By Loren K. Keim Copyright © 2010
Copyright
© 2010 by Gideon Publications
Copyright © 2010 by Loren K. Keim
All rights reserved. No part of this book shall be reproduced or transmitted in any form or by any means, electronic, mechanical, magnetic, photographic including photocopying, recording or by any information storage and retrieval system, without prior written permission of the publisher. No patent liability is assumed with respect to the use of the information contained herein. Although every precaution has been taken in the preparation of this book, the publisher and the author assume no responsibility for errors or omissions. Neither is any liability assumed for damages resulting from the use of the information contained herein.
ISBN 978-0-578-04868-0
Address: 2299 Brodhead Rd, Suite J, Bethlehem, PA 18020
Phone:
484-893-3004
Fax: 610-866-6075
Email: gideonpublications@yahoo.com
Acknowledgements
The 25 years I’ve spent as a Real Estate Agent and Broker have been an exciting adventure. The people who have helped me in my career are too numerous to mention, but I do want to thank some of the people who have significantly contributed to this book (while hopefully not leaving anyone important out):
Theresa Keim, Tim Mahon, Ellie Barrett, Wayne Talaber, Joe Bartera, Deb Hartman, Keri Schlosser, Don Blose, Marc Lucarelli, Elmer Heiney, Christa Klein, Mike Miller, Michelle Miller, Holly Weiss, Cathy Mahon, Bob Wilfinger, George West, Elmer Heiney, John Stangl, Francisco Sainz de la Peña, Kathy Reither Ziegler, Bob Hartman, Tom Young, Jeff Sell, Balji Minhas, Becky Hite, Ruth Wuchter, Todd Siegfried, Tom LaDue, Niko Pitsilos, Karen Ackerman Pitsilos, Cindy Bartera, Neil Szanyi, William Bader, Chris Bracy, Joe Stumpf, Ralph Williams, Tom Cooke, David Zinczenko, Chris Bracy, Stephen Thode, Geraldo Vasconcellos, Kathleen Clayton, Mary Pat DeJarnette, Rick Petko, Curt Cameron, Mary Hudock, Rudy Amelio, Linda Becker, my children (Bridgett, Caitlin, Logan and Kourtney) and many others!
I also want to thank the person who assisted me with editing and compiling all this information: Betty Broadbent
Cover Art was done by Anthony Giest of Ghost House Studios
Primary Editor was Mary Linn Roby
Chapter 0:
An Introduction to Life
It’s a typical crazy Monday at my real estate office in Allentown, Pennsylvania. In the front conference room, a frantic mother, having recently lost her husband in a traffic accident, and unable to afford the mortgage on her own, needs me to help her figure out a way to keep her two children from losing the only home they have ever known.
In another room down the hall a man and woman both having recently lost their jobs, leaving them unable to afford the mortgage payments on a house which, in the current market, is worth less than what is owed on it, need advice on a short payoff with their lender.
However, I haven’t been able to meet with either party yet because I’m on the phone with a third client whose family homestead is deeded in his mother’s name. The nursing home, where she is currently living, has informed him that according to Medicaid, the house, which has been in the family for five generations, must be sold to pay part of the cost of her care since federal regulations will not allow the property to be retained by either her or the family.
In desperate need of help, and on hold with our Medicaid client, I head to Michelle Miller’s office on the other side of the building, where I am greeted by whoops of laughter and other indications of a celebration initiated by the fact that the young couple with whom she is meeting have just received word that their bid on a unique stone farmhouse has been accepted by the seller.
“What’s up?” Michelle asks, looking up at me.
“I guess you’re too busy to help me right now,” I say. “Is Mike around? I’m feeling a little overwhelmed.”
But it seems that Mike is up at the house of Rick Petko, one of the stars of television’s Orange County Chopper. Our phones have been deluged by callers who want to see Rick’s home, but who are probably not qualified to buy it, making it necessary for Mike to attend each showing in order to weed out nosy fans.
To further complicate matters, Frank Langella beeps me on my cell with news that our favorite Academy Award nominated client, who is presently appearing on Broadway, and is considering a Pennsylvania farm as a weekend retreat, is not impressed by any of the properties that we had sent him. He needs, Frank tells me, seclusion, in a location that will be under an hour and a half commute from New York. As I mentioned, it’s a Monday.
Life doesn’t come with an instruction manual. We learn by watching and by doing. We test our limits, make mistakes, and hope we don’t accidentally kill ourselves while doing it. And given all the idiotic things that I’ve done in my time, I'm constantly amazed that I'm still breathing and walking. Some of the mistakes have become learning experiences that I'll share with you in this book.
So who am I? Over the past two and a half decades, I've been a successful real estate broker in Pennsylvania, just north of Philadelphia. In the world of the real estate agent, we are in a position to observe people and situations at their best and at their worst. If we’re careful, we can learn from the pain, resilience and triumph of others.
For good or bad, I've had the opportunity - or the misfortune - of quite often being in the right or wrong place at the right or wrong time. Many years ago, a good friend of mine wrote an online article called “Loren Keim, the Human Accident Magnet”. It was an amusing piece that garnered a lot of attention which I eventually asked him to remove from the web because I was afraid that, funny as it was, it was affecting my business, particularly since the article was so popular that Googling my name produced it up front, with the result that, instead of potential clients reading about my accomplishments in the field of real estate, they would find themselves engrossed in accounts of my various misadventures.
The fact that I have experienced an unusual number of unique encounters really came home to me in September of 2005 at a relocation meeting I was attending in Las Vegas when a group of us, on our way from the Aladdin Resort, now known as the Planet Hollywood Resort, to Paris witnessed an accident in which a driver jumped the curb with his Buick and ran down fourteen pedestrians on the sidewalk, killing three. As a result, that evening, sitting around a dinner table with about a dozen other real estate brokers, managers and relocation directors, the conversation turned to stories about near-misses to which I contributed an account of the time when a drug dealer fired a gun at an agent of mine and me, missing us by a few inches.
Someone changed the conversation, trying to add a lighter tone with “What about funny stories or anecdotes?” at which someone brought up the fact that she had recently assisted one of the stars of the TV sitcom “Everybody Loves Raymond” with purchasing a second home. I, of course, then shared two quick stories of celebrities I had worked with over the past few years including an academy award nominated actor and a famous rock star.
“Wow!” a woman at the table exclaimed, referring to one of the names I had dropped. “He’s been one of my favorite actors forever. I love his movies. The only famous person I’ve ever met was a mentor of mine, and that was before he became famous.”
“That’s wonderful.” I replied. “I had a mentor a number of years ago. He’s a brilliant person, a former realtor and entertainer. I’m told he is now a coach for some of the top minds in the country.”
One constant in the universe is that when one “salesperson” tells a good story, all the other “salespeople” around a table need to one-up them. And after each great story, I’d add yet another of my own. The first three or four stories clearly impressed them, but after the sixth, they started looking skeptical. Clearly I was coming across as a very skilled liar, or someone who belonged in a mental institution for the criminally deranged. All my stories were true, of course, but most people live within a certain paradigm of their surroundings and have difficulty accepting people or situations that don’t fit within their personal bubble of comfort, just as they can’t believe that so many different experiences can be part of an individual person’s life. But I assure you they can. I once told a colleague that I have the same experiences everyone else does. I simply have them more frequently.
For years, I’ve tried to guide my clients, friends and the realtors in my company in the direction I felt was best for their home sales, careers and life by relating some of these experiences, with the result that I have been urged to write a book about them, which is precisely what I have finally done.
What follows then are some of my best and worst experiences, as well as some of my thoughts on society and politics. I hope you will not only enjoy but learn from them. After all, the old line to the effect that those who do not study history are doomed to repeat it is true. I believe we can learn a lot about human nature, relationships, finances, economics, and overcoming pain by simply watching, listening and learning from those around us.
Stop living the “sound bite” life of those who watch only the headlines and form opinions without ever really understanding the underlying nature of a subject. To quote Ferris Bueller, “Life moves pretty fast. If you don't stop and look around once in a while, you could miss it.” Cue the music.
The
Eldorado and the police...
About twenty years ago, when I was just beginning in real estate, I had invited friends of mine who were thinking of investing in property to my house for dinner, along with my girlfriend, after which we drove in my car, a big Cadillac Eldorado, over to the office to go through the Multiple Listing System. By the time we were finished, it was quite late, and none of us were particularly pleased when, having piled back into my car, we discovered that it would not start. So I called one of the most important emergency services in the country. Yes, I called AAA.
The tow truck driver, who was dispatched in response to my panicked call, looked over the car and announced that he could get the car started but it wouldn’t make it very far. Even though he explained the problem, I was sufficiently mechanically challenged, not to understand it precisely. But the point is that, being young, macho and just plain stupid, I decided that since it was only a few miles to my house, where everyone had left their cars, I would make a run for it. And since the mechanic had told us that we had an electrical issue, I felt it would be better to drive with no headlights, and therefore we should stay off the major highway and just take the surface streets.
So, slightly after midnight on a Friday evening, I drove at a relatively high speed down Hamilton Street to Hanover Avenue in Allentown and took a short cut through a parking lot to try and save as much time as humanly possible, in the process of which I passed a police car going the opposite direction. I suppose it should have come as no surprise to me that the police cruiser spun around and, with sirens and lights flashing, proceeded to pursue me.
Making a quick turn around the corner, I pulled over leaving the car in park, naively assuming that I could simply explain to the officer why I was driving with no headlights and that he would certainly let me go the last mile to my home. As I went to open the big door of the Eldorado I noticed a police car pull up next to me in addition to the one that was now behind me, and another car approached from the other direction pulling up in front of my car, boxing me in.
Putting the car in park, and starting to get out, I turned to my companion, and over the noise of the loud engine said, “Keep your foot on the gas pedal, we’re going to have to get out of here quickly”. In the process of stepping out of the car, I somehow managed to trip over my own foot and land flat on the ground at one of the officer’s feet.
To add a bit more context to this story, I should probably inform you, that having all but cut off my middle finger several weeks before by slamming it in the car door, the doctor at the Muhlenberg Hospital Center who had sewed me back together, had cast it with a metal bar on either side of my middle finger. As near as I can determine using hindsight, the police officers, seeing me take a dive with a metal object in my hand, assumed that I was armed.
Suddenly officers were diving behind their cars, drawing their guns as they did so. “Lie face down!” someone shouted. “And push that weapon away from you!”
I, of course, had no idea what they were talking about. After all, my only problem was that my headlights weren’t functioning. So naturally, I stood up and said, “What are you talking about?”
And then, since they were all shouting at once, I got back in the car and shut the door, only to find myself caught up in a spotlight. Needless to say, when all of us were forced to get out of the car while the officers searched it, my friends and potential clients, not to mention my girlfriend, were far from pleased.
As it turned out, the police had been responding to the burglary alarm at a bank in the shopping center parking lot when they found themselves being passed by a large car with no headlights, with the result that they had pursued the car. Needless to say, they were extremely unhappy with this turn of events. Having bigger fish to fry, they eventually let me go.
The next day the five of us were at McDonald’s on Union Boulevard in East Allentown with a group of probably fifteen other friends, busy recounting the story of what happened the night before. My friend Tom was in the process of making a few well chosen disparaging remarks about the incompetence of police officers in general, and one in particular, when he realized the rest of us were staring at him wide-eyed, and turning he saw the gentleman in question standing right behind him, arms folded across his chest and an unpleasant expression in his eyes.
I had never before seen someone actually faint.
Hidden in the Attic...
During the course of the last decade, most real estate companies conducted so-called caravans, by which I mean that all the realtors in any given office inspect all the new listings that have come on the market over the prior seven days, in order to acquaint them with the company’s current inventory. Many companies still do this although, in my opinion, it’s a wasted effort since the agents could be more usefully employed actually marketing the available homes.
Consequently,
we stopped this practice a long time ago, replacing it with broker’s
open houses for unique properties.
In any event, several years before, one of our agents, Christa Klein, had brought in a listing of an all brick split level in the west end of Allentown, a beautiful house that we scheduled first on our caravan tour that coming Tuesday.
As always, our receptionist called the owners to verify the Tuesday morning appointment to view the home. When Tuesday came, we joined two dozen other realtors at the house. I rang the doorbell and received no response, which was odd because the owner had definitely said that she’d be home. After knocking loudly and again, received no response, I decided to use the lock box on the front door. I had just begun spinning the dials when the door flew open.
The woman answering the door, presumably the owner, looked dumbfounded at seeing such a large group of people assembled in her front yard. “What are you doing here?” she asked, whereupon Christa took the lead, explaining that we were caravanning new listings and we were going to take a quick walk through the house just to get a look at the general layout.
But, she protested, the house was dirty. Couldn’t we come tomorrow instead? And when I explained that Tuesday was our day to do caravans, and went on to assure her that we would look past the grime, she protested that she had dishes in the sink. And when I told her that would not be a problem, she told us that she’d be right back and shut the door, only to reappear a few minutes later and lead us down to the basement, muttering something about giving her time to straighten up a little.
This was early in my career and most of our office was made up of women, so I was attempting to show off my vast knowledge, having just completed a construction course, and believing I actually knew something about it. As a consequence, I was busy explaining the type of electrical service in the house and the size of the beams when the owner reappeared and told us we could go through the rest of the home.
We stepped up into the family room and looked around, and then proceeded to the next level to look at the dining room and kitchen. There were a good many dishes in the sink in the kitchen, but certainly that didn’t detract from the nice oak cabinets and solid surface countertops.
Finally, we proceeded to the upper level and looked last at the master bedroom, which had its own bathroom and a walk in closet in which there was a trap door that allows access to the storage area of an attic.
Since there was a chair positioned directly underneath the trap door, I suggested that we take a look at the attic insulation and at the same time find out how much room there was for storage. But when I raised the door, I was surprised to find myself face to face with a pair of men’s bare legs, and looking up, saw that the gentleman in question was outfitted in nothing but boxer shorts.
“I’m working on the attic fan,” he said in a singularly unconvincing way, hoping no doubt to put us off.
But realtors are a curious bunch, and in the end every single member of my office staff wanted to also climb up on the chair and look at the man in the attic. This took about fifteen minutes. When we returned to the kitchen, we found our hostess pacing back and forth, wringing her hands. Then, pulling herself together with an obvious effort, she explained that the man in the attic was there to help her pack.
We later learned that the owner had been transferred to Texas where he had already started working while his wife remained at home to oversee the sale of the house. The sad part of the tale is that the husband called us two days later and told us he wanted the house removed from the market, because, he said, his wife was unhappy about the way we were “servicing” the property.
Needless to say, we failed to mention the man in the attic which she was apparently “servicing” very well.
My
First Sale
Over the years, I’ve read a lot about the great American work ethic, but I have yet to see signs of it in the general population. Perhaps I’m being cynical, but I believe the reason “get rich quick” books, audio programs and workshops sell so well is that most people are looking for a way to get around the hard work and long hours that lead to individual success.
The field of real estate sales is a classic example of this. In most areas of the country, a person simply has to take a course or two and pass a state licensing exam. Then whammo, they become licensed to assist buyers and sellers with their most valuable assets: homes, land and businesses.
Each year, I interview a few dozen newly licensed agents who tell me that they’re becoming realtors because the earning potential is virtually limitless, often adding that since my firm is well known they would be glad to help take advantage of all the buyers and sellers who are, clearly, desperately in need of their services. I can’t begin to calculate the number of fresh new realtors who have come to me, nurturing the notion that, if they show a half dozen homes to a young couple, and write an offer, they can make ten thousand dollars. How tough could that be, they say?
It’s true that the earning potential of a realtor can run into the millions. However, building a multimillion dollar career in real estate means working exceedingly hard, taking on the difficult tasks that most people would never dream of tackling.
Now, please don’t misunderstand me. I make a great deal of money by teaching licensed realtors techniques to improve their ratios and dramatically increase their incomes. However, a newcomer must put a lot of effort and time into building their personal business in order to be successful and avoid becoming a statistic in the extremely high fall-out rate of licensed Realtors.
Most new realtors sit at their desk, or hang around the water cooler, while waiting for that big break to show up on their floor time. I know that I started my career with the same mistaken beliefs. For my first few months in real estate, I bought into the myth that I could simply wait in the office for the phone to ring. Actually, when my first client did appear, it was one of the worst things that could have happened to me.
He called me after seeing a “For Sale” sign on a property our office had listed on South Fifth Street in Allentown. Prepared to do everything right, I called the owner of the home and left a message saying that I’d be showing the house later that afternoon. We set up showings through an index card system. Each home had an index card with showing instructions, and we were to follow the showing instructions and then write our name and the time on the card so the listing agent would know who had been at the property. We simply had to let the owner know we were showing it, leave the showing time on their answering machine, and use the lockbox on the front door.
Just after one that afternoon, I drove to the home, a three story brick row home with a covered front porch, to find my new clients already there. I rang the bell and knocked on the door. No one answered, so I dialed the combination on the lockbox and called out as I opened the door, just in case the owner was home and hadn’t heard us knocking.
Like most Pennsylvania row homes, this one was long and narrow. Just inside the front door, a long staircase led to the second floor, while to the right, a long living room – dining room combination stretched to a kitchen at the very back. After viewing the first floor, we heard a muffled noise as we proceeded up the long staircase. When my client asked about it, I explained that, although sometimes they might hear something from an adjoining home, I was certain that their privacy would be insured by the brick, lathe and plaster walls which separated this townhome from the next.
The couple did not seem particularly impressed by the size of the bedrooms on the second floor. They mentioned that their bedroom furniture wouldn’t fit in the relatively small front bedroom of the second floor. Additionally, the noise persisted, and I was concerned that the couple would not purchase the home because the walls were obviously less thick than I had assumed.
However, when we reached the third floor, which my notes told me featured a large master bedroom suite, we found ourselves in a room with a mirrored ceiling and walls, in the center of which, on a king sized bed, the owners were absorbed in enjoying some mid-afternoon delight, an exercise made all the more striking by the fact that it was reflected above us and on every side.
I’m fairly certain my cheeks turned several shades brighter. I had, I admit, never thought of voyeurism as a sales gambit, but the fact was, that despite everyone’s embarrassment, the buyers made an immediate bid.
Oddly enough, however, I never received a referral from the sellers.
Sometimes gratitude is too much to hope for.
Chapter 1:
Why Selling Homes is a Challenge!
Although home buyers are usually ecstatic when they find the perfect home in the perfect neighborhood, working with sellers can be a challenge, primarily because they often entertain the illusion that their home will sell for a higher price than is reasonable, given the current market conditions. Needless to say, we realtors love the fact that the seller often blames us when a buyer doesn’t materialize as quickly as the seller’s desire.
Home sellers have a difficult time accepting the fact that their price might be too high or today’s buyers aren’t purchasing the home because of the lime green shag carpeting that was installed in 1967. Instead, it must be the realtor’s marketing efforts that are to blame for the lack of an offer. Over the years, I’ve been told by more than two dozen clients that I simply need to run a big display ad in the New York Times and buyers will appear at their doorstep. Unfortunately, it doesn’t work that way, and for the cost of a display ad in the New York Times, I could probably buy the house.
One client actually suggested that we hire a celebrity or entertainer to put on a show at which we could sell raffle tickets, thus luring potential buyers by offering them the possibility of winning the property. When I suggested that no doubt Robin Williams would drop everything and do a comedy routine for us, I don’t think my attempt at humor was appreciated.
Many clients also believe they know more than their realtor. After all, they’ve lived in the home for many years and believe they know which features are most likely to attract the best buyers, and since they have the nicest home in the neighborhood (everybody does), it should sell easily.
Unfortunately, home sellers often talk their way out of sales when they get the opportunity to either control the advertising or marketing or actually meet and negotiate with the buyers, which is a polite way of stating that many home sellers do really dumb things when trying to sell their homes. There are definitely times when an impartial third party between the buyer and seller can certainly help bring the sale to a close.
Selling
a home at a busy intersection...
Some of the unwise things that home owners say when they’re trying to sell their home constantly amaze me. Sellers, being emotionally invested in their property, are often their own worst enemy, making statements that absolutely cost them a sale.
As an example, a few years ago, I had a young couple named Stacey and Dennis, looking at a property along a very busy road near Whitehall, Pennsylvania for the third time, a house that was located at least a hundred feet off the road, behind a line of trees, but was only one door off a major intersection. The layout reminded Stacey of her grandmother’s home, and she also appreciated the convenience of being very close to a major shopping district. Dennis loved the convenience of the home’s proximity to his work, just five minutes away. Neither was bothered by the noise from the busy intersection, which apparently, was the primary complaint of potential buyers who had looked at the house previously.
As we were about to leave for the office to write up an offer, the seller pulled into the drive, and hurried out of his car towards us. “Wait a minute, wait a minute,” he yelled, waving his arms. “Come back to the house. I want to show you something.”
Given the circumstances, I could scarcely refuse, and in a few minutes we were standing in his living room.
“Do you hear that?” He demanded triumphantly, shutting the solid oak front door.
“Hear what?” I said.
“Nothing! That’s exactly what I mean. You don’t hear anything once that door is shut. There’s no sound whatsoever. This house is so well built that you don’t hear noise when the door is shut.”
Assuring him that that was wonderful, I began to shepherd my buyers back outside.
“You don’t understand!” he said, positioning himself between us and the door. It’s really, really quiet in here. You can sleep without having to worry about being awakened by the noise.”
“Uh, okay.” I replied, displaying my command of witty repartee. His emphasis on “the noise” was beginning to unnerve me.
“As a matter of fact,” he continued, “there’s a major accident every single week at the corner down there, and sometimes we don’t even hear the sirens.”
It was beginning to be perfectly clear to me that if I allowed him to continue in this vein, he was going to jinx the sale.
“Okay, that’s fine. I’m sure the buyers appreciate that”.
“You know, there are ambulances and police on this corner all the time because of the accidents,” he confessed enthusiastically. “And we don’t even hear the sirens. That’s how well built this house is.”
“That’s wonderful. Thanks for your time,” I responded once again.
He put his hand out, frantic that we were trying again to leave. “No, no, no, you really don’t understand,” he said. “For example, my son’s best friend was killed on our front lawn last year. He was pulling out of our driveway and got T-boned on the main road right out there.” He pointed behind him toward the front door. “His car rolled over into our front lawn. We had ambulance, fire trucks, and police in our front lawn with lights going, and sirens flaring, and we didn’t hear a thing. That’s how incredibly well built this house is.”
My buyers and I were flabbergasted. Looking back at Stacey, I saw that her mouth had formed a perfect “O”, which was not surprising, given what she had just heard. On the way back to the office, her husband said, “Well, if we purchase the home, we’d have to buy a really big shop vac to suck the blood out of the front yard, won’t we?”
It came as no surprise to me when they decided not to make an offer on the house which, eventually, sold for significantly less than the original asking price.
Sellers have to be really careful about intervening between their realtor and the potential buyer. Of course, no reliable realtors should fail to meet the state’s requirement of full disclosure. However it is not necessary to introduce the possibility of offering a property which will give the buyer a front row seat to scenes of horror, featuring gore and dismemberment.
Watch out for flying cars...
I encountered a similar situation this year while taking clients through a property adjacent to a raised four lane divided highway, which ran about forty feet above the home’s back yard. Standing out back on the rear patio of the property, it was hard to miss the loud sounds of tractor trailers screaming by at sixty-five miles per hour. It was so loud that, when we inspected the back yard, we had to yell to be heard but the most unfortunate thing was that the seller was present.
When
the seller joined us on the patio, and asked what we thought of the
property, my buyer told her that she loved the house, and thought the
price was reasonable, but as she put it, pointing at the highway, “I
don’t know if I could live with this.”