Real Estate Darwinism

Here on our Long Beach Real Estate site I usually write purely real estate related articles targeted at educating and informing buyers and sellers of Long Beach Real Estate. Today I would like to give you a little peek into the business side of things and explain how they can affect the sale or purchase of your Long Beach homes.

In a recently published post I disclosed the 2008 closed sales in Long Beach; 674 of them, through 4/30/08. While the chart shows the sales increasing each month, the sales figures are still very low. (Includes sales of homes, condos, lofts, co-ops, Oyos, 2-4 units and 5+ units as recorded on the MLS)

• Jan 130
• Feb 153
• Mar 179
• Apr 212
• Total: 674

These are difficult times for those of us surviving in the real estate industry. Going into this down market there were about 2900 licensed Realtors on record, there are currently about 1600 licensees active in the Long Beach area. Every market will support a certain amount of agents based on the closed sales of that market. Each agent needs a certain amount of closed sales in order to survive. Lets assume that 8 to 10 closed sales for the year are required for a Realtor to even survive this market; 674 closed sales would produce 8 to 10 sales for the year, for between 200 and 250 Realtors. Those sales are currently spread across 1600 current licensees, which would equate to less than ½ of a sale for each Realtor for the first 4 months of 2008.

In the real estate industry we have an 80/20 saying. It states that 20% of the agents do 80% of the business. 20% of 1600 agents = 320 which would equate to about 2 closed sales for the majority of the 20% still doing business.

So how are 1600 Realtors surviving a market with sales that will currently only support 200 to 250?

• Some have other income, or a spouse or significant other with income.
• Some have taken on Part or Full time jobs, while trying to juggle their real estate.
• Some have anticipated this market and made plans to survive it.
• Some are making enough sales to manage.

What of the 80%? That is 1280 agents, still active, for the last 4 months. How are they surviving with little or no sales? Well, they either have spousal support a trust fund or they have accepted salaried positions. Lets take a look at that. Real estate is a more than full time job; it is a commitment which permeates every hour of every day of our lives. Real estate transactions require a lot of attention on a daily basis. Escrow, title, lenders, inspections, appraisers banks and more need to be attended to, mostly during normal business hours. Buyers need to see properties around their schedules which often means after work or weekend showings. Sellers properties often need tending, flyers run out; keys go missing from a lock box or end up in another box on the same property. A pipe may burst on a listing with an out of town owner; anything can happen. How is an agent who has accepted employment elsewhere, with a set schedule, going to be able to deal with the schedule and responsibilities of a full time Realtor? How does that affect the buyer or seller? Has the agent even disclosed to the buyer or seller that they are not fully available? Do you know if your agent is available to conduct business, full time on your behalf?

The buyer, who sees property after work, writes an offer, has it accepted, goes into escrow, has a right to expect their Realtor to be available during normal business hours to properly handle their transaction. Why isnt my Realtor answering their cell phone? Why isnt everything moving along? Why is everything taking so long? I called escrow today, they havent heard from the agent either. Whats up with that? They are not available. If they spent the time required to handle your transaction on the phone, fax and email from their place of employment, they would lose the job they need to survive.

Too many agents are not answering their phones when other agents and buyers are calling to see properties they have listed. Every one of these missed calls is a missed opportunity for a seller. Agents and buyers just move on to other properties and more cooperative agents.

So how do you figure out who is doing business and why? You go to the internet. 80% or more of buyers begin their search and find their agent online. Which agents do you find online promoting their business? Go ahead and put Long Beach Real Estate into the Google search engine. You will find a small handful of Long Beach Realtors who have made it their business to acquire a very substantial position in the #1 search engine online to not only promote their business, but to drive traffic through their listings and to attract buyers. You will also find a group of vendors who have property searches, none of which include the entire MLS property search. Why? Because they are not real estate brokers; they are in the business of selling advertising and buyer/seller leads to Realtors. They do not have access to this level of information. They can only provide the listings which SOME of the larger brokerages and individual agents provide to them. How does this help the buyer see ALL of the listings available?

Realtors who have a substantial internet presence understand what it takes to promote traffic to your home or condo for sale; the more traffic that passes through your home, the higher the chance that your buyer will be among them.

We are proud to be in the #1 position in Google for the term Long Beach Real Estate; we worked very hard attaining that position for our clients benefit. We are also in the #1 position for many other important search terms and are on page 1 of Google for just about every conceivable real estate search term related to Long Beach and real estate in Long Beach. We have spent years working on our websites and our internet presence. We anticipated the shift onto the internet and have been developing relationships with technology providers and other professionals to provide the best possible experience for our Long Beach Sellers and our Long Beach Buyers.

Buyers will find a multitude of helpful information and tips on our sites, all geared toward educating and informing about todays market and real estate issues.

You will find a full MLS search, which includes VIP service - the ability to set up exclusive searches for yourself, compare properties, relocation information, buyer information, seller information, home staging, market reports and updates, home loan information, mortgage rate reports, community and neighborhood information and much more. We have tried to provide a complete consumer experience.

In addition to our already highly successful site www.longbeachrealestatehome.com we are thrilled to announce our new site is up and running. We have moved www.lauriemanny.com to a new site. This site will not only improve the consumer experience, but should drive even more traffic. We love it and hope that you will too.

What makes a real estate site successful? We provide educational and helpful information for consumers. Consumers bookmark our site and become regular readers.

How do you judge the success of a real estate site? By its traffic.

How much traffic do our sites get daily? A lot! No really - a lot! We are now averaging about 5,000 hits a day and still growing. Most Realtor websites nationwide receive a few hundred hits a day if they are doing well.

How does that translate into business? Many consumers read us for months before contacting us - they are subscribed either by email or by a feed reader. Many buyers and sellers contact us, some we can help, and some we cannot. We promote properties on our sites. Buyers find us on the internet. Buyers call their agents and ask to see properties. Sellers get traffic - a lot of it.

Do you see the value in hiring an internet savvy Realtor with a substantial internet presence yet?

The Long Beach Real Estate Home site has attained national recognition for it hyper-local focus on real estate and its unprecedented success. Recently Laurie was one of four Realtors statewide called upon by the California Association of Realtors (CAR) to participate in a round table discussing social media on the internet and its impact on the real estate industry. CAR is releasing portions of this roundtable in its June/July Realtor magazine. Video clips from this event will be available on the CAR site shortly. Laurie will be speaking at the BloodhoundUnchained Conference in Phoenix May 17 through May 20^th, sharing her knowledge with Realtors from across the USA and Canada. Laurie has also been invited to share her knowledge and experience with the national real estate industry at the annual Inman News conference in San Francisco this summer.

Laurie has been invited to contribute to several nationwide real estate sites. Keep your eyes open, you never know where Laurie is going to turn up with more valuable information for buyers and sellers. (I will always share with my Long Beach readers)

It’s no news that the Euro is strong and Europeans are buying Miami Real Estate.  I read the other day (but can’t remember the source) that 1 out of 4 real estate sales in Miami are foreign national deals.  Rick and I have been dealing with foreign nationals since we began our real estate careers.

We both speak Spanish fluently (I was born in Venezuela and Rick is of Venezuelan and American descent) and we have family all over Europe - so we have close ties.  Because we have so many foreign national customers, we have come up with a plan to help our clients from abroad and have a complete system in place for when they are ready to buy and/or sell.

If you are a Foreign National buying Real Estate in Miami - ask yourself these questions:

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Long Beach Own Your Owns - OYOs

What the Heck is an OYO?

Why would I want to own one?

Long Beach has been home to many Own Your Owns over the years. They can be found throughout Downtown Long Beach, Alamitos Beach, Bluff Park and into Belmont Heights; older, usually 2 or 3 story buildings tucked between newer and sometimes taller buildings.   Recent Condo Conversions have trimmed the numbers of available OYOs considerably. OYOs used to be a really good investment, selling for considerably less than Long Beach Condos, they proved to be a very desirable purchase. When they successfully converted to condominiums owners realized large profits.  Often condo conversion was the motivation for purchasing an Own Your Own. 

Many buyers ask about OYOs.  They want to know if they are the same as a condo, or more like a stock cooperative. 

OYOs are similar in ownership to condos in that they are both fee simple ownership with individual tax bills and deeds. OYOs are a pre-condominium form of ownership, mostly built in the 50s. They generally sell for less than condos and are occasionally candidates for condo conversion, if they qualify, at which time they increase in value dramatically. Often OYOs will not have sufficient parking to qualify for condo conversion. 

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Long Beach California Real Estate Sales Update

January - April 2008

The real estate market in Long Beach has begun to shift.  We have witnessed a steady rise in homes and condos for sale in Long Beach since the beginning of the year, as is witnessed by the chart provided.  Buyers who have been waiting out the real estate market hoping to get that incredible deal are now buying those Long Beach homes and condos they have been wanting. 

Interest rates are still great, although lenders are tightening up on lending standards.  It is getting more difficult to procure a home loan unless your income and credit scores are high, your credit history is good and your debt ratio is low.  As we progress into the summer months lending standards will become even more stringent.   

• Long Beach Mortgage Rates Reports

If you are one of the consumers who has been sitting on the sidelines waiting for Long Beach real estate prices to drop before you begin your buying process, you might want to speak to a mortgage lender pretty soon.  Run your credit, find out if you qualify for a home loan sufficient to make that purchase.  You may also decide to go ahead and buy now while Long Beach prices are low, some concessions are still being granted and home loans are still available to consumers with less than pristine credit. 

• Long Beach Homes & Condos-7 Steps to Pre-Home Purchase Preparedness 
• Buying Your Long Beach Home - Getting Started 
• Long Beach Home Search-Where do I start? 
• New FHA Loan Limit For Long Beach Homes
  
• Long Beach Homes - To Buy or Not To Buy? 
• Long Beach Homes and Condos - Negotiating Your Offer 
• Long Beach Home Ownership - 1st Time Home Buyers and The American Dream 

 Real Estate Sales in Long Beach California - 2008 - Year to Date

• Long Beach Homes and Condos Market Report-Jan-Dec Home Sales 2007 
• Long Beach Income Property Market Report-January-December 2007-Including Signal Hill 
• Downtown Long Beach Stock Co-operatives 

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Are You thinking about Buying a Home in Long Beach?

When beginning the home buying process the best place to start is by getting pre-approved by a great lender.  Being pre-approved for your home loan not only assures you that you are shopping within your price range, it also equips you with the ability to make an offer immediately when you locate the home of your choice. 

When you speak with the lender of your choice, ask them if they will be able to provide you with a lock-in letter and a written loan commitment.  These items assure you that the loan is actually in place and that both the interest rate and the terms of the loan will be intact when you are ready to close escrow. 

There are currently less Long Beach homes on the market than prior months.  Over the winter months we had more, but less desirable inventory.  Todays Long Beach Real Estate Market is providing better and more desirable choices for home buyers causing many Long Beach properties to receive multiple offers.  It has been rare for offers to go much above asking price, however sellers are making choices based on the terms offered and the strength of the offer and the loan. 

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