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An Insider's Guide to North San Diego County's Coastal Real Estate
Jim Klinge, broker-associate
858-997-3801
klingerealty@gmail.com
Compass
617 Saxony Place, Suite 101
Encinitas, CA 92024
Klinge Realty
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Are you looking for an experienced agent to help you buy or sell a home? Contact Jim the Realtor!

Jim Klinge
Cell/Text: (858) 997-3801
klingerealty@gmail.com
701 Palomar Airport Road, Suite 300
Carlsbad, CA 92011


Category Archive: ‘Realtor’

NRT Rips Compass

Today, Ryan Gorman, the CEO of NRT which owns Realogy (Coldwell Banker, Century 21, Corcoran, etc.) took a major shot at Compass.

He released this two-page ‘questionnaire’ for his agents to use when interviewing with Compass, but he sure comes off as desperate and paranoid:

Help-Agents-Avoid-Being-Thrown-Off-Course-by-a-Spinning-Compass-CB-NRT

Our CEO, Robert Reffkin, shrugged it off, which is fine and what he should do:

“What you talk about is a representation of what you are focused on,” Reffkin said. “We don’t tear down competitors, we don’t pay attention to the noise, what we focus on is empowering agents.”

But as a Compass guy, I’m going to address some of Ryan’s specific concerns for those consumers and agents who might be curious and want to know the truth:

1. Robert Reffkin told us that because we’re in the Top 20 markets, the company was going to concentrate on supporting and growing those already in play – which sounds great to us agents.  I don’t know how you rate the Top 20, but here’s where we are: Atlanta, Boston, Chicago, Dallas, Denver, Houston, Los Angeles, Miami, New York City, Orange County, Philadelphia, San Francisco, San Diego, Seattle, and Washington D.C., plus nine other smaller cities – which makes 24 markets.  Close enough.

2. Compass agents grow their business quickly after joining Compass? I don’t remember that claim specifically, but every agent knows your business usually takes a hit when you change companies.  Ryan said York at MoxiWorks contradicted the claim, but that’s not true. York said that the Compass market share was lower than claimed, but he checked the Compass production only, when Compass said it was the agents’ cumulative total for the year.  Agents count their annual sales volume, regardless of their brokerage, so the Compass and MoxiWorks measurements were apples and oranges – for Ryan to misconstrue what happened is disingenuous.

3. Ryan says Cigna isn’t our insurance company, but looks like they are to me:

We saved $4,000+ per year and have a lower deductible.

4. Ryan claims Compass is losing money and wants to know about the turn-around plan?  There’s $1 billion in the bank, and Compass will likely do an IPO in the next 24 months.  But agents are focused on selling homes – if we make any money on stocks or stock options, it will be icing on the cake.

5. Ryan said that Compass ‘strongly encourages’ agents to use the in-house tools. Nobody has ever asked or told me to use the Compass tools.  Furthermore, the Compass agents I know are all seasoned professionals who used their own tools long before working at Compass.

After his release went public, Ryan said this:

“I believe competition raises the level of play, and I welcome it,” Gorman said. “But when a competitor fails to uphold the basic ethics and integrity that this industry has together worked so hard to build, and puts the people I care about in jeopardy, I cannot sit on my hands.”

“The ‘talk’ coming from Compass behind closed doors is disturbing, and yet even in public forums, such as this publication, the inconsistencies, exaggerations and flip-flops by Compass executives are deeply concerning.”

The NRT sales volume is around 5x what we sell at Compass, and this guy goes ballistic over half-truths and innuendo, most of which is wrong or inconsequential?  Why?

Posted by on Feb 21, 2019 in About the author, Compass, Jim's Take on the Market, Realtor, Realtor Training, Realtors Talking Shop | 4 comments

Embezzlement Reimbursements

Hat tip to Mark for sending in this conclusion to a previous story seen here:

CARLSBAD, Calif. (KGTV) – More than two and a half years after Team 10 first reported about a North County property management company accused of stealing money from clients, the victims are finally getting their money back.

Kelley Zaun owned Carousel Properties, a Carlsbad property management company. Victims first told Team 10 in 2016, they hired her to pay fees associated with their rentals. They said she did not pay those fees. She was accused of taking roughly $200,000 from victims, according to investigators.

In 2018, Zaun faced 29 felonies for embezzlement, according to Deputy District Attorney Anna Winn. Zaun entered into a plea deal and agreed to a year in custody. With the help of the DA’s office, Zaun’s former clients were able to get their money back through the Department of Real Estate’s Consumer Recovery Account.

Stephen Lerner, the Assistant Commissioner for Legal Affairs for the department, said so far, 23 victims have been reimbursed through the account. Other victims’ payments are still processing. They have been able to reimburse $172,084.68 thus far.

The Consumer Recover Account is an option for fraud victims when trying to recoup money from the person who took it from them. In order to utilize the fund, Lerner said there must be a criminal or civil court order for the defendant to pay back money he or she took. If victims cannot get refunded from the person who stole it, they can apply through the Department of Real Estate.

Winn said she volunteered to be the victims’ liaison with the DRE, as the process for reimbursement is lengthy and many of the victims were elderly. One of Zaun’s victims told Team 10 he is “extremely grateful” for the DA’s office work on this case.

Victims started receiving reimbursements within the past couple of weeks.

Money for the account comes from license fees. Lerner told Team 10 there are approximately 421,000 people with a license under their department, which includes broker and salesperson’s licenses. 12 percent of the license fee paid goes to the account.

Since 1964, the DRE has paid more than $61 million to victims. Approximately 54 percent of all applications are approved.

Link to Article

Posted by on Feb 21, 2019 in Jim's Take on the Market, Real Estate Investing, Realtor | 0 comments

Mortgage Business Shrinking

Reader SM sent in this story on a mortgage company shutting down – and this one had a Carlsbad office:

https://www.ocregister.com/2019/02/14/provident-savings-bank-to-shutter-mortgage-banking-arm-cut-133-jobs/

Provident Savings Bank, the largest community bank in Riverside County, is discontinuing its mortgage banking operation, the company said in a statement.

The decision, announced by the bank’s board of directors Feb. 4, was based on a lack of profitability given the current financial environment. The operations are scheduled to cease on or before June 30.

Layoffs of 133 employees, of which 83 are in Riverside, were posted this week on the California WARN Act website, which requires layoffs to be publically reported. The others were at satellite offices in Brea, San Bernardino, Glendora, Carlsbad, Placer County and Northern California.

This one was even bigger:

https://www.housingwire.com/articles/48196-homestreet-bank-moves-to-sell-off-almost-entire-mortgage-business

HomeStreet announced Friday that it is planning to sell off its entire retail mortgage operation, which includes 72 home loan centers in five states, as well as nearly all of the mortgage servicing rights associated with loans originated in those retail outlets.

According to HomeStreet’s website, the company has 72 home loan centers: 37 in Washington, 16 in California, six in Hawaii, five in Idaho, and eight in Oregon.

According to the bank, it is making this move due to the “persistent challenges facing the mortgage banking industry.” The bank cites “the increasing interest rate environment,” which has reduced the demand for refinances, and higher home prices that have decreased the affordability of homes.

The mortgage business thrives on refinances in the ultra-low rate environment, but once rates rise, those refis dry up in a hurry.

A long-time local lender told me this week that two years ago there were 8,000 licensed mortgage originators in San Diego County, and today it’s 4,200!

We speculated that many of them became agents – another industry that is overdue for constriction.  There are over 15,000 realtors in San Diego County, and last month we sold 1,770 houses, condos, and mobile homes countywide.

Posted by on Feb 15, 2019 in Jim's Take on the Market, Mortgage News, Realtor | 3 comments

Real Estate for the Older Crowd

According to the Realtors Confidence Index national survey, 89% of home sellers were at least 35 years old, and two-thirds were selling their primary residence:

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

Of those who bought a home, 72% were at least 35 years old, and 40% came from a home they owned. Mix of those buying up or down? Maybe 50/50?

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The REALTORS® Confidence Index is a key indicator of housing market strength based on a monthly survey sent to over 50,000 real estate practitioners. Practitioners are asked about their expectations for home sales, prices and market conditions.

Link to NAR Survey

Posted by on Feb 13, 2019 in Boomers, Jim's Take on the Market, Market Conditions, Realtor, Realtors Talking Shop | 0 comments

Realtors & Guns

Hat tip to Richard who sent this in, but honest, I’ve never seen him packing! There are 1.3 million realtors, and 2-3 get killed every year – I’ll take my chances. But I don’t think women should do open house by themselves.

Realtors often go into houses they don’t know, with people they’ve just met. Safety efforts have become a real focus, but the potential for violence has some of them taking up arms.

Scott Smith spends a lot of time at the range, making sure if he has to use his gun, he’s fully trained and ready.  But Smith doesn’t just shoot for sport. He legally carries a concealed gun for his job as a realtor.

“People think realtors have a lot of money, that they are rolling in the dough, so people automatically think – ‘there’s an easy target.'”

Link to Full Article

Posted by on Feb 11, 2019 in Jim's Take on the Market, Realtor, Richard Morgan | 1 comment

Redfin Estimates

Be careful with those Redfin estimates – they are tied to the list prices.

The snip above was taken on January 15th, and the one below was taken last night.  It’s hard to believe the actual value went up 12% in 48 hours:

Should they have the ability to revise their estimate once they get new information?  I suppose, but they should state that clearly for those who believe what they read on the internet.

But they flat-out lie to you – their estimate was $465,166 on Tuesday.

This is what they show today – 12 months of estimates over $500,000:

I won’t mind if the Redfin estimate helps me start a bidding war, but I’d rather operate in a pure, non-manipulated market.  Once buyers get burned enough, they shy away, which isn’t good for anyone.

Posted by on Jan 18, 2019 in Jim's Take on the Market, Listing Agent Practices, Operation Transparency, Realtor, Why You Should List With Jim | 6 comments

Off-Market As A Strategy

It’s been widely accepted for years that off-market sales are part of the real estate landscape.  After the (fraudulent) short sales went away, realtors needed another sexy lure to attract new clients, and rather than crafting the high demand and bidding wars into an auction-like experience, we went the other way and are using restricted access as our ploy.

None of the industry players want to even talk about it, let alone do anything.

In the meantime, it’s the way the business is trending.

With no public objections and so many off-market deals happening right before our eyes, every agent and brokerage wants to take advantage and create an effective off-market strategy.

It restores control of the inventory to the agents – we decide who gets exposed to the listings, and when.   It will also turn the MLS into the website of last resort, used only when a listing agent can’t find their own buyer.  The real estate portals will suffer, and full access for consumers won’t be the same.

We might as well go back to the MLS books!

Many agents claim it’s just ‘pre-marketing’, but what happens if a buyer makes an offer before the listing hits the open market?  Are you going to turn it down? Or are you going to make a quick deal and move on to the next one?

The phase underway now is the building of realtor clubs.

There’s the PLS, as well as the Top Agent Network, which is operating in 31 markets and should be coming to San Diego soon.  They offer club membership to the top 10% of producing agents in each region so they can network and market their listings to each other.  I’m also a member of 4-5 groups on Facebook, where the focus is pre-MLS exposure of listings and ‘making deals’, plus there are several realtor meet-ups around town too.

The shift to private, off-market deal-making isn’t just coming soon – it’s here.

I think we should just admit it to ourselves and to the consumers, and then find a way to make the best of it – because it’s not going away.

Posted by on Jan 15, 2019 in Coming Soon, Jim's Take on the Market, Realtor, Why You Should List With Jim | 22 comments

More Contingent Sales in 2019

While some folks can’t make sense of a move up or down, there are others who have specific wants/needs, and are willing to forge ahead – if they can just sell their existing home and pour their equity into the next one.

I’m three for three this year with contingent sales already, and I wouldn’t be surprised if half of my sales in 2019 will involve contingent buyers.

The challenge gets more complex when multiple sales are contingent!  They stack up like dominoes, all dependent on sales on either side to be completed successfully – and risk all crashing if a problem pops up that can’t be solved.

Up to now, listing agents and sellers haven’t had to deal with contingent buyers because we’ve had enough non-contingent buyers to go around.  Not any more.

The #1 reason sellers and listing agents should consider a contingent offer?

Contingent buyers pay more.

They know they are asking a favor, and in effect, they are purchasing a favor.

Plus, their purchase is contingent upon them selling their house (read: getting the price they want), so everybody gets what they want. Win-win!

Contingent sales can be highly speculative, however, and our existing system doesn’t provide a safety net, so there is a risk that every seller could get left holding the bag.

How can we tighten these up?

  1. Have buyers obtain full loan approval.  At least if the buyers are fully approved by the mortgage underwriter, that concern is satisfied.  A pre-qual letter isn’t solid enough to tie up a property.
  2. Review the lender downstream.  If there is a chain of contingent sales domino-ed together, let’s take a good look at everyone’s lender letter – because we’re all in it together.
  3. Review the agents downstream.  Is everyone competent? If my sale is reliant upon an agent downstream finding and solving problems, then it’s not asking too much to know who it is.  What else have they sold lately?
  4. Supply comps and photos of contingent properties. Every agent involved should know – and get to render their opinion – on the price/value of the other homes in line.
  5. Bridge loans. Bridge loans are out there, and Compass should have a good alternative ready before too long. A fantastic option that solves everything.

There is another viable alternative that every contingent-buyer should consider: Selling your home first.  The immediate reaction is usually the same – I don’t want to be left homeless, or I don’t want to have to move twice, which is understandable.

But we do have the seller contingency that allows us to find a suitable buyer for your home while not binding the seller to move until they find suitable housing:

Our ability to master the contingent sale will probably make or break the market this year.  Without them, will there be enough buyers with the equity, desire, and ability to keep the party going?  It’s doubtful.

Most realtors, let alone buyers and sellers, are unfamiliar with contingent sales.  But this is where our creativity will pay off in a challenging market!

Posted by on Jan 12, 2019 in Jim's Take on the Market, Market Conditions, Realtor, Why You Should Hire Jim as your Buyer's Agent, Why You Should List With Jim | 3 comments

C.A.R. Attorney Gov Hutchinson

Yesterday we heard from Gov Hutchinson, the assistant general counsel for the California Association of Realtors.  He travels around the state to inform realtors of the basic changes to forms, and helps define other aspects of the business – here’s a summary of what we heard:

  1. Transfer Disclosure Statement – The buyer has a five-day rescission period after receiving the completed TDS from the seller (the form where the sellers disclose pertinent facts about the property).  If the form is delivered to the buyer’s agent late, incomplete, or unsigned, the buyer can still cancel the transaction even if they have already released their other contingencies.
  2. The CA Department of Real Estate is unhappy with compliance to the rule that realtors need to have their license number on every flyer, business card, sign, social-media account, etc. They have hired additional personnel to chase us around.
  3. It’s acceptable for landlords to say ‘no pets’, but they must accept tenants with service animal (seeing-eye dog) or emotional-support animal with a note from a licensed caregiver – as long as it is reasonable. If the animal affects the landlord’s insurance, or is a threat, the landlord can say no.  The law supersedes HOA, C,C,&Rs, and city codes, and the landlord cannot require a pet deposit or higher rent for these animals.
  4. A landlord cannot require tenant insurance.
  5. A landlord cannot be compelled to take a Section 8 tenant.
  6. Low-flow plumbing is required in all homes throughout the state.  Sellers don’t have to fix/update if the buyers will accept as-is.
  7. If a house for sale has hidden cameras, there should be a sign near the front door to alert buyers and agents who are showing the property that the house is under surveillance.
  8. No laws, rules, or guidance on Coming Soons – it is a local MLS issue.

I think we can say that the Coming Soon dilemma has been decided – nobody wants to address it globally, so it will be left up to the agents.

Realtors love the Coming Soons, and are now pitching them as a vital part of the marketing program.  But with no rules or guidelines, what happens when a buyer wants to see the home?  Do you show it during the Coming Soon period?  Do you field offers?  If you do get an offer, do you throw the listing on the MLS to give everyone a chance too?  Or do you just make the deal and hurry off to the next one?  How do you know if you got full value? (you don’t know)

Virtually every listing will go this route in 2019, and then most will be uploaded to the MLS with diminished urgency because the motivated buyers already saw the sign two weeks ago, and forgot about it.

Instead of relying on instant market data from the internet, we’ll need drivers to patrol for new Coming-Soon signs, and rely on word-of-mouth between agents to make these off-market deals we now crave for some reason.

This business is going backwards!

Posted by on Jan 8, 2019 in Coming Soon, Ethics, Jim's Take on the Market, Realtor, Realtor Training | 3 comments

Strangest Questions

This is a great list:

1. ‘How do you keep alligators from coming up into the toilet?’

Michael Lyons, a real estate broker with Lyons Realty Group in Hollywood, FL, has certainly heard his share of concerns about alligators lurking in yards, ponds, and swimming pools. But sneaking into the house? Through a toilet? That left him stumped.

2. ‘Do any swingers live in the neighborhood?’

While home buyers often have questions about the neighbors, this one was a first for Kate Julian, a real estate agent with City Chic Real Estate, in Washington, DC.

“They said they were swingers and that’s something they were looking for,” she said.  Unsure what to say, she countered with, “drive around the neighborhood and see.” After all, aren’t swingers very friendly?

Click here for full list:

https://www.realtor.com/advice/sell/realtors-reveal-strangest-questions-ever-asked-open-house/

Posted by on Jan 5, 2019 in Jim's Take on the Market, Realtor | 0 comments