Posted: April 23, 2010

Realtors open to social media; more agents market on Web

Joy Santiago stood in the living room of a one-bedroom condo she had listed for sale in Detroit, videotaping a 360-degree view to post on YouTube.f Dwellings Unlimited in Farmington Hills, didn't stop there. She created a Web site for the home, featured it on two Facebook pages, posted a tweet or two on Twitter and listed it on a slew of real estate sites, including Realtor.com, Trulia and Zillow.

Like Santiago, more real estate agents are turning to social media to drive sales, featuring listings in their Facebook status updates. Others are marketing on 50 or more Web sites. They say Internet marketing -- aside from being free -- lets them tap into new audiences and sell more homes.

"There's never too many sites. There's no overkill -- the more exposure, the better," Santiago said.

Elyse Van Houzen, an agent for Re/Max Showcase Homes in Birmingham, said she's sold several houses to old high school friends just from reconnecting with them on Facebook. She loves the site.

"It is free marketing. It is daily marketing," Van Houzen said. "It is probably the best thing to happen to real estate agents."

Social media is changing the way Realtors market and sell homes. It's faster than cold calling and costs nothing to promote the latest listing through a status update on Facebook or a tweet on Twitter.

But sales from social-media contacts still represent a small portion of overall sales.

Take Mark Zawaideh. The agent with Keller Williams Realty in Novi said he markets listings on as many as 150 Web sites including large search engines Google and Yahoo, local classified-ads site Craigslist, and real estate search engines Trulia, Zillow and HomeFinder. HomeFinder is on Freep.com and includes metro Detroit real estate listings and classified ads.

'The results show'

"I have one marketing manager and that's all she does all day is post these homes on all these Web sites," Zawaideh said. "And the results show. That's how we sell 200 homes a year."

He's sold nine houses in the past year and a half to friends through Facebook alone.

Now, about 35% of Realtors actively use social or professional networking Web sites and 14% plan to begin integrating online marketing in their business, according to a survey of members by the National Association of Realtors.

Internet and social marketing have allowed Zawaideh to cut expenses on print advertising, which he dropped entirely this year. His office recently discontinued placing ads in Keller Williams' monthly color magazine, saving $4,500 a month that it had spent over the past 11 years.

Karen Kage, president of multiple listing service Realcomp in Farmington Hills, said that many Realtors are just learning how to use social media tools to communicate with customers.

"It is another way to get information out by pushing it out instead of waiting for the customer to come looking for it," she said. "The first-time homebuyers are so used to communicating using these kinds of tools. And that is why it is so important to understand it."

The National Association of Realtors began offering a social-media course last summer.

Max Pigman, vice president at Realtor.com, who teaches social-media classes and shares tips on the Realtor.com Facebook page, said there are a lot of Realtors on Facebook, but a small percentage of them are actually making money from it.

He said that's because a lot of them think they need to be on social-networking sites because everyone else is, but they aren't creating a business strategy. That's what he teaches them to do.

He encourages agents not to use Facebook just to talk about open houses and new listings.

"I have a friend who is a dentist and he doesn't write, 'I did another root canal,' every day," Pigman said. "You have to get strategic about what you are sharing."

Instead, Pigman encourages agents to start conversations on Facebook about the state of the real estate market or even create neighborhood pages where they specialize that could come up in Google searches.

"It's all about creating some sort of relevant information," he said.

Besides Facebook, Pigman suggests agents share video tours of homes on YouTube, create a professional profile on LinkedIn, and search Twitter for tweets about real estate where they might find leads.

"I think social media itself is here to stay forever," Pigman said. "What the Realtors really have to do is learn how to get people talking about them."

Santiago said the math is simple. She has nearly 1,000 friends on her personal Facebook page and each of them has an average of 250 friends as well.

"So that is potentially exposing my listings to 250,000 people for free," Santiago said. "That's where people are. People are on Facebook every day five times a day."

The Basics: Extended Home Buyer Tax Credit 2009/2010

as featured on time.com

Luring Foreclosure Buyers on Detroit's 'Lonely Homes' Tour

On a recent Sunday afternoon, Joy Santiago, a real estate agent, stood atop the front steps of a vacant, eight-bedroom colonial-style mansion, bullhorn in hand. "Alright, 10 minutes," she declared, ushering in the 50 or so people on the Lonely Homes Tour, an aggressive effort to sell foreclosed properties in one of Detroit's last solidly middle-class neighborhoods. (See pictures of the Lonely Homes Tour.)

Those grimmest aspects of Detroit city life are just a few blocks from Indian Village, where the Lonely Homes Tour took place on a recent Sunday. For decades, the neighborhood managed to defy that fate. It was carved in the late-1800s, barely three miles from Detroit's downtown, as an enclave for the city's emerging industrial barons. Even as Detroit's wealth moved further into the city's suburbs in the wake of World War II, Indian Village's Tudor- and Georgian-style homes — many with large back yards and carriage houses — attracted politically connected, white-collar professionals.

But not even the neighborhood's lawyers, judges, principals and auto-industry executives have been immune to the economic crisis battering Michigan, the state saddled with America's highest unemployment rate. Some have lost their homes. Some who've left have been unwilling to lower their home's prices. At the same time, banks have become more discerning in issuing mortgages to prospective buyers. By one estimate, about 15% of the 350 homes that comprise Indian Village are foreclosed. (See pictures of the remains of Detroit.)

Residents have taken various steps to prevent vacant properties from becoming magnets for criminals: Regularly mowing lawns, installing curtains, or even baby monitors. Detroit's crime, failing schools and the shortage of supermarkets selling fresh, reasonably priced fruits, vegetables and meats have been barriers to attracting the kind of professionals that have transformed other once struggling cities. One longtime resident, Steve Wasko, recalls real estate agents dismissing Indian Village, saying, "We don't have time to come 'down there,' like 'down there' is crossing some line you never travel without a passport." Some agents, Wasko says, simply gave the keys and alarm codes of homes to prospective buyers without bothering to vet their backgrounds. "That's like giving the goods to potential thieves," he says.

Last year, a group of Indian Village residents launched a search for a real estate agent who would commit to the neighborhood. They soon found Santiago. She'd left Ann Arbor, Mich., for Detroit in the late-1980s to work as a booking agent for techno music DJs. By the late-1990s, she'd become a real estate agent, and frequently worked in Indian Village. The timing was good back then: In her first year, Santiago says she sold one house a week. "Everyone had a job, everyone wanted to have the American dream — homeownership," the 41-year-old says. (See The Detroit Blog's coverage of the city.)

One of Santiago's first marketing ideas was what she christened the Lonely Homes Tour. The first tour, in September 2008, drew car loads of prospective buyers. More importantly, it generated considerable buzz about Indian Village's mansions. The next installment came last month. Residents lined the leafy streets leading up to Indian Village with ads promoting the tour. Of course, they also touted the event on Facebook.

And lo and behold, there wasn't a single empty seat on the two tours' busses. A caravan followed Santiago to each of the seven stops. At one point, the caravan rolled up to a sturdy, four-bedroom, 2,400-square-foot colonial built in 1925, that's priced at $39,000. Then came the tour's most expensive home: an eight-bedroom, 8,500-square-foot 1917 colonial. The price: $189,000. One woman covered her nose to keep the smell of mildew away. Her husband carefully took notes about the cracked wooden floors. People looked in awe inside the elevator of one house. Santiago stood by, answering questions about the house's history and its original owners, handing out business cards to the young and middle-aged professionals from the suburbs or downtown condos looking to trade up to bigger home at a bargain. (See pictures of a day in the life of Detroit's Mayor Bing.)

So far, Indian Village residents seem satisfied. Wasko says: "If I were a real estate agent, I'd act like Joy: I'd work my butt off on Sunday afternoon, and not roll my eyes and say, 'maybe this won't get the sale.'"

That effort just might be paying off. One day after the tours, Santiago says she had gotten several calls for second showings. About six people from the Lonely Homes Tours have made offers. "People heard about Indian Village, but without an event like this," Santiago says, "they wouldn't have made it."

Selling Homes in Detroit: It's About More Than Just the Benjamins

If all you knew was what you saw in the national media, you'd think being a real estate agent in the city of Detroit would qualify you for a guest spot on the Discovery Channel's "Dirty Jobs" show. Talk of $100 houses makes Detroit seem like the blue-light special of real estate. Everyone from CNN on down is telling the story of out-of-state speculators snatching up Detroit property like the sample vultures at Costco mindlessly gorging on the freebies. It sounds sad and ugly.

There's some truth in those cheap property stories, but that's only one part of the real estate picture here.

Enter Sabra Sanzotta's beautifully decorated live/work space in Eastern Market's FD Lofts, where swaths of luxurious fabric drape brick walls, silver cut out butterflies glimmer from the impossibly high ceilings and the kitchen gleams with fancy appliances. As Sanzotta sits, chatting and monitoring her buzzing cell phone, she doesn't seem on the precipice of defeat, gnashing her teeth and shaking her fist at the heavens. She offers no "why me?" diatribe and doesn't rail against the state of real estate. She just seems busy. Really busy.

"This has been our best year,"  says the proprietor of The Loft Warehouse. You may have a hard time believing this, but she means that this year -- yes 2009 -- has been her best yet. Huh?

Sanzotta isn't the only one telling that story. Realtors who specialize in the greater Downtown area and some of the city's more affluent neighborhoods say they aren't immune to the realities of a national mortgage crisis, sky-high home foreclosures and other unsavory economic realities. They aren't quitting the city either, not when there's good money to be made.

Many of the city's agents are selling more than just cheap houses to scavengers. They are selling things like luxury lofts to happy new residents. They sell fixer uppers to families, condos to empty nesters. Good homes to people who will live in them. And Detroit agents are making money doing this, even if to do so they have to work their tails off and harder than ever.

What are they buying?

Oh, that mythic $100 house. It's out there, but most of us couldn't or wouldn't live there.

While innovative projects like the internationally famous Mitch Cope/Gina Reichert Power House are extremely cool, not everyone has the guts or the vision to be gutsy and visionary. Some people want to buy a home, move in and live in it without first giving it an extreme makeover. You can do that in Detroit, real estate agents say, but you'll have to pay a little more than a Benjamin.

Joy Santiago, a real estate agent and resident of The Villages, says people who have been waiting are now moving forward to get into properties and neighborhoods that in another time would have been out of reach. "We've got the biggest opportunity ever to be able to purchase Riverfront, Downtown, or Midtown property," she says.

Condos on the riverfront that were once six figures are going for less than $100,000. Houses in sought-after neighborhoods like The Villages -- historic homes that anywhere else in the nation would be worth millions -- are more affordable than ever.

In Midtown on highly desirable historic Ferry Street, Sanzotta is selling new construction luxury condos at Centurion Place starting at $150,000 – about half of what they were selling for a couple years ago.

One of Sanzotta's young professional customers, Damoni Hurt, a marketing manager for Ford who is in his 30s, was one of those waiting for the right time. He just bought a condo with a downtown view on E. Jefferson across from Belle Isle.

"Now is the opportunity to transition from renting and sitting out to really jumping in," he says.

Hurt bought a bank-owned condo for $80,000 in The Lofts at Rivertown, a building that a couple years ago had units going for at two to five times as much. He knew the location was perfect: He was living there already. "It was a no-brainer from a quality of life standpoint," Hurt says. "I was living in the same building renting, paying twice as much for rent."

And he was not just buying junk. His is a tri-level loft with high-end fixtures. "This is the whole kit and caboodle," he says. "It's a foreclosure, but it wasn't a falling apart, dilapidated kind of East Side house deal."

The same space in downtown D.C. or Atlanta -- where he's lived before -- would have been out of his reach: "It'd be $1 million plus in D.C. In Atlanta, half a million easily," he says.

In addition to foreclosures, real estate agents say another big part of their business right now is short sales. In these cases, they negotiate with the banks to let homeowners sell the homes for less than they owe, and then the banks forgive the difference.

A short sale, however, is a lot more difficult and takes longer than a traditional sale, but agents say that when these short sales work out, it's a win-win for all the parties involved. In a short sale, the home won't sit empty, the seller gets out of the mortgage, the buyer gets a good deal and the agent gets a better commission than he or she would have gotten if the home was sold in a foreclosure.

More than foreclosures

Foreclosures and short sales aren't the only deals being made in the city. It's squishy, but there is still a market out there.

Last month, Sanzotta sold a $165,000 condo in Harbortown to a firefighter who plans to retire on the riverfront. She's also closing on a $141,000 townhome in Corktown in a few days. Both are not foreclosures.

Ryan Cooley of O'Connor Real Estate and Development in Corktown, says he's had a lot of demand for architecturally significant properties like the Mies van der Rohe townhomes in Lafayette Park. This month, in fact, he showed them to a couple from Baltimore, relocating here to work at Wayne State University. And it looks like they're buying.
 

Santiago just wrapped filming an episode of the ultra-addictive real estate drama "House Hunters" for HGTV. She showed the buyers three $400,000 properties -- all within Detroit's city limits. If you watch the show, which we already established that you do, you know they always buy something at the end.

And real estate agent Austin Black II, who works a lot in his Midtown neighborhood, says a customer walked in recently and paid a cool half million cash for a penthouse loft in the new Willys Overland Lofts development in Midtown.

Those stories -- market rate sales and big properties with high price tags -- might be more rare thanks to foreclosures and short sales, but they are out there.

Who is buying?

Black says 2009 is turning out to be a good year for him, as well, but he's had to hustle. "Part of it is, I am working with a lot more people, and you have to work a lot harder with those buyers," he says. Buyers have a lot more from which to choose, and they want to see the options, he says. "But it's paying off."

There might be out-of-state speculators looking to buy up Detroit by the block, but Black, Sanzotta and others who regularly sell in the city say those customers aren't as frequent as one might think. And the media reports mislead people to believe that for pennies, they're going to get a great house.

"I've gotten calls from people who are not from this area and who are from other parts of the country, and their impression is that they are getting a livable home for $100 in a livable neighborhood," Black says. "I think you'll find the market is typically more stable in Midtown."

OK, so who are the regular buyers? Sanzotta says many of her customers are professionals coming to work at the Medical Center. Black sells a lot to empty nesters, too. Cooley has a lot of customers relocating from out of state. Black does, too, and says that "95 percent of them grew up in the 'burbs, and a good percentage of that group has lived in cities across the country." They want an urban lifestyle, and they want it here.

In Detroit, he says, new development has slowed but there's still a trickle, like the newly rehabbed condos on Mack in Brush Park that Black sells. Black says selling new condo developments is tricky right now because lenders want 15 percent down on condos not already half sold, and most buyers don't have that to pony up. Sanzotta is facing the same challenge at Centurion, but she's seeing new interest in the property.

But even with the slowdown, Black says don't let those big media guys fool you: In Detroit, there's still plenty of life.

"One of the unique things about the downtown and Midtown areas, we've lost some businesses and some of the developments that were proposed never got off the ground, but you still see businesses opening, places under construction, new restaurants," Black says. "I still see more people walking outside, more people walking and running. Things are still happening and people want to be down here."

It's clear that first-time home buyers have been having a major impact on the housing market this year. The National Association of Realtors announced that first-time buyers, who typically account for less than 40% of home sales each year, have been especially busy…in March, homes that were purchased by first-timers accounted for 53% of all sales, and this percentage is expected to hold true for all of 2009.

With home affordability higher than ever, available tax credits and some of the lowest interest rates ever recorded for home loans, who can blame them? Particularly as a first-time buyer, there may never be a better time to buy a home than right now.

However, the availability of a tax credit, while a great incentive, does not put the money in the hands of a buyer right away. HUD's announcement now allows for prospective and qualified home buyers to borrow the money from approved agencies and lenders.

While details of participating lenders and HUD-approved agencies are not yet available, this should turn up the heat on prospective buyers to get busy searching for their next home. As further details become available, I will get them to you.

In the meantime, alert your database that one more barrier to homeownership is being removed and the time to start shopping is now!

The Real (Estate) Deal 

By: Kelli B. Kavanaugh

February 19, 2008

It ain't pretty out there. Read Model D's Development News column and it's clear the motor is running, but definitely not chugging along like it was just two years ago. Detroit needs a tune up, badly.

To wit: condo projects are being scrapped (The Griswold), converted to commercial (Mid-Med Lofts) and worst of all, sitting empty (Nine on Third). That's not even mentioning the countless developments that while complete, are just not filling up. Which begs the question: has the proverbial boom gone bust?

Well, yes and no. There are some signs of health hiding under this case of the market blues. At last week's Model D Speaker Series, a panel of speakers intimately familiar with real estate in the city talked the bad — and good — news.

The Detroit Investment Fund's Dave Blaskewicz presented an overview of the last six years of development in Greater Downtown – new housing, retail and dining and entertainment venues, not to mention cornerstone changes such as Compuware, Campus Martius and the Detroit RiverWalk.

DIF studied the evolution of Greater Downtown's housing stock between 2000 and 2006 and found 2,500 new units of housing, a significant increase in sales prices (from approximately $140 -160 per square foot in 2004 to $198 in 2006) and a young, affluent, educated group of new residents. All good things, no doubt.

But the pace slowed in 2006.

Blaskewicz characterizes the current market conditions as "soft." High unemployment, jail-tight credit, an over-supply of homes for sale and – ouch – record numbers of foreclosures are all to blame.

The results? The absorption of new units has decreased, sellers are having trouble doing so, projects are failing, would-be purchasers are nervous and potential developments are finding financing more difficult to come by.

Hooray for rentals

So where's the silver lining? Rentals, most definitely. Developments like the Kales Building and Lofts at Merchants Row are both at stably high levels of occupancy. To take advantage of historic tax credits, developers must keep buildings as rentals for five years, which actually makes a lot of sense in this market.

Ryan Cooley of O'Connor Realty & Development, one of four panelists also on hand at the event, sees another benefit to marketing rentals. He finds that people new to Detroit might prefer to rent before taking the plunge into ownership.

Two rental developments his company has been involved with – Eastern Market's Detroit Candy Co. and the apartments above Slow's Bar B Q in Corktown – have both filled up quickly.  It's important, he says, to offer "a good, solid, clean product."

While renters are sometimes looked at as less valuable to a neighborhood than home- and condo-owners, Joy Santiago of Ralph Roberts Realty, another panelist, disagrees. "It brings people into the city, brings people around," she says.

The mother of invention

Another point Blaskewicz made is that this market forces – and also rewards – creativity. Examples of this include event-based marketing, multiple developers joining forces to draw potential buyers, financing incentives – like free association dues for one year or rent-to-own opportunities – and promotions such as allowing interested parties to try a loft out for a weekend.

Real Estate One's Elizabeth Tintinalli is no stranger to such efforts. The mastermind behind Illuminate Detroit, she works to draw people to developments with a cheese-trap of music, food and art. This makes sense, considering one demographic she finds herself interacting with frequently are those with artistic backgrounds, looking to "get in on the ground floor," she says.

Cooley agrees. He has worked with people relocating from other areas that find Detroit's cost-of-living low enough to encourage the fulfillment of dreams often deferred in other urban areas. "Here, you can start something on their own."

For his part, Austin Black II of Max Brook Realtors looks north of Eight Mile. He finds himself working with Oakland County natives recently returned from college, and sometimes even their parents, looking for an empty-nest condo. Both groups have one thing in common: they demand proximity to an urban experience not found elsewhere in Michigan.

Weathering the storm

And then there's that four-letter word: Foreclosures.
 
So, what is the real deal with those nasty, dirty foreclosures? As we all well know, the Detroit area has been hit hard. So, what does this mean to the real estate market?

For Santiago, it means she is making lemonade out of lemons. "[Foreclosures] are our largest source of business now," she says. It's a buyer's market, she says, "Everything is a really good deal."

Cooley says there are two divergent markets when it comes to foreclosures. In the condo foreclosure market, units are moving fairly quickly. He even thinks there is less supply than many buyers anticipate. "People think there will be more than there really will be," he says.

On the other hand, when it comes to foreclosed houses, it's a whole 'nother animal. "They are in rougher shape than the condos," he says.

The bottom line is yes, everyone is hurting, from developers to builders to realtors to sellers. But a lot of people are digging in their heels and riding out the storm. "We're all hurting a little bit right now," says Tintinalli. "But we're still out there, still promoting the city."

Kelli B. Kavanaugh is Development News editor for Model D. Her glass is half empty and half full.

Model D Speaker Series: Detroit Sells