Memphis Real Estate Buzz » sales

Working for Commission

Joe Spake — Mon, 14 Nov 2011 21:46:07 +0000

QUESTION: What’s wrong with this scenario?

You need a new refrigerator. You go the big box store and are engaged by an energetic salesperson. She knows the specs for all the models off the top of her head, but you have done some research too and ask her some questions that require studying factory specs, and a call back to you at a later time. Within minutes you are doing everything you can to beat down the prices on the your favorite models. You leave with the salesperson’s card, and the she calls you back in a couple of hours with the answers to all your questions, offering to fax you the information. You are a picky shopper. You call her with more questions. You visit the store and the salesperson 3 more times, spending time with “your” salesperson, while other eager buyers wait. On one visit, you prevent her from getting her scheduled lunch break with your persistent questions. Throughout all this the seasoned salesperson maintained her professionalism and helped you at levels far beyond your exepctations.

You see, the majority of her pay was based on commission, and it was in both of your best interests for her to establish a relationship and provide you with superior service.

A few days later the lizard part of your brain gives you the BUY signal. As you are driving by another branch of the same big box store, you swing into the parking lot, go in, and tell the first salesperson you encounter the make and model of the refrigerator you have decided on. He writes it up, schedules delivery. You whip out your credit card, and in a total of 15 minutes, you have bought yourself a refrigerator. The salesman gets full commission for his 15 minutes of work. The first salesperson, the one who spent all that time with you, gets ZERO.

You run into that salesman from time to time when you are shopping at her store. You always greet her with a smile, and have even asked her advice on other appliances you will be needing in the upcoming months.

ANSWER: Nothing. You got what you wanted. End of story.

Lots of people depend on commissions to survive. As a real estate agent, 100% of my income is based on commission, yet, it is not unheard of in this business to work with a home buyer for weeks, taking calls at crazy hours, juggling and re-juggling business and family schedules at their whim, establishing levels of rapport that rival those of family members, and showing them scores of properties, only to have them go to another agent to show them that ONE last house, which they buy without consulting you. No guilt at their loyal agent making ZERO, while their second agent who probably spent all of 2 hours with them takes a 5-figure commission.

Real estate and other straight commission people don’t talk about this much. If you even think about it, it makes you crazy. It’s part of the business of commission sales. You just suck it up and go on.

I have a business card stuck in the corner of my white board from a big box store appliance salesman. I took up a lot of his time when I was researching dishwashers a few weeks ago. I am not quite ready to buy yet, but when I am, I know who my salesman will be.

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Joe Spake is a Memphis, Tennessee based Consultant, Real Estate Broker, and Blogger. Call 901.214.5563 for a consultation or click to make a social connection.
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Special note for current RSS Subscribers – If you subscribe to Memphis Real Estate Buzz via RSS feed, Please subscribe and start following this new feed for spake.com. This will assure that you do not miss any items from either blog as I begin the process of merging the 2 blogs into one feed. Watch for future updates

Memphis area residential real estate sales – September, 2011

Joe Spake — Tue, 11 Oct 2011 13:14:29 +0000

September 2011 Total Sales

The Memphis Area Association of Realtors (MAAR) reports that September residential real estate sales in Shelby, Fayette, and Tipton Counties increased slightly over 2010, based on data compiled from deeds recorded in those counties. Total units sold increased increased by 19 units or 1.8%. There was a 2.7% increase in median sales price, while average sales price dropped by 4.4% . Year-to-Date totals show a 11.7% decrease in sold units from 2010, with both median and average sales prices dropping.

The report is loaded with interesting information about about sales and inventory. Foreclosure auctions are down, as are bank sales. The resultant increase in “normal” sales indicates a strengthening market, despite the constant market corrections in prices.

New home sales saw a big drop – 43 units vs. 69 units in 2010, with a YTD drop of 34.1%

September 2011 New Home Sales Comparison

I always stress that real estate is a Micro thing. The area reports section proves this by breaking down sales statistics by area, so you can see how your neighborhood fits into the big picture.

Download the full September report Here

If you have real estate questions, contact me either through the contact form on the site or directly.

Related articles

Memphis area residential sales reports – August 2011 (memphisrealestatebuzz.com)

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Memphis area residential real estate sales – June 2011

Joe Spake — Sun, 24 Jul 2011 11:50:58 +0000

I have been commenting for a while about the Memphis Area Association of Realtors’ publication of 2 separate sales reports each month, one based on MLS numbers and one based on recorded sales. The reports didn’t match up to my satisfaction and now MAAR admits they are working on reporting issues. The problem with the numbers is described in this Daily News article by real estate reporter Sarah Baker. Apparently the issue being addressed (it is mentioned on MAAR’s site), the recorded deed numbers for all the off 2011 are being reworked, and eventually comparing the 2 monthly reports will make a little more sense.

For the time being, let’s look at the June MLS sales.

It’s not hard to see that June unit sales dropped 7.5% from last year, with an accumulated drop in unit sales of 12.1% YTD. Average and median sales continue to trend down.

The full report provides some very interesting about the Memphis housing market:

1510 (28.2%) of 5351 total reported sales YTD for 2011 have had sales prices below $50,000, with 680 units (12.7% of total) selling for less than $20,000.
122 (2.2%) of the total had sales prices greater than $500,000
Average days on market – 115.13
Current listings – 8498
Total pending sales – 1639 -an indication of a stronger sales trend? I don’t put much stock in pending sales numbers. They don’t mean a thing until the sales close.

Click here for full report

In summary, more of the same kind of numbers we have been seeing for months in this distressed market. The economy is driving the housing market and not vice versa. It’s going to take jobs and a brighter economic outlook, not smoke and mirrors, but something the public can buy into, to turn this market around.

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Memphis residential real estate sales – May 2011

Joe Spake — Fri, 24 Jun 2011 19:06:15 +0000

For the full story you need 2 reports

The Memphis Areal Association of Realtors publishes 2 sales reports per month reflecting residential sales for the previous month. You can find fresh and historic reports on MAAR’s site. The earliest release is the Multiple Listing Service Sales Report, which is based on sales reported by MLS/MAAR Members:

May, 2011 MLS Reported Sales

Unit sales for May once again lagged; 989 units represent a 17.2% reduction from 2010, with a 12.8% lag year-to-date. Median and Average prices also showed decreases for the month and YTD. Other interesting stats in this report offer few surprises:

Average Days on Market - 119.9
% of total sales <$100,000 – 45.7
# house sold >$1M -4
# months supply of >$1M properties – 70.5

Later in the month, MAAR publishes the Memphis Area Home Sales Report, which reflects recorded deeds (however, not trustee deeds).

The sales numbers and median and average prices are quite different from the MLS numbers, and the report, provides monthly sales comparisons, active and pending listing data, and sales activity broken down by neighborhoods. I am researching the cause of the rather wide discrepancy between the figures in the reports.

So if you want to be a Memphis real estate statistical whiz, check both reports (Links will take you directly to the reports on the MAAR site.) While you are there check out the brand new MAAR Monitor: A 6-Month Window into the Memphis Real Estate Market, which condenses major data and trends. Bottom line, there are a lot of ways to look at the data and “trends”, but the market is still molasses slow, and prices are declining. It’s a great market for buyers; and a challenging market for sellers. If you are not willing to be a serious and competitive home seller, you might as well wait. How long?, you might ask. Well that’s a good question.

One thing to always keep in mind – Real estate is about micro markets. If you need a professional to help you sort through this, one who has no problem telling you the truth about your individual situation,whether you are a seller or a buyer, get in touch with me.

Memphis residential real estate sales – April 2011 (memphisrealestatebuzz.com)
Memphis area real estate sales – March, 2011 (memphisrealestatebuzz.com)

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Memphis residential real estate sales – April 2011

Joe Spake — Wed, 18 May 2011 19:39:41 +0000

April 2011 Residential Sales

The Memphis Area Association of REALTORS® (MAAR) has released residential sales statistics, based on Multiple Listing Service data, for April, 2011 and 2011 YTD. Total unit sales show a 13.4% decline from 2010, while sales are off 10.9% year-to-date. There are also declines in average and median sales prices.

MAAR is providing a lot more information in the sales report these days (download here), including sales by price range, beds and baths, finance type, days on market, and current active listing data. Here are a couple of interesting tidbits:

Over 14% of houses sold last month were $19,999 or less.
One house $1,000,000 or more sold in April, and 5 so far this year.
136 $1,000,000+ houses in active inventory which translates to about 9 years of inventory based on this year’s sales.

So have a ball, stats lovers. I don’t know quite what to make of the numbers. The agents I have talked with recently are all having “good years”, and every one is saying how much better things are than last year. I can personally attest to that, but it may be a factor of my micro market here specializing in IN-City properties. If you have questions about your specific real estate situation, give me a call or email.

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