ADAPT OR DIE
Courtesy of the Arizona Daily Sun
Feb 27, 2011
It is 20 minutes before dawn on a Tuesday morning and there is already a man barking at Valerie Caro.
The local Realtor calmly sifts through one of three stacks of papers piled up on her desk as the man offers positive, real-estate-centric tips with the subtlety of a drill instructor — all via voicemail.
“You only have yourself to blame if you don’t sell today,” the man says before hanging up.
Oddly enough, Caro says the daily motivational messages from a Las Vegas-based real estate coach are one of the reasons she is having one of her best years on record as a Realtor.
Her small team sold a total of 83 homes in northern Arizona, a personal best for Caro.
She already has an ambitious goal of selling 17 more than that in 2011 — an even 100 — despite less-than-rosy forecasts for the national housing market.
With the overall housing sales flat, Caro will need to capture a big slice of the real estate pie to sell more houses.
The centerpiece to that goal is on the corner of her desk — a stack of expired listings that didn’t sell with other Realtors.
She calls the owners, using a script to briefly introduce herself and gauge whether they still want to sell their house.
In this economy, it is often a difficult decision.
Many don’t want to hear “the comps” — what similar houses in the same neighborhood recently sold for — after trying to sell their house for months or even years.
“I’m the doctor telling them they have cancer,” she said.
The size of the price reductions vary, Caro says, because she ties the prices to what the market will bear. Some Realtors, she says, will list houses for whatever the seller wants.
She won’t take the listing if the seller can’t be realistic about the current value of their house.
“My business model is not to tell them something that’s not true,” Caro said.
It is a hard decision for many to list their houses for less than they think it is worth, but Caro reminds the seller there are other costs associated with not selling when they need to, ie, mortgages, utilities and lost opportunities to move, etc.
She said for every 10 phone messages she leaves, roughly three return her call.
Those relistings now account for roughly 60 percent of her business.
Caro has been receiving the phone messages from a real estate coach named Mike Ferry for the last 2 1/2 years.
There have been other coaches in the 25 years she has been selling real estate in Flagstaff, but she chose to work with Ferry for his advice on how to sell more homes in less time.
Caro has always been open to improving herself and the services she offers her clients, she says, continually shifting with the ebb and flow of the local real estate market. It is why she spends $2,000 a month on real estate coaching with Ferry.
She spends several thousand more on an annual basis traveling to workshops Ferry hosts.
Ferry emphasizes pursuing expired listings and for-sale-by-owner properties using scripted cold calls in the current market.
PAYING THE HEATING BILLS
It’s a stark change from five years ago, when some owners were getting multiple offers on the same day they listed their homes.
This is in addition to the usual costs: Staffing, rent and advertising.
There are different costs, too, like paying to keep bank-owned properties warm throughout the winter so that they can be shown to potential buyers.
This is another contrast with five years ago, when Caro spent part of her budget on raffles to attract crowds during the white hot real estate market when nearly everyone qualified for a house.
Today, Caro has as many as a half-a-dozen homes with utilities in her name at any given time.
She also employs “runners” to hang signs, turn on utilities and run errands.
“It is not all popsicles and ponies,” she said.
The coaching has kept her motivated, helping her to make some of her first calls of the day before other Realtors get out of bed.
“People were excited to meet with me back then,” she said. “It is a very hard conversation now because the home values are very different than in 2005.”
Caro’s four-person staff, including dad Joe Haughey, starts shuffling in shortly after 7 a.m. last Tuesday.
By then, she is ready to start making calls to her clients. Caro wants to be the first Realtor potential clients hear from in the morning.
She banters back and forth with a member of her staff, trying to discern which client to call and which cell number to use. It is 7:24 a.m. and she has received a cash offer for $210,000 on one of the houses she is selling.
An hour later, the sellers, a retiree and his girlfriend, are in Caro’s conference room to negotiate the details.
It is in this room where she is in her element, poring over a thick document detailing the buyer’s offer.
She knows every detail of the offer: Real estate rules, banking requirements and, more importantly, her clients.
Deep into the multi-page agreement, the client changes his mind — the fridge, the washer and the dryer, are coming with him to Prescott.
“Some of the places don’t have a fridge, Valerie,” says the lifelong Flagstaff resident.
She disappears for only a few minutes, the whir and clicks of the printer the only sign of life as Caro amends the contract to reflect the changes.
The ink is barely dry and the client again wants another change: He wants to keep the curtains.
Caro again disappears.
Whether it is curtains or holding out for a better offer, Caro has a laser-like focus when the client is in the room or the phone.
She is deaf to distractions like phones ringing or new mail chirps on her Blackberry.
Or holidays, apparently.
The client picks up on the fact that the bid on the house came in on Monday, i.e. Presidents Day. He thanks her, but Caro is coy.
“I didn’t know it was a holiday. Nobody told me,” she teased.
ADAPTING TO MARKET FORCES
Less than an hour later, Caro meets with another man who remembers her from several years ago.
At the time he didn’t want to sell his house, a decision he clearly regrets now that the home value declined dramatically.
The current economy has meant the man could no longer afford to keep his house and he turned to her to sell it.
He said he remembered Caro from a chance meeting they had two or three years ago, but it was an impression that stuck.
“You seem to care,” he told her before signing a thick stack of documents.
The veteran Realtor has always placed a high premium on personal, one-on-one contact, but she concedes she shifts her market focus depending on the economy.
Five years ago, for example, a major portion of her business was representing a condo-conversion project in west Flagstaff, selling converted apartments for between $100,000 and $200,0000.
Today, she represents homeowners trying to sell their houses.
The relationship with the conversion project ended several years ago when the ownership of the 300-unit development changed. She played down the change, saying it was common in the industry.
“Partnerships change all the time,” she said.
The condo conversion market in Flagstaff never saw the buying frenzy of other major metro areas at the height of the housing market. Some complexes in town still have units for sale, launching in 2006 or 2007.
Many have been sold to investors, who are now renting out converted apartments.
FRESH ROUND OF CALLS
At the end of the day, Caro has made a dent in the pile of expired listings, but a fresh round of comps will be added to the pile by the end of the week.
The pile is never empty, so Caro will get up early the next day and start a fresh round of calls.
Joe Ferguson, Sun Staff Reporter