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Author Archives: Lane Bailey

Crazy Idea? Brilliant Marketing Tool?

I am kicking around an idea.  Shocker, huh?

I was sitting in the living room of one of my sellers.  We were talking about his condo which I have had listed.  An idea just fell out of my mouth.  And then it just kind of stuck to me…

I have written different types of copy for this property.  We have had descriptions of the property.  We have tried lifestyle marketing.  There are lots of great pictures (if I say so myself…).  In each stage, I have gone to my “usual suspects” and asked them about the copy.  Each time they have thought that the place sounded great…

But they aren’t active buyers.

And that is the problem.  I need to spend some time with real, active, in the market buyers… that aren’t currently my clients.

What I am thinking about is doing a panel.  Providing drinks and snacks, and some other inducements in order to sit down a panel of buyers and talk to them about their motivations.  To get it straight from the real buyers.  What is exciting?  What would drive them to see a listing?  Contact a certain agent?

Honestly, the NAR does this every couple of years… but their results aren’t local.  I want to hear from people in THIS market.  Buyers in LA or NYC aren’t buyers in Gwinnett County.

So, two questions:

As a buyer, what would get you interested in participating?

Do you think a round-table discussion or survey would be more conducive to open transfer of information?

I am pretty sure I could get some input from a mortgage guru so that the information transfer wouldn’t be just one way or just about the sales part of the equation for buyers.

POV Sunday.

This Sunday I decided to go with a little POV (Point of View). So, there are two videos and a bonus video.

The first video is a cult classic. In the days before internet videos, it was only available on VHS… and VERY rare. So, if you were lucky enough to know someone that knew someone else that had a friend who’s cousin’s boyfriend had a copy… you might get to see it.

The soundtrack was later dubbed in from a Ferrari 275GTB… and oh what sound. Through independent verification by analyzing the sites, it is verified that the car reached 136mph. Keep in mind that the director was unable to get a permit and the roads were open. He was also arrested when the film was shown. The driver has never been identified. Claude Lelouch – C`était un Rendezvous (1976)This video is 8:39.
The next clip is a POV from one of the most insane motorcycle races in the world.

The Isle of Man Tourist Trophy (TT)

The IOMTT is a timed event. While there is passing, the bikes are released at intervals and run the course. This video is a lap. It spans 18:46, and includes pulling out of the pit area. The single lap record is 17:22, and that is an average speed of just over 130mph. If you have ever thought of taking a full on racing motorcycle and run through average roads… you are going to like this. This isn’t an antiseptic course with run-off areas and soft barriers. And the sound…

The bonus is a view of a 130mph lap from aerial and location cameras around the course. It runs just over 7 minutes. What I find amazing is to see the front wheel wobble under braking or after the jumps. It truly would scare the poop out of me. But it is amazing to watch.

What if I didn’t say it?

It may seem a little self serving.  It doesn’t take much surfing on the RE.net (real estate blogdom) to find a real estate agent saying that there are good deals to be had, and those that wait may well lose out.  In all honesty, there are a couple of reasons (I’ll be frank with you):

  • We need buyers to buy in order to make money… but that isn’t all of it.
  • Many of us have seen these types of markets before… perhaps as an agent, or investor or just as a bystander.
  • We know that the only way we can see the turn of the market is looking back.
  • We are looking at the market every single day and we see the bargains.
  • We are looking at the market every single day and we see the bargains going away.
  • We need buyers to buy in order to make money.

I told you I would be honest…  But, let me cover each of these a little more.  I’m going to skip the first and last one, since it is pretty obvious…

  • Many of us have seen these types of markets before…  perhaps as an agent, or investor or just as a bystander.

Here is an excerpt from Dick Gaylord, President of the NAR:

“The prices of houses seem to have reached a plateau, and there is reasonable expectancy that prices will decline.”
– Time Magazine, 1947

“Houses cost too much for the mass market. Today’s average price is around $8,000 – out of the reach for two-thirds of all buyers.”
– Science Digest, 1948

“The goal of owning a home seems to be getting beyond the reach of more and more Americans. The typical new house today costs about $28,000.”
– Business Week, 1969

“You might well be suspicious of ‘common wisdom’ that tells you, ‘Don’t wait, buy now… continuing inflation will force home prices and rents higher and higher.'”
– NEA Journal, 1970

“The median price of a home today is approaching $50,000… Housing experts predict price rises in the future won’t be that great.”
– Nations Business, 1977

“The era of easy profits in real estate may be drawing to a close.”
– Money Magazine, 1981

“The golden-age of risk-free run-ups in home prices is gone.”
– Money Magazine, 1985

“Most economists agree…. [a home] will become little more than a roof and a tax deduction, certainly not the lucrative investment it was through much of the 1980’s.”
– Money Magazine, 1986

“Financial planners agree that houses will continue to be a poor investment.”
– Kiplinger’s Personal Financial Magazine, 1993

“A home is where the bad investment is.”
– San Francisco Examiner, 1996

And yes, this is the same Dick Gaylord I took to task over this very same post on 3/5/08.  But, as I said in the blog, the media is giving us the short stick right now…  So, look at the stock market.  Crash… and then opportunity.

Another interesting post I came across today was from Seth Godin.  Seth is a marketing GENIUS.  Seth mentioned on his blog:

Change (and the fortunes that go with it) is almost always made during the down part of the cycle. It might not be fun, but it’s exciting…  The opportunity is to find substantial opportunities (in any field) that deliver real value and have a future. Those jobs/investments/companies/ideas are undervalued right now, but not for long.

And then comes:

  •  We know that the only way we can see the turn of the market is looking back.

Right now, the most recent solid stats I can pull from my MLS are almost 6 weeks old.  I won’t have a good idea about February until April.  And, we can’t tell a trend until it has showed itself over several months.  So, if the market turned today, I wouldn’t really be able to show the stats that prove it until July or August… June at the soonest.  And, in that time 2,000 of the best deals in Gwinnett County could be sold.

  • We are looking at the market every single day and we see the bargains.
  • We are looking at the market every single day and we see the bargains going away.

As a full-time professional real estate agent, I look at the market each day.  I don’t see bargains every day, but I do see bargains.  I also see those properties sell.  Sure, the average Days on Market are currently about 100 days, but there are properties that sell in less than 10.  Because they are good deals.  There are other deals that never make it to the MLS.  But, every day there is another great opportunity that goes away.  before long, there won’t be a full boat of opportunities.  There won’t be anything left but the picked over properties.  This is also a good primer for bargain shopping

So, what it comes down to is that there are some good buys out there right now.  They won’t be there forever.  The first movers will have the best selection of deals.  When the pent-up demand is unleashed, the market will turn.  Finally, if you are planning on buying a house to own for 7-10 years, this is a great time.  If your horizon is shorter, it might be more risky, but could still work out.  If your timeline is longer… you are pretty safe.  Of course, remember that the location is important.  Some markets might still have a while to fall.  Others haven’t really slowed and still look under-valued.  I’m writing for Gwinnett County.
If you are looking in or around Gwinnett County, give me a call.  I spend time at Lake Lanier, too… I know of an incredible property that could be had for a pretty good discount (still knocking on $2m, though).

If you are looking elsewhere, I’d be happy to refer you to an agent I trust.  I have a pretty good network of agents around the country that I know and respect.

Warren Buffett is wrong.

Ok, Warren Buffett is a genius, and likely the most brilliant investor of all time.  But there is one issue on which he is glaringly wrong.  Taxes.

It has been widely reported that Buffett feels that there is an unfair disparity when he pays 17.7% on his income and his secretary pays 30% on hers.

Last year, Buffett said, he was taxed at 17.7 percent on his taxable income of more than $46 million. His receptionist was taxed at about 30 percent.

What is seldom mentioned with the same emphasis is how this happens.  It is quite simple…  Capital Gains Tax Rate.

The event comes as public frustration has grown over executive compensation and disparity in pay. It also comes as Congress debates changes to the tax code that would decrease take-home pay for managers of private-equity firms and hedge funds, pools of money for wealthy families and institutional investors. The rich can take advantage of tax loopholes, including one that allows those managers to pay the capital gains tax rate of 15 percent instead of the ordinary top income tax rate of 35 percent. (emphasis added)

So, the reason his rate was lower was that it was largely capital gains rather than ordinary income.  Before I get into that, there is something else here that bears mentioning…

It is NOT just the wealthy that directly benefit from a lower capital gains tax rate, and it isn’t a “loophole”… it is likely that the author benefits from the capital gains tax rate.  Anyone that invests money longer term benefits from the lower rate.  That investment might be stocks or bonds, mutual funds, your home or baseball cards.  In fact, there are a lot more middle class people that benefit from the lower capital gains rate than there are wealthy people benefiting.

So, back to the subject.  A lower capital gains rate is VERY desirable.  Aside from the fact that this is money that is invested after it has already been taxed, it is money that is invested.  In the case of stocks and bonds and long term CDs and mutual funds, this is money that is in turn loaned out to businesses to expand or to individuals and families to do things like buy homes.

This country already has a negative savings rate.  Should we really be doing things to punish (increase taxes on) those that DO save?  If anything, the capital gains rate should be lowered, encouraging more savings.  ***Personal note here, I think it would be much more effective to adopt the FairTax than fiddle with any income tax scheme.***

Now, despite what you might hear on the nightly news, the federal government has been experiencing record revenues the last several years… since the lowering of the capital gains rate.  We set a new record of 54 months of straight economic growth… since lowering the capital gains rate.  The issues that the government has with deficit spending have come from spending increases that far outpaced the increase in revenue… simply put, they got a raise and spent WAY more than the raise.

So, back to Warren Buffett for a minute…  And the Clintons too, since they echoed the same sentiment.  There is nothing stopping them from paying more to the IRS.  There is a form which allows them to do just that if they don’t think they are being taxed enough.  But, none of them have used that form.  Nor has Senator Obama.  Senator McCain hasn’t either, but he hasn’t been saying that he didn’t pay enough in taxes.
Creative Commons License photo credit: Larsz

Creative Commons License photo credit: roarofthefour

Are there really people that fall for this?

Like many people, I have received the Nigerian scam email… and the new Afghanistan and Iraq variants.  Like the vast majority of people, I shake my head and hit the delete button.  I have no idea how someone can think that there really is a legitimate reason for them to send their bank info to some unknown person, or that if they do, they will get millions of dollars for “facilitating” some transaction.

But now there is a new wrinkle…

To whom it may concern,

We have nabbed a syndicate of fraudsters who specializes in document forgery, impersonation and using of fictitious offices and clandestine phone, fax and emails to defraud innocent people. On interrogation, we promised these syndicate that if they confess their victims, that we will help them reduce their jail terms. Based on this promise we made to them, they provided your email address as one of their victims. We don’t know if their testimony that they defrauded you is correct. If indeed you lost any money to fraudsters in the time past, please notify us with immediate effect. We have recovered enormous amount in their accounts. We have also seized and sold all their houses, companies, expensive cars, stocks and shares they bought with their ill gotten wealth for the purpose of paying back their victims what they lost. Their victims as they enlisted are so many that all the money we realized from the sale of their belongings including the money recovered in their account will not be enough to pay back all

Reverend Barrister Willy Bayo
Director, Centre for Cyber & Electronic Crime Control

Same poor use of the English language… same appeal to greed.

So, assuming someone sent them their bank info, only to have the account cleared out… would they do it again?

What I think would be hilarious would be to find a way to do a reverse sting and when they ping an account, have the account they ping from cleared out…

Anyway, here is the new scam.  Don’t give them your bank information.  The easiest way to do that is to just ignore them and not reply… use the ol’ delete button.

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