Tuesday, July 31, 2018

Black Sheep Make Better Agents

A few weeks ago, with the help of Patten Law Firm, StepStone had the opportunity to present a free CE class, Advanced Owner Fi Strategies, to local real estate agents. Dan teaches this class and while it can be a lot of information the take away is certainly the advantages of the owner finance option for sellers.

After one of the classes, an agent came up to me and admitted that she had a lot of questions but didn’t ask during the class because she felt so behind the eight ball in understanding the subject. However, her interest was piqued particularly because she had a listing in which owner financing seemed like a perfect option for her client.  We discussed the seller situation and I agreed with her and gave her some advice on her listing.  In fact, not only was owner financing a good option for her listing it was a GREAT option that would allow her clients to not only sell the property but also create residual income on that sale for many years to come. I have a feeling that her clients are going to appreciate her out of the box thinking.

I admit it. When I’m around other, more traditional real estate agents, I’m a black sheep. In fact, before we did the class Dan and I wondered if we would get any negative reactions. It sometimes happens that agents from more traditional training will have the point of view that investor strategies are unscrupulous, illegal, especially illegal for them as agents to participate in, or simply, unsavory. Luckily, we had some great participants who were actively engaged in the discussion of Wraps, Sub To’s and Amortization tables although I’m pretty sure some of them were happy to have their 2 hours of free CE credit and never think about owner finance again.

So, it was especially exciting for me when that agent engaged me on how what is often thought of as an investor strategy could help her get a big win for her and her client. But, it’s not only familiarity of creative selling strategies that can help agents service their clients.  As real estate professionals, we ought to be aware of all strategies available to sellers and buyers. Over the years, I’ve seen some traditional agents do a disservice because of their inability or unwillingness to consider creative, investor strategies in some situations. Here are some examples of when an investor strategy or creative agent can help a seller:

1. Seller with equity facing imminent foreclosure.  Many real estate agents do not know what to do to help a homeowner facing foreclosure and yet this is when a seller most desperately needs help from a professional. I’ve seen agents list a property days away from foreclosure with no clue of how to postpone a foreclosure date.  Bad idea! How many traditional transactions can be completed in a matter of days with a foreclosure pending? In this case, the best option for the seller might be to sell to an investor often with creative terms such as Subject To. At the VERY LEAST, an agent needs to be familiar with the strategies for postponing the foreclosure sale to buy the seller more time.

2. Seller with no equity facing foreclosure. This one is even more dire. A Subject To sale to an investor may still be a good option for this seller. Alternatively, a short sale listing may be the seller’s best option. What is not a good option is listing the house for what the seller NEEDS rather than actual market value.  Another bad option is to do a short sale listing with an agent who doesn’t understand the short sale process. That is a nightmare scenario for all parties involved!

3. Seller with major repairs needed. Many agents visit sellers with the intention to advise them on what to do with the house to sell for top value. While on it’s face this may seem like a good idea it does not take into account the seller’s need. I’ve visited many sellers who told me they consulted with an agent prior to calling investors who told them the property could not be listed until X,Y, & Z were completed.  All houses are sellable as long as the price is right! I’m less concerned with how my listing portfolio looks than finding the right solution for the seller. Again, being familiar with investor strategies will allow an agent to evaluate the value of the property in its existing condition (ARV x 70% minus repairs) and effectively market to investor buyers.

4. Investor Client Wanting to Buy! This sounds like an easy client to take care of but if you are awake and paying attention you will know that in the current market finding a property priced appropriately for an investor can be a challenge. All four of Texas’ major metro’s are experiencing months on months of low inventory and investor guru’s and clubs are churning out new investors every day making the market all the more challenging. You are not going to find a juicy deal on the MLS willing to wait for your client’s loan to be processed. By being familiar with investor purchase strategies, getting plugged into the investor community and understanding how to identify and vet potential deals you will be more likely to locate potential properties for your investor client as well as teach them new methods for leveraging their money and buying more property.

At StepStone Realty, we proudly call ourselves the Black Sheep of the real estate world. Caught between the investors who think getting their license would hamstring their investing and Realtors who think what investors do is unscrupulous and we are the ones armed with all the tools and knowledge to not only help our clients and customers to a higher degree but also with the knowledge on how to build wealth for ourselves while we are at it!

If you want to learn more about being a Black Sheep shoot us an email at recruitment@stepstonetexas.com and ask for an invitation to one of our upcoming Agent MasterMind lunches.

Saturday, June 30, 2018

Which Group Will You Be In?

I was chatting with a Realtor recently who was considering joining the StepStone team. He’s interested in investing and has done a bit himself but was skeptical that our brokerage could really be the community we described when he came to one of our monthly MasterMind lunches.  After that lunch, he had spent some time with some of our Investor-Agents and found that it really was a group that collaborated on investing strategies, partnered, shared their knowledge with others and had strong ethics. Glad to have you on the team, Sergio. I may have paraphrased a little but that’s how I heard it!
The StepStone Workshops are the culmination of that community spirit.  Twice a year, StepStone Agent Investors and their business partners and spouses are invited to an exclusive event… StepStone Workshops. Our next one is in Houston on August 10th & 11th (‘cause we’re Investors so Houston in August doesn’t scare us!)

There are three types of folks that attend our workshop:

1. The Core Group: You may not spot them right away because they won’t be bragging about their various deals or all the leads they are getting! You may spot them huddled in the corner taking a lead call. Or, they may be one of the class presenters. Or, they may be in the front row of the class you are attending asking all the questions and taking notes.

Why are they there? They clearly have it all figured out. (AKA. Common excuse for NOT attending a workshop). It’s because they understand that things change all the time…There is always something new to learn, that there is value in community… no man can build an empire alone and that there is opportunity… other people’s money or time.

2. The Up and Comers: This driven bunch quit their jobs, Drive for Dollars, network every Monday, Wednesday and Friday and seek out people they can learn from. They understand that all the experience and expert direction they get in return is worth pounds of gold.  They are soon to be promoted to the Core.

3. The Wealth Builders:  These folks are NOT so interested in Door Knocking or Dealing with Contractors. But, they sure appreciate the value of real estate and want to use their license and knowledge to their advantage. They surround themselves with people who find the good deals, can offer them a return on their money, and understand creative opportunities when they come their way.

Do you want to fit into one of those categories? But still on the fence? In that case, let me counter the top 3 excuses for not attending:

1.  Too Smart?  When Dan and I started in real estate we were making a living on Lease to Purchase Options. If we depended solely on one strategy we would have to be selling our house to one of you. Continued success depends on being able to grow and the only way to do that is to harness the time and money of others to do so.  StepStone Workshops are the perfect place to do that.

2. Too Poor? I get it. When Dan and I started we shopped garage sales on the weekend to sell on eBay to buy groceries. You can choose to spend your limited funds on various guru events which try to upsell you, or you can choose to spend it with a community who supports your efforts and doesn’t charge you to be a part of the club. This event is not cheap for us to put on (have you ever SEEN the hotel food quotes!) but we spend months researching various venues and soliciting sponsors to make it as affordable for you, as possible. Money is spent out of our pocket for every person who attends. But we WANT you to come because we know it’s vital to your success! Just can’t swing it? Email Kim@stepstonetexas.com to request a payment plan. We want you there!

3. Too Busy? Oh gosh. I know. I know so well. But first, the voice I would use for my son, “ I TOLD YOU LONG AGO TO PUT IT ON YOUR CALENDAR.” There are some of you who may literally be having a baby. But, for some of you, there will always be something more pressing until you decide that you want to be on that list above AND that you will actually do something about it. Is it busy or are you scared, shy, nervous?  Me too. I’m actually a shy person but I have to get out of my comfort zone every day if I want to make my business a success. We don’t expect you to know everything or be the life of the party.  Join us for New Agent Basics, Investor 101, play BlackSheep Bingo! This is a community and everyone is welcome!

If you are a StepStone Agent.. sign up. Reach out to Kim@stepstonetexas.com if you don’t know how.

Interested in being a StepStone Agent? Maybe even get an invite to our Workshop? Shoot Christina a message at recruitment@stepstonetexas.com

Thursday, May 31, 2018

When The Personal Gets Professional

My sister and brother-in-law recently purchased a business that they plan to operate together. While they have been married for over 25 years, they are still a little nervous about working together day after day. For the past 10+ years, he was on the road a lot and they sometimes only saw each other on weekends so this will be a huge shift in both their professional and personal lives. My husband, Dan, and I have been in business together for 12 years so she asked for my advice.

In real estate, it’s very common to find spouses or partners working together so I thought this was some advice many of us in the field could appreciate. I reached out to several other successful couples who are in business together to solicit their advice as well. Based on their responses and my experience, I believe the best advice can be boiled down to three main points:

1. Mutual Respect - Whether you are partnered with your spouse, your parent or even your best friend, it is important to appreciate that your personal relationship may operate on a different level than your business relationship.  While you may have a marriage where one of you is considered “captain of the ship” or in a parent/child relationship where a parent is used to being the boss, when operating a business together it’s important to recognize that your personal dynamic may not translate well when running a business. Each person’s voice, opinions and expertise needs to be equally appreciated or you run the risk of alienating your partner. While this doesn’t mean that all decisions require a consensus (more on that later), it does mean that the contributions of each person should be equally valued.  If one person is a dictator, the partnership will likely fail or at the very least will not flourish.

2. Shared Goals - Are you on the same page? Does one of you envision a small local company while the other grinds toward statewide domination? Or, worse, one of you is full speed ahead thrilled to be self-employed while the other resents the risks, longs for the steady paycheck and benefits, the weekends free of worry or work? Before you begin a partnership and then regularly afterwards get out of the office environment, grab some coffee or cocktails and talk about your goals. If you aren’t on the same page, keep talking (being mindful of point #1 above) until you get on the same page. As my colleague, Anita Ortiz, put it, “Make sure your spouse has the same level of commitment to your business.  If one is not ready or able, it will leave the other resentful as more work falls on them.” Furthermore, both partners need to be very honest with each other about their goals. If you are practicing mutual respect both people should feel free and open to share their concerns so any issues will be confronted sooner rather than later.

3. Division of Labor- This is the final, and vital, piece of the puzzle for a successful partnership. Take time to discover each other’s talents and strengths and then give each person ownership of the role that suits them best. Erika Butler, who is in business with her husband Tiger, told me they took personality tests to determine how best to divide labor. I think this is a great idea. It may take a little practice and tweaking to get the roles set most favorably so don’t be afraid to switch things up. But, once those roles are clearly defined, stick to them and trust your partner to do their part. Doing so will make your business run much more smoothly and with quicker progress.

While I can’t promise that there won’t be disagreements, struggles or rocky patches, I can tell you that being in business with your spouse or other significant person in your life can be an extremely rewarding experience. Dan and I never run out of things to talk about and sharing the achievements that we made together strengthens our bond and commitment to each other! With that, I wish two of my very favorite people who are about to start this adventure together the absolute best!