Wednesday, December 10, 2008

Getting The Dirt On Your Local Real Estate Market

All this concern about the environment and "going green" continues to increase in our daily lives, yet I am not seeing it reflected in the local real estate community. I'm not talking about throwing soda cans into the recycle bin at the real estate office. I'm talking about the history of both commercial and residential properties.

If you are considering a purchase, lease, or rental of new construction, shouldn't you know what used to be there?

Last week I happened to be driving through the neighborhood in Chicago that I grew up in. I noticed a recently built condo building that appeared to be almost if not completely full within a short period of time for this market. That's fine and dandy. Until my mind raced back about 20 years and I remembered the number of years that location was a gas station.

What I don't know is if or to what extent that information was disclosed to the buyers within this condo building. Did they know that they could (emphasis on "could") be living directly above pipes and coil which used to carry gasoline before buying? Maybe they did not, since a number of years have passed since that usage was taking place on a daily basis. Or maybe they did, but looked an excellent deal in the eye at the same time and chose to overlook the underground.

Perhaps 20 years is enough time for unused gasoline pipes to clear out or even be removed. This still brings up the point that with the change and growth in big cities and further reaching suburbs, we often don't know, don't recall, or aren't told what is and was underneath the home we now live in.

This doesn't always mean that potentially unhealthy chemicals lurk just below. I recall the time many years ago I was taken to look at some undeveloped land near Cape Coral FL. This was before that community had become much more than a few houses. I was being shown several residential lots that were available at the time, while I could see patches of standing water in several places. No way, Jose!

How could they expect someone to buy property when we don't know how much and how easily there could be standing water nearby. How solid is the ground in the surrounding area? I didn't hang around long enough to see if there was any wildlife on the property. However, years later when I returned to that area, it was a city with houses and stores everywhere.

You are probably asking - What does this have to do with real estate marketing?

My answer is - PLENTY.

Speaking as a consumer, the real estate agent should KNOW the answer about what is or was underneath when selling a property, whether commerical or residential. As it so happens, I happen to know what used to be in the new construction townhome I presently live in, but I'm happy to say that the builder told me anyway before making the purchase. And since then, I have made a positive personal recommendation of that builder. It's these "little things" that make a huge difference with me as a consumer.

Believe it or not, our government actually has a helpful resource available. You truly can get "the dirt" on a property online.

That is for the USDA Natural Resource Conservation Service's Web Soil Survey.

This is a big part of why I constantly tell consumers (friends, family, acquaintances) to do as much research as you can before making a real estate or big ticket purchase. The realty agent (or whomever) doesn't know how much or how little you know. You should ask these questions anyway, even if you know the answer. I'm disappointed to report that 2 of the first 3 realty agents I asked did NOT know the above site exists.

When you are considering a realty agent and/or a mortgage lender, test their knowledge before proceeding.

Since this blog is just as much for those realty agents and mortgage lenders within the industry, the message should be clear. A property you are representing or assisting with is a big ticket item for the buyer and seller. You can't treat it like another brick in the wall.

My best advice is to treat a listing appointment or loan application like a job interview. In addition to making sure the needed paperwork is on hand and accurate, you should use every opportunity to reinforce that you are the person to handle this transaction. Even AFTER the papers are signed.

I don't know the person who wrote this about job interviews, and will mention that the comments which follow present just as many interesting views, but this will hopefully bring out the importance of my "job interview" theory:

During the course of my personally contacting more than 1,000 lenders and realty agents every month about a variety of advertising and marketing concepts, I have several of them each day tell me that "I work by referral".

If only it were as simple as they make it seem. There are a number of times I ask a realty agent or lender a specific question about a property or a loan, and the answer I get is not the correct one. He/she figures I won't know the difference. They probably get away with sounding like an expert most of the time because consumers don't do their research. My point is that a BAD referral is going to cost them additional business.

Yet, they didn't need to spend more for advertising or marketing, as much as that would help. They did need to have done their homework in order to clinch the sale.

1 comment:

maskew said...

Dave, I stumbled upon your site from the interview question link you mention in your post. Speaking as a member of the Architectural community, I'd like to chime in on a few of your points.

First, the condo building you mention in Chicago most likely required foundations deeper than gasoline storage tanks. Such mitigation of contaminants and underground objects is required in such cases during site prep and construction.

Secondly, you might also take note that most local governments (county-level in the midwest, for example) are beginning to keep detailed records online, (usually through the auditor or whomever collects property taxes) of every property including photos, site dimensions, previous owner data, sales values, assessed values, liens, zoning guidelines etc.

These are invaluable resources for researching property. They are free to search by owner name, address, map, etc.

Here is a link to my county's site:

I hope you find this information valuable.