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Tips for Texas Realtors after Hurricane Harvey

by Pat Wattam

 

Houston and Baton Rouge had a similar experience after Hurricane Katrina This event with Hurricane Harvey and the massive flooding over Houston and surrounding areas may end up being more like what we went through just a year ago. In our unnamed storm last year the metro BR area received 24 inches of rain  over a large area that included several parishes resulting in over 100,000 houses being flooded.

I want to share some of my experiences from last year that might help you get through this disaster. First understand that the Market will right itself. Things will be OK for your business.

There are a few steps that real estate professionals go through in a flooding situation.  Here's a video or you can just read the text below!

https://www.facebook.com/wattam/videos/10154827453322344/

Number one is remediation of your personal property. Right now if you have a flooded property you need to find a contractor or someone who's going to help you with this and get people lined up that you know and trust. You don't want to have to worry about redoing your house and keeping your business going at the same time. Having people around you to help you will make this much easier to get through.

The second issue is finding your past clients. Who needs help and who can you help? Everyone wants to help in the recovery process. I worked with one of the local shelters close by my office to get them what they needed.

There is a third critical step as well. I started collecting money from friends and fellow Realtors across the country to just have money to hand to clients or people I met. When your house floods, typically you lose all your shoes. So people I would meet at church, particularly our elderly parishioners, I could hand them $100 and they could go buy shoes for themselves.  It's little gestures like that that mean so much people. Dropping by just to say hello and checking on your clients and bring them some money or food lets people know they are not alone and that you care. 

So, in no particular order, here are my tips to keep business going:

  1. Pick a flooded subdivision that you have sold a lot in or have a connection with in some way. 
  2. Deliver sandwiches and water to those working in houses in that subdivision.
  3. Reach out to your past clients.
  4. Call on vendors you know that you can recommend to help. See who is available.
  5. Don't be worried about what your market will do.  It will right itself.
  6. Wish I had gone door to door and met people and offered my assistance before they were taken advantage of by investors.  I thought it would be crass and would appear I was taking advantage of a bad situation. I was wrong. One of my clients was offered $50K for a home worth $225K before the flood. I asked him to let me give it a shot before he took the investors offer. I sold the house for $95K. How many others could I have made that extra money for just by being more proactive?
  7. Accept no cash offer without a deposit and proof of funds with the offer. You will get a lot of these and they always say “I’m good for it.” Some are.   Some aren’t. Time is of the essence for your seller so be demanding.
  8. Be wary of out of state buyers who say they want to buy multiple properties unless you have vetted them or their money in some way.  Yep, people came in, bought a lot of properties and could not perform.
  9. Be aware money laundering happens with some of these out of town investors. Doesn't affect your seller but, just saying, it happens.  If you go to closing and the buyer brings in 10 checks for $10K from different people, and it happens time and time again, you might want to report it.
  10. Put together promotional materials that show you care and what you can do to help people make a decision.
  11. Particularly older people who have no mortgage and have flood insurance, it really is better for them to  sell their house and move one.    When you add their flood insurance settlement to the proceeds from the sale they have plenty to go buy another house. The amount of time, energy, and frustration they will have redoing their home is overwhelming. It is better for their mental health and physical health to start fresh.
  12. If client does not have flood insurance and has a mortgage they are in a tougher spot. They may be better off fixing the house and moving back in or fixing the house and selling it. Some people will have to walk away. 
  13. The max FEMA pays out on a property with no flood insurance and not in a flood zone is $33k - not even enough to get started.  My 1300 sq. ft. rental cost over $42K to fix up nicely after the flood.
  14. Our homes that flooded have not had a stigma selling and are selling for high prices. Whole subdivisions are being revitalized as these homes all have granite, wood floors, new appliances, etc.  This will impact the non-flooded homes that are not updated. The flooded homes may sell better than the non-flooded ones because many will be practically brand new when they are rehabbed.
  15. Some cabinets can be saved. They really have to be dried out.  The amount of water in the house and the length it stayed in the house will affect this decision.
  16. Quickly partner with an inspector you respect to get guidance on what steps to tell people to take in remediating the  flooded property.  Become the ‘go to ‘ expert.  Get press if possible.
  17. Partner with an appraiser to have ongoing discussions about how the market is faring.
  18. Clients will want you to value their home Pre-flood for use on their taxes for their loss.  I did the value pre-flood and an appraiser did the flooded value for them.  It was all a guess.

Things You Might Not Know About REALTORS

by Pat Wattam

In this day and age I am still amazed at the misconceptions the public has about REALTORS.  Let me try to shed some light!

1.  REALTORS are not paid a salary.  They are only paid when you use them to buy or sell a house that actually goes to closing!

2.  They pay for their own gas.

3.  They do not have a company car.

4.  Whatever the commission is, they only get part of it.  Part of it goes to their broker, to a relocation company, to a referral company.  And they pay all their expenses and marketing dollars out of that commission.  Oh yeah - and pay taxes.

5.  If a REALTOR buys you lunch, there is no company behind them paying for it.  It actually comes out of their pocket.

6.  If a REALTOR sells a lot of houses it isn't because they sell them for a low price - it's because they do a good job at marketing and negotiating.

7. We don't get kick backs for referring you to people we trust.

8.  We do have a LIFE and are not available at the drop of a hat - and come to think of it, neither is your doctor, CPA, dentist.  And just like other professionals, we will do our best to accommodate you.

9.  We truly want to make you happy because we want you to refer us to your friends.

10.  We have continuing education we must take every year (12 hours) and we have a Code of Ethics that we must adhere to.

So there you go - just a few things that I thought I should share with you today! And Remember, when you are thinking about real estate, Call the Pat Wattam Team at RE/MAX First!

What Does A Realtor Do for You?

by Pat Wattam

What does a REALTOR do?  What do they do for you?  That’s a loaded question.  Let’s start with putting a house up for sale.

THE LISTING PROCESS FROM THE AGENT'S POINT OF VIEW - sort of a job description I guess!

  1. Run comparable sales to give the seller the best advice based on the homes that have sold in the area
  2. Go over listing paperwork with seller and explain what the buyers expect from them
  3. Explain to seller what updates are necessary to EVEN get the house sold – each Market is different.  Some areas the buyers are just happy to have a house for sale and in others, like ours, the buyers don’t want to have to do any updating.
  4. Show the seller how to declutter and stage the house.
  5. Measure the house, inside and out  - rain or shine, in the heat of summer or cold of winter
  6. Prepare paperwork to turn in to real estate office
  7. Copy House  Key
  8. Put on lockbox with Key
  9. Put up sign
  10. Take photos
  11. Photoshop the photos
  12. Write comments that will engage the buyer 
  13. Write ads to engage the buyer
  14. Submit to Multiple List (MLS) in their area
  15. Create a virtual tour  See how wonderful it looks?!  Doesn't matter how large or how small, we make your house sing!
  16. Submit listing to personal websites
  17. Create a flyer/brochure
  18. Deliver flyer
  19. Talk house up to other agents
  20. Contact buyers in their data base
  21. Send flyer/brochure to other agents
  22. Answer ad calls/sign calls/internet leads on house
  23. Show house
  24. Monitor showings and feedback
  25. Call for feedback if not provided by showing agent
  26. Answer questions from feedback
  27. Perhaps hold an open house
  28. Determine when to reduce price
  29. Present offers
  30. If not sold, do another market analysis. Examine Feedback.  Try to determine buyers’ reluctance to purchase house.
  31. Explain all this to the seller
  32. If reduce price, then redo flyers
  33. Deliver flyers
  34. Sent notice out of change of price
  35. Present offers

 

ONCE OFFER IS ACCEPTED, then the agent starts the next step!

 

All this is done on each and every listing, plus agent is showing houses to buyers, handling closings, etc!  

 

When you hire the Pat Wattam Team at RE/MAX First, you will find a well oiled organization with systems and check lists in place to make sure we don't miss one of the steps!  

Confusing Real Estate Terms

by Pat Wattam

Everytime I have someone new join my team in the administrative/Secretarial position, I realize how much the general public really does not know about who the players are in the real estate business.  Some terms can be confusing to the public, so I have made a short list for you! 

REALTOR - an agent who belongs to the National Association of REALTORS who agree to abide by a code of ethics and are accountable to that code.  All the members of the Pat Wattam Team are licensed REALTORS!

Real Estate Agent - someone who has passed the test to be a real estate agent but does not belong to the National Association of REALTORS and does not HAVE to follow the code to protect the public. A Real Estate Broker can't have some agents who are REALTORS and others who are't.  Look for a REALTOR when buying or selling - or just call the Pat Wattam Team!

Real Estate Broker:  The person who has taken further training and can hire real estate agents to work for them.  

Associate Broker:  A person who has taken the broker training but is not the primary broker in the real estate firm.   I have my Broker's License but at RE/MAX First, I am not the broker for the firm - in fact, at RE/MAX First there are many associate brokers as these REALTORS tend to want the additional eduation and could step in and run the company if anything happened to the prinicple broker.

Real Estate Company:  Some companies are stand alone, others are part of a franchise - such as RE/MAX, but each office is typically Independently Owned and Operated - which means they share advertising, web sites, and other items all the companies can do but operate independently of the other offices. 

TEAM - a group of REALTORS who do business together under the umbrella of their Broker and at the direction of their Team Leader.

Team Leader - usually the lead agent in a team.  This person sets the tone and the direction of the team.  My team has been trained to do business like I do, to continue on the traditions I have started and thus are an extension of me.  That allows me to give the same great service to more people that I could by myself!

Buyer Agent or Buyer Specialist:  a full REALTOR who happens to specialise mainly in helping Buyers.  My team are both buyer and seller agents, but more heavily on the buyer end as I handle the majority of the sellers.

HUD or Settlement Statement - this is the most confusing because it now has a new name!  It is the document at Closing that shows where the money goes - to the lender, to pay the Real Estate commission, to pay the title company,  to pay home owners insurance, set up escrow, etc.

Listing agreement - a legal contract that binds a seller for a specific period of time to a real estate company to sell their property.

Purchase agreement - a legally binding contract between a buyer and a seller.  Once all parties have signed, each is legally obligated to complete the transaction.

Property Dicslosure - a document prepared by the seller to let the buyer know the condition of the items in the house that they are aware of.  However, every one who owns a house doesn't really know the condition of it unless it is something they had replaced or installed!  That's why home inspections are so important!

Home Inspection - part of the purchase agreement gives the buyer the time to pay for any and all inspections they want to have on the property so they know what they are buying.  This is not a way to get the seller to turn an old house into a new one - you knew it was old when you made the offer and your offer price reflected that.  However, an inspector is a professional who will point out things that are not working that the seller might not be aware of and will usually give you tips on maintaining your home with items to address in the future.  

These are just a few things I thought of this morning that I thought you might find helpful!  If you have any suggestions for more topics or questions, please send the to pat@patwattam.com


Exxpectations

by Pat Wattam

One of the most interesting parts of real estate are managing the expectations of the clients.  Think about this.  The buyers expectation of the seller is to give them a house in move in condition.  The seller of an existing house they are tired of decide,  instead of updating it, they'll just sell it.  The expectations of these two clients are in direct conflict.  As a Realtor, one of our jobs is to help our clients bring their expectations into the reality of the local Market.  A seller is not usually going to make their 40 year old home a new home, with everything updated.  However, we do expect the seller to have maintained the home.  They don't get extra value for having a new HVAC system because that is considered maintenance.  But will it make their house sell faster?  Yes.  And that helps make them more money.  Say a new HVAC costs $5000.  If the seller doesn't want to repair the system and wants to sell their house with no repairs, a buyer is going to offer significantly less than the cost of the HVAC.  Why?  Because many buyers make the assumption that if the seller hasn't maintained the HVAC, what else has not been maintained.  And, depending on the price range, the buyer may not have the cash to do the replacement, so they just go select another house.  

Some other expectations that have to be managed include what a client expects of us, as Realtors, and what we, as Realtors, expect of our clients.  We expect our clients to be on time and respect our time as we respect theirs.  We expect our buyers to be prequalified.  We expect our sellers to disclose all the information about the condition of their home so that we can give them the best advice possible.  We expect loyalty, as we give our clients.  We expect sellers to make their house availble to be shown at all reasonable hours.  We expect our buyers to give us notice when they want to see houses so that we have time to make the appointment to see it.  

All of these expectations are discussed in our counseling interviews with our buyers and sellers.  Isn't it nice that we can talk about all of this up front?  Sure makes for a nice real estate transaction!!!  All of us on the Pat Wattam Team look forward to helping you buy or sell your next house!  Let's get together and discuss expectations!!

Determining an Offering Price

by Pat Wattam

One of the biggest questions buyers ask us is "How do I determine the amount of offer on a home I am buying?"  As your Realtors there are several factors in real estate that help us help YOU determine the amount to offer on a purchase agreement.  The first thing we look for is the history of the house - how long has it been on the Market, when was the last price change?  Then we do a market analysis on the subdivision to see what the homes in the area are selling for - as in, how much did the seller negotiate down from the list price and did they pay any closings costs.  This information gives us a starting point.  The longer a house has been on the market is usually reflected in the offering price.  If a house has just come on the market, and is priced well and requires no updating or repairs, then you might find yourself in a bidding war with other buyers - in which case you may have to pay full price or even over full price in order to buy the house.  We guide you on all this, based on our years of experience and market knowledge.  One important fact to remember is that the bank has the last say on the value of the house. It must appraise for the price you paid for it so the odds of overpaying are slim.  However, several times I have seen appraisals come in low but the house was the only house in the area the buyer wanted to buy, and they paid the difference between the appraisal and the purchase agreement offer in cash.  

The Pat Wattam Team is here to make your home buying experience an exciting time!  Let us help you determine that offering price and help you buy the home of your dreams!

Should I Use a Realtor?

by Pat Wattam

Let's face it, buying or selling a home can be a major financial and emotional undertaking. To take away some of that stress, enlisting the services of a Realtor can be of great benefit.  Here are a few reasons to work with a Realtor:

1. A Realtor can guide you through the process. You want to avoid costly mistakes or delays and the realtor can prepare the best deal for you.

2. A Realtor can find the best property on the Market.  Sometimes property you may be looking for is available but it may not be actively advertised.  Your Realtor is willing to do some investigation to find all available properties.

3. A Realtor can help with determining your buying power.  By providing your Realtor with basic information about your available income, savings, current debt, they can refer you to the best lenders to suit your needs.

4. A Realtor can help with negotiating.  Financing, price, terms date of possession and sometimes repairs of equipment are among some of the negotating factors. 

5. A Realtor can help close the sale of the home.  Questions can (and usually) arise between the initial sales agreement and closing (or settlement).  Your Realtor is the best person to objectively help you resolve these issues and move the transaction to closing.

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Pat Wattam
RE/MAX First, Independently Owned and Operated
4750 Sherwood Common
Baton Rouge LA 70816
Office Direct: 225-298-6900
Office Main: 225-291-1234
Fax: 225-295-1234

RE/MAX First
Each Office Independently Owned and Operated
Main: 225-291-1234

Licensed by the Louisiana Real Estate Commission