Archive for October, 2009

Alternative Buying Opportunities

Monday, October 12th, 2009

The vast majority of U.S. real estate transactions begin as advertised listings, held by real estate brokerage firms. Sellers begin the process by selecting an agent to represent their side of the transaction and agree to a listing price. These listings are then readily promoted by the agent’s brokerage firm, in hopes of attracting interested buyers.

This, however, is not the only way you can buy real property. Alternative buying opportunities, including foreclosures and auction sales, provide additional paths to homeownership. While listed transactions still dominate the real estate market, informed buyers will want to consider all their options.  One advantage of working with the Exclusive Buyer’s Broker’s at Buyer’s Resource is that we will exhaust the market to locate the type of property you are seeking.

If you decide to investigate alternative buying opportunities, make sure you take time to become fully educated on the process. Educating buyers is our primary function!  Foreclosures and auction sales are unique, involving specialized knowledge and training. You may find attractive opportunities, but you must also be prepared to avoid potential pitfalls, and we would be happy to discuss all of the options with you.

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Location Neutral Business

Friday, October 9th, 2009

Location Neutral Business is a term that has been used more frequently over the past decade. What is a Location Neutral Business? Since the onset of our electronic communication era and the advancement in internet services, it is now possible to conduct a variety of business anywhere in the world as long as you have connectivity. Several examples exist in the Yampa Valley as noted in the October issue of the Mountain Town News:

 

Noreen Moore, business resource director for the Steamboat Resort Chamber says that when she recently assembled a panel of speakers about location-neutral businesses, she rounded up 10 companies that collectively have $14 million payroll while employing 350 people. That, she points out, equals the employee base at the local hospital. In fact, while Ms. Moore has identified 400 such location-neutral businesses in the Steamboat area, she admits she’s sometimes at a loss to define the dimensions. “I feel like Louis Pasteur,” she jokes. “What the heck is this under the microscope?” Yet, of what she has found, Ms. Moore finds nothing but good for ski-anchored mountain towns. The location-neutral jobs tend to pay well, an average of $40,000 in the sampling of her panel. They add richness to the community fabric and they do not depend upon a commodity. Ski based tourism, despite upgrades in snowmaking, still relies absolutely on good snow. “The more diversity there is for these communities, the stronger they become” she states.

 

The diversity of businesses are also increasing as people figure out how to “have their cake and eat it too”.  Everything from Insurance companies, attorney’s software developers and yes, even manufactures. Smart Wool is just such a company. Established in Steamboat to take advantage of the abundance of local wool, their manufacturing is in China and distribution in Tennessee. The headquarters remain in Steamboat and continues to grow.

 As our technology continues to grow so will the opportunities. A couple of decades ago we were concerned that the economy was too reliant on tourism. It was called our “one legged stool”. We wrung our hands trying to figure out what we could do to diversify this economy. Little did we know that we had to do nothing, the beauty and recreational opportunities that brought most of us to this valley was the perfect magnet for these location Neutral businesses.  

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Challenges With Traditional Real Estate Offices

Monday, October 5th, 2009

The 2009 Legal Scan, from the National Association of Realtors was just released. It is conducted every two years and is a survey in conjunction with a comprehensive research project of the current legal environment real estate professionals face. To no one’s surprise in our office, Agency Issues remained the top area of concern. 28% of survey respondents reported agency issues being a significant source of current disputes, with 35% anticipating that number growing over the next two years.

Top among the agency issues, breach of fiduciary duties remains a common source of licensee liability. This fact alone speaks highly of our chosen profession as exclusive buyer agents (EBA’s). The service we provide clients is clean, concise and clear as to who we owe a fiduciary duty to.

More than 50% of respondents indicated that breach of fiduciary duty was the basis for a significant number of current disputes, and more than 61% ranked the issue among their top three issues. It is also the top-ranked potential future issue, and two-thirds of respondents believe there is significant need for training.

In my opinion, an equal amount of training and education needs to be provided to the consumer, and once they understand the differences in the types of agency relationships available, the more consumers will seek an exclusive buyer’s agent, who has the ability to work and advocate for buyers on any property they have a desire to own.

Among the reasons respondents cited was the thought that there existed a disturbing relationship between the lack of understanding of fiduciary duties and the need to earn a commission. NO KIDDING!

However, although EBA’s give up half of the potential revenue source in this profession by not listing property, if we do a good job for a client, they will seek an EBA to make another purchase, as well as refer our specialized services to others whom they know are looking to make a real estate purchase.

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