Now that the opportunity to claim the Federal home buyer’s credit has passed, the $64,000 question is: what will happen to the housing market without that $8,000 crutch? There is a wide variety of opinion — some have said the credit has had no effect, so removing it will also have little effect. Others have said that the housing market is poised for another dip as buyers will leave the market without an incentive. Prudential decided to ask the people who really count — potential home buyers. Here’s what they found out

[The raw data of the survey comes from Prudential. The graphics and analysis come compliments of Tara Steele and Agent Genius]

* People still in the market think the end of the credit will have little effect

. . . but they felt the credit helped them enter the market in the first place

even though other factors are larger drivers on the market

It’s certainly worth taking a few moments to read the raw data or the graphical interpretation depending on how you process data. What I took away from it was that the tax credit did what it was supposed to. It got people off the fence in 2009 and early 2010 at the expense of slightly slower sales in later 2010. As time went on, however, larger issues such as employment have a greater influence on the buying decision.

We’ll see over the next few months what the price is for having the credit over the past two years.

Real estate, as many of you know, is based largely on referrals. It should be no surprise then, that I was eager to get a copy of The Referral Engine by John Jantsch. John was kind enough to send me a review copy of his upcoming book, so I had a two week head start in reading it.

Vince Lombardi, as the story goes, was known for his belief in fundamentals. According to legend, he would start every season by gathering the entire team, veterans and rookies, around him. When everyone was huddled together, he would pick up a football, hold it above his head and say “Gentlemen, this is a football.”

The Referral Engine treats referrals and referral-based businesses the same way. It starts with the very basic foundation and builds from there;

•    What is a referral?
•    Why do people make referrals? [hint, it's not about you, it's about their friends]
•    What can I do to make it easy for people to refer my business?

Jantsch could have stopped there, adding some more examples for padding and gotten a pretty solid book out of it. This is, however, only the foundation for the core theme of the book

According to Jantsch, the key to a successful referral-based business is to make referrals  the core of everything the business does — referrals are not an “add-on” to a marketing plan, but rather a plan unto themselves. From the initial marketing materials to initial customer contact all the way to the post-sale relationship, everyone is trained to facilitate the referral process as the customer flows through his natural lifecycle;

•    At first, they get to know your company
•    Then, they start to like your company
•    After they have come to like you, they start to trust you
•    After you earn their trust, they are willing to try what you have to offer [having a content-rich website with lots of reports, white papers and such helps here]
•    If they like their trial, they will buy your main product
•    Happy customers are repeat buyers
•     . . .who refer you to all their friends

Done properly, customers can be lead through the life cycle so that the referral at the end is completely natural. At that point, your referral engine runs itself and becomes the turbocharger of your marketing machine.

Finally, as the capstone to the referral model, The Referral Engine comes with over fifty “snack-sized suggestions” on how to apply the principles of the book to specific businesses and business types. This is a great help to people who see the great machine that is a referral engine, but can’t see how to implement it in their own businesses. By presenting some bite sized starting points, Jantsch takes us back to basic concepts that are easy to implement, yet things on which one can build a referral engine of their own. A couple quick samples;

“Attorney – Held Friday help clinics on a range of non-legal issues . . . the idea here was that his clients saw it as a great way to get some very specific free help and the other professionals saw it as a great way to get in front of some prospects.”
“Golf Driving Range – When members signed up for a package that included ten sessions, they got four “Free Range Time Coupons” to give out to others who they would like to bring to the club.” [I picked this one because I just got something very similar from Triangle Sportsplex here in Hillsborough]

Both of these ideas are easy to execute, and they start the process of making referrals a natural part of the business — they create an attitude from which referrals naturally spring.

So who should read The Referral Engine? You should. If you have anything to do with sales or recruiting in any aspect of your life, you should read this book. The core concepts work well in a sales position, recruiting for a non-profit organization, or even looking for new members for your church. For once make the buzz about you positive with The Referral Engine.

April is when flowers start to bloom, home buyers come out in force, and the $8,000 Federal tax credit expired. Which of those had more of an effect on the market?

For all of Durham County there were 2,551 homes listed for sale at the end of April – an increase of almost 5%. 251 sales closed in April, which is an increase of about 20%. That means that it would take 10.1 months like April to work through the current housing inventory. That a drop of 1.2 months — another step towards a stable market

For the 27713 zip code there were 579 homes listed at the end of April – an increase of just over 5%. 58 homes sold during March, a 16% increase. The combination of increased listings and increased closings puts the adsorption rate at 10.0 months – another small step as the market firms up.

With the Federal Tax Credit expiring at the end of April, it might be worth looking at the number of homes sales pending at the end of the month. That should give us some idea of the number of transactions we’ll see in May and June. It’s not perfect — some of these will not close until later in the year, others will fall out of contract and not close at all. Nonetheless, here are the current numbers

• Durham County: 657
• 27713 area code: 166

Those are both pretty solid numbers and a cause for some optimism heading into summer.

Here’s a look at the communities we’re tracking. If you would like to see data from your community, please let us know in the comments.

On a neighborhood level, recovery is still uneven. Hope valley Farms backed down from the March numbers, while Woodcroft and Parkwood both took a small step back. I should also note that this is the second month without sales for Wynterfield, Wellington Forest and Colvard Farms.

Like I said last month, I still believe this will be a fairly solid summer for real estate. The tax credit will continue to power sales until the end of June [qualifying sales must close by June 30], and that momentum should drive us through the end of the 2010 selling season. To find out if I’m right, watch these pages.

Last week seemed to be a slow week for yard sales, which was probably good since it was fairly chilly too. This week seems to make up for it with not one, not two, but three big community yard sales. Set your alarm clock now, it’s going to be an early morning!

Starting in the west, Garrett Farms is having their community yard sale this Saturday from 7AM to Noon. In past years, this has been more of a “lots of people hold a yard sale at the same time” kind of sale, but they have done a great job of getting you to all the sales including a map you receive at the entrance to Garrett Farms, which is on Garrett Road, just west of NC 15-501. Here’s a map.

The Auburn community is also having a community yard sale this Saturday at their clubhouse. every year they have a good turnout, and I expect to see 40-50 booths set up this year as well selling a wide selection of items. The Auburn community is at the intersection of Woodcroft Parkway and Barbee Road. Use this map to get to their clubhouse.

Finally the Parkwood Community Yard Sale is this Saturday. The Parkwood sale has a very long pedigree, so I expect this sale will be very popular. this always seems to be the yard sale I spend far too much money at! Parkwood is just west of the NC 55/NC 54 intersection. This map will get you to the Library parking lot where the sale is held.

That’s it for the yard sale roundup this weekend. hopefully I’ll see you out enjoying the good weather and the great deals!

If you’re out and about this weekend dodging thunderstorms, please come and visit me at my Open House! This Sunday from 3PM to 5PM I’ll be at 2715 Tanglewood Drive showing this beautiful home to everyone who stops by.

This beautiful 4 bedroom, 2.5 bath home has everything one could ask for. Just under a half-acre of land at the end of Tanglewood means your new home would be quiet, but you’re still just minutes away from South Square, Downtown Durham, RTP and Chapel Hill. Inside, this home has granite counter tops and stainless appliances and is completely move in ready. Don’t forget that the $8,000 Federal tax credit ends next Friday!

Here is more information about this beautiful home. Also, as my small encouragement, I’m digging into my stash of Girl Scout Cookies to welcome all visitors. I hope to see you on Sunday!

Our Fair City got some nice press in the Food section of yesterday’s New York Times. While I could sniff at the “so-called Research Triangle — Chapel Hill, Raleigh and Durham” — which is like referring to the 5 boroughs as the “so-called New York City” — the article was a pretty fair discussion about the revival of downtown Durham and the overall trend towards local produce. Read it for yourself — here is the main article and here is the accompanying slideshow

The Securities and Exchange Commission filed civil charges against Goldman Sachs yesterday alleging that Goldman Sachs fraudulently promoted and sold a series of mortgage instruments without telling buyers it had been deliberately set up to fail. The details of the alleged scheme are well reported in this News & Observer article.

Here is the basics: Paulson & Co, a hedge fund, went to Goldman Sachs, for help in creating an investment vehicle based on mortgages Paulson owned. Paulson selected the mortgages used in the security by pulling together subprime mortgages it believed would fail. Goldman then sold the securities to others without telling the buyers that the securities were set up to fail.

Paulson then sold the securities short — it bet on them to fail. So when they failed Paulson made its money back on the shorts, and the buyers were left holding the bag.

To put it in layman’s terms, suppose you knew your spouse was sick, but no one else did. Then suppose you went out and purchased a large life insurance policy on your spouse. Shortly afterwards, your spouse dies. you collect on the policy, and the only person harmed is the insurance company, which would have never issued the policy if it knew your spouse was sick.

If that is the case, Goldman should be fined. And honestly, Paulson should come under some scrutiny, although I’m not sure for what. One of the problems with the economy in the last few years is that there has been no penalty for bad decisions and misbehavior — companies get bailed out, management gets it golden parachutes, and everything goes on pretty much like before. Without a penalty for failure, there is no reason not to take risks. That has to change.

With the Federal tax credit expiring in just two weeks, I wanted to invite people over to my Open House this weekend. On Sunday, April 18 from 3PM to 5PM I’ll be at 12 Innisfree Dr. showing off this beautiful townhome. This 3 bedroom, 3 bath home has all the advantages of a detached home, but without all the yard work and exterior maintenance. Plus, you’re just minutes from Duke, UNC, Southpoint and downtown Durham.

Please stop by and take a look at everything this home has to offer. for more details about this home, take a look at our extended listing

As some of you know, I like to go to yard sales on Saturday morning. The weather was really nice this morning, so my son and I went out to see what we could find.

There were a lot of signs along the main roads [Woodcroft Parkway, Revere Road in Parkwood, Roxboro Road in Hope Valley Farms]. When we saw a sign, we would turn into the development to find the sale. All too often we would drive down to the end of the road and not see anything. That’s right, the address on the original sign was supposed to guide me all the way to the “big sale.”

Open Houses are a lot like yard sales. They are both “one time only” events that largely depend on signs to bring traffic in. A key element of the Weichert recipe is eight directional signs with balloons. We put them on the main road and make sure there is a part of signs that leads you right to the big event. For example, when I hold an Open House in Woodcroft, I put a sign at each end of Woodcroft Parkway [at Fayetteville Road and Hope Valley Road], a couple signs at the traffic circle, and a sign at every intersection between Woodcroft Parkway and the listing I was selling. I imagine you could get lost along the way, but it would have been really hard — we did everything but roll out a carpet for our prospects.

If you would like to hear more about a Weichert Open House, or just about how Weichert can help you sell your home quickly, for the most money, and the least hassle, please email me. Our Neighborhood Expertise is waiting to work for you.

For those readers who can never have enough books, the Friends of the Durham Library Spring book sale is this weekend. The book sale is a great way to find gently used books to add to your collection. You can find this treasure trove at the Main Library [300 N Roxboro Street] during the following times;

• • • Saturday, April 10, 10 a.m. – 5 p.m. Everyone welcome.
    • Sunday, April 11, 2 – 5 p.m. Everyone welcome. $7 Bag Sale.

Come find some great books and help your local library all at the same time.