Tell Your Realtor To Shut Up And Listen To You
I grew up on Lake Martin, in the real estate business. I know what I like. I know which parts of Lake Martin I prefer. I have been all over this lake, and have friends in every corner. But guess what…
No one cares about that.
Especially my clients… nor should they.
One of the first things my dad taught me about Lake Martin real estate was “don’t show them what you like, show them what THEY like.” Simple but true.
The key to helping people be happy with their waterfront property is to focus on what they think, not you.
A realtor’s local knowledge and experience does matter, but only to the extent that they use that to help their clients get what they want. There are all kinds of buyers out there.
Some Lake Martin buyers prefer Kowaliga Creek to Blue Creek. Some prefer the Preserve at Stoney Ridge to the Ledges at The Ridge. It doesn’t matter what I prefer.
On the selling end, in order to be the best listing agent, I must look at a seller’s lake home with the eyes of an unbiased buyer, not filtered by my own preferences. I have to market each home based on its own unique properties. You don’t market a condo in Stillwaters the same way that you do a cabin in Little Kowaliga.
So how do you find out what people want? You shut up. You ask a good question, then you shut up and listen to their answer.
Not that I am perfect at this. I constantly have to remind myself to be quiet and listen. I make it a habit to ask specific, dialog inducing questions - not “did you like that waterfront lot?” - rather “what about that lot did you like?” The latter helps me understand their reasons instead of just logging a result.
The more I learn about the client, the better I can help, and the happier they will be.
I believe it was jazz great Dizzy Gillespie that said, “It’s taken me much of my life to learn what notes not to play.”
Amen, Dizzy.
Local Lending Would Have Helped Mortgage Mess
The Lake Martin real estate market has not really felt a direct effect of the mortgage meltdown yet. Sure, the subprime fiasco has caused conventional and jumbo rates to rise, but I consider that indirect. By direct effect I mean huge waves of foreclosures from high risk loans, and we haven’t really seen that on Lake Martin up to this point. I don’t think we will see as much of that here as was seen in other markets, because I don’t think that many of the 2004 and 2005 sales were fueled by speculators. A quick trip to the Tallapoosa County Courthouse last week confirmed the low foreclosure rate.
This is not true of other markets around the nation. Headlines like this abound: “Fraud Seen As Major Driver In Wave Of Foreclosures.” In a subject this big, there is a lot of blame to go around: borrowers who falsify their income to buy a home they know they cannot afford, unscrupulous realtors selling for commissions instead of trying to educate clients on wise home buying, dial-a-dollar appraisers who will sell their integrity for $400 a pop, and downright dirty mortgage brokers who churn up new paper and burn families in their wake.
Basically, in many of the cases I think much of this could have been avoided if buyers had stuck with local lenders.
I know this sounds naive of me. Sure, the mortgage industry has changed in the past 10 years.
I know, I know, huge national companies can loan you money no matter where you buy, from Alaska to Port Orange. Sure, because of the internets they can offer low low rates with no no documentation.
So why go with your local yokel lender?
And how would local lending would have helped this mess?
First of all, it’s true, huge national companies can make mortgage loans anywhere with great rates. But the opposite is also true - local banks can tap national rate markets, and almost always match the best rate you can find on the internet. Plus their closing costs are usually lower, at Lake Martin, or anywhere else.
Secondly, more local lending would have helped because it’s human nature to care more about the person you know than you do about some number that’s three states away. If you’re a buyer, would you try to convince your local banker that you can afford a caviar home when she knows you can barely make the payments on your Gremlin? And if you’re a mortgage lender, how willing would you be to give a buyer a loan that you know you will have to foreclose in three months, if your wives are in the same bunko group? If you’re an appraiser who’s on the edge, wouldn’t it be easier to lie to an out of state lender versus one that you sit by at every Friday night football game?
I am not suggesting that we all turn the clock back 40 years and only deal with the bank on the corner and that we all have a credit account at the Feed n Seed. Shareholders pressure banks to make lots of loans, and to do that, they must venture out of state. I get that. But maybe this latest mortgage scare will cause lenders to return to common sense lending.
ElCo Tax Man Squeezes Lake Martin Property Owners
If you own Lake Martin waterfront property that is in Elmore County, chances are that your assessment (and therefore property taxes) went up this year. I have heard lots of anguish from taxpayers that were shocked by their increase this year. I don’t know that those in Elmore County are any worse than Tallapoosa or Coosa, but ElCo has been hit hard this year. Property tax rates have stayed the same, but when they raise your assessed value, your taxes go up anyway.
If you disagree with your assessment, there is an appeals process. You will need to call the Elmore County courthouse at 334–567–1428. They only allow you to appeal for a certain time, so if you disagree, hurry up. Be warned – I have heard of some taxpayers’ appraisals actually going UP after an appeal. I guess after scrutinizing, the tax man figured he needed to go up, not down.
Lake Martin property owners from outside the state of Alabama should note that our property tax fiscal year runs October 1 to September 30. So, the bill that you have to pay by December 31, 2007, is based on an appraisal at October 1, 2006. Therefore any appeal that you make would need to estimate the value at 10–1–2006.
The best way to get your appraisal lowered is to show them comparable sales that prove a lower
value. The best comparables are those that are most like your waterfront home or lot. On Lake Martin, most of the value is in the dirt, so look for comparables with similar views, water depths, and sizes as yours. Then try and find homes that are like yours. Generally, it is easier to first find similar lots, then adjust for the differences in the homes. For instance, if your neighbor sold on September 20, 2006, and his lot is almost exactly like yours, you would only need adjust for the differences in your homes. If he had four bedrooms and you only have three, then you would adjust down by the cost or value of an extra bedroom.
If you are trying to appeal your assessment, and need some comparable sales, or you are just wondering what your Lake Martin waterfront home or lot is worth, give me a call. I would be glad to help you out, no cost, no obligation, no cheesy sales pitch, no guilt. I promise. Just buy me a Slim Jim at Nail’s and we’ll call it even.
To Predict Lake Martin Real Estate Market Cycle - Look West
Most Lake Martin real estate observers now recognize that the sellers’ market is over, because all real estate is local. In fact, we are in a buyers’ market. For those who are in doubt - a buyers’ market means that the buyers have the advantage - IT’S A GOOD TIME TO BUY.
Market forces in real estate shift back and forth like any other market in free nations. We can learn about what might happen in Lake Martin by looking at other markets - like one of the most high end markets in the nation - Silicon Valley.
Recently I came across an excellent post by Patrick Kapowich on his blog - Silicon Valley Broker. He covers some excellent points about different parts of the real estate market cycle. We at Lake Martin would do well to read and learn.
I love his first sentence describing the changes in ’Cycle One of a Buyer’s Market’ - he says (talking to
buyers) - “Listing Agents return your calls.” Hilarious, but true! Great work, Pat.
6 Crucial Changes Coming To Lake Martin Real Estate
As the Lake Martin real estate market shifts to a buyers’ market, away from sellers, what does this mean? If you are about to sell or buy waterfront property, how can you use this to your advantage? What changes can we expect? We can guess a few possibilities from studying other markets around the nation that have been experiencing this phenomenon for a longer period of time. I’m not saying that all of these will happen, but they are strong possibilities:
1. More pizazz from sellers - there are 5 times as many waterfront properties for sale now as there were in 2005. More competition means Lake Martin sellers need to do more to get noticed and get paid. Some examples:
a. more pictures - too easy not to do it
b. home staging- a must
c. talking homes - look for a sign on the home that says “tune in to FM XX.X for more info” where a commercial is played over and over
d. text message info for homes - like the talking homes above, they have a “for more info text #12345″ rider on the sign
2. Builder incentives to buyers - Builders who have extra spec homes sitting unsold are always among 
the first to slash prices. Some Lake Martin builders have already started doing some of the below:
a. free TVs
b. free boat storage
c. pay for first 3 months’ mortgage payments - haven’t seen this one yet, but just wait
d. extra commissions (above the 6%) to the realtor that brings the buyer. As a buyer, you need to ask your realtor if such an incentive exists. Not that that would affect your agent’s impartiality, of course……..
3. Less downward pressure on realtor commissions - A buyers’ market exposes the pretenders from the listing agents that really know how to market. If the sellers feel that they can pay the popular 6% in commission and have their waterfront home sell, instead of languish unsold for a year, they are less likely to go for the cheapest “low bidder.” In the Lake Martin sellers’ market up to 2005, sellers had so much influence they could almost name their commission. Not so now.
4. Proliferation of buyers’ agents? Since buyers hold the cards on Lake Martin now, many agents may shift their marketing focus to buyers. Some agents may even pitch themselves as exclusive buyers’ agents, refusing to list homes for sellers. In extreme buyers’ markets in other locations, they even go so far as to advertising that they will give part of their commission as a rebate back to the buyer. Could this happen at Lake Martin? It’s possible, but doubtful, I think.
5. Reduction in effective FSBOs - FSBO or For Sale By Owner - (pronounced FIZZ-bo) - again, in a sellers’ market, it was a lot easier for Lake Martin waterfront sellers to go it alone. Stick a sign in the yard, and get twelve offers tomorrow, right? Now that there is more supply out there for sale, it’s a lot harder to get it done, even for agents. See #1 and #3 above.
6. No change in BUDDY-BOs - I define “buddy bo” as sales by owners directly to that buddy or relative 
that told them “hey - if you ever sell that house on Lake Martin, let me know.” OK, so it’s not a change. But maybe the lack of change is crucial. These type sales are not as dependent on market conditions so I really don’t see a huge change here.
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2007 Is Russell Lands’ 2nd Best Year On Lake Martin
This year has been good to Lake Martin developer Russell Lands.
Broker Steve Arnberg was interviewed by the Opelika – Auburn News recently about the sales trends on Lake Martin. Arnberg said that, while low water levels on Lake Martin had affected sales, this year was still strong enough to qualify as their second best.
Arnberg is quoted as saying “It’s not as good as last year and we can’t necessarily say why, but (sales) are as good as the year before.”
I assume that means that Russell Lands has sold about the same amount of Lake Martin waterfront property this year as they did in 2005, but not as much as they did in 2006.
My questions on this:
1. What do you mean by Lake Martin “sales?” Does he mean the dollar value of total sales? Or the number of waterfront lots or homes sold?
2. Why can’t he “say why?” I have already written in earlier posts about the number of Lake Martin waterfront sales declining in 2007, and that I think it is mostly related to over pricing by sellers. Does he disagree, or has he not figured that out?
3. Why doesn’t Russell Lands publish its sales figures for Lake Martin? The entire Lake Martin 
market is down 35% from last year, yet Russell Lands is having its second best year. How? I realize that they sell plenty of waterfront lots that they don’t publish in the MLS. For instance, when they opened Phase III in The Ridge, they sold lots to buyers themselves, so the data doesn’t come through our MLS. I affirm their right to do that. It’s very possible that they sold so many of their new Ridge lots that they are having their second best year ever. So why not publish, or at least mention in this interview, what they mean by “second best year?”
Russell Lands is far and away the biggest developer on Lake Martin. Naturally, as they own one half of the 700+ miles of shoreline. I’m not so nosy to think that they should tell us every penny that they spend and make. They are a private company. But, I do think it would be helpful if they gave general sales totals in number of properties sold and dollar value thereof. For instance, they could say that they have sold 40 of 100 lots in the new phase of The Ridge at an average price of $600,000. It would shed more light on the reality of the Lake Martin real estate market, and therefore benefit them, as they are this market’s biggest landowner.
This Man’s To Blame For Slow Lake Martin Market
The Lake Martin real estate market has slowed way down - it’s no longer a sellers’ market. Who is responsible?
One man - Adam Smith.
In 1776 Smith established himself as one of the most influential economic philosophers when he penned Wealth Of Nations. He described the natural economic forces that have existed since the caveman wanted to trade his neighbor one rock for two bones. OK, so maybe he’s not responsible for the slowdown, but he was the man who so eloquently described what is - Supply and Demand.
That’s right - the Lake Martin real estate market has slowed down because of simple supply and demand. Not because of the drought. Not because of the Army Corps of Engineers, not Alabama Power, not Russell Lands. Mr. Smith’s omnipresent Invisible Hand has suppressed the number of waterfront closings. In the 12 months before August 1, 2005, there were 386 waterfront closings. In the 12 months before August 1, 2006, there were 346. In the last 12 months, that number is down to 226. Looking back, the summer of ‘05 was the peak. Face it. There are fewer waterfront closings this summer. But why? In a free market, the more accurate question to ask is always ..
What has affected supply and demand?
SUPPLY:
Easy explanation here. Waterfront property has been on an unprecedented run since 1999. Prices have skyrocketed. Whether we’re talking waterfront property or widgets, more people are willing to sell at higher prices. While supply will always be fixed (Lake Martin ain’t gettin no bigger), the quantity supplied this summer is higher than in 2005. At the peak of the sellers’ market in 2005, there were only 126 waterfront properties for sale. Right now we have 603. Per se, that might not contribute to a slowdown, but when taken in conjunction with…..
DEMAND:
As inseparable as yin and yang, you must consider both supply and demand in any free market evaluation. 
So where are all the Lake Martin buyers? Anyone could tell you that they must be scared away by the increase in prices since 1999, but is it a true downward demand shift? Are fewer buyers interested in Lake martin waterfront property now? Or is it simply a decrease in quantity demanded?
Has the drought, low lake levels, and high prices removed buyers from the market? Is that why there is a surplus? I think not. Anecdotally, I am talking to more buyers now than I was in 2005. Buyers that I talk to are not phased by the low lake level. They understand that it is a 50 year anomaly. Sure, I think that the drought has affected it some, by removing potential buyers out of the pipeline before they ever talk to realtors. But I don’t think it has affected demand that much. So I don’t think we’re experiencing a demand shift.
I think the Lake Martin buyers are still out there. There are still plenty of folks who want waterfront real estate, but they want it at lower prices. Case in point: the condo auction at Harbor Pointe. 20 waterfront condos were sold in three hours, when in the previous 12 months, only 34 had sold on all of Lake Martin. Why? Price. The exact same condos that were listed on the mls at $420,000 sold at the auction for about $250,000. This jives with my anecdotal evidence - from talking with buyers. Plenty of people want to own Lake Martin real estate, but not at a crazy price. This extends across all market segments - lots, condos, deeded lot homes, and leased lot homes.
SO WHAT?
So what does this mean? It means that buyers can exert their influence more strongly, by seeking out better values with research. Don’t expect prices to return to the 1990s. But buyers can find decent buys if they know how to research and if they let a good realtor help them. Click here if you need help.
Lake Martin waterfront sellers need to get realistic. Don’t price things based on what you wish you could get - check the numbers on sold comparables. Hire a good realtor (read: me) that will aggressively market your property - and it will still sell, trust me.
Related Posts:
Proof Of End Of Selllers’ Market On Lake Martin
Results Of Waterfront Condo Auction - Harbor Pointe - Lake Martin
Lake Martin waterfront condo buyers flock to the condo auction at Harbor Pointe in Stillwaters.
Roebuck Auctions held an auction at Harbor Pointe Marina in Stillwaters last Saturday, July 7, 2007. The bidding started at 11:07 AM, selling 20 units in the Harbor Pointe Condo development. Chris Boden, representative of Roebuck Auctions, stated he thought the auction went very well. He estimated that there were about 500 people in attendance and about half were registered bidders. Boden confirmed that all 20 condos were sold and are under contract to close in thirty days.
Boden went on to say that the boat slips were not auctioned that morning. They were pulled from the auction due to a “legal snafu” that the sellers were currently working out. He said that 24 slips are still available, and they would be offered for sale first to the auction high bidders, then to existing Harbor Pointe owners. Boden also said that some boats were sold, but since he worked on the real estate side, he didn’t really know the details on how that all turned out.
Lake Martin Voice roving correspondent Kirk Wascom had this report:
“I went to the Harbor Pointe Auction at Harbor Pointe Marina this past Saturday. There was obviously a lot of interest given there were 300 other folks in attendance as well.
The first condo sold for $385,000 and the last one went for $235,000, not including the 10% fee to be added. They auctioned the condos on a buyer’s choice. The first condo sold allowed the buyer to choose his/her choice of the 20 available waterfront condos. The first one sold and chosen by the buyer would have been the one I would have chosen.
Although I attended the auction more out of curiosity and genuine interest, I did take my checkbook and a letter of guarantee from bank. During my registration they asked me for my letter of bank guarantee. However, a buddy of mine who also attended the auction was not asked to present one. We registered at different times. I guess it’s like buying alcohol; sometimes you’re carded and other times you’re not.
In my opinion, I think those who were the high bidders and who got their choice of a condo got a good deal at a fair value. It was all a win-win position for both sides. Due to the number of buyers at the auction there was no way anybody was going to get a condo for some low bid price of $75,000 - $100,000.”
Thanks Kirk, for that report, and for the inspiration for this series of posts.
Does anyone else out there have a subject they would like to see covered by the Lake Martin Voice? Speak up! And watch out, you may be drafted into action like Kirk…..
Related Posts:
More Info – Harbor Pointe Condo Auction – Lake Martin
Lake Martin Voice Auction Post Linked By The Wall Street Journal
6 Questions To Ask At A Lake Martin Auction
Lake Martin Real Estate Spotlight: Bolton Cove Update
Lake Martin has a lot of development and new construction going on right now. One of the newest neighborhoods is called Bolton Cove. Below are some pictures of the construction progress, and how it compares to their plans.
Will the above be the site of the Bolton Cove Clubhouse?
The above is a rendering of the planned Bolton Cove Clubhouse per the developer.
To the left is an example of the “Tuscan inspired” lake homes that will be the theme throughout Bolton Cove. I doubt you will be able to rent any of these.
Below is a pic, I assume of home sites, next to an existing Lake Martin home that is 
not part of the project.
The pic to the left was made standing on the south end of the cove, looking west to the back of that slough. I couldn’t easily tell by looking around how much waterfront the lots will have on Lake Martin. Maybe the next time I check I will be able to see some stakes or something.
Planned amenities of Bolton Cove:
The Bolton Cove Manor provides:
- A community meeting room
- Dressing areas
- Swimming pool
- Hot tub
- Covered pavilions
- Outdoor fireplace
- Lake side beach
Concierge services:
- Boat valet to the marina
- Private slips
- Lawn care
- Hosting for Manor events
To find Bolton Cove by land, from Birmingham you take 280 east, then take a right on highway 9 south at Kellyton, Alabama. Then take a left on Coosa County Road 20 east. Take Coosa 20 east until you take a right on the second Bywater Road, Bolton Cove is immediately on your left. You can take a left on Kowaliga Cove Road, it borders some of Bolton Cove, too.
From Montgomery, take Alabama highway 9 north, take a right on 259 north at Equality, then a right on Coosa 20 east, see above.
From Auburn take 280 west, then take a left on 22 west in Alex City, then a left on 259 south, then left on Coosa 20 east, see above.
By water, you need to be on the Kowaliga side of Lake Martin. Go north towards Willow Point. Pass by Sand Island. Head towards Veazy’s Marina and Scrushy’s house. When you see the point across the water from Veazy’s, hang a left and go west. Bolton Cove is almost directly west of Veazy’s.
Related post:
Have You Heard About These 4 New Projects On Lake Martin?
Lake Martin Home Prices Not Affected By Sales Drop?
Rest easy. Alabama home