How do you plan for the future…

How do you plan for the future…Unless you are a savvy economist, I would suggest you find one that you enjoy learning from.  It is with that I share my favorite economist and his most recent opinions.  

First as a method of patting him on the back for his predictions, and me for be just smart enough to listen and act on said predictions, I will share with you my real live story.  The year is 2006 and it is spring time and my Economist said in his fall presentation, if you are going to sell your home do it in spring/summer of 2006.  Being the smart guy I am, I took his advice and put my personal home up for sale.  If sold, it would be a record setter price for my neighborhood and of course why wouldn’t it be?  After all I’m a smart Realtor with 2 decades of experience.  He was correct!  In 10 short days, I sold my home for more than twice what I paid for it.  Not bad right? 

His advice went on to say, don’t go out and buy right away, just rent and let the market continue to fall so you can get a great deal.  This after all, is the epitome of sell high and buy low!  Well, I deviated a bit from the plan that was shared with 300 business owners in the room, and I bought an investment property and fixed it up and lived in it of just shy of two years, with a slightly unhappy bride.  When we found a great opportunity, we jumped back in the market and bought a home and here is where this story gets really good.  I sold 5,000 sq ft, built in 1972 with a two car garage and eight foot ceilings on a .75 acre lot in east Carmel that I had updated to the umpteen degree.  But in the end, the wall locations were where they were and room sizes were dictated by that, regardless of how nice my wife Tamara and I made it look.  That was then but here is now…Over 7,000 sqft, 3 car garage, same .75 acre lot, daylight basement, 9 and 10 foot ceilings, 2 more bath rooms, built in 2001, swimming pool and surrounded by homes of equal value.  But the really AWESOME part is I paid less for the larger home than what I sold my original home for, and I bought an investment property in the middle.  I’m no genius.  Just ask anyone who knows me, but I will take credit for listening to people smarter than me.

So by now I’m sure you want to know what predictions have been made at this year's fall event, drum roll please!

2014-2015

·      Sluggish until mid 2015

·      Borrow money

·      Buy Real Estate, such as rental property in neighborhoods you would live in

·      Inflation will kick in for 15 coming years; 3% inflation in 2017, 2020’s will be a double digit inflation decade

·      Wages are going up, with slow increase in hiring

·      Invest in your business now, particularly efficiency and productivity enhancements as well as technology and training

·      Retail sales drop in June 2014 was steepest in years - weakening forecast

2016-mid 2018

·      Strong years

·      Interest rates will nudge up; mortgage rates to 7.5% by 2018

·      Create loyalty and team building with “A” customers

2018 or 2028

·      Best time to sell a business

2019

·      Significant recession, similar to 2001

·      2029 GREAT DEPRESSION

·      Be cash strong

·      Buy competitors who are not prepared

·      Teach millennials how to sell in a down market

If you are like me, all you can say is WOW!!!!! But if I were you, I would do more than say wow.  I would align your future with this information and plan for that future like I did.  

Since I’m sure you want to know who this person is I enjoy following, and since I have quoted his work which means I need to give him credit where credit is due, his name is Alan Beaulieu and he, along with his twin brother, work out of the east coast and provide what I consider to be some of the best advice around. They have also just written a book called Prosperity in the Age of Decline.  Check them out and get a plan with some expert insight to the world ahead.

Bon appetite,  Jimmy

Growing pains...

Many agents are feeling the winds of an improving Real Estate market and desiring growth of their team or growth into a team.  When should an agent consider becoming a team and when should a team add members?  Different questions but the same answer works just fine.  Let's start with what isn't the answer:

1. Everybody else is doing it so I should.

2. I want to make money on other people.

3. I need people to help in the office with admin tasks.

4. I know someone who is looking to be on a team.

5. I don't like helping others.

So why would a individual become a team or a team expand? Simple:

1. I have systems and lead sources that create more opportunities than I can work or more than my current team can handle.

So why do I feel this way?  I've seen people attempt to grow because others did, without the systems and leads the others had, only fail and lose time and money.  Agents tell me all the time that I want to make a "little bit" off of some team members.  Agents looking to join teams tell me they want to join a team because they "are great with clients" but they don't have enough of them to work with. Sometimes the thought is, I have too much paperwork slowing me down in the office but I don't want to hire an admin and pay a salary so I will hire a licensed team member that can sell and do my paperwork. Let's play this scenario out.  I'm a licensed agent and join your team and part of my job is to do your paperwork and part is to sell real estate.  Of course our goal is that I'm good at both, so what does this look like? I take calls, process paperwork, set up showings, negotiate inspections, complete paperwork, and get all of it turned into the office so we can close files.  I'm also showing homes, listing homes, and doing open houses now for two agents but I used to be a $1 million dollar producer on my own and it's all I know.  Now I'm doing all my work as well as my $7 milion dollar team leader's.  This can be a recipe for disaster and in the end it can lead to a revolving door of team members.  Btw it is real hard as a team leader to go sell real estate when you're stuck in the office training.  

Start with a plan including job descriptions, titles, team polices, and a written contract.  Then begin interviewing potential matches based on the job descriptions.  I would even suggest asking your office to help screen potential people so you only meet with the best candidates.  In the end this can very a very successful way to grow your business and make more money but without proper planning and intentions, it can also be a big waste of time and money!

bon appetite 

Jimmy