March 2007 Archives

One of my goals in writing my book "Ripping the Roof off Real Estate" as well as in developing the Accredited Consultant in Real Estate (ACRE)™ course for agents is to see the real estate industry evolve similarly to how the financial industry did 20 years ago.

This past Sunday, the cover article of Parade Magazine was entitled "Do You Have a Better Idea?"  The article talked about how solving problems can be accomplished by simply looking at the issue at hand and "thinking out of the box". From the "Forever Postage Stamp" to increasing the supply of organ donors, the article offered many examples of how we can devise simple solutions to big problems by simply borrowing an idea from another country, industry, or context and applying it to a problem.

A similar point was made by my colleague and friend, Ken Deshaies, in the foreword of my new book "Ripping the Roof off Real Estate". Ken noted that the authors of the book "Blue Ocean Strategy" described how major business successes over time have come from innovative business leaders re-imagining the business at hand.

Property and homes are commodities, pure and simple. High demand and low supply drives prices higher and the asset becomes more liquid (easier to sell). Low demand and high supply drive prices lower and assets become less liquid (harder to sell). Market value is ultimately determined by what a buyer is willing to pay and a seller willing to take. I hear the following statements from consumers: Well, I can't sell for less than my tax assessment! My home is worth at least my appraised value! My neighbor said... My Mom told me... The one down the street sold for...and my home is better... Zillow says...