NC REALTORS Talk

Legal Q&A: Can brokers check the "no representation" boxes on the Residential Property Disclosure Statement when selling their own property?

noreply@blogger.com (NC REALTORS®) — Thu, 15 Sep 2016 18:28:00 +0000

QUESTION: I’m a licensed broker and I’m about to list a residential property for sale that I have owned for several years. Am I allowed to check any of the "No Representation" boxes on the Residential Property Disclosure Statement?

INTERESTED IN THE ANSWER? CLICK HERE

Have a legal question? Call the Legal Hotline. As a member of NC REALTORS®, you have free, unlimited access to this benefit. Call 800-443-9956 or email legal@ncrealtors.org with any questions regarding contracts, forms, fair housing, disclosure and more.

Make your marketing count

noreply@blogger.com (NC REALTORS®) — Tue, 13 Sep 2016 14:00:00 +0000

By Paul Salley, marketing strategist

Traditionally, marketing a product or service consisted of putting out a message to the masses with the hope that the broadcast message would attract a handful of individuals who would pursue the product or service further. This old school style of marketing is comparable to a sales funnel or marketing pipeline. There would be a large number of people who see the ad and eventually the campaign will sort out those who are not interested.

With today’s digital marketing capabilities, traditional marketing has been reversed. This strategic style of marketing is known as reverse marketing. We start at the bottom of the funnel and advertise directly to those who we know have an interest in our message. It’s the traditional sales/marketing funnel turned upside down. The technology that makes this marketing dream a reality has to do with sophisticated ad platforms that can tap into a user’s browser and online activity history.

Some examples of platforms that have this capability include Facebook, Google AdWords and REAL Trends’ predictive marketing solution. All of these platforms have the ability to segment users into different audiences. One example of how to use this technology is to create an audience that is based only on visitors to a specific page of your website and market directly to that audience with an ad message relevant to that webpage.

Another strategy is to market to an audience based on their browsing history. On the REAL Trends predictive marketing platform, there is an audience list known as real estate intenders. That list is comprised of those who previously visited a real estate-specific website. This real estate intenders filter coupled with location and demographic parameters creates a very hyper-targeted audience that can be shown an ad that is specific and relevant to that audience, thus driving up clicks, conversions and, ultimately, quality leads.

When reviewing your company’s marketing dollars and strategy, take advantage of the potent digital marketing tools now available to drive quality leads and more business. In addition, achieve results and a return on your investment with sophisticated digital marketing platforms that allow you to gauge exactly what is working and what is not. This takes the guesswork out of how and to whom to market. Most marketing tools that offer segmented audiences can have effective campaigns starting at around $150 per month. However, remember that the higher the budget allocated to these platforms, the greater their performance will be.

This article originally appeared in the July 2016 issue of the REAL Trends Newsletter and is reprinted with permission of REAL Trends Inc. Copyright 2016

Legal Q&A: Who pays owner association “transfer fees?”

noreply@blogger.com (NC REALTORS®) — Thu, 08 Sep 2016 15:48:00 +0000

QUESTION: I’m representing a buyer who is closing on a property that has an owner’s association. I am trying to figure out who is responsible for the payment of a “transfer fee” that’s being charged by the association’s management company. I’ve reviewed the Offer to Purchase and Contract (form 2-T), and I don’t see any reference to transfer fees on the Contract anymore. Who is supposed to pay it, my buyer or the seller?

INTERESTED IN THE ANSWER? CLICK HERE

Have a legal question? Call the Legal Hotline. As a member of NC REALTORS®, you have free, unlimited access to this benefit. Call 800-443-9956 or email legal@ncrealtors.org with any questions regarding contracts, forms, fair housing, disclosure and more.

Developing a technology and marketing plan for your company

noreply@blogger.com (NC REALTORS®) — Wed, 07 Sep 2016 14:00:00 +0000

By Travis Saxton, vice president of technology

Did you know that most U.S. brokers don’t have a plan when it comes to their technology and marketing? Sure, they have technology and marketing, but there is no shared vision between the two. Some organizations run flat, with many people meeting and controlling everything, only bringing to the table what they find interesting. This type of brokerage is susceptible to the shiny penny syndrome. Other brokerages run in linear silos with people in charge of respective areas but not coordinating or communicating with each other.

Here is a simple exercise that we recommend each brokerage complete to get a handle on what they are spending, where, what the return on investment is, how you use these efforts for recruiting, what lead sources and rules you have and, ultimately, your plan.

First, organize anything technology and marketing into four areas:

1. Technology Initiatives
2. Marketing Initiatives
3. Leads Initiatives
4. Recruiting Initiatives

You may be asking yourself, “Why is recruiting on the list?” Recruiting today is largely a byproduct of the three areas that precede it on my list. Without clarity in the first three areas, your recruiting managers have a hard time telling your story. Without clarity, your efforts in those areas blend with every other firm in your market. This is one reason why E-edge from Keller Williams made such big waves. They were one of the first firms to add clarity and message around what they were doing in the first three areas on the list above. So, yes recruiting belongs here. More specifically, the person in charge of recruiting needs to communicate clearly with the other three areas to develop a concise value proposition and use those other areas to drive home your value proposition to potential recruits. The problem with most organizations is that recruiting is done in a silo, and they don’t get the help from the other areas.

Build the Foundation

Let’s talk about leads. In the next three areas, we have a great exercise every firm should do and repeat every six months. Build yourself a lead matrix. Use a google doc/sheet or an Excel file and make it simple. Track every lead source in your organization. If you get a name, email address or phone number, then it goes in as a lead source. Lead sources include your website, listing portals, MLS, mobile, sign riders, customer service desk, relocation, etc. Any name or opportunity is placed in this spreadsheet.

Then, add a field for estimated monthly volume, cost, comments/feedbacks, and what do you currently do with the leads. If you have closing information, place it here as well. This will act as the foundation for your leads strategy. Whoever is in charge of this area will update this doc every six months. They will then set three attainable goals every six months to work towards. For their area. This evolving message is then relayed to Recruiting for use.

Marketing Leads

You may think marketing and leads are the same. In some organizations they are, but they should be separated. In the marketing section, repeat the above exercise and build a marketing matrix. This is a spreadsheet where you track marketing sources, number of visits, impressions, clicks, followers and other pertinent information. Start with your website, social media, digital marketing campaigns, listing syndication and more. Anything that has eyeballs on your brand or listing goes into this spreadsheet. The more detailed you are, the better. Think of this as more outbound and leads as inbound. Tackle three goals every six months with clear, measurable success KPIs. This is then relayed to leads and recruiting.

Technology Initiatives

Finally, you have the technology initiatives. Create a technology matrix that lists every technology penny you spend. The slight overlap is with marketing where the website and agent websites should be in here. This is small; however, and the goal is to see the landscape of your technology. But, in this matrix, you want fields such as cost or cost per month, agent adoption of tools, training initiatives, last training held, perception and more. Your goal is to see which technology is being used. This offers you coaching and training ammunition and sets the foundation for the brokerage to add or subtract technology.

In the end, you have the four pillars for getting your technology and marketing under control and ultimately the foundation for a great recruiting and retention strategy. Clarity and shared vision across your organization are important, and this exercise will help you achieve that.

This article originally appeared in the July 2016 issue of the REAL Trends Newsletter and is reprinted with permission of REAL Trends Inc. Copyright 2016

Legal Q&A: Is a contract terminated if the buyer and seller exchange competing termination forms and cannot agree on who gets the due diligence fee?

noreply@blogger.com (NC REALTORS®) — Thu, 01 Sep 2016 18:59:00 +0000

QUESTION: During the due diligence period, my seller received a Form 390-T signed by the buyer stating that the buyer would receive both the earnest money deposit and the due diligence fee on termination. My client disagreed with the due diligence fee portion of the buyer’s 390-T, and responded by sending the buyer a revised 390-T signed by the seller stating that the buyer would only receive the earnest money deposit on termination.

It seems like the parties both agree as to termination and who gets the earnest money, and I just received another offer. Is the contract terminated? Do I need to advise my client to seek legal counsel before he signs the new offer?

INTERESTED IN THE ANSWER? CLICK HERE: http://tinyurl.com/083016legalqa

Have a legal question? Call the Legal Hotline. As a member of NC REALTORS®, you have free, unlimited access to this benefit. Call 800-443-9956 or email legal@ncrealtors.org with any questions regarding contracts, forms, fair housing, disclosure and more.

May housing sales show strong upward trend from April

noreply@blogger.com (NC REALTORS®) — Tue, 30 Aug 2016 14:00:00 +0000

While prices are up slightly, unit sales up 11.9 percent while prices up 1.1 percent.

The REAL Trends Housing Market Report for May 2016 shows that housing sales increased a robust 11.9 percent from the same month a year ago. The year-over-year gain was slightly higher than April 2016 results and nearly back to the record increases recorded in January and February. The Northeast once again led the way with a huge 19.5 percent increase over May a year ago.

“The May Housing Market Report shows that an acceleration in year-over-year growth in housing sales is not a one-time occurrence. April and May 2016 were two of the strongest months so far this year,” said Steve Murray, editor of the REAL Trends Housing Market Report. “In fact, except for the March results, the first five months of 2016 have all been among the strongest year-over-year results in the past five years. Additionally, price increases continue to soften as the year progresses” said Murray.

The annualized rate of new and existing home sales was 6.434 million which was up from the rate of 5.749 million recorded in May 2015. The results indicate that the housing market continues to show very strong growth.

Housing price increases continue to show moderate change with May 2016 showing a 1.1 percent increase in the average prices of homes sold a year ago.

“The Northeast region had the strongest showing with unit sales up an incredible 19.5 percent. Each region saw unit sales increases with the Midwest showing an increase of 15.1 percent, the South at 10.7 percent increase and the West coming in with an increase of 6.4 percent. The housing market appears to be in good shape despite continued evidence of lower-than-normal inventory levels and has shrugged off other negative news such as the decline in equity markets, low inventories and the slower rate of foreign purchases of homes.”

The average price of homes sold in May 2016 in the Midwest region was up 3.8 percent the best performance in the nation. The South region increased by 2.5 percent; the West saw average prices increase 2 percent, while the Northeast region saw prices decline by 2.4 percent.

“We now expect that housing unit sales increases will continue to be higher in 2016 than thought earlier this past year. Most forecasts say that housing unit sales will increase 3-5 percent for all of 2016 and that average prices will increase 3-4 percent,” said Murray.

This article originally appeared in the July 2016 issue of the REAL Trends Newsletter and is reprinted with permission of REAL Trends Inc. Copyright 2016

Legal Q&A: What do I need to know about the FAA's new drone rule?

noreply@blogger.com (NC REALTORS®) — Fri, 26 Aug 2016 20:52:00 +0000

QUESTION: I’ve heard that there is a new federal rule regarding drones that is taking effect soon. What do I need to know about that rule?

INTERESTED IN THE ANSWER? CLICK HERE

Have a legal question? Call the Legal Hotline. As a member of NC REALTORS®, you have free, unlimited access to this benefit. Call 800-443-9956 or email legal@ncrealtors.org with any questions regarding contracts, forms, fair housing, disclosure and more.

The secret to dominating the real estate industry

noreply@blogger.com (NC REALTORS®) — Mon, 22 Aug 2016 14:00:00 +0000

By Kristen MacDonald, content specialist for Lone Wolf Real Estate Technologies

You spent the majority of the first 20 years of your life in some form of a classroom, trying to cram as much knowledge as possible to get prepared for the real world. And then suddenly, as if to signal the end of your potential, it stops. You’ve learned all you can learn. Now, go try to make something of yourself.

When you stop to think about it, the concept seems a little bizarre.

The world is constantly evolving; things are changing each day, and there is always some discovery or trend emerging. What you learned in the classroom 15, 10 or even five years ago, won’t necessarily apply today.

The solution? Keep learning!

As a real estate professional, you are part of a highly competitive industry. Brokers and sales associates aren’t in short supply. And that agent down the street? He completed that same entrance exam and sat through The Fundamentals of Running Your Real Estate Business with you last Saturday morning.

Yes, the fundamentals are important; they are what help to build the foundation of your business. The lessons you learn in those classes provide you with the knowledge needed to build trust with your clients. But how do you start those conversations? How do you overcome their objections? How do you stand out among the competition? Keep learning and go beyond what is expected.

Take Tom Brady, for example. The NFL quarterback has earned six trips to the Super Bowl (more than any other quarterback) and won four. The keyword here is earned; an accomplishment like this isn’t achieved by just doing what is expected. Brady has gone above and beyond to perform better and reach his full potential. In a recent article by NESN, Brady even goes as far as attempting to get into stadiums in the middle of the night to get in some extra practice or watching game tape at 3 a.m. to analyze what he could do to be better.

Sure, you’re not a football player but the principles still apply. Becoming great at anything requires putting in lots of effort; putting in more effort than those around you is what allows you to win. Remember, all of your competition has completed the same entrance exam and the additional hours of education that your licensing body requires every few years. It is up to you to ensure you stand out from your competition.

Leveraging new education opportunities is a great way to expand your knowledge and learn new skills that go beyond the basics of what was required to become a real estate professional. And pursuing continued education doesn’t have to mean getting back into a physical classroom. There are plenty of options; here are three to get you started:

Start Reading

Instead of starting off your morning catching up on emails, dedicate time to some light reading—the Internet is filled with a ton of great tips, tricks and stories on the latest trends. I suggest picking a few favorite blogs or publications to read regularly and setting up Google Alerts for topics you don’t want to miss. The key here is being aware. Reading may not necessarily make you an expert on a particular subject but it will set you in the right direction.

Find a Virtual Classroom

Webinars! Webinars are great for a number of reasons but No. 1 on my list is convenience. By attending a webinar, you can gain great value without the high cost of travel or even leaving your desk. Stepping into a virtual classroom also provides the opportunity to re-watch the session and become a master of the skill that was discussed. There are plenty of companies that offer webinars covering a variety of topics, all you have to do is pick which one to attend.

Bring the Classroom to You

This is where you will get the most value and ROI. Bringing an industry expert into your brokerage or attending a speaking session allows you to feed off the energy of the room and engage at a level that can’t be matched by other education opportunities. And since, in my opinion, this is the most important channel, I have a couple of extra tips when it comes to selecting an expert to come to your brokerage or when choosing a speaking session to attend.

First, ensure your experts are truly experts. Anyone can Google, 10 Up and Coming Real Estate Trends and relay the information. The value comes in the lessons learned from professionals who have experienced client objections first-hand and learned from their personal wins and losses. Don’t be afraid to look outside of the real estate industry. A professional with a background in tech or marketing will still have great lessons to share and if they are truly an expert, they will be able to relate their learnings to the real estate industry.

Second, and more important than the first, is to ensure that your speakers not only tell you what to do but how to do it. We all know you need to get leads and market yourself, the question is: how do you do it? Even better than giving you the how look for professionals who can suggest tools and technology that will allow you to execute on all of your new knowledge. Technology has changed dramatically over the last 10 years, and so has its role in business. Today, a brokerage cannot reach its full potential without the proper tools and technology in place. An expert with a solid understanding of what works and what doesn’t will ensure your new education comes full circle and that you can streamline processes and easily implement what you have learned.

These are just three ways that you can continue to educate yourself and grow your business; the truth is, there are many more. How you choose to continue to develop professionally and learn continuously, is up to you. What is most important, is that you do it. In the real estate industry, what you know is what will set you apart. Take a step back into the classroom and towards a more successful real estate career.

Kristen MacDonald is the content specialist at Lone Wolf Real Estate Technologies. With a passion for writing and technology, Kristen loves exploring the latest trends in real estate and sharing her perspective with her audience.

This article originally appeared in the July 2016 issue of the REAL Trends Newsletter and is reprinted with permission of REAL Trends Inc. Copyright 2016

Legal Q&A: Are bathroom wall mirrors fixtures?

noreply@blogger.com (NC REALTORS®) — Thu, 18 Aug 2016 15:12:00 +0000

QUESTION: I recently attended a training class on the latest forms changes. The trainer said that bathroom wall mirrors are now fixtures regardless of how they are attached. Is that so? Why are bathroom wall mirrors now being treated differently from other mirrors?

INTERESTED IN THE ANSWER? CLICK HERE

Have a legal question? Call the Legal Hotline. As a member of NC REALTORS®, you have free, unlimited access to this benefit. Call 800-443-9956 or email legal@ncrealtors.org with any questions regarding contracts, forms, fair housing, disclosure and more.

Enough about millennials

noreply@blogger.com (NC REALTORS®) — Tue, 16 Aug 2016 14:00:00 +0000

By Patrick Lencioni, The Table Group

Am I the only person in the world who’s tired of hearing people talk about Millennials? Whether it’s a complaint about their entitlement mentality or a declaration of their brilliance, it all strikes me as shallow and simplistic.

Now, I do not deny that every generation has a few things that make it unique. Today’s young people get their information differently than I did. I get that. And they communicate with one another using different devices than I did. No doubt. And I agree that they have different expectations around employment than I did. But isn’t that true of every generation? Why is it that we seem to be fascinated with this new collection of human beings, as though they come from another planet?

My fascination with all this is related to my most recent book, “The Ideal Team Player,” because it has ramifications on how we go about bringing Millennials into a workforce that is increasingly team focused. There seems to be a fear on the part of recruiters and hiring managers that they’ll be forced to deal with hordes of self-focused, isolated and lazy geniuses who are incapable of working well with others.

As it turns out, there is a better way to think about hiring good people than focusing on a person’s generational stereotype. It comes down to looking for three simple, timeless and observable virtues that are reliable predictors of whether someone of any age will be a good team player. Thankfully, while generations change, the nature of teamwork does not.

The first and most important of the three virtues is humility. And yes, plenty of Millennials are humble. Humility is a timeless virtue, one that society will always yearn for, even when its celebrities and cultural icons seem to renounce it. Plenty of Millennials are just as tired of self-indulgence and narcissism as the rest of us. They’re capable of caring for others more than themselves and have the ability to enjoy team success more than individual achievement.

Another critical virtue is hunger, the desire and willingness to work hard, to go above and beyond what is required for something worthwhile. While paper routes and lawn-mowing businesses for teenagers may seem like a thing of the past, hard work and sacrifice is alive and well among young people. The question is whether or not they’ve ever been made to work hard. I’m convinced that a large percentage of people in any demographic group, including Millennials, are capable of hard work, and a certain percentage are destined to be slackers. The key is finding the right ones to hire, and weeding out the others.

The third virtue that indicates that a potential new hire will be a good team player is what I call smarts, which is having common sense about people, and knowing how one’s words and actions impact others. While it may be true that Millennials have spent a disproportionate amount of their time using abbreviations and Emojis to communicate, it doesn’t take long for them to adjust when they realize that the guy or gal sitting next to them in a meeting needs a little eye-contact and emotional connection. All human beings, yes, even teenagers, yearn for interpersonal connection and are capable of embracing it.

And so, let’s take a breath and realize that our society, and our economy, will survive the onslaught of Millennials. Companies that place a high priority on teamwork, on finding people who are humble, hungry and smart, will have no problem with them, or with any other generation for that matter.

In the spirit of this current generation, I’ll close with a tweetable summary: Teamwork is not limited to any one generation. Millennials aren’t so special. In fact, they’ll be just fine.

Patrick Lencioni is founder of The Table Group and author of several books including, “The Ideal Team Player,” and “The Five Dysfunctions of a Team.”

This article originally appeared in the July 2016 issue of the REAL Trends Newsletter and is reprinted with permission of REAL Trends Inc. Copyright 2016

Legal Q&A: Can a client make changes to the pre-printed language on a NC REALTORS© form?

noreply@blogger.com (NC REALTORS®) — Thu, 11 Aug 2016 15:15:00 +0000

QUESTION: My client received an offer from a buyer on a Standard Form 2-T, and before signing, my client crossed out paragraph 13 (“Delay in Settlement/Closing”) on the form. I told him not to, but he would not listen. The buyer initialed the change when he received the 2-T back. The transaction has been moving forward, however, the closing is scheduled for next week and the lender does not look ready to close. My client does not want to give an extension. Is this sale dead if we do not close on the scheduled date? Was my client allowed to cross out paragraph 13?

INTERESTED IN THE ANSWER? CLICK HERE

Have a legal question? Call the Legal Hotline. As a member of NC REALTORS®, you have free, unlimited access to this benefit. Call 800-443-9956 or email legal@ncrealtors.org with any questions regarding contracts, forms, fair housing, disclosure and more.

Need Inventory? Try this!

noreply@blogger.com (NC REALTORS®) — Mon, 08 Aug 2016 14:00:00 +0000

By Larry Kendall, chairman of The Group, Inc. and author of Ninja Selling

Most areas of the country are experiencing a shortage of listings, more buyers than sellers and multiple offers. In some markets, the pushing and shoving are so intense it’s being called a “Mosh Pit Market.” The companies with the listings are controlling the market. How do you help your team generate more listings?

In surveying top listing Ninjas, we find that many of them are listing more properties than ever. How do they do it? Here are three of their top strategies:

1. Bring your A Game. In a hot seller’s market, the temptation is to cheap out. Why invest any money in professional photography, brochures, staging or pre-inspections? This house will sell in 72 hours with multiple offers. This is a short-sighted approach.

Top listing real estate professionals have a mindset that “my next listing is embedded in this listing.” They know that 65 percent of the buyers coming through that house will have a house to sell. They know that curious neighbors will also come through.

When the buyers (sellers) and curious neighbors (sellers) see a beautifully staged home, professional color brochures, a wonderful counter display with all the information on the home, and a contract writing kit, what do they think? Wow! This home is a cream puff and this listing sale professional is a pro. I like how they market. When I sell, I want to list with them. Because the real estate professional brought her A Game, she generated her next listing(s) from this listing.

2. Dog Days. The opposite of a cream puff is a dog. This is a property that has always been hard to sell. Maybe it’s on a busy street, has an obsolete floor plan, is in poor condition—or all three. In a normal market, this property has been nearly impossible to sell. However, anything will sell in the “Mosh Pit Market!” Top listing real estate professionals are calling these sellers and letting them know, “If you have ever wanted to unload that dog, your time is now!”

3. Buyers are sellers. Sixty-five percent of buyers have a house to sell. When they buy, they generate a listing. What if they are afraid to put their house on the market because they are worried it will sell quickly, and they won’t be able to buy another home? Legitimate concern.

Ask this question, “With perhaps the lowest interest rates in your lifetime, are you living in the home of your dreams?” Follow up with, “If you could wave a magic wand and live in your dream home, describe it to me.” Rehearse these questions at a sales meeting and see how it feels when you are the buyer/seller. Discuss how, with the low interest rates; they could be living in that home today. How do they do it?

In most markets, prices have risen dramatically in the past three years. In our market, the average home price has gone up over $100,000. In our market, sellers who put 20 percent down three years ago have seen their equities double or even triple. Most have equity again—big equity in many cases. What about refinancing, pulling money out of their current house, and using that money as a down payment on their dream home?

This strategy isn’t for everyone. They run the risk of owning two homes for a while. However, if they’re in a hot seller’s market, the risks are minimized, especially if they are moving up. In most markets, the hottest segments are the lower and mid-price points. The higher price points tend to be slower markets. If that is the case, they can buy in a slower market segment and sell in a hotter one. Again, this is not for everyone, but top real estate professionals are presenting the idea to their clients and letting their clients decide.

Real estate is like a game of monopoly. Control the board, and you control the game. The way we control the board in real estate is with listings. It’s also how we thrive in the Mosh Pit.

This article originally appeared in the July 2016 issue of the REAL Trends Newsletter and is reprinted with permission of REAL Trends Inc. Copyright 2016

Legal Q&A: Can buyers be held to their representations regarding financing?

noreply@blogger.com (NC REALTORS®) — Thu, 04 Aug 2016 14:46:00 +0000

QUESTION: In recent months, I’ve had several transactions where buyers, who have represented that they do not have to obtain a new loan in order to purchase the property, have later notified me that they will be financing their purchase with some sort of loan. I suspect that each of these buyers intended all along to obtain a new loan, but checked the "does not" box in paragraph 5(a) of the Contract in order to make their offer look more attractive. Is there anything I can do to protect my seller-clients from this tactic?

INTERESTED IN THE ANSWER? CLICK HERE

Have a legal question? Call the Legal Hotline. As a member of NC REALTORS®, you have free, unlimited access to this benefit. Call 800-443-9956 or email legal@ncrealtors.org with any questions regarding contracts, forms, fair housing, disclosure and more.

The greatest challenge ahead?

noreply@blogger.com (NC REALTORS®) — Tue, 02 Aug 2016 14:00:00 +0000

Are regulatory changes a bigger threat than technological advances?

by Steve Murray, publisher

Most say technological change is the greatest threat to brokerage. Perhaps. What we see as possibly the greatest challenge may be in the regulatory arena. While the Consumer Finance Protection Bureau (CFPB) certainly has our industry’s attention, and while many believe that the mortgage interest deduction may be amended in ways not favorable to our business, it is the myriad of state lawmakers and regulators that may also affect the ability to do business. This also does not take into account recent actions by the National Labor Relations Board (NRLB) which may raise the costs of doing business for tens of thousands of brokerage firms, nor does it consider the Federal government’s research into healthy homes.

Consolidation?

If history is any indicator, it appears that every time government and regulators get involved with more regulation of an industry, that industry consolidates faster than it may have otherwise. Look at the market-share increases of the large banks since Dodd-Frank was introduced. Also, look what is happening with the CFPB’s recent attempts to regulate the payday lending industry so much that they may cease to exist. Also, we can refer to the shrinking numbers of hospitals and health insurance firms since ObamaCare was implemented.

Lost Market Share

In brokerage, something happened in 2015 that we have not seen before. The REAL Trends 500 firms have historically lost market share in strong markets and gained it back in down markets. But, in 2015, these largest of brokerage firms gained nearly 5 percent share against the rest of the market. Might it have to do with the CFPB chasing thousands of small- to medium-sized brokerages to abandon their mortgage MSAs, removing a source of profit and reducing their ability to compete with larger brokerage firms? Only the largest brokerage firms can now add profit and revenue from mortgage. Are they using this to compete more effectively with medium and smaller firms that lack this source of profit?

Brokerages Being Investigated

A client of ours was investigated by their state’s department of corporations. The regulator had no complaints, no reason to believe anything was wrong with the brokerage. Nonetheless, this brokerage firm spent hundreds of thousands of dollars on legal and compliance fees to make the corrections demanded by the regulators. This is not an isolated incident. Several other states are in the process of examining how to increase brokerage supervision, or how to further regulate agent teams—the list is extensive.

So, while many think it’s technology that will fundamentally change our industry and the way we do business, it may be that it is government and regulators who will do more to change the environment in which we do business.

This article originally appeared in the July 2016 issue of the REAL Trends Newsletter and is reprinted with permission of REAL Trends Inc. Copyright 2016

Legal Q&A: Is there a contract if the earnest money deposit hasn’t been paid?

noreply@blogger.com (NC REALTORS®) — Thu, 28 Jul 2016 14:23:00 +0000

QUESTION: One of my listings recently went under contract using the Offer to Purchase and Contract (form 2-T). The Initial Earnest Money Deposit was to be paid by personal check and delivered within five days of the Effective Date. The EMD is now two days late. I’ve been contacted by a buyer agent who says she has a buyer who wants to make a full-price offer. My seller wants to know if there a binding contract on the property with the first buyer, since the EMD hasn’t been timely delivered, and if so, may he terminate the contract and sign a contract with the second buyer?

INTERESTED IN THE ANSWER? CLICK HERE

Have a legal question? Call the Legal Hotline. As a member of NC REALTORS®, you have free, unlimited access to this benefit. Call 800-443-9956 or email legal@ncrealtors.orgwith any questions regarding contracts, forms, fair housing, disclosure and more.

What do football and real estate have in common?

noreply@blogger.com (NC REALTORS®) — Tue, 26 Jul 2016 14:00:00 +0000

It turns out the same things that make a good football coach, make a good realty leader, too.

by Steve Murray, publisher

A few weeks back, my wife and I took a vacation on a riverboat in Europe. While on the boat, I met a man who was a hugely successful football coach for a successful collegiate program. Proving that one can learn something at any time, we had a conversation about what he thought made his programs successful (at two separate major colleges over 20+ years). Here is what he shared.

The most important behaviors for leading people, in my opinion, are just two simple things listening carefully—really listening—and confirming what was discussed, whether you reached an agreement or not. He said in all his years working with coaching staff and players; these were by far the two most important reasons for his success and that of his teams.

It was also interesting to hear him say that quite often he would recruit a player who starred at one position in high school but turned out excelling at an entirely different position at the collegiate level. He said that when recruiting top players, it is just as important to look at their character, drive and willingness to work as a part of the team as it is to look at their particular skills. When he talked about these key players, he said some of his best teams were made of young men who played positions other than what they had previously starred in but who, through their character and leadership skills, caused other players to want to play with them and around them.

Given his success over a long period at a very high level, I listened carefully. Reflecting on that, I recall some of the research we have done at REAL Trends about what causes some firms to outperform others over long periods of times through good markets and tough times. It seems that it all lines up. What makes for great college football coaches also makes for great realty leaders.

Listening and confirming what was said and follow through on commitments are what make great organizations. The words vision, trust, communication, empowerment and support may sound like gobbledygook from a consultant’s handbook, but everywhere we look we find that they are the cornerstones of great organizations.

The financials, numbers and ratios only measure the output of an organization and not necessarily the key inputs into how an organization got successful. I am convinced that the how comes down to the key interpersonal skills of an organization’s leaders.

One last note—assuming the coach was right, recruiting talent for your brokerage, especially at the management level, may mean you look outside our industry for the kinds of talent that will drive success in the future. It could be that we find talented people who have led other sales organization. Also, that we structure realty firms around talent wherever we may find it..

This article originally appeared in the July 2016 issue of the REAL Trends Newsletter and is reprinted with permission of REAL Trends Inc. Copyright 2016

Legal Q&A: Can I use a last name different from the one on my real estate license for advertising?

noreply@blogger.com (NC REALTORS®) — Thu, 21 Jul 2016 14:41:00 +0000

QUESTION: I’m a broker-in-charge, and one of my provisional brokers has always said her name was “Claire Eliott-Carter.” Claire recently passed her license exam, and when my firm received a copy of her real estate license, it stated that her name was only “Claire Eliott.” When I asked Claire about the discrepancy, she informed me that her legal name is the one on her license, but everyone in the community has known her for years as “Claire Eliott-Carter.”

I need to order business cards and create Claire’s advertising signage. Can I use “Claire Eliott-Carter,” since that’s how everyone knows her, or do I have to use her legal name?

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Have a legal question? Call the Legal Hotline. As a member of NC REALTORS®, you have free, unlimited access to this benefit. Call 800-443-9956 or email legal@ncrealtors.org with any questions regarding contracts, forms, fair housing, disclosure and more.

The people side of deals

noreply@blogger.com (NC REALTORS®) — Wed, 20 Jul 2016 14:00:00 +0000

Emotions play a big part in mergers and acquisitions.

By Steve Murray, publisher

When discussing the merger or acquisition of brokerage firms, the first question is almost always about the multiple. Then, they move on to terms, how much cash, how long the earn out, how is it structured and executive compensation. And, while these are important, some lessons we have learned over the past 29 years of putting brokerage firms together is that it’s rare that it’s only about these factors. Far more often, it is about the legacy of the seller, the emotional feeling one has about ending a significant chapter in an owner’s life and how he or she will be viewed in light of doing a transaction that matters the most.

Many brokerage firm owners like to think of themselves as rational creatures. Likely, most of the time this is true. After all, they’ve survived multiple recessions, rising costs, and the threats of technology and other new intermediaries for many years. For those who have lasted 20-30-40 years, the business has changed so much in its economics that it is hardly recognizable. But, when it comes down to deciding whether to sell or merge with another firm, it’s inevitably a very personal decision. And, often at this time, rational thought diminishes and the emotional factors rise.

In our experience, those who’ve built great brokerage firms have also formed an emotional attachment to them. How the owner will be viewed after a deal by the agents and employees of the company is important. What will happen if they, the masters of their universe, will be judged for the decision to sell or merge that matters more than the money of the deal?

In fact, it’s this characteristic that makes them great brokerage leaders. They don’t want to say they care about these factors, but they do, intensely and personally. Yes, they like being at the center of the action. As Bill Moore, who ran a great brokerage firm in Denver, having sold it some time ago, decided to acquire another firm and re-enter the brokerage business, told us that he “flunked retirement and missed being with agents and around the action of the business.” He said aloud what many brokerage owners think and feel. They miss it greatly once they are not in it.

So, while the discussions will always be about the price and terms of deals, it’s actually how an owner feels about him or herself, and how he or she thinks a deal will be perceived, that ultimately will decide whether he or she can successfully transition from owner-operator to some new role.

This article originally appeared in the April 2016 issue of the REAL Trends Newsletter and is reprinted with permission of REAL Trends Inc. Copyright 2016

Legal Q&A: Can I provide a tenant's credit report to my landlord-client?

noreply@blogger.com (NC REALTORS®) — Thu, 14 Jul 2016 15:04:00 +0000

QUESTION: I’m a property manager and I recently had to evict a tenant based on his failure to pay rent. After the case was over, my property owner client asked me to send him the credit report my firm ordered when we processed the tenant's lease application. Am I obligated to share that credit report with my client? If not, am I permitted to share that report with my client.

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Have a legal question? Call the Legal Hotline. As a member of NC REALTORS®, you have free, unlimited access to this benefit. Call 800-443-9956 or email legal@ncrealtors.org with any questions regarding contracts, forms, fair housing, disclosure and more.

Signs of increased online lender regulatory scrutiny?

noreply@blogger.com (NC REALTORS®) — Tue, 12 Jul 2016 14:00:00 +0000

Online marketplace lenders on regulators’ radar screens.

By Sue Johnson, strategic alliance consultant

Two federal regulators—the Consumer Financial Protection Bureau (CFPB) and the U.S. Department of Treasury—have been sending out signals in recent months that they intend to more strictly scrutinize online marketplace lenders, which offer financial products such as mortgages, student loans and payday loans. While these regulators have been cautious in their public statements, their activities raise the possibility of new federal regulations for this fast-growing industry.

CFPB Urges Consumers to Submit Online Lending Complaints
On March 7, 2016, the CFPB published a press release that encouraged consumers to submit complaints about online marketplace lenders on its website. The CFPB uses its database of consumer complaints (currently estimated at 530,000) to determine how it enforces laws and writes regulations.

The CFPB simultaneously released a consumer bulletin that provides an overview of marketplace lending and tips for consumers who are considering taking out loans from online lenders. Most of the tips are basic, but the bulletin tells consumers to “keep in mind that marketplace lending is a young industry and does not have the same history of government supervision and oversight as banks or credit unions.”

Industry observers question the CFPB’s motive for asking for complaints against online lenders when it already accepts complaints about consumer financial products, including mortgages, student loans, and payday loans. Why ask for complaints against a specific type of lender when there already is a complaint mechanism in place?

Scott Pearson of Washington, D.C.-based Ballard Spahr, LLC believes it’s a warning sign. “The CFPB’s objectives in taking these actions are questionable since consumers already could complain about marketplace loans using the CFPB’s existing loan categories,” he said in the law firm’s CFPB Monitor. “Rather than seeking to provide additional protection to consumers, perhaps the CFPB’s primary objective is to warn marketplace lenders that they are clearly on the CFPB’s radar screen.”

Treasury Department Announces Online Lending Study
The U.S. Department of Treasury also appears to have set its sights on the online marketplace lending industry. On July 16, 2015, it announced that it will “study the potential for online marketplace lending to expand access to credit and how the financial regulatory framework should evolve to support the safe growth of the industry” and requested public comments on this industry’s practices.

Despite the Department’s positive description of its study, its request for comments asked such pointed questions as: In what ways do different models raise different policy or regulatory concerns? How are borrowers assessed for their creditworthiness and repayment ability? How accurate are these models in predicting credit risk? Marketplace lending potentially offers significant benefits and value to borrowers, but what harms might online marketplace lending also present to consumers and small businesses? What privacy considerations, cybersecurity threats, consumer protection concerns, and other related risks might arise out of online marketplace lending? Do existing statutory and regulatory regimes adequately address these issues in the context of online marketplace lending?

The Department received over 100 public comments from online lenders, community banks, credit unions, institutional investors, payment services providers, trade associations, and consumer advocates. In August 2015, it held a roundtable discussion with input from 80 industry, borrowers and consumer advocates.

Outlook
The federal regulatory scrutiny of online marketplace lenders appears to still be in the fact-finding stage, so it’s too early to predict the results. Certainly, it would be a complex process, given the substantial differences between various online lending platforms and the diversity of the products they provide.

Whatever the outcome of this debate, it will have implications not just for online lenders, but also for companies that compete or partner with them. It’s a space worth watching.

This article originally appeared in the April 2016 issue of the REAL Trends Newsletter and is reprinted with permission of REAL Trends Inc. Copyright 2016

Legal Q&A: Does the Contract’s “Notice Information” section have to be filled out?

noreply@blogger.com (NC REALTORS®) — Thu, 07 Jul 2016 15:05:00 +0000

QUESTION: Two weeks ago, the weekly Q&A focused on whether notices, required or permitted under the Offer to Purchase and Contract (form 2-T), can be sent electronically. The answer to the question was “yes.” The Q&A pointed out that paragraph 21 of the Contract permits the use of electronic means for any notice or communication in connection with the Contract, provided that the “Notice Information” section on page 11 has been completed. It’s not uncommon to see contracts where none of the contact information for the parties or their agents/firms is filled in. Is that okay?

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Have a legal question? Call the Legal Hotline. As a member of NC REALTORS®, you have free, unlimited access to this benefit. Call 800-443-9956 or email legal@ncrealtors.org with any questions regarding contracts, forms, fair housing, disclosure and more.

The rise of the team

noreply@blogger.com (NC REALTORS®) — Tue, 05 Jul 2016 14:00:00 +0000

Trends in team offices

By John Steger, New Era Group at Your Castle Real Estate

REAL Trends has been instrumental in the growth of the team featured in this article, providing them with technology and marketing strategies. We want to get know teams, their structure, physical spaces, technology and marketing demands and more, CLICK HERE to be a part of this groundbreaking study.
—Travis Saxton, vice president of technology

When my grandmother was a real estate professional, just a few miles from where I now practice the profession, it was a very different world. In that world, the brokerage had the power and the resources to allow a professional to thrive. It was vital that your brokerage provided hard copies of contract forms and MLS in the form of a printed property book with three-hole punched fliers to show your clients. A secretary was necessary to answer calls and take messages. Most agents checked into the office by putting a quarter in a payphone. The fax machine and voice mail started the revolution that has now made the brokerage office an optional part of any agent’s business model, rather than a necessity. Once a jacket and a nice office was a sign of prestige, now, if an agent uses a pair of Google glasses, a consumer is more likely to be impressed. Many clients no longer expect an agent to have an office.

This transition allowed well-networked agents to operate independently. A recent study showed that one-person brokerages are dominating the luxury market in Denver. When even the most prestigious firms in the city are losing market share, year-over-year, the value proposition becomes suspect. With sales associates able to hang their licenses with a plethora of brokers, commission splits will continue to be more favorable to sales associates, and the margins of owning a brokerage will shrink. I have lived this, having gone from a two-person shop with my founding business partner to owning and operating a 20-agent firm. We had a great little brokerage, but after consulting with REAL Trend’s Steve Murray, we realized that dramatic growth would be needed to come close to getting a return on all the time we spent running the brokerage.

At first, we thought we had two choices, shut down our boutique brand or sell the brokerage to a larger firm. There would have been a decent pay day with an outright sale, but the brand would have disappeared, and our crew disbanded. Luckily, we found a solution and merged into a large, well-run independent brokerage and were able to keep our brand identity. Then, the magic happened. The advantage of the team model led to exponential growth and success. Only by having lived this experience can I explain it from a business perspective.

A Marketing Collaborative
Teams are now ideal in the industry, with a solid, blue-chip brokerage covering the evil necessities of the business, such as dealing with technology issues, file retention, file auditing, compliance, oversight, lawsuits, complaints, staff turnover, new agent training and more. Running a brokerage is not a sexy business, but it is a platform that must be in place for a sales associate to be a professional. You can be successful solo, but you end up owned by your job, and you can’t be great at everything. However, a team can focus on what the consumers want—awesome marketing and great support and service. That is what the team that I have majority ownership in does now. We consider ourselves a marketing collaborative and everyone contributes. Our mastermind sessions are well attended and offer fertile ground for new sales associates to learn and quickly see results. We share a brand. The brand and marketing platform are all I own. I have expectations of professionalism and team mindset, but we are all broker associates for our mother ship. What does this flat organization, team approach offer?

• We can be selective as to who joins because it is not about head count.
• We are nimble because the leadership is practicing the craft and always innovating.
• We can locate in a cool part of town, by restaurants and coffee shops.
• We don’t need a big office.
• We don’t get geographically pigeonholed.
• We don’t need a stuffy office building from which to work; our offices are everywhere.
• We have a central hub that is a fun place to pop in and out of, where music is playing and people are selling. There is no expectation that any of us goes to the office ever, yet we are attracted to the culture.
• We inspire and support each other without any formal leadership. Yes, I’m still the majority owner of the team, but I don’t have the responsibilities I had as a brokerage owner. Now, I get to spend time working on lead generation for the firm, improving our shared marketing resources and benefiting from these activities as my personal sales volume continues to climb.
• Mega agents are developing within the team.
• We have zero turnover.

Two years after saying goodbye to my beloved New Era Realty and waking up to a business card that says “New Era Group@Your Castle Real Estate,” I never could have imagined the results. We’ve grown from 20 to 50 agents. In 2014, the team sold 333 homes and last year we sold 443. Although total sides did not increase dramatically, the price point at which many of our agents are operating has changed. In 2015, our team paid Your Castle Real Estate four times as much in commission splits as it had in 2014. This huge jump in commission earnings and average sales price was, in part, due to dramatically improved marketing materials. More importantly, the business model has attracted some fantastic agents who want to be part of a positive and progressive culture. We are opening a much larger office, but it has all the key components of the smaller one. We remain in a hip, fun part of town with restaurants and coffee shops.

My grandmother would be proud. I am hiring my first assistant to help me keep up with the business that is coming my way. Now that I don’t have the distraction of running a brokerage, I have the time to focus on my clients and marketing platform. This transition has dramatically increased my personal income, as well as helped every sales associate operating under the brand I own.

How has the brokerage we are part of reacted to the explosive growth of the team? The owner of Your Castle Real Estate and I share a meal or play a round of golf on occasion. I enjoy asking him, “Did you ever think it would work out like this?” His typical response is, “Never” with a bemused smile. It’s clear that we’ve stumbled upon something, as his profits continue to rise.

I believe that teams have a huge competitive advantage over both the small shops and the big brokerages. With excellent vendors in the marketplace for almost any need, brokerages are no longer necessary in the way they once were. Small shops aren’t experts at anything because they are overwhelmed. Plus, it’s hard to compete with a team that is collaborating and sharing freely. We all feel a sense of brand ownership, and my profit share from the brokerage is becoming more meaningful than the revenue I had when I owned a brokerage myself.

Teams are the answer, my friend, and they are on the rise!

This article originally appeared in the April 2016 issue of the REAL Trends Newsletter and is reprinted with permission of REAL Trends Inc. Copyright 2016

Legal Q&A: Can a REALTOR® include one of my listings in her print advertising without my consent?

noreply@blogger.com (NC REALTORS®) — Thu, 30 Jun 2016 13:34:00 +0000

QUESTION: I recently received a postcard that was sent out by a REALTOR® who lives in my neighborhood (I'll call her "Jane"). The postcard contained a list of 15-20 houses in the neighborhood and identified them as either sold, listed or under contract. While some of the "listed" properties were Jane's listings, many were not. For those active listings that were not hers, Jane did include the name and telephone number of the listing agent. One of those listings was mine. I never authorized Jane to advertise my listing and, while my client and I both appreciate the exposure of my client's property, I feel like Jane's advertising without my consent is improper. Am I right about that?

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Have a legal question? Call the Legal Hotline. As a member of NC REALTORS®, you have free, unlimited access to this benefit. Call 800-443-9956 or email legal@ncrealtors.org with any questions regarding contracts, forms, fair housing, disclosure and more.

Stop selling; start solving

noreply@blogger.com (NC REALTORS®) — Wed, 29 Jun 2016 14:00:00 +0000

Don’t try to answer someone’s prayers until you know what they are praying for.

By Larry Kendall, chairman of The Group, Inc. and author of Ninja Selling

Most salespeople have been taught the traditional three-step sales presentation:

1. Make a connection (build rapport);
2. Make a presentation of features and benefits;
3. Close.

My observation is that most managers use this three-step approach in their recruiting, as well. After building rapport, they immediately launch into their spiel: “Let me tell you about the exciting things we are doing in our company—technology, lead generation, brand, staff systems, etc.”

There’s an old rule of selling, “Don’t try to be the answer to someone’s prayers until you know what they are praying for.” The traditional three-step sales presentation violates this rule. The manager (or salesperson) who is telling and selling never discovers what the recruit (or customer) is praying for. If you don’t accidentally hit a hot button, your presentation starts to sound like “blah, blah, blah.”

What would happen if the manager used the Ninja Four-Step Consultation instead? This is the process we teach in our Ninja Selling classes, and it works great for managers who are recruiting. Let’s face it; a recruiting interview is a sales interview. Here’s how the four-step consultation works.

Step 1: Connection
Recruits want to work with someone they like and trust. They decide this in the first two minutes. Do they feel a connection with you? Do they like you, trust you, and want to go down this path with you? They will feel the connection if you ask questions about them. We recommend you ask F.O.R.D. questions—Family, Occupation, Recreation, Dreams (goals). Most people are very comfortable talking about these four areas of their life, and you are building rapport and connection.

Step 2: Information (Pain/Pleasure)
This is a critical transition step. In the traditional three-step sales process, you would now be at the presentation stage, where you launch into your pitch of features and benefits. Most managers love this step because they get a chance to strut their stuff on stage.

There are two problems with this approach: first, the manager is trying to be the answer to their prayers without knowing what they are praying for; and second, the manager has time of possession (is doing all the talking). After a few minutes, the recruit stops paying attention, drifts off, and the connection is lost.

Instead of launching into your spiel, listen carefully to how the recruit answers your questions about F.O.R.D., especially about their business (occupation). Listen for pain and pleasure. This is what they are praying for. Here are my two favorite pain and pleasure questions:

Pain: “What is your greatest challenge in your business right now?”

Pleasure: “If you could wave a magic wand and have your business just the way you want it, what would that look like?”

Step 3: Solution (Create Potential Solutions)
Now, formulate potential solutions that solve what they are praying for. How can you connect what you have to what they want? I once had a top producer tell me she was so busy, and the market was so hot, that she couldn’t make a move at this time. When I asked her about her greatest challenge, she said she was working all the time, and business was falling off her desk.

Step 4: Proposal (Propose Solutions)
I showed her how our staff systems would save her time and make her money. We could dramatically increase her income per hour so she could have a life. She had also talked about a goal of having more time with family and this solution resonated with her. She joined us right away because she wanted the solution.

Be a master recruiter. Stop selling and start solving.

This article originally appeared in the April 2016 issue of the REAL Trends Newsletter and is reprinted with permission of REAL Trends Inc. Copyright 2016

Legal Q&A: Can a notice sent electronically be “legal notice” under the standard offer to purchase and contract?

noreply@blogger.com (NC REALTORS®) — Thu, 23 Jun 2016 13:30:00 +0000

QUESTION: My clients have a fully executed contract (Standard Form 2-T), but the buyers have not timely delivered the agreed upon earnest money deposit and due diligence fee. We know we can send a notice to the buyers demanding that they deliver the funds under paragraph 1(d) of the contract. Does the notice have to be an actual writing or can it be sent electronically?

INTERESTED IN THE ANSWER? CLICK HERE

Have a legal question? Call the Legal Hotline. As a member of NC REALTORS®, you have free, unlimited access to this benefit. Call 800-443-9956 or email legal@ncrealtors.org with any questions regarding contracts, forms, fair housing, disclosure and more.