Real Estate Technology Toolkit

By Rich Schiffer, REALTOR, e-PRO

(This article is part of a training series presented for real estate professionals, whether new to the industry or experienced, to help them discover, understand, and benefit from the tools that are available on-line.  For access to the full series, join the ActiveRain Technology Toolkit Training group.  If you have not yet joined the ActiveRain Real Estate Network, you may do so here.).

The Declaration of Independence put to words a concept that resounded with Truth - "...that all men are created equal..." - but this simple truth unfortunately cannot be applied to Real Estate.  I am not talking about the professionals within the real estate industry -- I may have my opinions about some practitioners, but I admit we were all created equal.  What I am referring to are the properties we are called upon by our clients to market.

All properties are not created equal. 

Many agents fail to realize this, and apply the same methods of marketing to every type of property they represent.  Some properties, by their very nature, however, require something different.  The underlying goal of the marketing is still the same - get the product into the awareness of potential buyers - but the methods for achieving the goal must change to fit the target audience.  Unique properties require a unique marketing plan. 

Historic Properties are a perfect case in point.

First, let me acknowledge that different areas of the world define "Historic" in different ways.  Along the Brandywine Valley, in southeastern Pennsylvania, for example, a 1750s farmhouse might come to mind.  In San Antonio, Texas, it might be an 1830s horse barn.  In Fairbanks, Alaska, it might be an 1897 Trading Post.  In European communities, with a much longer history, the age of the property might be counted in centuries, while a 50 year old property in parts of California might qualify as a local landmark.

Setting aside how the local market defines "historic properties," we can say with a high degree of certainty that the potential buyer for a 250 year old property fits an entirely different "profile" than the typical buyer of a comparably-sized piece of new construction, or the average resale property.

Much research has been done to assist Realtors with understanding the profile of potential buyers.  The National Association of Realtors (NAR) conducts an annual survey of transactions, compiles the demographic data, and develops the "profile" of that year's buyers.  Realtors across the country use this report, and other similar industry reports to help them understand the future direction of the market.  This allows agents and brokers to target their marketing, positioning themselves to capitalize on emerging trends.

Other industries follow their buyer profiles very closely, as well.  If the 19-27 year olds show the highest gain in disposable income, it stands to reason that a lot of consumer advertising will be aimed at that age group.  If a large number of older adults are about to reach retirement age, developers may begin to build more active adult communities, to meet the future need.  This sort of demographic trend-watching is often key to the ongoing success of any company.

Understanding the importance of market trends is only one aspect of successfully marketing a product.  That understanding has to be coupled with Practice, and Creativity.

Here is a comparison of common marketing practices, and how they might differ when marketing a unique property:

On the surface, the methods may appear the same, but with an historic property, the search for the potential buyer may be more - much more - broad than the coverage area of the local MLS.  Specialized websites, tightly focused on-line social networking groups, and niche print publications may be needed to get in front of the buyer. To reach that buyer, a little creative, outside-the-box thinking may also be required. 

One of my favorite creative strategies is the Charity Art Auction.

• Partnering with a local charity, the local historic society, and local art school or gallery, an event is planned.  (This takes time to do right, and is one of the reasons that a listing contract for this type of property should be for a sufficiently long term.)
• Deep-pocketed potential donors are invited to the event, which raises funds for the selected charity.  At the same time they are bidding on select artworks, they are also viewing the home.
• A thank-you letter to attendees reminds those in attendance that the property itself is also for sale, and that if they or any of their family or friends purchases the property, the seller will make an additional donation (in the buyers' name, perhaps?) to the charity in the amount of ______ (a fixed dollar amount or a % of the sale price, whatever the seller agrees to.)
• An event like this also helps build a database of potential attendees for other events, and targeted mailings.

Other Resources for Marketing Historic Properties:

Social Networking:

Active Rain Real Estate Network, targeted user groups: 

•  
  • Historic Homes
  • Heritage Properties, Historic Sites and Antiques .

MySpace:  http://groups.myspace.com/HistoricHomes

 Targeted Websites / Publications:

HistoricProperties.com

• $50 per listing (3 photos, 3 months)
• $75 per listing (9 photos, 3 months)
• $150 per week ("Featured Property" exposure)

www.preservationonline.org, http://www.preservationnation.org, www.nationaltrust.org

• (Preservation Magazine, published by National Trust for Historic Preservation) 
• Readership:  More than 500,000 readers, average age is 55 years old; average household income is $113,000.  They upgrade historic properties for modern living (83.3%); invest in historic commercial and residential real estate (45.3%); and remodel rooms, floors, plumbing and roofing (44.9%).
• $525 for 70 words of copy and a photo.

http://www.oldhousejournal.com

• (Old House Journal Magazine - Readership:  700,000+, bi-monthly distribution. 
• $525 single ad with photo -- $800 for "spotlight" ad.
• Ad Rates include listing on Historic Properties.com (see above.)

Local Organizations:

•  
  • http://www.preservationalliance.com (Greater Philadelphia regional partner of National Historic Trust)
  • http://www.cchs-pa.org   (Chester County, PA Historical Society)
  • http://www.delcohistory.org/orgs.htm (List of Delaware County, PA Historic Organizations)
  • http://www.preservationpa.org (State-wide historic preservation)

By Rich Schiffer, REALTOR, e-PRO

A couple of years ago, a client who was going through a divorce asked me to look for properties she could "rent to own." 

At that time, the market was just beginning to shift in our area.  Sellers were selling, and Landlords were Landlording.  Very rarely did the two types overlap.  Some agents would even categorize "rent to own" transactions in the same category as Santa Claus - something some people think exists, but is really just imaginary.

In that market, rent-to-own might have well been imaginary.  I could not find the right situation for her, and she ended up moving in with her mother.

Now, nearly 2 years later, the market has shifted.  Many properties are staying on the market much longer than in the past, and many people that would have been buyers back then, are finding themselves forced to rent for a while longer, till their credit scores meet today's tougher standards.

This is exactly the market conditions where a Lease Option makes sense - for both the tenant/buyer and the landlord/seller, creating a potential for a real WIN-WIN situation.

Here's the scenario:

• Agent is working with Client A that has insufficient credit to qualify for a mortgage, but has decent income and moderate savings.
• Client A applies to rent a property, but is denied by landlord because their low credit score represents an uncomfortable risk level.
• Agent is also working with Client B who wants to invest in real estate.
• Agent creates a win-win situation, by finding a property that the investor could purchase and rent to Client A
• Agent looks for properties that listed for sale which meet Client A's needs.  Client B might even attend the showing, also.
• Client A agrees to rent the property from Client B, contingent on Client B purchasing the property.
• Client B agrees to sell the property to Client A, contingent on Client A purchasing an "Option" and agreeing to a monthly option fees, in addition to the monthly rents.
• Client A and Client B negotiate terms - of the lease, and the potential re-sale down the road.
• Client B negotiates sale terms with the Seller.  If no agreement is reached, the Option money from Client A is returned.
• Client B settles on the property.  Client A settles in the property.
• After the agreed lease term, Client A has the option to purchase the property from Client B, at the pre-negotiated Price.

Here's how the numbers might work:

If Tenant exercises the Option, and purchases at the end of the year: 

The Landlord's Cash on Cash Profit:

If the tenant does not exercise the purchase option, the Landlord pockets the $4,400 in option fees collected, making his Gross profit $5,600, with no Transaction Fee to the Broker, keeping his ROI the same.  In this case, I intentionally set it up that way, to reduce the landlord's temptation to attempt to influence the tenant's choice whether to excersize their purchase option.

So, in this situation,

• Client B stands to make over 25% on his investment.
• Client A gets a place live when other landlords turned them away, and potentially a home of their own. 
• The original seller got what they wanted (their house sold),
• The Agent's Brokerage gets paid for 2 or three transactions.
  • Initial Sale ($4,800 co-op fee, for example)
  • Rental placement ($1,400)
  • Potential Resale transaction ($2,000)

In effect, this goes beyond a WIN-WIN situation.  All four parties involved benefitted from this type of transaction, making this a WIN-WIN-WIN-WIN situation.

So...Yes, there is a Santa Claus.

There is also a Risk Clause:

Every situation will be different, and each potential property being considered for a transaction like this must be evaluated in the light of local conditions, market rents, and projected appreciation.  Not every transaction will go as projected, and investors need to know that as with any investment, there is a chance that you could lose money on a deal like this if market conditions change for the worse.  The advantage to the Lease-Option is that the added payments from the Tenant/Buyer serve as a hedge against some of that risk.

Before jumping headlong into this type of transaction, agents should be warned:  The required language of the contracts used to set up the Lease Option will vary from state to state.  You should of course consult an attorney to ensure that the specific contracts you use meet your state's requirements.

 EDIT --

NOTE TO ALL:  My scenario outlined a situation with three consumers:  Seller, Investor/Landlord, and Tenant/Buyer.  If you remove the Investor/Landlord, and the Seller agrees to the Lease-Option deal, it can be even more profitable to the Seller, (presuming they don't need the sale to pay off a mortgage, and renting won't violate the terms of their mortgage).  Here again, though, each situation has to be thoroughly evaluated (by thoroughly I mean by the appropriate licensed professionals) before any action is taken by either party to the transaction.

Rich Schiffer is a Realtor serving Investors, Tenants, and Homebuyers in Delaware County, PA.

(This article is part of a training series presented for real estate professionals, whether new to the industry or experienced, to help them discover, understand, and benefit from the tools that are available on-line.  For access to the full series, join the ActiveRain Technology Toolkit Training group.  If you have not yet joined the ActiveRain Real Estate Network, you may do so here.)

Social Networking

Seen by many as the backbone of "Web 2.0", social networking has changed the way internet users connect with, and routinely communicate with each other.  This includes that way consumers connect with service providers.

What are the potential uses of Social Networking platforms for Real Estate Professionals?

1. Internet Presence -- By maintaining profiles on various social networks, and actively using the tools available on each platform, you serve to increase your "presence" on the Internet.  Each network you use essentially creates another pathway that consumers can potentially follow to your doorstep.
2. Targeted Prospecting -- By searching the profiles of other members of the network, you can vastly improve the effectiveness of your prospecting.  For example, you could specifically target only members that identify themselves as Engaged, or those interested in investing in real estate.
3. Building Rapport with clients -- You can use the social aspect of these platforms to find out what interests and hobbies your clients share.  More importantly, you can share yours.  Simply stating what your favorite movie is on your profile for example, may not seem like much, but it it may just be the thing that has a prospective client contact you.
4. Keeping Informed -- Many platforms allow users to subscribe to topical discussion groups.  This can be a great way to keep informed on news in your industry, as well as consumer sentiment.  By being well-informed, and up-to the minute, you can share that knowledge with your clients, and you can improve your perceived value as an expert.
5. Attracting Referrals -- by actively participating in the on-line community, you also establish relationships with people that may become referral sources for you.  Contributing to on-line conversations, and posting relevant information, you create a firm foundation for future real-word business relationships to develop.
6. Directing Traffic -- beyond a simple Internet "presence," networking sites allow you to create pathways to direct people to your own website.  The more networking platforms you use, the more likely your chances of seeing increased traffic to your website.

What Online Networking platforms should I use, and what should I do on them?

Social networking sites exist for many niches. Most broad-based networks have a feature that lets users create customized communities or groups to share information with friends. Agents can use these sites to create a profile for themselves, so that users of the network can find them and communicate with them more easily. This is value in and of itself, but the deeper value lies in searching the profiles for signs of interest, and reaching out to them first (in a way that is within the site's guidelines, and applicable Do Not Call and anti-SPAM laws, of course.)

As with any advertising an agent does, there may be state laws regulating what must appear in your advertising. Be sure to include all necessary information in your profiles on these networking platforms, since they can certainly be seen as interaction with the public, and thereby as advertising.

ActiveRain Real Estate Network is a networking site for real estate professionals. Currently, there are over 100,000 members.  Active Rain provides a free blogging platform, the ability to send and receive referrals from other professionals, and the ability to answer anonymous questions posed by consumers.  Local content posted on their blogging platform is posted to localism.com, their consumer portal, making it very easy for local prospects to contact you when they are searching for local information.

Myspace is the granddaddy of social networks, with over 300 million profiles which you can search, finding your target market is fairly easy. Members can also post classifieds. (Listings, available rentals, etc.)

Facebook originally for college students and graduates only, it is now free to anyone. Facebook also has a Marketplace, where you can post your listings, and looking through the "housing wanted" ads, will garner a few potential buyer or rental leads. A new addition to the site allows you to advertise within the network.  Facebook is actually made up of many networks, each based around a company, region, or school. Their platform enables anyone, anywhere, to build complete networking applications that you can choose to use. Users can fine-tune their experience on Facebook by choosing applications that are useful and relevant to their needs. The site has more than 60 million active users.

LinkedIn is a business professional networking site. Of all the networking sites out there, I see this one as having the greatest ability to facilitate referrals from the people you do business with.  Great for hooking up with luxury home buyers and potential relocation clients. It has more than 17 million registered users spanning 150 industries and more than 400 economic regions.

Gather is an innovative networking platform with a business model that provides rewards and incentives for active users. Very easy to publish articles to thousands of users.

Fast Pitch is a site designed to link users needs with other users business offerings. There are both free and premium levels of membership. 

WannaNetwork is a site designed exclusively for real estate professionals to network. Listings can also be posted.  There are currently about 16,000 users.

A word about On-line Networking and Etiquette:

To be successful at on-line networking, you have to remember the following:

• Think of online networking as very similar to face-to face networking.  Be respectful and appropriate to the conversations.  Don't simply interrupt a conversation to tell someone about your great website (unless the original topic was great websites, of course)
• If you are using a social site, be sociable.  You don't want to gain a reputation for sending people unsolicited commercial messages, a.k.a Spam.  All the time you spend creating and maintaining your presence on the network could get flushed away if you get banned for spamming.  Let the people you interact approach you, instead of you soliciting them.  Be a ready resource, but don't be "that guy."  You know -- "That guy" who always tries to sell something with every breath...it isn't appreciated by consumers in the real world, and the same is true on-line.
• The most successful on-line networking efforts will be the ones that you integrate with face-to-face efforts.  Invite people you know to join the networks you are on, and invite people you "meet" on-line to meet with you in person, when appropriate.

Rich Schiffer is a Licensed Real Estate Agent, a REALTOR, a certified e-PRO, and a private consultant for real estate agents that need help catching up with today's technology.  Additional Technology ToolKit Training is also available in an Active Rain Group by that name.  Check it out.

by Rich Schiffer, REALTOR, e-PRO

(This article is part of a training series presented for real estate professionals, whether new to the industry or experienced, to help them discover, understand, and benefit from the tools that are available on-line.  For access to the full series, join the ActiveRain Technology Toolkit Training group.  If you have not yet joined the ActiveRain Real Estate Network, you may do so here.)

Everyone seems to be familiar with the image of teens texting each other across the table.  Advertisments now regularly depict people using text messages.  Faster than email, this method of communication has become accepted and adopted into the mainstream.

But "texting" is not just for awkward teens that lack the self-confidence to talk face-to-face.  Business and industry are quickly incorporating text messaging into their corporate communications bag of tricks.

CTIA-The Wireless Association® released their Wireless Industry Survey Results back in April. 

Some highlights of the survey include:

• Text messaging is enormously popular:  more than 48 billion messages were reported for the month of December 2007 alone.  That's 1.6 billion messages per day!  (an increse of over 150% over last December.)
• Factoring in the number of phones in use, that breaks down to about 190 text messages per user, per month!

It doesn't take a statistician to tell that this means that your clients and (prospective clients) are probably using text messages to some degree, and to keep pace with them, you may need to, as well.

There are two affordable ways that a real estate professional can tap into the power of text messaging -- not just as a communication tool, but also as a tool to market your listings and increase your business.

1. Texting Lead Circulars by Real-Closer.com  For a one-time setup fee of $20, an agent can set up auto-responders for up to 10 Listings for 6 months.  After the 6-month trial period, it costs only $60 per year, for an unlimited number of auto-responders.  When a potential buyer requests additional info, the information the agent has set up is automatically sent to them via text message, and the system forwards the prospective buyers's cellphone number to the listing agent.
   
2. Teleflip.com  Perhaps you are working at your desk, and get poor cell signal while indoors.  You can use your email to send a text message to someone.  Each carrier has established the equivalent of an email address for each cell phone number.  All you really need to know is the phone number.  To send an email that will be received as a text message, use the phone number as the email address -- like this:  6105062663@teleflip.com
   The handy, free service from teleflip.com will rout the message to the appropriate carrier.  Replies will go to your email inbox.
   
3. If you use an email drip campaign manager like InterSend, you can combine it with the teleflip service, and set up an "email" campaign specific for text message users.  Keep the messages brief, like "Want to see some houses this weekend?" or "Are you still thinking of Selling your home?" or "Let's schedule a time to review what's happening in the local market." 

Rich Schiffer is a Licensed Real Estate Agent, a REALTOR, a certified e-PRO, and a private consultant for real estate agents that need help catching up with today's technology.  Additional Technology ToolKit Training is also available in an Active Rain Group by that name.  Check it out.