Take Me Out To The Cleaners...

Let's play a game.

Imagine you're rich. Super rich. Now, imagine you want to build yourself a clubhouse. Fun game so far, huh?

This clubhouse will be built in the middle of town, only you don't want to have to pay for it. So, you convince your neighbors to pony up their money to pay for your shiny new clubhouse. Well, not so much convince as blackmail. See, if they don't give you money to pay for the clubhouse, you will leave and take the town's prized tourist attraction because, well, you own that, too.

So, they agree to build your clubhouse. Once built, you charge your neighbors an exorbitant fee to enter the clubhouse.

Sounds like a rotten deal, huh?

Interestingly enough, that's exactly how most city stadiums are built. Sport teams are no doubt a huge part of a city's culture (indeed, the Cincinnati Reds, DotLoop's own hometown team, won their division last night and clinched the playoffs, causing all sorts of excitement in the city), but often, the city never really owns the team. Or the stadium that is built by public tax dollars.

But don't stadiums bring in revenue for the city? Yes and no. Yes, they bring in some new tax dollars, but no, not enough to offset the cost of building the stadium.

The bottom line: sports teams are great for a city or region's culture and helps them brand themselves, but when private teams reap most of the benefits, shouldn't they be the ones paying for the facilities?

Of course, the resale is where the real money is at. Just ask Detroit, who sold their Pontiac Silverdome last year for a whopping $583,000. That's a lot of money, until you realize it cost the city $55.7 million to build it in 1975.

You can buy an awful lot of Cracker Jacks with that kind of money.

Happy Little Trees

With fall upon us, many of you no doubt are starting to do some home fix-ups. It is, after all, the perfect weather for painting without panting (no humidity - whoo hoo!).

I painted this weekend myself, actually. As I was going over the old paint, I was careful to stay within the lines, until, at one point, I went outside the parameters just a bit.

At first, I freaked out. Being the perfectionist that I am, I wanted to make sure that the new coat of paint covered the old exactly.

But then it dawned on me: I don't have to follow the same old worn pattern. After all, I have a brand new bucket of paint and can make new lines and new boundaries with my paint brush. I have the power to create an entirely new design.

This is great news, especially since the old lines are faded. After all, it's been two whole years since the economy began to crumble. By now, the old paint has chipped off. The question then, is, are you still following the old path, or are you forging a new one?

I challenge you, then, with your new paint bucket, to go and create bold new brush strokes. Maybe you've decided to take on that challenging listing or make your office completely paperless. Maybe you've even decide to embark on an entirely new career path altogether.

It's completely up to you. With all the doom and gloom about the current economy and with everyone wanting to badly to return to the spreadsheets of 2006, we often forget that this crisis is as much an opportunity as anything else.

So, instead of lamenting that the old paint is peeling off, brush away those paint chips and go create a masterpiece.

Don't miss the forest for the "happy little trees".

The Economy Tsunami - Are You Prepared?

This economy is a strange, fickle little creature, and it may be years before we see an upswing.

At least, that's what Jeremy Grantham's predicting. This fabled recovery, he says, will not happen in 2010, but around 2016.

You know - the future.

Of course, he may be just another Economic Nostradamus and might be completely wrong about his "seven lean years" prediction. This downturn, after all, may last even longer.

Our economy is only as fickle as we are, though - we've been impatiently waiting for a recovery for the last three years. Now that it's lasting longer than we had anticipated, it seems a good idea to start thinking long-term about changes we can all make to wade through this economy tsunami.

Here are three areas you, as an agent, can start to cutback on to wade through this recession.

Office Supplies
Between the manila folders, costly ink cartridges, and burdensome storage cabinets (which take up precious office space), the cost of business has always been a bit on the high side.

With today's technology, however, you can run a completely paperless office, saving you space, waste, and haste. DotLoop's paperless online transaction system, for example, means you'll never have to worry about costly paper fees (or paper cuts) again.

Fuel
How much time are you spending stuck in traffic? How much money are you wasting on gas? Fuel costs add up and can eat into your revenue faster than you think. With more cars on the road today than ever before, even a quick trip downtown can waste hours and gallons.

Luckily, with e-mail, eSign, and eFax services so readily available, you can save your gas for when you really need it - to get to the closing table.

Advertising
There are only so many channels agents use to get their name out there; unfortunately, most are not only out-dated, but downright costly.

With free services like Facebook and Twitter allowing you to be your own brand manager (and more easily and effectively connect with your audience) why would anyone still use a billboard or bus stop bench to get the word out?

These are just three areas you can curb your spending to survive this wave of slumped sales. I'm sure you can think of even more.

And hey, even if this economy come back swinging again soon, think about how much more efficient, effective, and economic you will be as an agent.

Card Sharks

Consider yourselves warned.

As The Wall Street Journal reports, that "professional card" offer you received in the mail last week may give your ego a boost, but not without first raiding your wallet.

With issuing offers of such cards up 256% from last year, you may be asking yourself: has everyone become a small-business owner over night?

Hardly. Thanks to the new CARD (Credit Card Accountability and Responsibility and Disclosure) Act of 2009, card issuers can no longer jack up your rates or ding you with inactivity fees.

Such consumer protections do are not covered for small-business cards, though. So, now, not only can your dog receive a credit card, he can also be a small business owner, too.

They keep finding the loopholes.

Chase spokeswoman Laura Rossi says that only small-business owners should be receiving these cards and that "mailings for small-business cards have not spiked but have remained relatively consistent."

Apparently, a 256% increase is not a spike. "Professional", huh?

So, if when they ask you 'what's in your wallet?' let them know: cash.

Charge Change

And finally...

...some good news!

No, the housing market has not returned to "normal" (if you can call the recent boom "normal") and unemployment is still dangerously high (unless you live in North Dakota).

But perhaps this recession has taught us a valuable lesson: live within your means.

For the first time since 2002, the average credit card debt per American citizen is now below $5,000 ($4,951 to be exact).

"Consumers continue to pay down their credit cards in response to economic uncertainty and high unemployment," Ezra Becker, a consulting strategist, says in the article.

Like a kid who ate too much Halloween candy, Americans gorged themselves on cheap and easy credit and are now taking a more healthy approach to spending and saving.

It took a global recession to make us realize our faulty ways, but the best lessons are always the hardest to learn.

Rethink, Regroup, and Reinvigorate

“Gentlemen, progress has never been a bargain. You've got to pay for it.”
--Henry Drummond, Inherit the Wind

It’s been a tumultuous few years to say the least.

With the economy still stuck in the mud, despite the turning of our wheels, a recovery appears to be a long, long way off and the good old days of 2006 are nothing more than a distant dream.

It seems like Pandora’s Box has been opened as the housing market continues to whimper on.

Later today, NAR will release what is predicted to be a decline in July home sales, and foreclosures continue to rise in certain areas in the country. It seems we're continuously mired in bad real estate news.

But it's not all doom and gloom. This weakened economy may just be the reprieve we need to buckle down, tighten up, and condition ourselves for a post-recession economy. Sure, the sales may be down right now, but never before have agents had so many advanced tools at their disposal. Never before have agents been able to openly and actively communicate with their clients.

We will most likely come out of this Great Recession a bit worn, but also a bit wiser. The proverbial cream will rise to the top and the best agents will shine through. After all, the only way to turn a lump of coal into a diamond is with time and pressure.

The question is, are you bettering yourself in this downtime, or are you still waiting next to the fax machine for the latest offer? Are you talking to your clients on Facebook to see what they feel about the local real estate market? Are you polishing your HTML skills or updating your website?

Because now's the time to regroup, rethink, and reinvigorate your business. This recession, after all, won't last forever.

So, when times are difficult in the midst of all of this bad news, don't forget what was at the bottom of Pandora's Box: hope.

The New Abnormal

Mr. Homeowner, now that you've just finished your strategic default, what are you going to do?

"I'm going to Disney World!"

We just don't know what to do with ourselves.

As Bloomberg reported late last week, Americans are being schizophrenic in their spending habits throughout this recession, buying cheap toothpaste at the dollar store so that they can continue to buy $3 lattes at Starbucks.

In a nation where a giant shopping mall is a vacation destination and 70% of our GDP is made up of people buying things, it's easy to see why we are so desperate to spend. After all, it's how we're programmed to function.

The phenomenal sales of the iPad - a product that created a brand new need upon its release - is a perfect example. As the article showed, a gentleman who had just foreclosed on his condo purchased the new Apple product even though he had just lost thousands of dollars in wealth.

Of course, in a time of record profits coupled with crushing unemployment, all of these strange economic stories only verify what DotLoop already knows: the world is rapidly changing.

Honey, I Shrunk The House

As the economy shrinks, so do the houses.

As reported this week, the average home size has officially shrank to 2,438 square feet, which, if you ask me, is still a huge house.

It makes perfect sense, though. We've had decades of increasing house sizes that, for the most part, followed an expanding economy. Now that the tables have turned, it seems more people are embracing this new frugality. Small is the new black. Cash is the new king. And bling is about as socially acceptable as driving a Hummer.

I suspect that house sizes will continue to shrink until we get back to equilibrium between how much house we need and how much house we have.

The new status symbol is a free life, not a McMansion. This can only be a good thing.

'Fore' For Much Longer?

It's funny how the universe works. Just days after discussing neighborhoods designed for the elderly, this morning, I stumbled upon this article at MarketWatch.com. In brief, it outlines how retirees are re-thinking the cliched idea of a golf-course retirement in sunny Florida and how, "today 'cost of living' is the most important consideration on where to locate."




Also mentioned is a related article discussing the downsizing of the size of the average new home for the first time in 27 years, a topic I've covered before, too.

Regardless of your thinking about the housing market, it appears retirees are making a shift in their priorities. We'll see what kind of sea change this brings to the housing industry as a whole.

dotloop.com

No Preservatives Added

Here at DotLoop, we take seriously our charge to change the real estate industry in a positive direction (while having fun too, of course). In fact, one of our pioneering pillars is to lessen the amount of paper needed for a transaction. Sure, this makes sense environmentally, but it also makes sense financially--after all, the less paper used, the lower the costs.

And that's the beauty of real progress--not only can you enhance your pocketbook, but in many ways, you can enhance your environment, too.

Progress in Preservation

In fact, communities across the country (and world) are understanding that progress does not always mean brand new, but oftentimes means rehabilitating what's already there. This is especially true when it comes to the preservation and rehabilitation of historic buildings.

Just this past weekend in fact, DotLoop's hometown newspaper--the Cincinnati Enquirer--ran a three-page story about the efforts local businesses and community members have taken to preserve Over-The-Rhine, the nation's largest collection of Italianate architecture. The neighborhood has been in a spiraling decline over the last few decades for many reasons (suburban sprawl, new highway construction, lack of parking) but has seen a revitalization within the past five years spear-headed by the OTR Foundation and 3CDC.

The architecture found in such historic areas is unrivaled. While Dubai's latest skyscraper is impressive in its technological prowess and its shear size, seeing historic buildings with their detailed gargoyles carved by hand and intricate stained glass windows soldered one pane at a time gives communities a real sense of history. They don't make 'em like that anymore...

Blended to Perfection

Or do they?

If the city of Bruges in Belgium is any indication, they do. The city's market square looks as it did when it was around in the 1300s. Indeed, even the newer buildings look like they were built when lamb chops were eaten in between bouts with dragons. Bruges knew its history and heritage were worth preserving, blending the new with the old flawlessly. Bruges has benefitted economically by being one of the most visited places in Europe.

But you don't have to go halfway around the world to see the benefits in preserving historic buildings. From Charleston, South Carolina to New Orleans to Chicago, cities have all learned that preservation--and not razing--not only keeps a community's character in place, it also helps the local economy (a discussion I'll dive into in a future post). In fact, many preserved neighborhoods are thriving today because they attract the young urbanites who want to live in such places. The presence of young urbanites translates into more tax revenue for a city, and more discretionary spending for the individual, helping both the tax base and local businesses flourish.

Preserve or Parish

Photo (c) Chang W. Lee/The New York Times

We oftentimes confuse progress with new. Everyone loves their new flat-screen TVs, but what of their old tubes? Are they worth preserving? What happens when their "new" TV becomes obsolete with the latest rendition?

We've seen the lasting effects of preservation and the economic benefits of keeping historic buildings around. Still, historic buildings around the country, like the St. John's School in Garden City, NY (shown above) are still endangered. Historic buildings offer more than just a pretty facade, though. Many were built before the single-use zoning laws that took off after WWII and offer walkable, multi-functional communities that people gravitate to.

Besides, do we really need more strip malls?

dotloop.com