Melissa Savenko's Richmond Real Estate Review

Notorious R.O.B. on Magical Thinking OR How Realtors Get Marketing Wrong

I wrote this post back on July 24, 2012 and never posted it.  It's still relevant, but the good news - knock on wood! - is the market appears to be picking up, at least in the urban Richmond neighborhoods where I work.  AND on a purely personal note, I have hired an assistant, which has been AWESOME.  Should have done it ages ago.

But, it is still the case that deals are stupid hard to get closed, leaving anyone with several active transactions going on at one time, way less time to market.  The main culprits, in my opinion?  The large banks.  The underwriting criteria are ridiculous.  The appraisal requirements are ridiculous. They suck.  No ifs, ands, or buts about it.   Something has to change.

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I just read Rob Hahne's newest blog posting, "Magical Thinking vs. Boring Reality."  His point:  real estate agents quite often get it wrong when it comes to marketing, focusing on the hot, the new, the cutting edge, rather than just doing the boring old stuff that has proven results, like...oh...staying in touch with your past clients?  Returning phone calls within a reasonable amount of time?

You know what?  He is exactly right.  And I resemble those remarks.  But in defense of myself, and of real estate agents everywhere, let me provide a little insight into that behavior.  And let me link some of my, at least, personal failings in this area to the vagaries and realties of the current market.

And might I say, this current market has been dragging on, and on, and on, since 2007.  I got into real estate sales full time in February 2006, so almost my entire real estate career has been during the worst overall economic conditions since the Great Depression.  So all of us that do this as our sole source of financial support have been hampsters in a wheel for a very long time now,  And I personally am just overwhelmed and exhausted by it.  Can it PLEASE end?

So, here are my defenses.  Most of them come down to the simple combination of needing time and/or money.  Here goes:

1.  Every Deal Is Harder.  Every deal requires twice as much effort to keep it all together.  Getting the client under contract is not, in my opinion, the difficult piece.  The difficult piece is getting a transaction from contract to closing.  There are inspection issues.  OR appraisal issues.  OR financing issues.  None of these things are our fault.  These are just the realities of the market.  But if you are spending twice as much time on a single deal to keep the wheels on the bus, then the available time that might be spent on marketing is substantially less.

2.  You Have to Work Harder to Get Buyers and Sellers, Who Are Fewer and Father Between.  Every working agent, except for those lucky enough to have established brands and stable books of business that are more than adequate to support them and their loved ones, is having to work harder to generate enough business.  

3.  There Is Less Time and Money to Invest in the Business.  Client appreciation programs take time.  And money.  If all my time is spent keeping the active transactions I have moving forward, and if I have to count on a substantially higher percentage of deals falling apart for stupid, unreasonable reasons, I don't have that extra time.  So my solution would be to get some help.  Having additional help has been, for me, the chicken and the egg scenario.  You need an assistant to make more money, BUT you need more money to hire an assistant. 

 So, not a comprehensive explication of all the reasons agents may not be marketing the time tested and proven ways - keeping in touch with past clients, actively seeking referrals from those past clients, maintaining and actively working a client appreciation program.  But hopefully a glimmer of insight into the rationale of at least one full-time working agent. 

 

Baseball in the Bottom - AGAIN! And Was Anyone Else at the Same VCU Real Estate Trends Conference?

Okay, so I haven't blogged in forever.  And I am still digging out from the work pile-up from attending the VCU Real Estate Trends Conference yesterday.  But I am fired up enough about the newspaper coverage and the post-conference scuttlebutt that I am taking 20 minutes out to blog on the topic.

So, one of the three break out sessions was titled "Economic Impact of Sports and Entertainment."  Of course, being weeks away from the national election, none of the three sessions dealt with the potential implications of the national election on the housing and commercial real estate market.  Sports and entertainment is clearly more pressing.  This is a real shocker when you consider the private market forces + Venture Richmond are pushing for a baseball stadium in Shockoe Bottom.  Again.  And of course, don't forget that VCU has its eyes on the former University of Richmond/City Stadium property, a choice urban core 19-acre developable parcel of real estate, for the as-yet-t0-be-announced VCU football program.  Of course the ** positive** impacts of sports and entertainment development are more important than who is President.

But my sarcasm is showing, and I digress. 

Based on the newspaper coverage I read today, the reporters attended a different conference than I did.  Here is the Richmond Times-Dispatch's coverage, "Richmond Urged to Build a Stadium Downtown."  According to the reporter, and consistent with the remarks of both the introducer and the panel moderator, "Downtown" equals Shockoe Bottom.  What the intended conclusion is, I believe, and not-too-subtly advanced one at that - Richmond really needs, four years after the SAME battle over location, a new Double A baseball stadium in Shockoe Bottom.

Huh?

I've heard Tom Murphy, the former Mayor of Pittsburgh, speak multiple times now. He is a dynamic speaker and clearly a visionary thinker.   His relevance to Richmond:  During his tenure as Mayor of Pittsburgh, he spearheaded the development of new professional football and baseball stadiums, and the re-genesis of a downtown area into a "cultural arts district," in a similarly sized town, all at the same time, and with no money.  

Here's what I don't get.  Every time I've heard Mayor Murphy speak, he talks about the mistake that was made with Three Rivers Stadium, because it did not take advantage of Pittsburgh's greatest asset, the rivers.  He talks about the mistake of allowing surface parking to take over prime riverfront real estate.  He describes incorporating the river as the backdrop and creating parks and green space between the facilities and the river, to allow, and indeed encourage, the public to take advantage of the river.  Mayor Murphy speaks passionately about how the sports and arts facility development succeeded in Pittsburgh because the DESIGN was intentional. 

If you listen to Mayor Murphy speak, I have no idea how anyone could conclude that a successful Richmond baseball stadium should be located in....Shockoe Bottom.  If you track the story of Pittsburgh's success, and try to copy the formula as best you can here, the baseball stadium should be....in Manchester.

I know, I know, I've talked about baseball in Manchester before.  But it makes a hell of a lot more sense to me there than Shockoe Bottom.  The former Reynolds Metals South Plant property, anyone?

More tomorrow, when I'm less fired up, about why Shockoe Bottom is a terrible idea, why Manchester could really work, and how I interpret the model of the "urban dumbells" of sports and entertainment development, applied to Richmond's current landscape.  Let's just say in no model that I come up with does a baseball stadium in Shockoe Bottom make sense.  Ever.