People are the kaleidoscope of life

When you look around at a social or business gathering, do you ever think about how different the people are? Each person’s journey is made up of different experiences that make them unique in some way.

Einstein used color blindness as an example that each of us may very well see colors a bit different. Who really knows what green looks like to others. We understand the word and how to apply it but not how it appears to anyone else. Possibly that is why my brother does not care for the green sweater I give him for Christmas.

The richness of life comes from interacting with others and gaining perspective from how they see life.

I work mostly with client couples and in most cases, opposites do attract. It is always interesting to see how couples navigate and negotiate mutual decisions. What is important to one is often of little interest to the other. What I have learned is that the opposite strengths in one seem to fill in the weaknesses of the other person. If they learn how to harness the strengths and not drive each other crazy, they make very good decisions.

My roll becomes that of a facilitator to assist in balancing without taking a side in the process. I try to maintain a non bias role with both and as a result, I usually learn something in the process.

I sometimes teach in an interactive men’s’ Bible study.  I am always intrigued that the men can study the same passage and come to such different conclusions based on their own life perspective.

Telling the Truth…or not

When someone or you answer a question, is it with the truth? There are some easily discernable signs that will answer the question.

-          Is the answer or body language defensive? If someone is telling the truth there is no need for a defensive manner. Defensiveness might include jerky body, arm or eye movement as well as change in tone of voice. The truth will stand for itself and does not require a defensive position.

-          The provider of the answer is obviously not listening to the question. If a person is overanxious to provide an answer, they probably do not understand what the question really is. Listening until someone has finished asking in a non defensive manner is a skill that can be learned.

-          Over verbalization. The person answering tries to hose the question with so many words that it never gets addressed. This tactic is used in hopes that the person asking will get distracted and forget the question. If the question is asked again, the person answering will usually become more defensive or abusive (passive or aggressive).

-          Abusive. Many times someone not telling the truth will try to intimidate by using abusive body language, tone or verbiage. Common response is to try to shout down the questioner or try to make the question look irrelevant. This tactic usually makes the person using the tactic lose trust quickly. It looks like it works because the question may seem to go away when it is actually trust that disappears.

-          Changing the subject from the question to something entirely different.  Avoidance is a desperate method of hoping the question will disappear. The person answering looses credibility and the question remains.

-          No group discussion of the answer. People not telling the truth will avoid group discussion at any cost including abruptly terminating a meeting. They are petrified of the possibility of group consensus challenging them.

When answering a question, view it as an opportunity to either gain or lose trust. A question never goes away without an answer; it festers and grows, usually developing into low trust.

“I will find the answer and get back to you” is a great response. It demonstrates that the question deserves an accurate answer. No one is an expert on everything. Deferring to finding the right answer by research or asking someone else demonstrates confidence and character. A big ego has problems with this type of approach. They cannot separate a reasonable question from a personal confrontation.

Rarely but on some occasions a person has lost any sense of truth. These people can be so convincing when lying that it is hard to tell. They know how to avoid the above signs so well that they can present without moral judgment. If an answer sounds too goods to be true, it probably is not.  As a good safety net, it is always wise to check out an answer to be sure it is true with research or discussion.

Great use for the leftover turkey...Enjoy

Mexican (Chicken) Stew

1 ½ - 2 lbs boneless chicken cubed

! Cup chopped red onion

1 green or red pepper chopped

4 minced garlic cloves

3 regular cans of Mexican or chili diced tomatoes

3 regular cans dark red kidney beans

1 16 oz jar medium salsa

2 teaspoons chili powder

2 teaspoons ground cumin

-         Easy way: cube the chicken and brown with onions and pepper, add to the rest of the ingredients cook for approximately 30 min. Serve with cheddar or pepper jack cheese and Frito topping.

-         Better way: either pressure cook the chicken for 60 min or boil until it shreds. Sauté the onion and peppers until soft.  Add the chicken, onions and peppers to the other ingredients and cook for 30 to 60 min.

Ritchie 11.2010

Real Estate Trend for Knox County Tennessee

1-3 Quarter Statistics for Knox County Tennessee

	1st Quarter	2ond Quarter	3rd Quarter
Units Closed
$150-	451	642	382
$151-$300	323	574	580
$301-$500	97	154	115
$501+	30	60	63
Average Original List
$150-	$102,955.00	$105,140.00	$98,275.00
$151-$300	$219,623.00	$217,026.00	$221,545.00
$301-$500	$403,967.00	$394,504.00	$401,074.00
$501+	$789,505.00	$852,707.00	$721,030.00
Average Reduced List
$150-	$94,873.00	$101,048.00	$92,459.00
$151-$300	$211,904.00	$212,247.00	$215,284.00
$301-$500	$392,234.00	$384,860.00	$390,781.00
$501+	$765,834.00	$798,555.00	$693,982.00
Average Closed Sale
$150-	$90,725.00	$97,840.00	$88,474.00
$151-$300	$205,744.00	$205,678.00	$207,849.00
$301-$500	$378,337.00	$372,446.00	$371,138.00
$501+	$714,550.00	$740,573.00	$643,117.00
Original list to Sale %
$150-	88.12	95.55	94.46
$151-$301	93.68	94.67	93.81
$301-$500	91.39	94.4	92.53
501+	90.56	86.84	89.19
Reduced Price to Sale %
$150-	95.62	93.05	90.02
$151-$300	97.26	97	96.57
$301-$500	96.55	96.79	95.05
501+	94.19	93.13	93.17
Days on Market
$150-	90	89	90
$151-$300	112	106	104
$301-$500	129	116	140
501+	159	185	126

Statistics drawn form the Knoxville MLS 11/2010

1. The strength of the market has been below $300K
2. Sales declined after the Tax Credit expired
3. List prices reflect softening based on the reductions from initial listing to actual sale.

Next report will show fourth quarter results for complete 2010 comparison.

The paradigm has changed

My friend Jim Lee posted an article on his blog at  http://knoxvilletennesseerealestateblog.com/  an article about the market in 2011.

We are all wondering about the ramifications of leadership change in Washington and whether the new guys will actually address the problems in any reasonable manner. They have heard the people, now what?

The largest hurdle for Real Estate is buyer confidence. There are a variety of reasons buyers are on the sideline, some obvious and some subtle.

1. They financially are unable. This problem is based on personal debt, concern about the economy and job security.  Not much will happen here until a direction and plan emerge form top leadership.

2. Depreciated value of current property owned. Buyers will have to believe that they can recoup any depreciation they might incur in selling when purchasing. Right now, well priced homes that are in great condition are selling. Buyers are positioned to buy the best of the best and great pricing.

3. Fear of risk. Confidence in the future is still a big wild card for the qualified buyer. Many buyers that are qualified remain on the sideline conserving cash. Just a few years ago, buyers and lenders believed that Real Estate was insulated from downside risk. The problem is that both lenders and buyers began to speculate in residential Real Estate ignoring that with speculation comes risk. Neither was prepared for a downside market adjustment and now the market is driven by the shattered dream.

4. Low trust in the statistics provided. People simply do not trust the news and statistics they read today. “The Housing market is improving.” Based on what? Are foreclosures slowing, are number of units sold increasing, are sale prices decreasing, increasing or flat? Are the statistics based on specific or US markets? Until there are some sensible facts with definition, trust will be low and fear high. A bad equation for improvement.

So what is in store for 2011? The risk taker buyers and lenders are out of the market. The available buyers and lenders are acting very conservative. As a result, the whole Real Estate Market including builders and suppliers will feel the effect until leadership at the highest level instills enough confidence to offset the fears. At some point leadership may recognize that the best pool for job creation in the Real Estate and Real Estate support arena. If that happens and stimulus is applied properly the whole economy will improve.

Distressed properties will only sell at distressed pricing keeping pricing soft from top to bottom even on the most desirable properties. The number Lenders as well as number of Real Estate Agents, and speculative construction will decrease. This means a bigger piece of the pie for the survivors. Without much speculative housing start, market demand will focus on newer, updated and well maintained resale homes.

Hey Jim,

I agree with your numbers. 2011 down from 2010 in units sold. I think the pricing will still drop a across the board with the more expensive homes dropping significantly. I showed $175- this past weekend. Seventy-five properties matched my buyer’s criterion. Looked at eleven and the list price had dropped as much as $30k. All eleven were available to show. However, the property in the best condition and with the best pricing ended up with two offers right at the reduced list price.

You don’t have to be an appraiser BUT…

Homes will not appraise; a myth of the market today.

Real Estate Agents do not have to be appraisers to understand the process and some of the information that they can provide to their clients in a positive manner. If a client does not understand the process, how can he make good decisions regarding pricing?

Some important issues that will have an impact on an appraisal…

1. Does the property conform to the area? If a property is odd to an area it will affect the appraisal. An example might be a log home is an all brick neighborhood.
2. Is the property priced in line with other like homes in the area? If a home is priced $20K higher than a like property across the street. It will be hard to appraise even if it has upgrades. Some properties might be upgraded to the point that they cannot sustain the cost of the upgrades. The upgraded property may sell quicker but will probably not return the entire up grade investment
3. Upgrades need to be documented and cost substantiated in order to be considered by an appraiser.
4. An agent can provide pertinent information regarding a property to an appraiser as long as the intent is not to influence the appraisal. It will be the appraiser’s decision as to how the information factors in.
5. If considerable remodeling has been done to a property. Before and after pictures will be helpful.
6. Basements can vary in how much value they add to a property. How much and how well the basement is finished will impact the appraisal. Also, comparable homes with similar basements will help determine the value.
7. Agents need to research comparable properties more thoroughly to determine exactly which features like basements and upgrades are included in the comparables and how much value they will add.
8. Foreclosures will have a varying impact on a property. If one property out of many is a foreclosure the effect will be minimal. If there are multiple foreclosures in an area, it will appear that they have a much greater impact on similar properties in the area. Some research is necessary to determine exactly what is causing the foreclosure issue.
9. Appraisers should be competent in the area where the property is located in order to understand the nature of the area.
10. All of these points are considered in determining a fair value for a property for all parties to the sale including the lender. The more an agent understands about the process and the better the support documentation and communication, the more likely the property will be priced correctly and the appraisal not be a stumbling block in the process.

Why Impact Statements…

Once all issues have been identified, it is a good idea to finish by asking,

“Is there anything else?” or “Are there any other issues or concerns?” It is much easier to finish discovering all issues and concerns at this point instead of needing to repeat the process later.

Impact statements should be approximately ten words, leaving out adjectives and focusing on each issue as directly as possible. An impact statement should address specifically how unique value can be added in resolving concerns or issues.

Concerns or issues are either emotional or logical and the impact statement should offer a solution that is in the terms of the clients’ emotional or logical need.

People satisfy their logical needs and then always make a decision at the emotional level. Even the most logical person who checks out all the facts will finally decide to do what he wants supported by his research.

When asking questions listen for responses that indicate how emotional or how much fact someone will need to make a decision. A higher need for facts indicates a more logical approach.

How someone assesses risk also impacts their need for logical support. If a client is considering purchasing a home in a market that is rapidly increasing in value and there is no perceived chance of loss, it is a simple matter of finding a suitable property. If a market is depreciating, most clients will become very cautious about making a purchase.

Advertising for years has tried to convince people that there is no risk in increasing debt and that they somehow deserve to fulfill their wants even with no foreseeable method of decreasing debt.

When risk is considered high regarding a decision, many times a person will decide to do nothing at all. Often the frustration associated with deferring a decision based on high risk alone will result in an impulse decision in another area considered less risky. (I cannot buy a home but I can buy a new wide screen TV.)

Illustration…

Suppose I receive a call from a seller who expresses a need to change agents in order to sell his home. The seller says, “The last agent did not advertise enough,” Of course the question is, “What is enough advertising?”

Given control, the seller will want to exhaust every possible means of advertising that might sell his home with no consideration of the required budget.

I would probably use the following IMPACT STATEMENT

I can implement a marketing plan exposing your property to 85% of the available buyers.

Interesting perspective regarding Forcelosure mess if you are considering purchasing one

Robo-signing is just the tip of the iceberg. The revelation that loan servicers were rapidly signing foreclosure documents without even reading them has uncovered a morass of serious paperwork problems.

These issues could potentially prevent some foreclosure cases from proceeding and allow delinquent borrowers to stay in their homes indefinitely or wrangle settlements from their servicers.

"The whole robo-signing scandal has caused many judges to mistrust what servicers are saying in foreclosure petitions," said Patricia McCoy, a law professor at the University of Connecticut, who co-authored "The Subprime Virus." "Many judges will scrutinize filings more closely."

Several major banks have halted their foreclosure proceedings while they review their process and paperwork. However, several, including Bank of America (BAC, Fortune 500), are ready to continue the cases, saying they are confident that their methods are sound.

But servicers could still hit some big paperwork potholes in answering what seems like the simplest of questions: Who owns the loan and who has the right to foreclose?

Foreclosure mess: Fake signatures, lavish gifts

First, a quick primer. 
The debt taken out to buy a house is called a note, which is similar to an IOU. The mortgage pledges the property as collateral to pay off that debt.

When mortgages are bundled together into securities that are sold to investors, the notes are then transferred to a trust. The investors in that trust become the owners of the note and the holders of the mortgage.

Now for the problems. The note: One of the most important documents in this foreclosure fiasco is the note, which gives investors the right to take action against delinquent borrowers.


Foreclosure attorney fights back
The problem is that many servicers don't know where that piece of paper is. Or, they didn't transfer it properly to the trust that holds the securitized mortgages.

This could prove to be a possibly fatal problem for financial institutions.

Until now, many courts were lax about requiring servicers and investors to produce the actual note. Judges allowed the financial institutions to simply provide affidavits saying the investors owned the note.

Now that the robo-signing scandal has surfaced, more judges want to see the note.

In those cases, "the banks will have a big problem," McCoy said. "I don't see how the foreclosure can go forward."

How to buy a foreclosure in a robo-signing world
The American Securitization Forum, an industry group, said that the standard industry methods of transferring ownership of mortgage loans to securitization trusts are sufficient and appropriate.

"These concerns are without merit and our membership is confident that these methods of transfer are sound and based on a well-established body of law governing a multi-trillion dollar secondary mortgage market," said Tom Deutsch, the forum's executive director.

The mortgage: The mortgage industry is slamming into a digital wall.

State law requires that mortgages be recorded in county offices so homeowners and the general public can see that there is a debt on the property.


The foreclosure that started it all
But as mortgage securitizations began to boom in the 1990s, servicers sought to digitize and centralize the paperwork surrounding the bundling and selling of the loans. So they created the Mortgage Electronic Registration System, known as MERS, to serve as a repository to show both the owner of the note and the home that serves as its collateral.

About 60% of the nation's residential mortgages are now recorded in MERS' name, according to Christopher Peterson, a law professor at the University of Utah who wrote a recent paper on the issue.

When a homeowner falls behind on payments, the company often brings the foreclosure suit to court on behalf of the servicer and the investors who own the debt.

This has become a problem because some judges are questioning MERS' right to represent the owners of the note.

"An increasing number of courts have begun taking a dim view of MERS-recorded mortgages and deeds of trust," wrote Peterson in his recent paper.

If judges don't recognize MERS' right to bring the foreclosure suit, they could throw out the case.

But this problem can be rectified. The trustee can bring suit on behalf of the investors, McCoy said, though this involves more time, paperwork and filing fees.

MERS said it has prevailed in previous legal challenges to its authority.

"The MERS process of tracking mortgages and holding title provides clarity, transparency and efficiency to the housing finance system," said R.K. Arnold, the company's chief executive.

The Purpose of Asking Good Questions...

Good listeners are able to gain even better information by asking good questions. They know that sometimes the person talking may need some guidance in formulating exactly what their needs are, they also know there is power once someone verbalizes a though out loud to someone else.

Questions can address either perceived or real issues; the perceived based on emotion and the real based on fact or logic. The point is for the listener to clearly understand what issues must be addressed in order for the talker to proceed with confidence. Impact statements will be used to address concerns or issues once identified in order to prove that the listener can provide an adequate solution.

Illustration…

In today’s Real Estate Market, sellers are often frustrated because their homes do not sell as quickly as in the past. At some point feeling out of control, sellers resort to changing their agent because they do not see other solutions. When I receive a call from a frustrated seller in want to know;

1. Who is their current agent?

- I know many of the agents in the market and have some idea of their proficiency level

2. What has been the feed back from showings?

- The answer to this question will make the seller say out loud why  other agents think the property is not selling

3. What are your expectations for me?

- The answer to this question causes the seller to tell me what is causing his frustration. It also allows me to determine one of two positions available:

o       The seller’s expectations are not realistic and we must evaluate and determine if he is willing to implement a realistic plan based on market conditions and feedback

o       The seller’s concerns are realistic and can be addressed and a different plan implemented.

I can also determine based on this evaluation if I can:

-          Meet the expectations of the Seller

-          Exceed the expectations of the Seller

-          In some instances not achieve unrealistic expectations. If this is unfortunately the evaluation, I will not proceed after clearly explaining why I think the expectation s cannot be met.

Sometimes explaining the problem will cause the Seller to re-evaluate and except a reasonable plan of action.

Without a clear agreement about defining and how expectations will be met, I will not proceed.

Impact statements are appropriate after the preceding exercise because they will offer added value solutions to a clearly defined and mutually agreed upon issue.

Next blog will address impact statement once a plan meeting expectations is agreed upon.

If you need a training module regarding structuring good questions, e-mail me and I will send it to you.

Why Listen?

Listening was the first topic of the blog because it forms the foundation for communication. I heard a sales presentation recently that discussed impact statements. The presenter used a different name but that is what he discussed.
Am impact statement could be defined as a short statement of approximately 10 words that conveys how value is added to something. It is a great intellectual method of forming thoughts or solutions. Impact statements can address any area of life and we should think in terms of how we add value in any situation.
However, impact statements out of context add very little. That is why listening before speaking is so important. Impact statements should address how the listener can specifically and uniquely .add value to resolving issues.
Will discuss how to add value and think in terms of impact statements in a blog to follow. 

The Importance of Listening

I have been asked to start a blog by many of the people I have trained over the years with helpful tips.
So here is the first. Future blogs will contain thoughts, training tips, articles / links or other interesting information. Hope you find it useful. If you do, contact me or pass it along. 


No matter what the the situation, listening always pays back. Good listeners provide better solutions because they clearly understand the issues. Their solutions are less biased because they can stay focused on the speaker.. Good listeners ask and wait until they have enough facts to provide a great solution. They are not in a hurry to speak because they are more interested in knowing how to respond that to respond. People are more single tasked that we want to believe. It is very difficult to listen well when trying to formulate a solution or trying to speak.