Effective Communicationand the meaning of ‘Edutize’

www.steveharneyblog.com

Leadership in the Current Real Estate Environment

Sunday, November 159:00am-10:30am

Reports are still looking good!!

New construction

Existing home sales

Pending home sales UP!UP!

UP!

Sources: Bubble Meter 8/22/09

U.S. Existing Home Sales

$0 -100,000$100,000 -250,000$250,000 – 500,000$500,000 – 750,000$750,000 – 1,000,000$1,000,000 – 2,000,000$2,000,000 +

YoY change

38.8%8.7%

- 6.2%- 8.9%

- 10.6%- 23.3%- 32.4%

“These four months of improvement are

the first time we have seen broad

increases in home prices in 34 months.”

- S&P index committee chairman David Blitzer

Source: Micro Markets 7/28/09

Case Shiller

- Robert Shiller, the Yale economist who helped create the index

Sources: Wall Street Journal 8/25/2009

Prices

“It really is too soon to call this a turning point.”

Source: Seeking Alpha, Tom Iacono 7/05/09

Media headlines should not alter our business plans nor our diligence.

People don’t believe what you tell them.

They always believe what they tell themselves.

Cost vs. Price

“If prices come down another 10% but interest rates increase by 1 percentage point, that would mean the same monthly payment today versus waiting.”

Source: New York Times 7/27/09

New York Times

What will happen to house values in the

next six months?

“I expect, I hope, we’ll see stabilization. While there are still great concerns, we’re beginning to see the seeds of bottoming, not in prices yet,but in sales.” - Alan Greenspan at the NAR Midyear Conference

Sales vs. Prices

Sales Prices

In the next six months, do you think the values of homes in your market will:

HomeGain 3rd Quarter Realtor Survey

Sources: Homegain 8/2009

Sources: Newsweek 8/31/2009

“One of the most vital fundamentals (in housing), the ratio between supply and demand, is still out of whack.”

- Newsweek

Supply & Demand

32%

How big a role will foreclosures play?

13.16% in the second quarter of 2009

Sources: Mortgage Bankers Association 8/09

Delinquency Rates

Sources: Seeking Alpha 8/24/2009

for prime loans

dropped to 6.6%

from an average of 45% for the

years 2000 through 2006.

Sources: Wall Street Journal 8/24/2009

‘Cure Rate’

Source: Wall Street Journal, Stan Liebowitz 7/3/09

Causes of Mortgage Foreclosures (2nd half 2008)

Source: Google 9/09/09

Wisconsin Unemployment

8.7%

Wisconsin20%

Sources: First American CoreLogic 8/09

Mortgages Underwater

“Jumbo prime foreclosure

rates up 580 percent since

January 2008.”

The High End is also…

- Lender Processing Services July Mortgage Monitor Report

suffering

More than 25% of mortgage loan defaults are strategic.

Source: Northwestern University Kellogg School of Management, the University of Chicago Booth School of Business and the European University Institute 7/09

Mortgage loan defaults as a strategy

- ‘Moral and Social Restraints to Strategic Default on Mortgages’

“The Treasury expects

‘millions of foreclosures’

even if the HAMP is a

total success.” - Herbert Allison, US Treasury’s assistant

secretary for financial stability

Shouldn’t I just wait if a want to sell my home?

Source: CME Group 6/09

May 2010

Projected Bottom

Today’s Price

Nov 2011

“The housing market may not stabilize until the first quarter of 2011, the Mortgage Bankers Association said today, upon release of its National Delinquency Survey.”

Source: Housing Wire 5/28/09

Mortgage Bankers Association

2009 2010 2011

“With any luck, three years should be long enough for the U.S.

economy to recover and for the nation's housing inventory to shrink to more normal levels.”

Source: Business Week 6/09

USA Today

Wisconsin2012 or later

2008 2010

jumped 208 percent during the first quarter of this year compared with the same period in 2008.

Source: Office of Thrift Supervision and the Office of the Comptroller 6/09

Short Sales

TotalCommunication

TotalCommunication

Deal in person

‘Courage is what it takes to stand up and

speak; courage is also what it takes to sit down and listen.’

- Winston Churchill

The two most important rules:

1. You didn’t hear what I just said.2. Listen for what the person is

saying, not for what they just said.

The chicken was ready to eat.The sheriff caught the man with the gun.She tickled the baby with the stuffed animal.Mary put the candy in her mouth on the table.

Let’s test the rules

The facts:

• We speak at 100-175 words per minute.• We can intelligently listen at 600-800

words per minute.

10 Steps to better listening1. First, stop talking!2. Put the other person at ease.3. Show the other person you

want to hear them.4. Remove any distractions.5. Learn to empathize. 6. Be patient. Don’t assume you

can finish their sentence.

Let’s test #6

Did you hear the whole sentence?

He didn’t want to take the apartment because of the bugs…

The lawyer took the big case…

He was afraid of Ali’s punch…

he didn’t want the police listening to his conversations.

he knew it could hold all his papers.

he thought it might be spiked with alcohol.

‘One of the hardest things to do in life is to listen without intent to reply.’

- Author Unknown

7. Watch your own emotions.8. Be very slow to disagree, criticize or argue.9. Ask lots of questions.

10 Steps to better listening

Quiz1. Think of a number from 1 to 10 2. Multiply that number by 9 3. If the number is a 2-digit number, add the digits together 4. Now subtract 5 5. Determine which letter in the alphabet corresponds to the

number you ended up with (example: 1=a, 2=b, 3=c, etc.) 6. Think of a country that starts with that letter 7. Remember the last letter of the name of that country 8. Think of the name of an animal that starts with that letter 9. Remember the last letter in the name of that animal 10. Think of the name of a fruit that starts with that letter

How did I know?

DENMARK

7. Watch your own emotions.8. Be very slow to disagree, criticize or argue.9. Ask lots of questions.

10. Stop talking!!!

10 Steps to better listening

Hearing

Listening to retain content

Listening to feel what is being said

Listening to understand content

Listening to analyze and evaluate content

Energy

Most

Least

Facts

Thoughts and beliefs

Feelings

Levels of listening

10 years from now

1 yearfrom now