Mae, Freddie Mac, and Ginnie Mae; the program is being established to support the mortgage and housing markets and to foster improved conditions in financial markets more generally.

Sean Purcell and I talked about this breaking news on Radio Mortgage today.  Here, I talk about the cost of  "free market", non-government supported mortgage capital is over 8%.  Yesterday, I detailed why it is absolutely NUTS not to jump on this bailout immediately; I believe that the fear of inflation will whipsaw the mortgage markets in the not-too-distant future.

Is this action inflationary?  Well, the Press Release would suggest that it isn't:

Assets purchased under this program are fully guaranteed as to principal and interest by Fannie Mae, Freddie Mac, and Ginnie Mae, so the Federal Reserve's exposure to the credit risk of the underlying mortgages is minimal. The market valuation of agency MBS can fluctuate over time based on the interest rate environment; however, the Federal Reserve's exposure to interest rate risk is mitigated by the conservative, buy and hold investment strategy of the agency MBS purchase program.

I don't get it.  Sure, if the government can borrow money at 2.5%, and lend it at 4.5%, it sounds like a zero-sum game. However...not all mortgages are paid so their is the risk of default.  So while the government is borrowing money to lend money, it isn't a perfectly hedged arbitrage play; that's why Wall Street could eventually see this as inflationary, and start selling mortgage-backed securities.  That could drive mortgage rates towards the "free market" mortgage rates of 8%.

Wait, that's not all.  Where will the government get the money to but the mortgages?

Purchases will be financed through the creation of additional bank reserves.

Oh NOOOO!  The government is printing money again...that's inflationary! 

This is perhaps the greatest "bailout" you'll ever see in your lifetime.  If you're a well-heeled borrower (plenty of equity, documented income, and excellent credit, you can get a mortgage rate in the 4's BUT...

...you have to act quickly.  Contact me as soon as possible.

Take the 4.75% Bailout Mortgage And Run...Or Else

San Diego mortgage brokers are always asked what "the rate" is. We used to flippantly answer that question two ways:

1- With another question; "Are you talking about the "best rate"? (meaning an ARM product)

2- with opacity; that depends on the credit, equity position, and capacity to handle the debt

Of course, we know what your asking.  "The rate", more specifically defined, is the 30-year,fixed rate mortgage, with an equity position of 30% or greater, documented income, and excellent credit.  Even today, "the rate" is stratified into three loan size classes:

• under $417,000:               4.750% with 1% origination fee
• $417,000-546,250:           5.125% with 1% origination fee
• over $546,250:                 8.125% with 1% origination fee and 2 discount points

Pay mind to that last quote (8.125% with 3 points); that's the REAL, free-market, cost of mortgage capital and that's where we're eventually headed.  The lower, more attractive loan amounts are subsidized by the government, through the FHFA (which guarantees all FNMA/FHMLC loans).  That subsidy can't last forever.

San Diego real estate broker Steve Berg screams for help for this non-subsidized market:

According to Tim, if Congress doesn’t do something fast, the higher-end home market could be in a lot of trouble. Right now, there are few lenders who will even originate a 30-year fixed rate Jumbo loan. Countrywide/Bank of America will, but at about 8%, plus 1.5 points. You can get a 10/1 ARM at 6.5% with 1 point, but face the potential for a refinance down the road. I hope the National Association of Realtors (NAR), California Association of Realtors (CAR) and Congress jump on this problem, as Jumbo loan rates are already making a challenging environment worse.

Readers of this weblog know this; I outlined this problem in the 2009 San Diego Real Estate Market Outlook:

Next year, I suspect we’ll see a convergence of housing prices as the higher-priced homes follow the lead the of the lower priced homes’ decline.  The median price may very well drop but the lower-priced homes will hold value.  The government is doing everything possible to provide liquidity to the lower end of the market but there will be NO financing available, over $625,000 next year. Watch  Solana Beach, Encinitas, Poway and Scripps Ranch nose dive while the cash-heavy communities of La Jolla, Rancho Santa Fe, and Del Mar drop just a bit.  Sell that duplex in Cardiff and buy a four-plex in Imperial Beach, if you’re an investor (I imagine Jeff Brown will tell you to just get the hell outta Dodge).

The key component to the housing recovery for San Diego remains in the ability for a home buyer to get financing.  The US Treasury stepped in to provide financing for properties under $625,000, by:

(a) increasing the loan limits for FHA, conforming and VA loans to 115% of median price (expected Jan,2009)
(b) nationalizing Fannie Mae and Freddie Mac (guaranteeing the loan from default)

San Diego REALTORs know this; it's not just Mr. Berg who calls for federal subsidies for the tony communities of San Diego county.  The National Association of REALTORs wants the US Government to subsidize higher loan amounts.  I was in Orlando, at their convention,  when they called for it in their "four part housing stimulus package"

Why won't more bailouts work?  A commenter in that post, named Smithers, nails it:

I suspect the fed has to drawn the line somewhere, since voters in Kentucky are not thrilled with guaranteeing high-priced CA mortgages. (I’m not either, and I live in CA). While I think it is bad policy to prop up housing prices beyond what people can actually afford (e.g., in form of artificially low interest rates maintained by fed), politicians are hell-bent on doing it to suck up to our “gimme, gimme, we deserve it” mentality. However, the current politicians are also exploiting class-jealousy, which makes it hard for them to justify propping up prices that, for the vast majority of Americans, are for “the rich”.

The concept of classism is coming into play.  I talked about this in my 2008 Real Estate Market Outlook:

There will be a marked class distinction that develops within the next 6-7 years.  It won't be determined by assets but by debt and its utilization.  Those that respected money will get more of it; those that didn't respect it will lose it.  That will have a profound effect on productivity as the "hourly worker" will become despondent about his life and stop pushing for the overtime.  Why work the extra hours to make the mortgage payment when the house was lost in foreclosure?  A commitment to mediocrity will be the mantra of the American worker because every disposable dollar will be spent payig the bar tab he ran up five years ago.  Personal bankruptcies will rise.

When we scream for "bailouts" for California real estate we forget that Iowans think that we're ALL rich.  Now, we might be able to logically explain that a family living in a $700,000 home "ain't really rich" but perception is reality when it comes to asking for federal subsidies.  If Californians keep beating up Congress for more money for cheap mortgage rates, the Kentuckyans, Texans, Iowans, and Georgians are gonna get REALLY mad.   Igor Panarin's prediction of Civil War, based upon that class distinction, just might come true:

This map is from The Wall Street Journal's article, dated December 29, 2008.

Am I trying to scare you? 

Damn skippy, I am !

The real, free market cost of mortgage capital is 8%.  Federal subsidies are bringing mortgage rates down to 4.75%, for a 30-year fixed rate loan, for a limited period of time.  The federal subsidies can only last so long before rampant inflation comes into play.  We've been printing money for the past 18 months and, eventually, that will drive interest rates up to the free market rate.  We know that free market cost of mortgage capital to be 8% or greater for homes with equity.

Protect yourself from this today.  Call me at (858)-777-9751 and we'll see if you can get your bailout money, at 4.75%.

Am I crazy or just "keeping it real" ?  Contact me to find out.

Seven Things You Didn't Know About Me

1- I was an oarsman in high school.  I rowed for the St. Joseph's Prep crew team on the Schuykill River.  While the "sweepers" received a lot of attention, I was a sculler for the late, great crew coach Gus "The Hammer" Ignas.  The Hammer was a giant of a man.  He cursed like a sailor but loved all of us like his own sons.  I wept when he died.  Here's Chris O' Brien, recalling The Hammer:

After three hours in the broiling summer sun and 18 miles in an underpowered, overweight boat, he allowed us to go in to the dock but told us to stay in the boat once we pulled up alongside the slip. At this point, Gus hops out of his launch and starts in with, "Now, men, I am very proud of the way you handled this practice. It was tough and you gutted it out. Before you get out, there is one more lesson that I need to pass along to you today. When you are sitting at the dock like this, never lift your oars up off the dock like this." With that, he demonstrated just how high an oar had to go before the old Pocock quad would tip and then laughed hysterically at us as the boat rolled over and dumped us into the muck of the Schuylkill. There were all kinds of people up on the balcony who were absolutely roaring at us as we righted the boat and climbed on to the dock. Then, to top it all off, Gus says, "now get your boat out and put it away" as he turned to go home.

To this day, I still am unsure how we managed to get the boat out of the water without doing permanent damage either to it or ourselves, but we did manage to get it out and put away by ourselves. I wasn't really sure what the lesson in all of this was at the time as I wondered what the hidden message was, but in retrospect, I think that Gus actually wanted us to see that you could tip a boat on the dock and could think of no better way than to demonstrate it to us after an 18 mile row.

He was one of the great characters on Boathouse Row and I have related this story to countless people who knew the man very well who just laughed and said, "that's Gus" with no other explanations offered. For some reason, I just couldn't keep my promise to never get back in a boat again either- once you have felt the bottom of the Schuylkill swallow your legs to mid-thigh, there is no where to go in rowing but up.

2- I lived in Phoenix for twelve years.  I moved there when I was 26 and fell in love with what was then, a sleepy desert town. Alas, I missed the ocean and moved to San Diego in 2003.

3- My first teenage job was in Sales at a company called "Associated BankCard Holders".  I sold a service akin to Pre-Paid Legal to people over the telephone.  That experience was invaluable.  At 16, I learned the important salesmanship skills so many in my industry lack.

4- I've been an "information marketer" since I was eleven years old.  My neighbor and I created a "tip sheet" to sell, outside of the Garden State Race Track, with our suggestions for the winning picks.  Vendors at New Jersey race tracks are generally sanctioned by certain families and we were not granted that sanction.  That business lasted about two days.

5- I learned how to surf at the Jersey Shore when I was 14 years old.  Waves in the Atlantic are far inferior to the ones in the Pacific Ocean.  When I tried to transfer that learned skill to my new home, I failed miserably.  Today, I bodyboard:  monthly in the off season and thrice weekly during the summer.

6- I coached Little League in Litchfield Park, AZ, about ten years ago.

7- I"ve been on a "teenage dance show" at the Jersey Shore.  It was broadcast on Sundays from the Music Pier in Ocean City.  Dozens of people watched that show on Channel 46.

Eartha Kitt Passes Away on Christmas Day

Eartha Kitt, the sexy, seductive, sultry songstress, who made "Santa Baby" popular, died today.  Here's Eartha, at age 79, performing for President Bush, two years ago.

How To Get a 4.75% Rate For Your San Diego Mortgage TODAY

National mortgage bankers have become extremely stingy about the yield spread premium they offer, to San Diego mortgage brokers or directly to consumers, for accepting a higher mortgage rate.

Essentially, yield spread premium is a way for consumers to lower the upfront costs associated with obtaining a mortgage.  Generally speaking, each .25% higher in rate used to afford a 1% “rebate” to the consumer.  The formula isn’t linear and it varies with economic conditions but we used to rely on that .25% rate/1% rebate formula.

Today, that scale looked like this:

RATE                             REBATE

4.750%                           PAR

4.875%                          .375%

5.000%                          .500%

5.125%                          .625%

5.250%                          .875%

5.500%                           1.0

You follow?  In years past, a “par” rate (one that offered no rebate and required a 1% origination fee) was about .25% lower than a “no point” loan (one that paid the originator her fee from the lender).  Today, that spread was three times as much.,,,and I bitched about it on Twitter.  Enter Seattle real estate agent, Ardell Della Loggia.  She said, on Twitter:

ARDELLd @mortgagereport - Bigger news 4 buyers and agents…”break even in 21 months vs. WAS just over 5 years A point is looking like a bargain!”

Ardell was a bit off but she’s a REALTOR not a mortgage lender.  It normally took four years to “recover” the upfront point, the consumer paid.  Today it only takes about 18 months.  Ardell looked at the POSITIVE benefit of this disjointed market rather than the negative implications.  In other words, she recognized that the sub-5% mortgage rates are artificially low and that the 5.5% rate is more in line with the market.

Should you pay that “point”? Of course you should IF…you plan on staying in the home for a year and a half.

Sometimes, it’s all in the way you view things.  Thanks, Ardell.  I should have seen that.

San Diego Mortgage Rates Report: December 22, 2008

Conventional mortgage rates are currently 4.75% and people are still waiting for them to drop that last quarter point...THAT IS CRAZY!

There is SO much risk of mortgage rates popping back up to the 5.5%-6% range, if the US Treasury reverses course and stops buying mortgage-backed securities.  On a straight risk/reward analysis, holding out for that last quarter percent while the risk of a full percentage point spike is NUTS.

My RadioMortgage.net partner, Sean Purcell, was busy writing the draft of our new book so I was the guest on Radio Mortgage.  Rebecca Levinson, a real estate marketing consultant in Milwaukee, hosted Radio Mortgage and asked me:

What do the posted rates REALLY mean to a consumer?

Listen to my answers in this 12 minute podcast, hosted by Rebecca.

PS:  Expect to hear Rebecca a whole bunch more on Radio Mortgage.

Action Plan For 2009

Dave Facer is an old classmate of mine at Villanova.  We reconnected a few years ago at the San Diego Chapter of the Villanova University Alumni Association.  Dave's a life coach and performance consultant, in San Diego.  This good piece of advice came from his website (www.ActivatePotential.com):

I am not the least bit interested in your resolutions. I want to see your plans and evidence of what FDR called, direct, vigorous action! Show me your calendar with your goals broken down into daily tasks. Show me your budgets with allocations by month for those tasks that require money to be spent. Show me your hour blocks that dedicate your time to working on those tasks. Show me the calendars, budgets, and time blocks of key colleagues/partners/teammates who are working with you on accomplishing your important goals. Those are the things I want to see!

I whole-heartedly agree.  Here's what I will do in 2009:

My action plan is so simple it’s stoopid. The challenge, as always, is consistently implementing it. Time-blocking three hours a day, four days a week, should get it done.

2008 was a great year for “lead generation”. I amassed over 2000 contacts on various social media. While it has resulted in business, more consistent phone conversations, combined with systematic e-mail newsletters, will have a much better result.

My game is a contact sport so all I want to do, in 2009, is:

1- speak with 20 new people each week.
2- speak with 20 referral partners each week.
3- speak with 20 past clients, asking for business and/or referrals, each week.

That’s 15 calls daily, four days a week; plenty of time for play if you think about it.

Of course, I’ll want to measure activity and results, too

Friend and BloodhoundBlog colleague Chris Johnson passes along some advice from Joe Paterno:

We all have built in excuses to fail, to screw up. Our parents to and peers were let us off the hook. In our culture, nothing is ever “our fault.” Now, I’m 31, and I’ve never t hit on all cylinders for very long. I’ve had myself committed to being uncommitted. That way, I never measure myself against anyone.

Most people are just resting on imaginary laurels!

That’s all it is, man, and people do it all the time. You have to earn the position you’re in day by day, moment by moment. You’ve gotta engage yourself, to see how far you can go. Accept the fact that you’re always gonna have people left that are luckier, smarter, richer, more equipped than you. Get over that–let your ego go, and then spend the time maximizing YOUR talent.

“And to whomsoever much is given, of him shall much be required” Luke 12:48

If you’re reading this, you’re in the “much is given category.” You’ve got intellect, you understand a lot. You’re going to either make ultimate use of your talents…or you’re going to waste them. Your ego can be a bitch. It’s easier–mentally–to be disengaged from your life, to wear the “gen-x” slacker/underachiever mantle. It’s easier to scoff at people.

Sage advice from two friends and mentors:  one I"ve known for 25 years and one I've known, only through online communications, for less than 25 months.

Thanks fellas.

How Can REALTORs Find More Buyers, in 2009 ?

I asked this question, on LinkedIn, two weeks ago.  Here's what I heard:

Danilo Bogdanovic

Real Estate Consultant, Realtor, Blogger, Social Media Consultant

see all my answers

Best Answers in: Lead Generation (1)

This was selected as Best Answer

Here are top 3:

1) Focus on strengthening your relationship with past clients (not just increasing the frequency of your drip campaign). You'll be amazed how referrals will increase.

- Rather than decreasing your marketing efforts, increase them. But make your marketing more cost-effective and increase your ROI by focusing on what works and stop doing what no longer does.

- Get involved in your community and do something you like to do. You will meet new people and network while doing good within your community. You'll feel better about yourself while getting your name out in your community.

Clarification added 8 days ago:

(sorry for the typos/grammar...typing while on the way out the door to a meeting)

Messages from Danilo Bogdanovic (2):

Greg Swann

Owner, BloodhoundRealty.com

see all my answers

I do a lot of work with buy-and-hold rental home investors, many of whom are able to come into Phoenix with all-cash offers. Poor me, I know.

But: I've been spending a lot of my time, lately, thinking about "triangle-trade" strategies -- old-style funding mechanisms that we were happy to forget all about when money was easy.

So picture a buy-and-hold investor with 100% equity who wants the best deal he can get when he sells his former rental home. Why not do a lease-purchase instead of a straight sale? The investor can help his buyers accumulate a down-payment, perhaps working with them to improve their credit score at the same time. The investor gets a higher purchase price, the buyers get a lower monthly payment, everybody wins.

Or how about selling with a contract-for-deed? There are a lot of people out there with great incomes but lousy credit -- more every day. If an investor -- or ordinary homeowner with equity -- is willing to take on the risk of a carrying back note, the home can sell at a premium over its market value.

Buyers are not in short supply. Workable deals could be, going forward. The Realtors and lenders who can make things happen are the ones to watch.

Links:

• http://www.bloodhoundrealty.com/

Jay Thompson

Real Estate Professional and Chronic Blogger

see all my answers

Web 2.0, 3.0, blogging, Facebook, Twitter, etc etc. I'm a big fan of all that.

But sometimes nothing beats picking up the telephone. Expanding your "sphere". And by "sphere" I mean people you REALLY know, not your 486 Facebook "friends" and the 1,132 people you follow or follow you on Twitter.

Use those tools to MEET people. You know, REALLY meet them. As in face-to-face, shake hands, establish a relationship meet.

People are still buying and selling homes. Every day. But there are many more buyers "on the fence". Meet people, educate them. They're out there clamoring for it.

Links:

• http://www.PhoenixRealEstateGuy.com

Geno Petro

Real Estate Consultant and Contractor

see all my answers

Geno Petro

Write a series of blog posts on buying Short Sales and Pre-foreclosures in a local market using all the right keywords but also with decent readable content. Be consistent and Google will begin spider for authority. Have a point of conversion on site that is easy to find and fill-in. Become an advocate for the buyer and an expert on the whole messy process and see what shakes.

Thomas J. Hall

Expert Marketer, Real Estate Broker, Blogger & Web 2.0 Enthusiast

see all my answers

Thomas J. Hall

Great question Brian! I say focus on the fundamentals - look for face to face opportunties. Aside from social media sites such as LinkedIn, Facebook or Twitter, the next step is to organize a TweetUp, encouraging face to face interaction - but with folks OUTSIDE of your business sphere.

I strike up more conversations with folks standing in line at the grocery store - goofy yes, but we have something in common - the long wait!

Links:

• http://www.itaintallbighairandcadillacs.com

Dru Bloomfield

Real Estate Professional in Scottsdale, Arizona, Blogger - AtHomeinScottsdale.com

see all my answers

My first answer is to find several avenues for acquiring buyers, and to do them over and over, consistently. Choosing ways to connect with people needs to jive internally or it does not come off as authentic. The actions really need to be something that an agent believes in and ENJOYS doing.

I also believe that having 2-3 primary modes of touching potential buyers is paramount to long-term business success. For me, that currently includes buying leads (yes, unpopular, but works for me), web 2.0 (blogging, being very active in social media), and volunteering in my community (really started as a way to give back).

Keeping touch with past clients and our sphere is critical too. In this market, they are almost afraid to ask how we are doing for fear our response will not be positive. Reminding them we are in business is an easy way to start a conversation..... and right now, everyone really does want to know how real estate is doing.

Links:

• http://www.athomeinscottsdale.com

Maureen Francis

Residential Real Estate Sales, Consultant

see all my answers

My best source of business is referrals from my past customers. I would like to keep it that way.

Keeping in touch is more important than ever. With all the bad news out there, people even need to know that agents are surviving and thriving.

Links:

• http://mioaklandcounty.com

Toby Boyce

Realtor in Central Ohio

see all my answers

I'll echo Jay, when I say that I'm working on getting back to the basics.

There will be less mass marketing and more direct mail.
There will be less Web 1.0 (well none) and more Web 3.0
There will be less non-met focus and more Met focus.

All of these things will help, but the most important thing is for me to exactly what Gary Keller says about our sellers ...

"They have to be IN the market not ON the market."

Leading with revenue, working from a point of "value" and building myself in that manner.

Chris Griffith

Chris Griffith Columnist at Naples Daily News

see all my answers

Blog, write, blog, write, stay out of the office and avoid the negative complaining of other agents. I know I sell more real estate because I limit my exposure to negative agents.

Market to prior customers. Its easier to keep customers we have than find new one's.

Links:

• http://lifeinbonitasprings.com

Jim Lee

Affiliate Broker at Realty Executives Associates

see all my answers

I think buyers are still to be found in all the places they've been found before.

A great, FINDABLE online presence is good.

Home buyers seminars attract new buyers.

Since rates are low again it's probably a good time to start targeting apartment complexes; particularly high end ones with high end rent. Once renters find they can own a condo or house for less then they're paying in rent they will become buyers.

Links:

• http://www.KnoxvilleHomeCenter.com
• http://www.KnoxvilleTennesseeRealEstateBlog.com

M

Mike Sparr

Entrepreneur - Real Estate Text Message Advertising

see all my answers

Brian, the theme we see here is personal relationships, referrals and diligent follow up. I stress the latter because it's often the most important. It's one thing to use tools like a site or otherwise to generate new buyer leads; it's another thing to benefit from using them. Commit to timely follow-ups and personal interaction while under promising and over delivering and you cannot go wrong.

One of my REALTORs in Reno, NV often bought a surprise housewarming gift for first-time clients after closing. If they needed a dishwasher, he'd have one delivered. If they didn't like a room color, he'd have a bucket of paint and drop cloth sitting in the room waiting. It was this "above and beyond" reputation that won him my business - my friends had already done three transactions with him and referred me.

For me, he showed up on a Sunday and helped me unload a moving truck. It was a painful short sale (I was buyer) requiring two appraisals (rural area - ranch estate and dirt roads) and various delays and he helped every step of the way. To make matters worse, the well broke suction a month after closing and I discovered a false well report passed off as current by the seller; he made them right and split costs w/ seller's agent for new pump, well deepening, etc. Despite the hassles, I proceeded to give him my listing when I sold that property for $100K profit 18 months later. I still refer clients to him 5 years later. Small personal gestures beyond the bottle of branded champagne show you care and that significantly increases your referrals and repeat business.

A good loyalty program is Homeminders.com and a cheap way to keep your brand top-of-mind with clients. This could be one of those "gifts" you provide clients and a useful tool they use to remind them to change filters, clean the spa, etc.

Vicki Lloyd is a client of mine and I cried when I didn't hear her yell Goomzee.com ;-) Actually, you will need lead capture tools like ours to help collect new buyer leads and reduce missed sale opportunities. The work starts with the tool, however, so be committed to follow up on leads same day, ideally within the first couple hours. Go get 'em! Happy holidays and to all, a prosperous 2009.

Links:

• http://www.goomzee.com
• http://www.homeminders.com

 

Mark Hankins (startnow@flacorps.com)

Lawyer & Owner, Florida Incorporators, Inc., providing fast & affordable formation of Florida Corporations and LLCs

see all my answers

Best Answers in: Government Policy (4)... see more, Car and Train Travel (2), Mergers and Acquisitions (1), International Law (1), Business Development (1), Planning (1), Equity Markets (1), Energy and Development (1), Green Products (1), Using LinkedIn (1) see less

Get in touch with some of the local real estate investors who find tenants using bandit/snipe signs. Arrange for them to qualify prospects for FHA purchases and pass them along to you when possible.

Zach Bussey

Owner at Swingcat Productions

see all my answers

The best way to get more buyers is to do what is counter-intuitive during a recession. When people make cuts, normally one of the first things to go is marketing budgets - bad idea. While everyone cuts their marketing budget, this leaves a market that's less cluttered by others messages and more open to yours.

However, this doesn't mean go and spend a ton of money on newspaper ads or television spots - it means find new ways to better market yourself.

Take advantage of social medias like this site, Twitter, start a blog, get on facebook. Basically start interacting more with people.

The more people that know you; the more often you'll get referrals or you'll be the one they think of first; the more buyers you'll get.

Diana Perez

Realtor - Property Manager

see all my answers

I think that for every negative there is always a positive. The challenges that Realtors face with the foreclosure and credit crunch saga brings more opportunites to the real estate professional once we divulge our expertise. These are times when we have to understand what opportuniites are there for us. Timing is everything - time does not do anything for us - it is up to us who do it so everyday brings its challenges itself. We all thirst for answers and those answers will rely on creativity, perseverance, and the power to exercise our expertise in the real estate field.

Missy Caulk

Associate Broker Keller Williams Realty- Ann Arbor

see all my answers

Best Answers in: Commercial Real Estate (1)... see more, Internet Marketing (1) see less

Brian you know what I think, PPC. We should talk maybe you can hook up with some Realtors in CA near you and help co-pay the system.

Of course you know I use Tiger because it is sticky and I have plenty of leads in M I C H I G A N.......................enough said.

Tamara Dorris

Real Estate Speaker & Author

see all my answers

First off, let me tell you that as an active agent, real estate professor and author that I'm not a wierdo, but I swear by Feng Shui. While all agents can run ads, cold call and beat the streets, most agents who don't succeed haven't got the right mind-set, or energy. Feng Shui helps get all that energy flowing in the right direction. Thanks!

Links:

• http://www.TopProTech.com

Vicki Lloyd

Residential Real Estate Consultant

see all my answers

My plan is to be very visible and easy for buyers to find. More blogging, probably some twittering, continue to participate in my community's activities, wear my name badge everywhere, do some open houses, etc.

Links:

• http://LiveLakeForest.com
• http://LakeForest2Homes.com
• http://VickiLloyd,com

David M. Childress

REALTOR® at Howard Hanna Real Estate Services

see all my answers

Thank you for asking such a good question as I enjoy the ideas being proposed in the answers. I really feel the market will improve as the bail outs start to focus on mortgages. Homes are the key to the economy and they will figure it out eventually. We Realtors need to blog, social network and utilize all tools available on the internet, as that is where our future clients are looking. Print media is dead; look at the Times and Tribune!

Links:

• http://www.liveinakron.com

Mitch Ribak

Owner, Tropical Realty of Suntree, Inc.

see all my answers

Pay off someone who will give you all their buyers! Ok, you know my answer. The best way to get more buyers is by having a quality website with a great lead capture and lead conversion system attached to it. Even in the downturn, most buyers are going to start their search on the Internet. He who captures and converts the most leads win! Of course I have all the answers ehomesrealtynetwork.com.

Another great way to find buyers in this market is seminars. This is not only easy to do, it's very rewarding. I love helping first time homebuyers find their new home. They listen and are extremely appreciative of your hard work!

Links:

• http://www.ehomesrealtynetwork.com

Rick Schwartz

Realtor, Sales Executive, World-class Sales Trainer

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The key isn't in the specific techniques - there are dozens. Some are new, high-tech ideas, like blogging, social networking, e-newsletters, updating your website frequently and some are more traditional like holding open houses, taking as much floor time as you can (yes - it can be boring in a down market but bring your laptop and do your e-based stuff), calling your sphere of influence, physical networking groups, etc.

The key to finding more buyers is to take the various techniques that you want to do - and do them. Make a list of what you are going to do. Schedule time on your calendar every day, block it out and do your marketing/lead gen activity. If you don't schedule time to do it, you'll only work on them "when you have a spare moment" - which, for most people, never happens.

Our business is really quite unique if you think about it. 100% of people need a place to live. We help people find places to live so everyone is a prospect at some level. The fact is that well past 99% of those people have are people we've never met - so our goal should be to meet as many of them as you can.

I look at everyone as a potential client or referral source. I don't accost people but I always talk to strangers - not about real estate, but I always am either wearing a baseball cap with the name of my company on it or I have my Realtor badge on. It's amazing how many times, people say "Oh - you sell houses?" I ask other customers in the grocery store if they know where things are or I sometimes I'll ask someone taller than me to reach something, or I'll comment on how crowded the store is.

I never pay for gas at the pump. I always use a credit card and choose "pay inside". I sign the receipt with one of my imprinted pens and leave it on the counter. I do the same in restaurants or anywhere you pay by credit card (darn those electronic sig tablets).

None of these are brilliant ideas that are going to generate a ton of sales immediately but my point is that you have to be marketing all the time - except when you have day off - which is very important to plan also.

Faith Sloan

Sr. Web Technologist Consultant at Idaho Power Company

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I believe that The Future of Advertising is NOT Pay Per Click (PPC). Why, because it is no longer cost-effective in my opinon. The costs has skyrocketed.

The new way of advertising where you can get BUYERS in front of your product and brand yourself is what is called, Cost-Per-View Advertising or CPV.

There is a company that is moving fast in this area. Noobing L.L.C. was created in August 2008, and the Overland Park, KS based marketing and advertising company is already carving a foothold for itself in the internet marketing world.

Part of the Noobing’s strategy is to generate interest over its very unusual name. Its creators have taken a page from the books of successful businesses such as Google, Yahoo, and Twitter, and from oddly named music festivals such as Lollapalooza and Wakarusa—in its bid for bucks.

I spoke with the Director of IT and he communicated to me that Noobing is a high traffic advertising venue that raises the Alexa rating of all it’s advertisers. I am using them for advertising my own products and services. When you come on board with Noobing, you give yourself the option of placing your websites in front of a captive, BUYING audience for 30 seconds or more at a time. It is like an online commercial in my opinion but at the fraction of the cost and also at a fraction of the cost of Google Adwords and others like it.

Links:

• http://www.noobing.com/?sid=1648

Jillayne Schlicke

Forward-looking educator in the real estate and mortgage lending industry

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Hi Brian,

The buyers are all out there......They are waiting for home values to come down further.

The best thing Realtors can do is to stop trying to delay the deflation of home values at the upper (Washington D.C.) levels of leadership.

The more the Realtor industry tries to stop declining home values, the longer it will take for the buyers to come off the sidelines.

Patrick J. Canavan

Realtor / ECOBroker at

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Stop complaining about the market. Stop complaining about the economy and be excited that housing and rates are at a fantastic low. Then people will listen to the benefits of buying now.

☆Forrest Graves☆ LION ☆ 5,490,800+ professio

☆☆☆☆☆ Network Business Consultant

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Draw close alliance with lenders…all the while knowing that the average home owner relocates every five years. Then position yourself to list their old home, and help them find a new home at the appropiate time. Obtain your list...and "go to market."
FORREST GRAVES networking@alltel.net

Doug Beaver

Hands on Realtor with Century 21 Olde Tyme In Norco California

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In a word "Internet"

Mortgage Rates at 4.875% with no points...IF...

...you have LOTS of equity, in an owner-occupied property, stellar credit (over 750), documented income, and act quickly.

I locked a loan for a customer last night at 4.875%; no points, no origination fee.  It was for $417,000 and his home is worth $700,000 or more.  The third-party costs (appraisal, credit, lender fees, escrow, title, recording, etc) totaled about 1%.  This means that the cost to acquire that 4.875% rate was about $4,000, putting his APR around 5.199%.

No-cost loans, where the lender pays all the third-party costs, would be a FULL percentage point higher, at 5.875% for a 5.875% APR.  Mortgage markets are NOT rewarding higher rates.  This means that anyone with a conventional loan, with a loan amount under $417,000, and a rate over 6% should be considering a refinance to a no-cost loan, at the very least.

Rates are awesome and money is cheap...IF you don't really need it.

Mortgage Advice for San Diego Home Buyers and REALTORs

Midori Miller, a real estate agent and trainer in Florida asked me three questions:

 1- What piece of advice would you give a buyer in purchasing a home?

Get your documentation in order BEFORE you look for a mortgage:

a- Fill out a uniform residential loan application (Form 1003). 

b- Organize your two year income and employment history.  That means you should copy the first two pages of your 1040 income tax form for the last two years,  your W-2 or 1099 forms supporting these tax forms, and your last 30 days worth of pay stubs.

c- Gather up your asset statements:  checking account, savings account, securities account, IRA, 401(k), and any annuities you have. 

d- Now, get three sheets of paper.  In BIG magic marker, PRINT, the following:

• APPLICATION
• INCOME
• ASSETS

These are your dividers. 

e- Scan the package, IN ORDER, to a pdf format. Now, you have something to show lenders when you call around for a home loan.

2- What piece of advice do you have for real estate agents?

Work primarily with buyers whom are able to obtain mortgage financing.  If you are partnering with a lender, develop a twelve month campaign, for buyer referrals, targeting people with wage-earning jobs.  Groups to target would include:

Nurses, cops, firefighters, teachers, government workers, employees of big companies, and military service members are all likely prospects for home buying.  While the larger transactions will be bought by the entrepreneurs, many business owners have difficulty documenting their income.  A strong base of "wage-earners", as home buyers,  will carry you through 2009.

3-What can REALTORs do to make your job easier?

Naturally, the easiest thing a REALTOR could do is to point a home buyer to the first answer. Educating borrowers about the importance of proper loan documentation, prior to calling a lender, makes our job a LOT easier.  Taking "ownership" of the client, when they fail to comply with lender's documentation requests during the loan process, keeps transactions on schedule.

Great questions, Midori.  Thanks for the insightful discussion!