Friday, February 24, 2012

No Comment? About A Multi-Million Dollar Home?

Another instance of a poor decision in the marketing of a property, and this comes from an agent that handles multi-million dollar homes in a city the size of Chicago. It is not just the state of the current real estate market that's entirely to blame for this situation. Some serious exploring of how properties for sale are advertised and marketed would be a definite help.

Eric Ferguson is a media celebrity in the Chicago area, based on his role as co-host of the extremely successful morning show on WTMX-FM. Therefore, when he decided to sell his Lincoln Park area mansion and listed it for just under $3 million, it became a news item.

Listing agent Joanne Nemerovski of Prudential became the beneficiary of a ton of "free" publicity about this when the Chicago Tribune picked up the story:,0,4863058.story

However, she flat out blew this opportunity. The newspaper story starts out by providing a description of the property and some of its amenities. The agent could not buy this type of publicity. Thousands of fans of Ferguson and the radio station, along with thousands of regular readers of the Business section of the Tribune in print and online were reading a positive vibe about the property. Until the last paragraph, that is.

She "declined to comment" about why Ferguson is looking to sell the property, with the story adding that Ferguson did not return a call.

I can understand Ferguson not returning the call to comment. It is not his role to provide the newspaper with a reason for his decision. But I absolutely do not understand Nemerovski's reasoning behind the "declined to comment".

Some will argue that she is "representing" her client by not commenting. She should have been ready for this prior to issuing the listing. It's up to her as the agent to have her "story" ready from the Fergusons for when this came up.

As it is, the story also mentions that the Fergusons are asking $540,000 more than they paid for this mansion back in 2004 although it does not specifically mention any improvements since it was built. A potential buyer or investor could be motivated to explore the listing details to find out if a $540,000 "increase" is justified or not before possibly proceeding. After all, homes no longer automatically increase in value in this market, especially by more than a half-million dollars in an 8-year period.

Working in the media, even in one of seemingly the more secure jobs in radio, there has to be at least one solid reason for the Fergusons to make this decision. However, by not playing the public relations angle and having an 'answer' ready, this "declined comment" could delay the sale of this property even further.

Nemorovsky and the Fergusons should have been ready for this. All she needed to do was to respond something like "Eric wants to downsize" or "Eric wants to return to the suburbs where he grew up" or "There are some family matters making this necessary", and this story would have come off like a commercial endorsement to benefit all.

Even if not completely true, it would not have tarnished the marketing effort.

Instead, that neither the agent or the seller would "decline comment" about the house makes it appear that there is something about the property being hidden. That may or may not be the case. Now, all of the advertising in the world may not overcome that neither would comment about a reason for the house being put up for sale, and leave thousands of readers skeptical.

Any buyer or investor capable of qualifying for or paying cash for a multi-million dollar property is extremely likely to explore the reason for the listing going on sale before proceeding. It is not as though this is the only multi-million dollar home available in Chicago or its metro area.

Other such properties where the seller "is looking to move to Arizona", "wants to retire", "is looking to downsize", and/or "selling at a loss", are far more likely to get an inquiry for the agent over one for which the seller AND the agent "decline comment".

This has nothing to do with the current state of the market, recent home sale statistics, the flucutation of home prices, or problems with mortgages. Based on the asking price being higher, this is not a Short Sale or an act of desperation either.

It has everything to do with the marketing. While it is true this is a newspaper story and not a paid advertisement, it is the agent that is supposed to be representing the property and her client as best possible. Putting it out there as if there is something to hide does not do that.

If there truly is nothing to hide about this mansion, or any other properties for sale, people should know that. Like with the home sale statistics and the mortgage problems that continue to plague the real estate industry, we all need answers.

Tuesday, February 21, 2012

Does Houston Have A Problem?

It's the next round of home sales and pricing releases around the country. The newest chance to see if the various realty associations have cut down on adding to the negative publicity about the current real estate market.

This one from the Houston Association of Realtors is attempting to show a positive spin:

However, they have a few too many statistics included. Serious real estate market observers will see right through this, and that's not good.

This story builds up the so-called rise in home sales and relative steadyness of home prices for January and the months prior.

But it also shoots itself right back down. The real reason for this is right there in the story. As in the part about the increase in foreclosures, and how they now account for a much bigger percentage of home sales.

Why is the home sales market "up"? Because more and more former home owners have been foreclosed upon. Take away those statistics, and, well, it sheds a different light on the current marketplace.

This is where Houston has a problem. As well as other cities. The current market isn't really "up". If fewer people were losing their homes due to financial reasons beyond their control, it would not appear as if home sales are up.

It is really foreign investors, flippers, and a few speculators who are buying the homes out there, and doing so because in many cases they get a below market deal by acquiring a foreclosure.

That even more people are being foreclosed on in the Houston area, while many other parts of the country are "reporting" that the number of foreclosures has dipped, certainly should not be treated as the "positive" news the HAR is doing in this story.