Looking Out From the Garage: July 2007

OK, I've already told everyone that Moab, UT is my happy place.  But, there is another place that I really enjoy with my family.  DisneyWorld.

I will be the first person to admit that Walt Disney World (WDW) is not a cheap place to take the family for vacation, but that doesn't mean that one can't maximize their value from the experience.  Although I'm certainly FAR from being a local, and there are plenty of people that have been there more than we have, I thouth I would pass along a few tips that we've picked up from our WDW travels.  Although I don't want to turn this post into a link extravaganza, there will be a few more links coming. 

Some of you might be familiar with the DVC or Disney Vacation Club.  It is Disney's version of a timeshare.  Even though we have thought about buying into it, we haven't, but that doesn't mean that we can't take advantage of it to get a better deal.  The way we take advantage of it is to rent points from a DVC member.  There is a resource called DISboards that is a great place to find point rental opportunities.  DVC members buy points that they can use each year for Disney trips.  If they have more points than they can use in a particular time frame, they can rent out those point to third parties.  While the points can be used at almost every Disney resort, there are specific properties that are DVC Properties.  A DVC member, or point renter will get a lot more bang for the buck at these resorts.  Generally, the DVC resorts are on par with Disney's Luxury Resorts.  In fact, several are on the same properties.  Those are: Animal Kingdom Villas, Beach Club Villas, Boardwalk Villas, Wilderness Lodge Villas.  There are also Old Key West and Saratoga Springs, which are primarily DVC properties.  You might also notice that these are listed by Disney Travel as "Home away from Home" resorts.  All of the DVC properties have a kitchen or kitchenette.  Some of the larger ones also have their own laundry facilities, too.  There are Studio, One Bedroom, Two Bedroom and Three Bedroom villas available.

But, where is the deal?

On our last trip, we stayed at the Boardwalk Villas.  We were in a studio.  We went during the Adventure Season, so the room was 9 points per night Sun-Thurs, and 20 points for Fri-Sat.  We arrived on Sunday, and left on Saturday, so we used 65 points.  We were able to find points for $8 each, so the room for the week was $520 for 6 nights.  That averages out to under $87/night.  At that time, they were offering Value Resorts (the All-Star Resorts) for $89/night, and the Moderate Resorts were $119/night.  Luxury Resorts were starting at $179/night.  Had we booked our room through Disney, it would have been $349/night.  I think we did OK.  Here is a point chart.  Last night I ran across points for August for $6ea.  That means that one could stay in the same room for $66/night Sun-Thurs, and $156/night Fri or Sat.  The only difference that you will notice is that the rooms do not get daily maid service.  If you are there less than 4 days, you won't have any maid service.  If you are there longer, you will get a maid visit after each four days. 

The next strategy is with tickets.  If you plan on going again, you might look at No Expiration Tickets.  They are a little more, but they are good forever.  Additional days don't cost that much, so the more you buy, the cheaper it is per day.   I also recommend the Park Hopper Tickets.  we like to visit different parks at different times of the day... like the Japanese Pavilion in Epcot for a Sushi Dinner. 

Speaking of food... there is a fairly new dining plan available.  It only became available for DVC stays since our last visit.  Basically, it allows each person to get One Sit Down Meal, One Counter Meal and One Snack per night of stay.  They don't have to be used each day.  It costs under $40/night/person to add on.  While it seems kind of pricey,  it isn't that bad compared to  paying Disney prices for food, and the Sit Down meal can often be a Character Dining experience.  Make reservations and maximize your dining dollars.  And remember, the Disney Calories are FREE.  I keep telling myself that...  and I tend to walk about 15 miles per day while we are there. 

Another GREAT source for info is AllEars.  Wander around the web, and see what sort of deals you can find.  The AllEars Newsletter often has ticket discounts that aren't otherwise available.

Enjoy.

Take a look...

The Chicago Tribune posted a story today about garages.   Here are a couple of excerpts:

Home builders, remodelers and specialized garage-organization companies see that problem as an opportunity to sell you a solution. They have plenty, including more square footage and garage-themed cabinetry. You can even find a fridge specially built for the garage, so you can always have a cold drink at hand when you're working on your wheels.

Around some homes these days, the amount of space devoted to the garage is big, indeed. Three-car garages were included in 20 percent of new homes built in 2005, according to the National Association of Home Builders. Another 64 percent of new homes had two-car garages.

and

The garage on display in a Stanley Martin model home at Coles Run Manor in Manassas, Va., is packed with nearly as many fancy upgrades as the kitchen. Their "tricked out garage" option includes raised-diamond pattern rubber-like floor protectors; a work bench; storage cabinets; tool racks; slatted wall coverings that accommodate a variety of hooks and baskets for storage; ceiling-mounted bicycle hoists; and even a 20-inch, wall-mounted flat-screen TV. Buyers can choose elements a la carte or sign up for the full slate of options for $19,500.

finally

And who knew there even was such a thing as a refrigerator specially designed for the garage? Gladiator makes the Chillerator Garage Refrigerator, which is Energy Star rated for efficiency and is designed to handle the wide variations in temperature and humidity usually found in a garage.

The Freezerator, specially designed for garage use, allows you to turn the temperature in the freezer compartment down to ordinary refrigerator temperatures, to better accommodate your stockpile of beverages. Both come in an oh-so-manly diamond-plate metal finish.

See.  I'm not crazy.  I'm just ahead of the curve.  There are a lot of us out there that appreciate a nice garage.  What goes into a great space in the garage is often something that escapes the average real estate agent.  Power consumption baffles them (what are those funny looking plugs for?).  While a work triangle in the kitchen is pretty normal knowledge, the same type of work patterns in the garage only appear to people that, ta da... work in the garage.

Just like equestrian properties, or golf properties, or waterfront properties are most often best represented by those that understand them, so are garage properties.  

Enjoy, and get out there and spin a wrench.  It's GREAT therapy to work for a couple of hours and see something accomplished when it's over.   

I touched on this in another thread, but I think a lot of people thought it was actually about cars, so I am going to go into a little more depth, and be a little less cryptic.  But, the main point of the thread was...

    They are saying that they specialize in EVERYTHING.  If one specializes in everything, they really mean that they             specialize in nothing.  I mean, really.  How can you specialize in everything?  

    Now, let's tie this back to real estate.

    Have you ever seen an ad that said "I specialize in Buyers and Sellers"?  I guess that means that they will deal with         anyone but lookers...  But, isn't that what everyone else does?  Are you truly a specialist if you think you do                     EVERYTHING?  The short answer is NO.  the long answer is No, you are a generalist.  

    Why not just say that you generalize in everything?

So, for agents, in order to separate you from the crowd, you have to separate yourself from the crowd.  Was that repetitive?  Take a look at the little house books (Hobbs/Herder calls them little house/little head books).  Look at all of the agent pages.  Almost everyone is using the same template.  Almost everyone says the same thing.  To look at one of those books, you would think that EVERY AGENT IN THE MARKET is #1 for integrity, service, and production.  For the vast majority of agents, they put out nothing that makes them any different than any other agent.  And, 20% of the agents out there do 80% of the deals.  So, if what you offer is no different than what the next person offers, you are a commodity.  There is only one way commodities can compete, and that is by being cheap.  If you think all gasolines are the same, will you buy the more expensive one, or will you go across the street where it is ten cents cheaper?  If you think your car runs better on Brand B, will you still buy it when it costs a little more?  If the Kraft Mac & Cheese tastes the same as the Kroger store brand, will you pay 50% more for it?  But, if you family says that the Kraft is better, you'll put that in the cart.

But, we tell prospects the same thing that all of our competitors say, and then we wonder why they put the cheaper agent, or the one that happens to be standing next to the Mac & Cheese, in the cart and list their home or buy their home with them. 

But, we tell prospects the same thing that all of our competitors say, and then we wonder why they put the cheaper agent, or the one that happens to be standing next to the Mac & Cheese, in the cart and list their home or buy their home with them.  Yes, I said it again on purpose.  

Now, the next phase of this little game is this.  

Why should someone buy the house that you just listed?  If it is just like the 6 other houses just listed in the subdivision, the only way to compete is with price.  If you do GREAT marketing to drive buyers to finding it, as soon as they visit, they will see that there are 6 other houses that look just the same.  I guess you might be able to creatively route them through the neighborhood so that they don't see anything that is cheaper.   

Instead, maybe it would be better to make the house different from the others.  Proper staging may make it prettier.  (yes, there were three different Atlanta stagers linked in the last sentence...)  Having a kitchen that is just a little more modern and stylish or usable may set it apart.  Or (my favorite) having a garage that is well laid out for a car person, with epoxied floor, and great cabinetry will also separate this house from the others in the subdivision. 

BTW, if you are a builder in the Atlanta area, and want to set your small upscale community apart, contact me.  I have a GREAT idea for you.  

As always, I'd love to see your comments and please rate this entry.  Thank you so much. 

How many times do we have to hear that the housing market is doing one thing... and that must mean that the whole market is doing the same thing? 

When the price of a barrel of oil goes up, it is a singular commodity moving.  While there are different grades of oil (sweet light crude, heavy crude, rough crude, etc.) they are interconnected.  If one moves, they all move because their value is interconnected.  

When prices move up or down in GA, there is little correlation to prices in Maine.  They aren't interconnected.  There may be a few instances when they can be driven by the same forces (the Sub-Prime Meltdown.. SPM, is an example).  If there is MASS unemployment nationwide, that would affect multiple markets, but even unemployment is largely regional.  Even the SPM has an uneven effect.  It will affect markets that have had more "heat" more than stable markets.  In fact, we are seeing that it is mostly those markets that are leading the foreclosures... although Atlanta didn't have the big price run-ups, it snuck in there too.

The point is that if there is a shortage of $250k homes in Atlanta, an over supply in Charlotte can't be used to offset it.  If there are too many $1m homes in Lansing, MI they can't be shipped to Ann Arbor to ease the problem.  Even when the job market causes some local imbalance in the supply and demand for homes, that doesn't mean Birmingham can ship their unemployed to Marietta (GA or CA).  

It would simply be responsible when mentioning that real estate is moving up or down to say that some sectors are doing the opposite.  Many of the same business programs that go in depth with stock reports, and go out of the way to mention that "there is a flight from tech to blue chips" or that "transports are taking a beating while oil is going through the roof" fail to mention that some areas and some price ranges are healthier or unhealthier than others. 

Remember, real estate being off 3% on a national average is VERY DIFFERENT than gasoline being off 3% on a national average.  The gasoline might vary a little from market to market, but up is up, and down is down.  In real estate, that same 3% average might encompass one market being up 10% and another being down 18%. 

Just remember that when dealing with real estate, as the FTC required many years ago, "Your Mileage May Vary."  YMMV. 

I have been reading a bit about green construction, and green living, and green (yada, yada, yada fading away...)

Let's see.  I changed my lifestyle in part so that I wouldn't have to drive an hour to work every day.  In doing so, I cut the number of miles I drive by quite a bit.  I also cut dramatically the amount of time I spend sitting around with the engine running.  

I've always felt that 78* in the summer for the A/C, and 68* for the heat in the winter was appropriate.  But, is because I'm cheap, and it just seems that when I am out in the 100*/100% humidity Atlanta summers, coming in to 78* feels just as good... and it doesn't slap quite as hard when I have to go back out.

I turn off lights when they aren't being used.

I keep my tires properly inflated.

I insulate.  I caulk.  I don't water... ok, I rarely water the lawn.  My truck is usually not THAT clean.  I don't over-mow my grass.  

Of course, on the flip side... I Jeep. 

But, then one could argue that it is the ultimate recycling project.  

But, back to the good side, I've always recycled.  In fact, I practice what s called pre-cycling.  When buying things, we look for items that will be easily recyclable, or can have a second life in some other way.  As my son would say (quoting Builder Bob), "Reduce, Reuse, Recycle."

I alluded to this here, but didn't really jump into it.  There is another part of the story though...

Let's recap.  I said in the previous post that I thought that real estate licensing requirements (from the state) should be relaxed or eliminated.  Pretty bold, huh?  Here is what I think the exam should look like.

1.  Are you breathing? Y N (if yes, provide proof)

2.  Are you a convicted felon?  Y N (if no, please provide proof)

3.  Are you a citizen or legal resident alien that is allowed to work?  Y N (if yes, please provide proof)

Simple and to the point.  But... 

I think that the NAR should have an exam that is at least as hard as the state exams are currently.  The education requirement should be tougher, and there should be an apprentice period.  When one is cleared to be a REALTOR, it should mean something.  It shouldn't be a gimmee.

Currently, if one asks around, the VAST majority of people think that REALTOR and real estate agent are interchangeable.   Even among real estate agents and brokers, I hear the two terms used incorrectly.  On another forum I am a member of, I had a debate with someone that swore up and down that membership in the NAR was a legal requirement for licensing in their state.  I had to pull the page from that state's licensing requirements to show that there was no REALTOR requirement for licensing.  

Currently (here in GA) one can get the license for a couple hundred bucks and a 75 hour commitment to the class.  I did the class online, and knocked it out in under two weeks.  The hardest part was scheduling the exam (I had to wait almost three months for an opening).  Becoming a REALTOR was even easier.  I sat through an orientation class and... ta da...  I was a REALTOR.  Of course, there is the matter of spending a few hundred dollars per year for membership in the local, state and national associations.  And, in my case, since I can't just join anything, I have a time commitment to serve on the local association's RPAC. 

I look forward to your ratings and comments.   

First, let me say that I work for a brokerage that does NOT allow dual agency, but does allow designated agency.

Second, let me say that I work in a state which does allow dual agency, if it is disclosed on the contract to all parties. 

But, as I look at the landscape, I see something I don't like.  I don't like the idea of dual agency.  And, further, I think it is time that the NAR step up and stop the practice among its members.  I don't want to see the government take the lead, and I don't want to see any law passed.  I want OUR trade organization to voluntarily stop this practice, and then tell the world that they have done it, and why.

As a person with of the libertarian persuasion, I don't like to see the government constantly stepping in to the relationship between service providers and the clients/customers.  In fact, I think that licensing requirements for real estate agents should be relaxed or eliminated... but that is for another blog post (please save the comments on licensing for the post I'm sure will follow soon).

But, as a REALTOR, which promotes the ethics of its members, I can't see a way to reconcile dual agency with fiduciary responsibility.  How can we represent two opposing parties and keep both of their best interests at the forefront?  Obviously, we can work towards a win/win situation, and personally I try to do that anyway.  But, when push comes to shove, and when a problem arises, what is good for one party will often be bad for the other.  If there is a financing problem, and the buyer needs more time, but the seller may be better served to move on, or there is an inspection problem, and the buyer should move on, but the seller needs THIS buyer, the agent WILL be in a position that requires them to pick which party they are going to truly represent.  

Obviously, we go through many transactions that don't have these issues.  In fact, the majority don't have issues.  But, the point is that I seldom get a memo at the beginning of a deal saying that I am entering a troublesome situation.  Usually we only know we have a problem when we are in the midst of stepping in it.  At that point, if we are "representing" both parties, we already have a problem.  What does one do then?  Pick a side and call another agent in to help?  But, the original agent already knows more than they should about the other party.  Not a good solution.  

The bottom line is that if we, as REALTORS, are to truly serve our clients needs above our own, we need to begin by not allowing dual agency among our ranks.  Then we need to spread the word that REALTORS are leading the charge for ethics in real estate transactions.  

Walk the talk.

I look forward to your ratings and comments. 

I've seen several shops with that very "slogan."  But, what does it mean? 

Nothing.  

It doesn't mean a thing.  Aside from cars and trucks made in Asia, Europe and America, what are there.  I suppose there could be some cars made in Africa (ok, I just checked, and aside from cars that are also manufactured in other countries {Toyotas for example} there are VERY few made there... but Superformance is a VERY cool company) but not in a high enough quantity to be of issue here in Atlanta.  There isn't anything happening in Antarctica... or Greenland... and not many Australian cars come here. 

Back to the point.

They are saying that they specialize in EVERYTHING.  If one specializes in everything, they really mean that they specialize in nothing.  I mean, really.  How can you specialize in everything?  

Now, let's tie this back to real estate.

Have you ever seen an ad that said "I specialize in Buyers and Sellers"?  I guess that means that they will deal with anyone but lookers...  But, isn't that what everyone else does?  Are you truly a specialist if you think you do EVERYTHING?  The short answer is NO.  the long answer is No, you are a generalist.  

Why not just say that you generalize in everything?

Maybe we should try a little truth in advertising.  Sam's Club here in GA had to change their name.  They had called it Sam's Wholesale Club, but they sold to the public (that would be the definition of retail, BTW).  Even though they argued that they only sold to members, it was determined that since they were selling primarily and by a wide margin to non-resellers, they were a retail outlet, and not a wholesaler.  

I think that people who "specialize in everything" should be held to the same standard.   

I keep seeing and hearing about "dirty little secrets" that real estate agents won't tell their clients.  Most of them turn out to be pretty stupid points.  However, today while going through my morning routine (dead-heading, so my brain needed something to do) I thought of the dirty little secret that FSBO companies don't tell their customers.  We all know what it is, but many of us just might have never thought of it this way.

They don't care if you sell your house using their service.

That's it.  It doesn't affect their business plan if you sell or don't sell your house through them.  They only care if you list your house through them.  Their business model is only dependent on you paying $499 (or whatever amount) upfront, and then going on your merry little way.  They need as many people as possible to pay the $499 and go on their merry little way as possible. 

Sure, they need somebody to actually find a buyer through their service occasionally, but as long as they have enough sales for a few testimonials, they'll be OK.  And, they don't care if you sell in 6 day, 6 weeks or 6 months.  In fact, some of the companies would prefer that you not sell right away, as they'd love to get another $499 out of you to list again.  

Let's compare that to a traditional full-service, commission based real estate agent.  No sale = no money.  That's right, I don't get paid if you don't sell your house.  Let me say it again, I don't get paid if you don't sell your house.  I talk with you about pricing, we prepare a marketing plan, and we market your house.  After we find a buyer, we help you negotiate the sale, and then we make sure that the buyer follows through.  We also make sure that you (the seller) don't run afoul of any rules, or mistakenly breach the contract as we move from contract to closing.  We are there to protect you, and help you.  We are there to make sure that everything runs smoothly.  

Where is the FSBO marketing company?  They cashed your check, and they are hoping that you don't call, because it takes time away from getting $499 from someone else.   

Please don't forget to rate this post.  Thanks. 

OK, the water is chest deep now.  I started wading in here, and I just don't know when to stop. 

So, what do I see happening with interest rates?  Overall, I see them going down.  But, I think they'll go up first.  Was that vague enough that I can claim victory no matter what?  

First, the case for rate rising.  In the short term, I see rates going up a bit.  Not a lot, but somewhat.  We won't even get close to the credit card looking rates that Jimmy Carter left the mortgage market with, but rather people will think that 7%, or maybe even 8% was a deal.  With the meltdown of the sub-prime market, and the looming foreclosure crisis, the expenses that lenders have are going to go up.  In order to recapture those expenses, I see the rates going up a between 1.5 and 2 points.  But then, the rest of the market is going to catch up.  

Now, the case for rates falling.  After that short term bump, rates will need to drop.  Oddly, the SPM (Sub-Prime Meltdown) will be responsible for that as well.  The result of this SPM will be that fewer people will qualify for mortgages.  The ones that will qualify will be more stable.  Therefore, there is less risk.  However, and more importantly, since the pool of mortgage buyers will be smaller, there will be increased competition to get them.  Face it, money is the ultimate commodity, so the best way to compete is to make it cheaper.  Expect to see savings interest rates suffer as well.  Supply and demand will require that mortgage rates go down.  If there is more money available, and a smaller market for that money, the price has to go down.  So {brace yourself for a bold prediction}, I think that by 2009 or 2010, unless there has been a fundamental change in the market, we'll be looking at mortgage rates back in the 5.5% range. 

As always, I look forward to your ratings and comments.  I'd love to know what you think.