Why I Am In The 3%…

Discount Real Estate Brokers: the Problem with Being in the 1%

The problem with disocunt real estate brokersGenerally the term ‘one percent’ is associated with being part of an exclusive and prestigious group. What I want to discuss today is listing agents who charge a 1% commission versus a full service commission, which is generally 3%. These agents are not part of a prestigious club, but are discount real estate brokers.

Recently, a past client told me they chose to list their home for sale with another agent to “save 2%”. I looked at them in absolute amazement, wondering how two intelligent and college educated people could be so naïve.

The net profit on the sale of a home is NOT proportionate to the fees charged to sell the home.

  • Agents who charge 1% do not have the expertise to compete for a listing based on the value of their services. They can only compete on price. Is that the type of skill set you want representing you in the sale of your home?
  • Can a less skilled agent negotiate the highest possible price for your home?
  • Can a less skilled agent negotiate the best terms when it comes to potential repairs? Are the sellers opening themselves up to potential liability further down the road?
  • Will a discount agent have the funds available to spend on marketing your home? Will they take their own MLS photos or hire a professional photographer? A professional presentation of a home matters.

When my former clients told me they got a good deal because their agent charged them only 1%, the first thought that popped into my mind was that I could have definitely sold their home for 5% more, which would have put 2% more money in their pocket. As proof of my line of thinking, my clients asked my opinion about certain aspects of their transaction. They clearly did not have confidence in the discount real estate brokers they were working with.

When it comes time to sell your home, you should be thinking about your net profit versus the fees charged. What’s important is the amount of the wire transfer going into your account when the sale closes.

Does Size Really Matter in Real Estate?

In Park City Real Estate, How Much Does Size Matter?

Park City Real Estate SizeI met with potential clients last week. They told me they wanted to list their home for $600,000. According to the last MLS listing, their home is 2500 square feet. I reviewed the comparable sales in the neighborhood and found that all the homes that sold for close to $600,000 were closer to 3500 square feet. On a price per square foot basis, most homes sold at $171/square foot. A $600,000 list price would mean their home would be listed near $240/square foot.

Can we justify the higher price?

Sometimes homes have been remodeled or upgraded. Granite counter-tops, travertine or hardwood floors and walnut cabinets when your neighbors have tile, carpet and cheap wood cabinets can command a higher price/square foot. In the case of the home I visited, their finishes were comparable with the other homes in the neighborhood.

I suggested we hire an appraiser to measure their home. The appraiser is an objective third party who measures homes every day. Perhaps the agent who last listed their home made an error on the size of the home. If I have a measurement from a professional appraiser, I can use that measurement in thePark City MLS listing instead of the random number that was on the last listing.

If their home turns out larger than we thought, we can justify the higher listing price. If their home turns out to be smaller than their neighbors, then my clients will have to make a decision.

Smaller homes command a higher price per square foot because there are fixed costs for homes that do not change (the land and the labor to build the home). However, in this case, I think a $70/sq foot difference would be too aggressive.

Whether you are buying or selling a home, it’s a good idea to know the size, because there is a direct relationship between size and value.

Have you had an experience where a home was not the size you thought it was?

Mid Year Park City Real Estate Market Update!

Mid-Year Check-In: How is the 2016 Park City Real Estate Market?

I get asked this question a lot and figured it was time for mid-year check in. I ran these two reports for single-family homes in Park City (84060) and Snyderville Basin (84098) combined. This area is what I refer to as “Park City Mailbox” and this area makes up the Park City School District.

Supply & Demand

The first chart above shows the number of homes for sale vs number sold over the past two years. While our supply has gone down 5.2% during this time, the number of properties sold has decreased 14.1%.

Median Price

The next chart (above) shows that the median sale price has increased 30.4% during the same time period.

What do these Park City Real Estate Market insights mean?

These charts tell me a few things. Lower inventory has created pressure for increased prices and decreased number of sales. It is my opinion that the aggressive pricing of some homes has also caused sales to decrease and priced some buyers out of our market.

The little numbers at the top of the chart with the green bars are the number of homes sold each month. Although the number of sales is trending down over the two-year period, we had a very strong second quarter this year.

The Park City real estate market is very segmented, which is not shown on these charts. For example, in Jeremy Ranch, where I live, the number of sold homes increased by 29.2%. In Park Meadows, the number of sold homes decreased by 42.6% while the median price increased over 43%.

In answer to the question “How is the Park City Real Estate Market?” I would answer that inventory is down, prices are up and the market is highly segmented by neighborhood. What are your thoughts?

New Real Estate and Fun Events at the Dejoria Center & High Star Ranch in Kamas, Utah

8 Reasons to Love the Dejoria Center & High Star Ranch in Kamas, Utah

Located in the Kamas Valley in Summit County and butting up to the Uinta National Forest, High Star Ranch is a new kind of neighborhood. The equestrian ranch sits on 1,000 acres of land, and boasts stunning views of Mt. Timpanogos, Box Elder Peak, Deer Valley and more. Just 30 minutes from Park City and 45 minutes to the Salt Lake International Airport, High Star reaches the ever elusive state of being in the middle of nowhere yet being connected to it all.

1. State Road Tavern
State-Road-Tavern

The State Road Tavern opened in January 2016. This family friendly establishment features its own custom built smoker and provides hungry customers with freshly smoked Angus beef, pork and organic chicken. There are over 20 beers served and an impressive offering of craft cocktails. Come in for a side of High Star Jo Jo’s or Brisket tacos and enjoy the fireplace and the al fresco view. As if dining could get any better, there is a full bar and Sunday brunch.

2. Bar Josephine

Bar Josephine

Bar Josephine is the freshest watering hole to open in Utah. Yet the large cottonwoods and lush Kentucky bluegrass views make you feel like it’s been around forever. Come experience the awesome patio and the modern design inside. With live music on Saturdays, Bar Josephine is open Friday and Saturday nights and during Thursday concerts.

3. Summer Concerts

Summer Concerts at Dejoria

The Dejoria Center is proud to partner with Mountain Town Music to present a six-week Summer Concert Series. Every Thursday June 16 to July 21, these events are free and open to the public. Burgers, hot dogs and beverages are available for purchase. Let the kids run around on the lawn by the big pond while you listen and chat with friends. Or sit outside at the State Road Tavern to enjoy a full dining menu while you listen. While these shows are free, outside food and drink are not permitted.

4. A World Class Venue

Dejoria Center

The Dejoria Center is pleased to host events from 10 to 2000. Thoughtful practicality has been built into the design of this world class venue. There is ample parking as well as VIP valet services. And the venue welcomes everyone from executive gatherings to corporate retreats to meet in their state-of-the art meeting spaces. With full technology integration and wagon rides at the same venue, you’re sure to strike the right balance with Dejoria.

5. Laid Back Living

Laid Back Living

There is a type of home for everyone’s taste at High Star Ranch which now offers homesites, luxury Ranch Cabins and custom log homes. The area is nestled in the foothills of the Uinta Mountains and features an idyllic rural ranch setting. High Star Ranch sits on 1,000 acres only 18 miles from Park City. On-site amenities include a fishing pond, two barns, indoor and outdoor equestrian arenas and boarding facilities. Interested in real estate at High Star? Summit Sotheby’s is the listing agency and I’d be happy to get you connected and answer any questions you may have. Check out the brochure here.

6. Trails On The Way

Trails Planned

Don’t Cheat – Especially on your Real Estate Agent!

The Ethics of Using Multiple Real Estate Agents

Multiple Real Estate AgentsIf You’re “Cheating” on your Real Estate Agent in Park City, You’ll Probably Get Caught

I had the privilege of showing some homes to a lovely, young couple from Las Vegas. They were looking at homes in the $4-8 million dollar price range. We took a break from showings because the husband had to leave town for a week. Naturally, at that price point, the agents are present at all the homes I have been showing these clients. A few days after my client left town, an agent from my office who had met my clients at a showing told me she received a call from another agent who’s clients were from Las Vegas and closely fit the profile of the couple I was working with. We quickly determined it was not the same couple. Whew, my nice couple wasn’t cheating on me.

This incident reminded me of another that happened earlier in the year. An agent in my office asked me if I would show his client some homes while he was out of town. His client was particularly interested in one of my listings, which was an unusual “gentleman’s ranch”. He gave me the background on his client, including her name, email, where she was from, what she was looking for. I tried making contact with her several times and she was elusive in her responses to me.

A few hours later the same day, another agent called to set up a showing at the gentleman’s ranch. He gave me the background on his client and I said, “Wait, is her name X?” Sure enough he said, “Yes, how would you know that?” I said that another agent in my office had been working with her.

She was busted in the span of 2 hours. Can you imagine how my colleague felt when I told him that his client was now working with someone else?

The Value of Your REALTOR’s Time, Knowledge and Energy

REALTORs are paid on 100% commission, which means we work for free until there is a transaction that closes. If an agent spends an hour or two with you, you may think “no big deal”. It is a big deal. How valuable is years of market knowledge that is freely given to clients with no strings attached? How valuable is the time we spend researching properties, comparable sales and setting up showings? How valuable is the time we spend previewing properties every Wednesday so that we will understand the value of our market? It may be a few hours spent with a client, but there are hundreds of hours of preparation before the client is ever involved. It’s not nice to “use” real estate professionals for free advice if you have no intention of using them.

But, Your Agent Should be a Good Fit for You

Now, I am not talking about the situation where you realize that the REALTOR you started out with is not a good fit. We all have different personalities, work ethics, and levels of expertise. You deserve to work with someone who is a good fit for you.

What I am talking about is someone who using multiple real estate agents and makes each of them think they are that person’s exclusive representative. Or the person who calls three REALTORS, tells each one they are competing for the listing and then uses the knowledge imparted by the three REALTORS to sell their property to a friend. Yes, I was one of those three REALTORS and I was annoyed at the person’s lack of transparency.

Park City is a small town with a small REALTOR community. We talk to each other. Even though we compete with one another, we look out for each other. And we will almost always find out if you are “cheating” on us. So do the right thing.  If you are shopping around for a REALTOR, say so. If you are looking for help to sell a property yourself, say so. Isn’t that what the “golden rule” is all about?

Appraisers Are a Key Component to Closing a Sale

Park City Appraisers Are My Friends (And They Should Be Yours, Too)

Park City AppraisalsWhile about half of Park City home purchases are cash, the other half are not. And in our current real estate market, many “cash” offers subsequently involve financing. There is a gatekeeper to a successful real estate sale that involves financing, and that gatekeeper is the appraiser.

Yesterday I met an appraiser at one of my listings that is currently under contract. Since I have put 12 listings under contract since January, I’ve made several such trips over the past few months. I have run into the same few appraisers over and over again, including the gentleman I met yesterday.

I knew this appraisal would be a challenge. My listing is going to be the highest sale in the subdivision in 10 years. I arrived prepared. I brought a copy of the real estate purchase contract, a list of all the upgrades my client has made since she purchased the property, and a list of recent comparable sales. Together, the appraiser and I discussed each comparable sale. I left the packet of information with him when we were done.

Diligence is Appreciated

And then, to my surprise, he told me that he loves appraising my listings. He said that some agents do not answer their phones or are slow to return calls and he can barely get an appointment scheduled. He thanked me for always responding quickly, making it easy for him to appraise my listings, and meeting him each time with a packet of useful information.

So far, all of my listings have appraised. The appraiser told me that he didn’t see a problem with this one appraising either.  [Since writing this blog post, I learned the appraisal did come in at purchase price thus enabling the transaction to move forward.  A few years ago, when the real estate market was still in the doldrums, I was not so lucky.  However, with persistence, I was able to appeal the appraisal.  You can read about that situation here.

Marketing a property and being present for showings is just the first step. I stay engaged with the sale of each one of my listings until the proceeds are in my clients’ bank account. This is the only way I know how to do business. Based on the comments of my Park City appraiser friend, it may not be so typical in this town.

Don’t Quit Your Day Job! Hire the Experts!

3 Reasons to Hire a Professional to Manage your Park City Rental

Park City Long Term RentalsI specialize in helping people buy and sell homes. I spend most of my time providing real estate services to my clients. My downtime is spent with family. If you are a busy person, I’m sure this sounds familiar. I recently learned that I should “not quit my day job” when it comes to renting out the condo I recently purchased. I hope that my experience can prevent a headache for you if you’re looking to rent out a property in Park City.  This applies to both long term and short term (vacation) rentals.

Lesson Learned: Stick to What you Know. Hire Out the Rest.

  1. A professional will get the job done. As I mentioned, I am busy with real estate work. I helped 9 buyers and 9 sellers in the first 6 months of 2016. Getting my condo ready to rent, advertising it and setting up appointments are time consuming activities. In retrospect, I should have hired professional help. If you are thinking of selling a house on your own, think again. You will save time and money with professional help.
  2. They will be a buffer between you and the other party. When I receive an offer on a listing, I wouldn’t think of taking it off of the market without checking into the background of the buyer and ensuring the earnest money is deposited. Yet, that’s what I did with my own condo. A “friend of a friend” was going to rent it from me. She pursued me relentlessly and told me a sad story. I held the condo for her and allowed her to make her deposit a week before the start of the lease. Needless to say, she backed out and I lost a month of marketing time. A professional property manager would have better served my interests.
  3. They can help you figure out the price. I’ve seen this happen with listings and it immediately became apparent with the condo. If you have showings and no offers, you have a price problem. I knew I needed to either lower the rent I was asking or improve it the condo. I ended up doing both and l found a wonderful renter.

I am really good at representing people in the sale or purchase of a home. You are probably really good at flying an airplane, selling health insurance, practicing law, or being an amazing parent. It’s best to leave activities requiring specialized knowledge and time to those who are experts.

Our Unsolicited List of Long Term Park City Rental Property Management Companies

This list is totally unsolicited, but here are a few property management companies in Park City we’ve either used or heard good things about through the grapevine. Check out the list here.

What are your thoughts on using a professional vs. not? Any property managers you’d highly recommend? I’d love to hear your thoughts on this in the comments below.

Here’s What’s Happening in Pinebrook…

Park City Neighborhood Spotlight: Pinebrook

PinebrookNestled in the mountains that surround Park City, the Pinebrook neighborhood is truly one of the area’s residential gems. Just West of Kimball Junction, Pinebrook is attractive to commuters while remaining within Summit County limits.

Trail heads, bike paths and a collection of attractive shops and restaurants make this a convenient and lively area to call home. For the home shopper there is a unique assortment of options. Lower Pinebrook offers a nice selection of townhomes and twin villas while upper Pinebrook has single family homes with ample outdoor space. The market in this area is very stable, and 2015 real estate stats show Pinebrook had among the highest number of increases in home sales.

Quarry Village

Quarry VillageThere isn’t much that you can’t find outside of Quarry Village. Here sits the quietest grocery store around, which is a big plus during the Sundance Film Festival and major Holiday weeks. There are wonderful furniture stores and a specialty running store complete with coffee shop and more.

An eclectic mix of restaurants should appeal to all appetites. Family friendly Billy Blanco’s puts a fresh twist on Mexican cuisine, O’Shucks Restaurant and Ahh Sushi are great places for burgers, cold beer and sushi and they have live music at least twice a week. For a morning on the go, Park City Bread and Bagel can’t be beat.

Sports Around Every Corner

The history of Pinebrook is steeped in winter sports. Back in the 1930s and 1940s the Ecker Hill area was known for ski jump competitions. In fact, there is a neighborhood monument that honors the successes and tragedies of the jumpers. Another sport began in the 1960’s: local four-wheel drive hill climb competitions.

Pinebrook continues to attract a sporty population. Today the area is a mecca for yoga practitioners, hikers, bikers and snow shoe enthusiasts. Located next to the winter hot spot, Gorgoza Park, a sledding hill for all ages and abilities, there is never a shortage of fun activities. The Ecker Hill Aquatic Center is also close by and is open year round.

Education Opportunities

The Pinebrook neighborhood provides the widest range of education opportunities in the area. There are a number of popular preschools as well as the private Park City Day School. Public elementary schools, Parley’s Park, Jeremy Ranch and the charter Weilenmann School of Discovery are all very close by. Easy access to Highway 80 provides a number of other specialty programs in the Salt Lake Valley.

Courtyards at Quarry Village

The Courtyards at Quarry Village are a well-designed condominium complex. These 3 and 4 bedroom units feature oversized 2-car garages, large kitchens and gas fireplaces. Situated on walking paths and on the free bus route these homes would appeal to the mountain lover who enjoys urban amenities.

If you are seeking a home or a carne asada buritto, take a peek around Pinebrook and discover one of the best neighborhoods around.

Beautiful Packages…

Brands Like Tiffany’s and Sotheby’s Deliver the Whole Package

TiffanysWhen you see a box from Tiffany & Co., no matter what is inside, or how much it costs, the Tiffany box makes the gift special and its presentation an emotional experience. Similarly, when homebuyers see a Sotheby’s International Realty sign, they know that there is something special inside.

Sotheby’s International Realty enables me to offer “million dollar marketing” for all properties, from a $91,0000 residential lot to a multi-million dollar home. When a property is branded as a Sotheby’s International Realty listing, the “ordinary” is transformed to the “extraordinary”.

Through Sotheby’s International Realty, I create an emotional presentation for each of my listings. The professional photography, virtual tours, descriptions and branding, allow me to highlight the special content of each property I represent.

It costs no more to be represented by the best real estate brand in the world. If you know anyone who is thinking of selling a Park City property, please let me know. I would be delighted to share the unparalleled exposure I can provide as a Sotheby’s International Realty agent.

Update from Sotheby’s International Realty 2016 Networking Event!

Dinner with 2,300 Sotheby’s International Realty Agents

Laurie McClainI just returned from Las Vegas, where I attended the Sotheby’s International Realty 2016 Global Networking Event. My goal was to develop relationships with Sotheby’s agents who live in places where my Park City friends & clients transact real estate.

The event did not disappoint. I had lunch Laurie McClain (pictured above) from Pacific Sotheby’s International Realty in San Diego. Two months ago, Laurie referred clients to me who had recently purchased property in San Diego but were having trouble selling their Park City home. Their Park City home had been listed for 9 months with very few showings. I sold the home in 45 days. Our clients are beyond happy with Laurie and me for helping them achieve their goal of moving to San Diego.

I met Jay Kipp and Moire Holley, from Realogics Sotheby’s International Realty in Seattle. Jay specializes in waterfront properties and Moire specializes in urban condominiums. Rob McGarry, my personal realtor, is a top producer with Vista Sotheby’s International Realty in Manhattan Beach, California. Charline McGee is a great agent in Naples, Florida.

I broke bread with other agents from Newport Beach, Sonoma, Santa Barbara and Mill Valley, California. I enjoyed a drink with the agent who started selling real estate in Kauai, Hawaii back in the 1970’s. I met agents from Australia, Cyprus & Spain.  All are part of the Sotheby’s International Realty family.

If you are looking to buy or sell a vacation or permanent residence anywhere in the world, please let me help you find an exceptional Sotheby’s International Realty agent.