Hawaii Randy's Real Estate Opinions

At times it can be frustrating to search through listings of homes for sale.  There are too many agents willing to game the system.  Any possible advantage they may gain, is outweighed by the negatives.

Here are a few issues I see on a regular basis.

• Homes with overrated conditions (puffing). Marked "Excellent" or "Above Average", when the home is in a state of disrepair.
• Listed as Active, when they are in escrow and not accepting showing appointments.
• Not disclosing short sales or bank owned properties.
• Misrepresenting the size, type of property or topography.
• Not updating the listing to sold in a timely manner.

Why some agents do this:

• They use this listing as a carrot to pick up potential clients who inquire about the property.
• By overrating the condition or size, they hope to get more showings.
• They do not disclose the short sale or REO status to prevent buyers or their agents from filtering it out from their internet searches.  Some lenders are requiring their listing agent to not disclose this in their listings.
• Lazy or sloppy.

The net result is the listing agent looks unprofessional.

• They make our profession look bad, hurting the overall opinion of real estate agents to the public.
• They waste a lot of people's time.
• They hurt their reputation with other agents in the area.
• They hurt future clients by negatively impacting how agents will show their listings and will want to do business with them in the future.
• They give the seller, themselves and their broker potential added liability.

 I showed a property last week that was listed over $1.5 Million to a foreign buyer.  They saw it on the internet and wanted me to show it to them on short notice.  It was listed in "Excellent Condition".  The home needed approximately $400,000 to $500,000 in repairs and renovations.  This is an extreme case, because the numbers were so large.  The same principles apply to a home a fraction of that price.

If you have a fixer upper, call it that!  There are buyers looking for them.  Buyers looking for move-in condition will never buy it.  You are just wasting their time.  If it is a short sale or bank owned property, do you really believe you can trick someone onto buying it?  Get real!

Looking at the big picture you are tainting the data.  When real estate agents, appraisers and others are trying to establish value for homes in the area, they are looking at you bad data.  By not identifying a short sale, foreclosure, less than perfect condition or over sizing the home, you are negatively impacting the comparable market value of homes in the area.

My best advice is to be honest.  There is a buyer for every property.  Price it correctly and list it accurately.  That way the right buyer can find it.  Respect other people's time.  Be an asset to your profession and not a liability.

You can't trick someone into buying a home.  Lawyers and prosecutors have a name for that.  It's called fraud.

This year I began teaching continuing education classes for real estate agents.  It has been a positive experience for the first month of classes.  I got positive feedback, but saw things I could improve.  One broker who attended two of my earliest classes had some teaching and speaking experience and graciously sat down with me after class and helped my identify areas I could fine tune.  Some of the instructors in our area are really good and have been it for years.  That puts pressure on me to be at the top of my game.

A great benefits of teaching is learning.  The preparation and research to put the classes together, along with discussions and comments from students, have made teaching a great learning experience for me.  Imagine standing in front a room full of licensed agents, many who have been in the business many years and discussing how we conduct business.  Guaranteed someone in the class had a great experience or perspective we never considered.

One of the classes I'm teaching is "Mandatory Core B" that includes new laws and a refresher on fair housing and civil rights.  The fair housing discussions have been quite educational for everyone. It is amazing how many ways a person can get in trouble by saying something they thought was helpful.  I have had two different students who wanted to argue and defend comments or behaviors.  I had a little fun with them by using the same response, "you are up to $20,000 in fines and loss of license.  Would you like to try for $30,000?"  Believe it or not that barely slowed them down.  Oh well, I tried.  Possibly a real loss of license and some heavy fines at some point will get their attention.

My other class is called: "Getting Purchase Contracts Accepted and to Closing."  It has been fun class to teach.  During group breakout sessions we identify potential red flags in a transaction and discuss ways of addressing them.  Among my handout materials is a pre-approval letter from Bob's Mortgage and Hair Cutting Emporium.  It sounds funny, but helps address real life problems that come from bad pre-approvals.  Sample contract pages have similar over the top stuff in them, but are taken from actual issues we see and deal with on a daily basis.  Our group discussions are fun and informative.  Some of the ideas tossed out from the students are things I will be incorporating in my own business.  The teacher is also a student.

I am having a good time teaching classes and am looking forward to adding new courses next year that I am already developing.  Teaching is a great way to learn the business.  If you are visiting Hawaii and would like to sit on one of the sessions, please let me know.  If you are not licensed in Hawaii; you won't get CE credit, but are welcome to attend.  The classes are also open to members of the public.

Below are sales activity for the month of July 2010 compared to the previous month and the same month last year. This covers resale home for Honolulu County (Oahu).  The effects of the homebuyer tax credits have worn off.   Single Family homes median prices and sales volume have shown a slight increase over last year, while condos and townhouses have shown a slight decline in both price and volume.

 *Median price means half the prices were above and half below the given price.

Data was taken from the Honolulu Board of REALTORS®.  It is deemed to be accurate, but not guaranteed.

This is a wonderful list from Donna that every home owner should read before preparing their home for sale or doing renovations.

On of the hats I where is that of President for our small soccer academy.  We have three boys teams.  Last year all three won state titles.  This year two of the three won the state title and the third was the runner up.  Our 95 team took a national title on Monday morning in Virgina.

FOR IMMEDIATE RELEASE

• August 2, 2010
• Abunai Soccer Academy
• 95-1021 Aelike St. • Mililani, HI  96789
• Contact:  Randy L. Prothero, President
• (808) 384-5645
• Homes@HawaiiRandy.com
• www.Abunai-Soccer.com

 Abunai 95 Wins US Club Soccer National Cup Finals

Early this morning the Abunai 95 Soccer Team from Hawaii did the unthinkable.  They won the U.S. Club Soccer National Cup Finals for the Boys U-15 Premier Division.  Abunai 95 did it with an exclamation point.  After going undefeated in the regional championships, they went on to Virginia to sweep through regional champions from around the country.  Abunai completed their reign of terror on the mainland teams with a 2-0 victory over Tap FC Barcelona in the championship round.

To get to the final championship round, Abunai plowed through their bracket games with winning scores of:  3-1, 6-0, 4-1.  Based out of Mililani, Hawaii the Abunai 95 has players and coaches from around the island. Players for Abunai 95 also represent several Hawaii High School teams.

The champions and their families will be arriving at the Honolulu International Airport tomorrow, Tuesday 8/2/10 at 3:25pm on Delta Flight #2735, with the exception of  Head coach Darrin Goo and one parent will be arriving an hour before on an earlier flight.

Abunai 95 team was lead up by Head Coach Darrin Goo, Coach Andrea Toner, Coach Jon Morikawa and Team Manager Julie Sagami.

Abunai means "Dangerous or Look Out' in Japanese.  Our team completely lived up to their name by bringing home a national title.

Attached to this press release is a copy of the team profile sheet and a team photo at the champiosnhips.

For additional information please visit the Abunai Soccer Club home page:

www.Abunai-Soccer.com 

# # #

 The Abunai Soccer Academy is a 501(C)3 and a club member of the Oahu League Soccer Association (OL) and the Hawaii Youth Soccer Association (HYSA).

Today I held open house at three of my listings with the help of two other agents. 

At the one I was holding open, I got a visitor that made me stop and think.  He was one of those folks that seems to be an expert on everything.  To the point he was determined to teach me my business.  Normally I would have let it roll off my back.  The problem was that there were other visitors in the home and everything that came out of his mouth was 180 degrees out from reality.  He is the condensed version.

Misinformed Expert: You are priced too high.  How much was your appraisal?

Me: We are not in escrow yet, so there hasn't been an appraisal.

Misinformed Expert:   You should never list a home without getting an appraisal.  My best friend is an escrow officer and he would never accept a contract from me until we had an appraisal. 

Me:  Sir that's just not true.  The appraisal is for the lender.  If we get one up front, the lender can't use it and will still need to order another one.

Misinformed Expert: Well then you don't know what the home is worth.

Me:  I know exactly what the home is worth.  That is why I do a market analysis for the home.

He couldn't stop there.  He overheard the other couple who came in mention they were military.  So know he needed to give his expert opinion in that direction.

Misinformed Expert: VA will only loan on the value of the land, so unless you are willing to drop the price considerably you will not be able to sell it to them. 

Me: Sir, you are completely misinformed. 

Misinformed Expert: I am ex-military and know about VA.

Me: I do VA transactions regularly.  They do a full appraisal and count the improvements along with the land.  Since our market has stabilized the VA appraisals have been consistently been coming in at the expected levels.

Ooops, I stepped in there.  That one got him. 

Misinformed Expert: Stabilized? This market is not stabilized!  It is an extreme buyer's market!

Me:  How did you determine that?  To be a buyer's market you need at least 6 months inventory.  We do not even have half that in our town.  Inventory levels have dropped considerably the last 6 months. 

Fortunately he headed out the door and was off to train another real estate agent. 

Aloha!

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As real estate agents we always need to treat everyone the same.  Well maybe not.

In housing there are protected classes that you can't discriminate based on, someone being a member of one of those classes.

On a federal level the protected classes are:

• Race
• Color
• Religion
• Handicap or Disability
• National Origin/ Ancestry
• Sex

 In Hawaii our civil right laws includes all of those classes and a couple more:

• Marital Status
• Age
• Sexual orientation

On a federal level there is an exemption for a landlord renting out units in the same building they live in, if there is 4 or fewer units total.  In Hawaii the number of total units is reduced to 2.  The one exception to that rule is race.  The Civil Rights Act of 1866 prevents discrimination for race.

Now for the "maybe not" part of my opening statement.  Here are a few examples of legal discrimination.

• Color:  If you don't have the green, you don't get the home.  You can always discriminate on basis of credit or funds.  (Unless you are Fannie Mae or Freddie Mac)
• History: You can discriminate and the basis of a person's housing history.  Have they trashed previous rentals or do they have a history of not paying their rent.
• Pets: You do not have to allow pets.  In Hawaii we have a couple of exceptions to that rule.  You can't refuse to allow housing for someone with a service animal, whether it be a trained seeing eye dog or an emotional support pet.
• Drug Use:  You can discriminate against someone who has a drug or alcohol addiction.  You can discriminate against smokers.  In Hawaii you can't discriminate against someone who is in recovery.  That falls under handicap.

My favorite story about testing fair housing laws; was the story of a landlord in New York City who had a policy of not renting to lawyers.  One day he refused to rent to an attorney and got sued.  The judge asked the landlord if it was true that he refused to rent the potential tenant, based on him being a lawyer.  The landlord responded, "that is absolutely true your honor."  The judge asked the landlord to explain his policy.  The landlord responded, "Look where I am standing."

The moral of the story is that you can discriminate for reasons that do not fall under protected classes. Anytime you treat one group differently than another, you still may get sued, especially if they are lawyers.

All kidding aside.

• Keep good records.
• Be consistent with your policies and procedures. 
• Always remember almost everyone falls under at least one protected class or another so you better be prepared to defend your actions. 
• If you do not feel you can treat people equally, find another line of work.

The kinds of vendors our clients ask us to point them to are loan officers, home inspectors, termite inspectors, contractors, electricians, plumbers, handymen, flooring installers, painters, escrow officers, insurance agents, landscapers, home cleaners, property managers, locksmiths, etc.

I had a few discussions this week with other agents about giving referrals of vendors to clients.  I have my own set of rules in regards to vendors.

1. I only give names I trust completely to take care of my clients and will make me look good.
2. I have a list that is extremely difficult for a vendor to get on.  They can be removed in 2 seconds.
3. I would rather give the name of a really good loan officer, home inspector, etc. that I have complete faith in, than a list of several that are OK.
4. I accept no compensation from vendors for referrals.  I only require they give first class service.
5. Venders who offer kick-backs, etc. can't be on my list.
6. I do not require a vendor to send referrals to me to be on my list.  As much as I love to get referrals, I put client service ahead of all else.

I know many agents who believe they are protected from liability by giving many names to their clients.  I have heard some agents give 10 or more.  To the contrary, they would be better protected to give one really good name than several mediocre names.  Any name you give better be someone who you trust with your business and reputation, because that is what they have.

Good luck and good home selling!

$570,000

Wonderful 3 bed/ 2 bath home with incredible spaces.

Large workshop, large covered lanai and great pantry space.

The home has storage space everywhere including ample attic space.

You won't find many homes nicer than this one.  Get you offer in, it won't last. 

First public open house will be 7/24/10.

Contact Randy Prothero for showings:  808-384-5645