It Ain't All Big Hair and Cadillacs

I just added a new badge on my blog to allow viewers to click to my new profile on PropertyQube - again, a great find due to my twitter trolling. I really love the fact that I was able to syndicate my blog to PropertyQube.

There are many social networking sites that - ActiveRain for example, however, I can't syndicate my entries - i.e. post once, distribute many. I want one and only one place to blog - thank you PropertyQube.

The benefits or Twitter are endless! I found a really great blog written by Joel Burslem - a fellow Twitterer. His recent post refers to the mindscape for technology players for Web 2.0 for real estate - clearly there is no shortage of solutions in real estate - yet, as a real estate professional, I still feel that the solutions seem to be so disjointed.

As I look at the players in the social media space - and from my experience working with clients - time and time again, I am struck by the consumers lack of knowledge of the process of buying and selling - and the basic facts that consumers lack eduction in the process.

There are many tools which address opening the floodgates to the data trapped deep inside the MLS - analytical and search tools abound, however there is again a lack of general knowledge of the process of buying and selling. As I like to say, the consumer simply doesn't know what they don't know - this is the value that realtors provide, yet as a realtor I can say that we don't do the best job in educating the consumer.

I think a void that needs to be filled - and I believe it is a possible social media solution - is a collaborative environment - a wiki - where consumers gain process knowledge.

I have found my new addiction - TWITTER. As first, I wasn't sure what value it provided until I started to stalk - er...follow a few people in real estate and the social media space.

Needless to say, I am an addict. Not only do I have direct access to individuals and leaders who have tremendous mindshare in the social media space, I can TWEET with fellow colleagues about real estate, technology, my dogs - ah, the possibilities are ENDLESS!

This is more than a vehicle for marketing my clients' properties etc, it allows me to learn more about the exponential evolution of technology and its impact on my industry/business, plus I get to connect with some really smart people.

With the significant downturn in the real estate market, where will the real opportunities be?

From a seller of real estate - one who has the equity but needs to sell, perhaps the way to sell is to provide seller financing. The concept of a land contract has not been common during the times of easy money, however, it appears to be a new way for sellers to actually sell their properties. There are still qualified buyers capable of buying properties, but in light of the current credit crunch, they simply may be unable to get a mortgage.

In terms of private equity, there may be a growing market for private mortgages - not seller financing, but perhaps pools of private equity that may be able to bridge the gap.

My gut tells me that mortgage rates are going to climb and probably quickly in the near future, further squeezing out buyers - perhaps the worst is truly yet to come?

I had a light-bulb moment yesterday during a closing - yep a closing - that word has not been spoken alot lately - good news is, real estate is still selling - but I digress...

Here is some background information:

The process was second nature to me, needless to say, things come up during closings that are unforeseen - bottomline, I leave it to the legal professionals to work it out. However, my clients were uncomfortable with the nature in which documents were shuffled, stacked, signed, faxed etc with little or no explanation as to exactly what needed to be read, signed, explained etc. "Just Sign Here."


Unfortunately my buyers' attorney was not present during the closing and hence had to explain the significance of each document - what to sign and where to sign etc via the telephone ... My buyers had a less than ideal experience with the seller's attorney - she was extremely unprofessional and condescending to my clients with her terse explanation of why there was a delay from the seller's side in providing a clear and merchantible title. In addition to the mortgage, there was a lien on title which needed to be removed prior to transferring the title to my buyers.

During the laborious process of signing documents, the closer presented my client with a disclosure form, required by HUD to inform my client that that seller's attorney was an agent of the title company. As per Federal Law (RESPA) requirements, the disclosure informed them that the seller's attorney would be paid a referral fee for referring the closing to their title company.

Perhaps it would not have been an issue had there been a - hmmm - a more pleasant exchange - between my client and the seller's attorney prior to the presentation of the document. My clients questioned the validity of the referral - needless to say, they didn't feel she deserved it. My clients were not even aware of the fact that there was a financial benefit derived by the attorney simply by selecting a title company - and of course the signed document, while in full compliance, required a signature of acknowledgement that a referral was paid - somewhat after the fact.

To be clear, I don't fault attorneys in any way for deriving referral fees from title companies. I often pride myself on how I try to educate my clients thru out the process, trying to be as informative and provide as much information regarding disclosure as possible - however, it simply dawned on me that while this disclosure is relatively insignificant, it highlights the fact that consumers simply don't know what they don't know.

What even prompted this entry was the reading of article related to a study that questions the true effectiveness of RESPA, perhaps allowing the states to better regulate the settlement services.

Laws do not equate to better education or necessarily to better disclosure. Regardless of federal and state laws designed to protect consumers, I as an agent cannot minimize what is significant or insignificant as it relates to disclosing information. Consumer education regarding the purchase and sale of real estate is so critical, yet some many of us as real estate professionals fail to provide in-depth education of the process. Again, what was second nature should have been more thoroughly explained.

Perhaps the best way to leverage new technologies for real estate would be best leveraged in education regarding the PROCESS of buying and selling real estate and not on FINDING property - or maybe combine the two. Hmmm - now that sounds like an idea.

While reading this month's Illinois Realtor Magazine, I came across the following site sponsored by the Illinois Association of Realtors and its foundation, the Partnership for Homeownership. The resources for grants, assistance funds, legal assistance, HUD-approved counselors, senior services and energy assistance programs.

The interactive map allows you to select your county - you'll be provided a list of resources in the categories provided.

For those facing a potential foreclosure or currently in foreclosure, IAR's consumer site, www.YourIllinoisHome.com provides an array of resources for people currently facing foreclosure.

In light of the current real estate market conditions, the Federal and Illinois state governments and other non-profit organizations are offering assistance.

If you are in facing a foreclosure, SEEK ASSISTANCE - there are a number of organizations who can help. Most importantly, call your lender! If you are unable to make your mortgage payment, explain to your lender your situation.

US Housing and Urban Development homeowner counseling: 1-800-569-4287

Federal Housing Administration refinancing program, FHASecure

Illinois Legal Aid

Neighborhood Works America Center for Foreclosure Solutions: 1-800-995-HOPE(4673)

Our Own Home, Illnois Treasurer's Office loan and refinance program: 1-800-803-4663

Where's the good news regarding real estate? Here's some counterpoints to why you SHOULD buy and buy with confidence in Chitown - the Windy City - The City of Big Shoulders - ok, you get the picture. I just wanted to pass along the comments my colleague provided regarding why Chicago is a good bet when it comes to buying real estate:

If this city would get some New York attitude, it sure would help the situation.. If people can not make it here, they are losers.... see Wrigley Field... Chicago has no equal .. we are like the 20th largest economy.. IN THE WORLD. this city.. wake up to the gold at your feet.. the cry baby , un informed consumer needs shut up and buck up.... so pop this in their pipe to smoke..

from Wikipedia.... for memorization

Chicago has the third largest gross metropolitan product in the nation — approximately $ 442 billion according to 2007 estimates.[32] The city has also been rated as having the most balanced economy in the United States, due to its high level of diversification.[33] Chicago was named the fourth most important business center in the world in the MasterCard Worldwide Centers of Commerce Index.[34] Additionally, the Chicago metropolitan area recorded the greatest number of new or expanded corporate facilities in the United States for six of the past seven years.[35] In 2006, Chicago placed 10th on the UBS list of the world's richest cities.[36]

Chicago is a major financial center with the second largest central business district in the U.S. The city is the headquarters of the Federal Reserve Bank of Chicago (the Seventh District of the Federal Reserve). The city is also home to three major financial and futures exchanges , including the Chicago Stock Exchange , the Chicago Board Options Exchange (CBOE), and the Chicago Mercantile Exchange (the "Merc"), which includes the former Chicago Board of Trade (CBOT). Perhaps due to the influence of the Chicago school of economics , the city also has markets trading unusual contracts such as emissions (on the Chicago Climate Exchange ) and equity style indices (on the US Futures Exchange ).

In addition to the exchanges, Chicago and the surrounding areas house many major brokerage firms and insurance companies, such as Allstate and Zurich North America. The city and its surrounding metropolitan area are home to the second largest labor pool in the United States with approximately 4.25 million workers.[37] Chicago has the largest high-technology and information-technology industry employment in the United States.[38]

Manufacturing, printing , publishing , and food processing also play major roles in the city's economy. Several medical products and services companies are headquartered in the Chicago area, including Baxter International , Abbott Laboratories , and the Healthcare Financial Services division of General Electric . Moreover, the construction of the Illinois and Michigan Canal , which helped move goods from the Great Lakes south on the Mississippi River , and of the railroads in the 19th century made the city a major transportation center in the United States. In the 1840s, Chicago became a major grain port, and in the 1850s and 1860s Chicago's pork and beef industry expanded. As the major meat companies grew in Chicago many, such as Armour and Company , created global enterprises. Though the meatpacking industry currently plays a lesser role in the city's economy,Chicago continues to be a major transportation and distribution center. Early in the 20th Century, Chicago was part of the automobile revolution, hosting the brass era car builder Bugmobile , which was founded there in 1907.[39]

Chicago is also a major convention destination. The city's main convention center is McCormick Place . With its four interconnected buildings, it is the third largest convention center in the world. Chicago also ranks third in the U.S. (behind Las Vegas and Orlando ) in number of conventions hosted annually.[40] In addition, Chicago is home to eleven Fortune 500 companies, while the metropolitan area hosts an additional 21 Fortune 500 companies.[41] The state of Illinois is home to 66 Fortune 1000 companies.[42] Chicago also hosts 12 Fortune Global 500 companies and 17 Financial Times 500 companies. The city claims one Dow 30 company as well as aerospace giant Boeing , which moved its headquarters from Seattle to the Chicago Loop in 2001.