Latest adventure from Gertie Cranker....

Last week, Inman News released its annual list of 100 of the Most Influential Real Estate Leaders of 2011.  This is a pretty prestigious list in the industry, as befits a significant real estate voice and commentary.

I think AEs should fully recognize and celebrate the names of our peers in Realtor association management who are on the list*:

• Mark Allen, CEO, Minneapolis Association of Realtors,  and 10k Marketing
• Bob Bemis, CEO, ARMLS and MLS Domains Association
• Russ Bergeron, CEO, MRED, Ltd.
• Art Carter, CEO, CRMLS, Inc.
• Dave Charron, CEO and President, MRIS
• Merri Jo Cowen, CEO, MFRMLS and Chairperson of CMLS
• Bob Hale, President and CEO, HAR
• Rebecca Jensen, CEO and chair, UtahRealEstate.com MLS

That these names are included is important to all AEs: it means that the larger industry recognizes the importance of the work we do as association MLSs and the contributions those associations make to the industry.  I know I can look at each one of these people and respect their individual contributions to the success of our members.  They are, in the eyes of the world, some of the practitioners of Best Practices of real estate trade association management. As commentator Bill Fowler recently observed in his blog article “MLS in 2012”, “Creating something vital to REALTORS in MLS technology requires leadership in our organizations.” 

Inman has recognized many of these leaders.

However, without detracting one bit from the applause due these individuals, I’d also like to kick the Inman group in their collective kneecaps.  Why?  Because the MLS isn’t the only area of successful performance by association execs: there are other areas of management leadership and influence besides MLS and its derivative products, the only criteria seems to Inman recognize.  Other programs are equally influential in the world of organized real estate: let’s salute the AEs involved in the RAMCO development work and the successful implementation of some of the great Game Changer programs.  Let’s look at a collection of stunning association professional education innovations, international real estate outreach programs, cooperative infrastructure efforts between associations to produce better services and efficiency, and some outstandingly innovative state association programs—all influential real estate accomplishments in 2011.

Perhaps Realtor AEs need to do a better job of recognizing our own innovators and leaders.  How about an annual collection of best practices? An AE Innovator recognition program?  Another Game Changer program?

And for the benefit of all, let’s make our judgments not only on the program or product, but also highlight answers to the following questions as key learning opportunities for all association managers:

• ·         How did you foster overall management focus on results?
• ·         How did you create a governance structure to move your organization forward?
• ·         What techniques did you use to back your programs with strong, accountable, transparent financial management?
• ·         How did you motivate and structure available human resources?
• ·         What communications program and technology did you employ?
• ·         How did you manage resource development and fundraising to support the project?

Congratulations to the Inman honorees.  You’ve moved beyond IDX policy hysteria to develop practical programs for real estate professionals.  My hope for real estate in 2012 is that AEs continue to recognize skillful leadership and expand our opportunities learn from each other.

 

 

*Note, I didn’t include the NAR or ISC staff—they are also well represented on the Inman list.

 

ec. 10, 2011 - Making Lemonade: Building capacity in changing times

Well, this is interesting: the ever-optimistic NAR economist Lawrence Yun recently observed that 2012 won't see a robust recovery in the housing market. In fact, Yun says that as rents climb in the multi-family housing market and as the stigma of renting is disappearing, it will be the commercial real estate sector which will see the greatest increase in activity.

And noted economic commentator Barry Ritholtz states that the slow motion crash in housing will continue for another 5-10 years and predicts that the US are only in the 5th inning of a 9 inning game in which values may continue to drop. Additionally he says that"following a debt crisis, consumers spend a decade or more deleveraging, and tend to downgrade purchases that involve taking on more credit - like a mortgage."

What does this predicted trend indicate for real estate association managers? It's an uncomplicated answer: it simply means that our more aggressive members will go where the money is. And in turn, that means the association needs to provide those members with adequate support services to get them there.

Even the smallest real estate associations need to sit up and take note: if we are to remain relevant as trade organizations, we must understand that our membership no longer consists of 90% used home salespersons. In order to make a living in the real estate market, members need to respond to consumer trends-and according to the observations of Yun and Ritholtz, the markets are trending toward commercial real estate. That's where the action will be.

So how must real estate associations react? Most Realtors won't become full-fledged commercial specialists flashing their CCIM designations-a majority of US real estate market areas simply won't support many exclusively commercial specialists. What members will want to do is gain the skills and the tools to support an increase in their commercial activities, particularly in the rental property market for multi-family housing. And fortunately, there are some pretty robust existing programs that associations can use to build capacity to support these emerging member needs. Here are some suggestions for the association executive:

1. Encourage members to participate in a commercial overlay board. Many existing support services are already in place in these organizations-- you don't have to reinvent them and spend down your association resources. Becoming a secondary member in a commercial overlay board is a good answer for many Realtors who don't want to exclusively specialize but do want additional education and marketing networks.

2. Form a commercial marketing group in your own board. It could begin as an informal 'haves and wants' meeting over coffee and doughnuts. If the need is there, it will grow on its own-with the association acting the incubator.

3. Examine NAR's Commercial Services Accreditation program for local associations. While your association may not wish to pursue the actual accreditation (which may seem unnecessarily elaborate for your immediate purposes), this program does offer some very useful ideas on how to develop association support capacity in the commercial services area. Think about

a. A dedicated commercial page on your association website. It might feature member's commercial listings, statistics, and useful information about topics of interest-even some data from the local economic development organizations.

b. A website link to NAR's commercial home page, its commercial advocacy page, and the commercial education page. And don't forget NAR's commercial blog, "The Source.", as well as the Commercial Research department--members need easy access to this information.

4. Ask your commercial marketing group what kind of education programs its members need and develop an education series using local or regional experts-commercial developers, economic development corporation representatives, taxing authorities, and others. Again, remember that your target member market is probably not interested in becoming specialists in commercial real estate-but they do want information which will help them expand some specific skills in new areas. (There's a difference.)

a. Offering a regular (monthly?) commercial education program followed by an informal marketing session is one of the best ways to develop member awareness in the commercial area, assuming your association doesn't have the audience for anything more elaborate.

b. This activity might be one which could be shared with neighboring associations as well. Commercial real estate practitioners aren't always productively confined to geographical boundaries-a commercial program will possibly be more successful if your board can partner with other associations in this effort.

The take-away point here is that the changing real estate market is influencing member needs-and our associations must respond, even if only in a modest way. Most Realtors don't want the Commercial Member Golf Outing, or even a commercial ethics process or trade show (as the NAR Commercial Services certification application suggests). Reinventing the association model with the word "Commercial" attached to it is not what most of our members need or even care about-nor is that something that probably two-thirds of local Realtor associations have the resources to provide.

What members do want is practical, efficient access to the skills sets and useful information which the changing real estate marketplace is demanding. It's our job as AEs to start with what the member needs, and set about providing those tools.

(PS: How do you fund this stuff? Try charging the members to showcase their commercial listings on the association website, soliciting underwriting from developers of rental income properties, advertising sales, commercial affiliate member programs, to name a few ideas.…The opportunities are endless.)

Nov. 4, 2011 - Creating Communities: the Future of the Real Estate Association

Associations have a primary purpose: to create a community. In a real estate association, the primary purpose is to create a business community centered on the business of property ownership and transfers. It’s really that simple.

Let’s examine that word ‘community’. In many Realtor associations, the community is really quite limited: it consists of brokers and salespeople involved in the transfer of pre-existing homes. Oh, I know: lip service is often given to other groups—commercial specialists, appraisers, property managers, and a small number of affiliated business interests—but by and large the emphasis is on license-holding real estate practitioners. (Of course it goes without saying that the community is further limited by geographical restrictions, in many cases.)

Realtor associations build most of their programs and services around that limitation: licensed salesperson or broker, located in an assigned geography.

Frankly, there’s a problem here: in reality the real estate community is much more extensive and the desire to be a part of that business community much more far-reaching than the current operating definition would have us believe.   In addition, our existing membership is becoming specialized in other areas besides used-home sales: members are finding business in the rental and rehab market and personal investments for themselves and their clients. They are becoming more conversant in online marketing techniques, technology tools, foreign transactions, and finance.

The real estate community is also expanding well beyond the current limits of license holders, with a second tier of bankers, mortgage companies, and title companies. As members expand their interests and activities, they are partnering with an array of business interests never before included in real estate circles—marketing specialists, technology experts, website designers, foreclosure experts, and economic and development analysts.  

It’s easy to say “Not MY members—they just want to make sales. And, the  Realtors I know don’t read, anyway.” That’s a familiar litany, of course. And of course, in many cases it’s true: statistics show that well over half of current members don’t make a living at real estate. They are dilettantes, retirees, and folks who also have a ‘real job’ and just want to make a little extra income on the side.

The caution here is in thinking that these are the sum total of members, that this is the real estate community our association must serve. If we as trade associations fall into that trap, we are contributing to the erosion of our industry as surely as if we ourselves were the lions coming over the hill (“We have seen the enemy, and they are…).

Certainly this class of member is real and currently accounts for over half of our association dues income. “Ah,” you say, “doesn’t that make the non-productive majority our association’s target market? They are a majority of the association members. If it weren’t for them we wouldn’t exist. So let’s continue producing remedial level education programs, keep our dues and costs low, and direct our collective energies and resources at servicing these members.

I think there’s another answer: if the members in your community by and large don’t make a sustainable income from real estate activity, enlarge the community. Think about it: if your association is to become ‘The Voice for Real Estate’, for whom would they speak? Professionally, your organization would speak for all your industry partners—builders, remodelers, community planners, environmentalists, financial partners, attorneys, estate planners, and property owners. These are some of the areas of the real estate business community who share an interest in the business climate relating to real property.

There are many opportunities to enlarge a reasonably small and circumscribed audience and build a powerful community voice. These doors don’t necessarily depend on an MLS presence, either—they open onto a larger world of business interests, shared knowledge, and valuable networks and coalitions. It’s here that the real estate organization will find its future direction, I believe. There’s not a lot of reason to waste much more effort in locking the barn door after the MLS horse has gone elsewhere, but there is much to be gained by thinking about the kind of community that can be built through a real estate organization which is inclusive rather than exclusive, and which involves using technology tools and other resources to transcend the current limited organizational structure.

It also means assuming that the target market for a real estate association is based on skilled practitioners with skill and commitment to the many facets of the real estate business.

ct. 19, 2011 - MLS Questions? Who has the answers?

 

 

     Sometimes I feel like I'm standing in an empty room and all I hear is the echo of my own voice. This is one of those days.

     Two MLS-related news stories are bouncing around the internet this morning-one is about the NAR IDX policy proposed changes, and the other is about FSBOs.

     (Well, let's face it; they're pretty much about the same thing…)

     In a nutshell, the NAR IDX issue is this: "The big news, as many have already heard, is that the Franchise IDX policy will be repealed in its entirety. The overall thrust of the proposal appears to be one aimed at restoring the status quo ante." The quotation is taken from this morning's blog post by one of my regularly-read industry voices, The Notorious Rob. Rob proceeds to examine what this proposed policy change will mean, and then asks the question, "just what percentage of the Directors of NAR, who will be voting on this proposal on Monday in Anaheim, understand the issue? How many will have studied the issue? How many will have thought about it at all?.... Could someone explain to me how hundreds of NAR Directors are not in violation of their fiduciary duty as a director of nonprofit organization?"

     The other topic has to do with what's happening in the world that exists outside of the pre-meeting hysteria of an NAR convention. In this case I'm referring to Zillow's recent announcement that it has added 45,000 'for sale by owner' listings to its database of existing FSBO web and mobile real estate shopping , allowing independent home sellers to distribute their listings free of charge. Zillow obtains these listings through individual home sellers as well as listing feeds from ForSaleByOwner.com™, HomesByOwner.com®, owners.com® and Postlets® . The latter is a Zillow company, by the way, which allows home sellers, real estate agents and landlords to generate one listing and dispense it to Zillow's more than 24 million monthly unique web and mobile users, as well as 13 other sites including Yahoo!® Real Estate and craigslist®.

     We're not talking peanuts here--Yahoo Real Estate is a formidable challenger to realtor.com. But what really set me back was the association manager who, upon hearing of the Zillow announcement, shrugged and said (somewhat disdainfully), "I don't keep track of Zillow."

     Holy leaping ostriches! How can you disregard the competition with such insouciance? Oh, wait-I know! It's because you're busy word-smithing the following NAR proposal:

 

 

Associations of REALTORS® and their multiple listing services must enable MLS participants to display aggregated MLS listing information by electronic means. Electronic display subject to this policy includes display on participants' public websites, displays controlled by participants on other websites, display on social media sites used by participants, RSS subscription, and applications for mobile devices. All electronic display of IDX information conducted pursuant to this policy must comply with state law and regulations, and MLS rules. Any display of IDX information must be controlled by the participant, including the ability to comply with this policy and applicable MLS rules.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

     And I bet you're thinking: "Now how am I gonna enforce THIS on a budget that has been shrinking as members are dropping away?"

     Well, don't worry about real estate buyers and sellers: they may be looking elsewhere. As Zillow CEO Spencer Rascoff says, "Our integrated approach to marketing all types of real estate listings, creates the most comprehensive and data-rich shopping experience for web and mobile."

     Oh, and don't worry about the MLS subscribers either. They want to be where the consumer goes. That's where the money is.

Ari Weinzweig co-founded Zingerman’s Delicatessen in 1982 with a $20,000 bank loan. Today, the company is an Ann Arbor institution, and Weinzweig has branched out into a number of other businesses. We approached him recently to learn more about his leadership philosophy and his approach to innovation.

Describe your leadership philosophy.

There are many elements to it, but above and beyond all else, it’s centered around Servant Leadership. It’s the philosophy we learned from reading the work of Robert Greenleaf. The approach is based on the belief that our responsibility as leaders, first and foremost, is to serve the organization, not the other way around. One key element of it here is that it means that we—the leaders—view the staff as our customers. We need to give them great service every day to the people who work in our organization. The service that the staff gives to our front line customers will never be better than the service we give to them.

A great article....

 

 

As you may be aware, I serve on the Board of Directors for the MLS Domains association—because it’s a cause I believe in (well, ok, I have several causes…and I’m not very quiet about my enthusiasms). But as an association exec I was always frustrated by the ‘MLS thing’: the public appreciated an MLS but couldn’t define the term, and our members were equally confused—and thought every collection of housing information was ‘the MLS’. Whatever an MLS was, everybody knew they wanted one, including all the folks who weren’t an MLS but appropriated our name—like ‘FSBO MLS’ or ‘luxury home MLS’.

The 2012 opportunity to introduce new top level domains into the world wide web seem to me to be an ideal method to define the term ‘MLS’  and to control who can use it. If the MLS Domains Association is  granted the exclusive use of .mls by its members only, we will have come a long way to stabilizing the use of the term and protecting our organizations’ investment in being the source of the most accurate and timely data available in the US housing market.

Dot MLS (as I fondly call it) is an idea whose time has come—but not necessarily because the organized real estate is ready for it. The urgency was introduced by outside events: the international internet naming association has set January 2012 as the date that applications for new top level domains (TLDs) will be considered, “Big corporations, nonprofits, and governments are expected to scramble to claim the new TLDs,” says the Washington Business Journal. 

The MLS Domains Association will be standing at the head of the line, application and check in hand. 

But getting there is a bit of a battle. The biggest problem is that top level domains aren’t on everybody’s radar screen—and by the time the opportunity becomes  clear, it may be too late to be considered by the great domain naming authority in the sky (ICANN). The second TLD round may not be available for several years—opportunity lost!

The point of this long introduction is to set the stage for my comments on the recent Council of MLS conference held in Tucson. The conference itself was outstanding in its speakers, its format, and its opportunity to meet vendors and have meaningful hallway (and lobby bar) discussions. To my delight, the issue of ‘MLS branding’ was center stage during many sessions and informal conversations..

“What’s ‘branding’ mean?” my friend JoAnn asked me. “I’m an MLS financial person—I don’t know these things.” 

The clearest answer is in this quotation: “…understand that branding is not about getting your target market to choose you over the competition, but it is about getting your prospects to see you as the only one that provides a solution to their problem.” To that point, it was clear at the conference that in a world where real estate information is everywhere, the MLS brand is increasingly important as a way to tell our audience (members and the public) that our information source is timely, accurate, and as trustworthy as they’ll find anywhere.

If the CMLS agenda is any indication, the topic of branding is under consideration of MLS leaders across the country. They are asking, “How will we help the public understand that housing information from the MLS is the most reliable source? How can we motivate our members (who are the collectors of the data) to do the best job possible in conveying accurate data to the MLS in a timely manner? How can we repackage our data products so that they are valuable to the real estate community and their clients and customers?”

These questions formed much of the substance of the conversations at CMLS—and the work of the MLS Domains Association was often cited as one of the obvious solutions. 

To explore this topic further, CMLS is hosting a half day session on branding on November 9 at the NAR Annual Conference in Anaheim. MLS CEOs and decision-makers should make every effort to attend this important education event.

You can be sure the efforts of MLS Domains Association will be on the agenda.

Sep. 23, 2011 - Last in the Series: The Interim AE Job Description

 

I recently attended a meeting of several association execs and MLS CEOs where we spent a couple of days brainstorming and fantasizing about our jobs, our roles in organized real estate, and the state of the industry in general. At the end of the session, we asked each other the question “What will you take back with you to the Real World? How has this two day discussion influenced you professionally?”

I had to think about that for quite a while. What I know about my position as a retired AE/current consultant is that I don’t have the power to make the Big Changes in the real estate industry. I am never going to make the Forbes list, or even the Inman list.  What I can share is some practical knowledge and a perspective that comes from the outside looking in on the association’s daily management activities. What I can do is drop a few breadcrumbs here and there and hope that they will be helpful to you on your path to your goals.

During these most recent think tank meetings, one of the participants turned to me and asked, “So Judith, what’s behind these last couple of blogs you’ve written? Why are you thinking about interim association managers?” 

Good question. In part, it’s because I was recently asked if I would consider being an interim AE for three months and I had to answer the question, “If I were to do this, how would I go about it?” The other part is that my church just engaged an interim minister, and I began to understand the value of a well-defined breathing space for an organization which is undergoing some significant transitions.

What this latter process also taught me is that ‘interim’ doesn’t mean ‘placeholder’. It suggests using the transition period to regroup, get healthy, heal wounds, find direction, and move forward. An interim minister in our church setting is a specialist at being ‘interim’. He or she is not expected to fill the permanent position—the interim is a trained  expert in the techniques of transition and the job description is clear.

With that in mind, I wrote a hypothetical job description for a transitional AE. The following is just meant to be a template—feel free to use it and/or modify it to suit your needs.

INTERIM ASSOCIATION EXECUTIVE

SAMPLE POSITION DESCRIPTION

Sample Job Description

I. POSITION

Interim Association Executive (GM)/Chief Executive Officer)

II. JOB SUMMARY

Serves as interim general manager/chief operating officer of the association on a temporary basis. The interim AE is responsible for all aspects of the association including its activities and the relationships between the organization and its members, employees, community, government and other tiers of the Realtor organization. Sustains and administers the association’s policies as defined by its bylaws, policies and direction of the board of directors. Directs the work of all department managers; monitors the budget; oversees the quality of the association’s products and services and ensures maximum member satisfaction unless otherwise directed by the board of directors. Secures and protects the organization’s assets, including facilities and equipment.

III. JOB DUTIES AND RESPONSIBILITIES

Implements general policies established by the organizations Board of Directors, and directs the implementation and execution of those policies. Plans, develops and approves specific operational policies, programs, procedures and methods in concert with the general policies of the NAR and/or the association’s local board of directors. Coordinates the development of the association’s operational plan, and prepares a 90-day transitional action plan in concert with the board of directors prior to the hiring of a permanent AE. Develops and administers a sound organizational plan and initiates operational improvements and structures a plan for their implementation. Monitors policies relating to personnel actions and training and professional development programs. Conducts a human resources audit.  Ensures that the association’s current policy handbook covers all necessary topics such as sexual harassment, conflict of interest, and whistleblower policies. Maintains an active and informed relationship with the State and National Realtor organization, and oversees the implementation of appropriate mandated policies and activities. Attends conferences and professional education sessions as approved by the Board of Directors of the Association.

Coordinates development of operating and capital budgets according to the organizations calendar, and monitors monthly and other appropriate financial statements.   Takes corrective action as required. Upon arrival, the interim AE evaluates all budgets to ensure that they are supported by appropriate details, and conducts an audit of existing organizational resources such as buildings, equipment, and financial reserves.

Coordinates and serves as ex-officio member of the board of directors and of association committees.

IV. SAMPLE JOB DESCRIPTION

·         Provides advice and recommendations to the president and appropriate committees about materials, supplies, equipment and services not provided in approved plans and/or budgets

·         Ensures that the organization is operated in accordance with applicable local, state, and federal laws

·         Oversees care and maintenance of all the organizations physical assets and facilities

·         Coordinates marketing and membership relations programs to promote the associations services and programs to present and potential members

·         Develops a membership marketing program for members and affiliates

·         Ensures the highest standards are met in enforcing professionalism within the organization

·         Monitors compliance with state and national Realtor organization policies

·         Analyzes financial statements, manages cash flow and establishes controls to safeguard funds, if needed.

·         Reviews income and costs relative to goals and takes corrective action as necessary.

·         Attends meetings of the organization’s Board of Directors and Executive Committee

·         Participates in other activities judged appropriate and approved by the board of directors to enhance the prestige of the organization

·         Broadens the scope of the association by fulfilling its public obligations

·         Serves as liaison between the staff and the board, as appropriate

·         Implements policies concerning employee-employer relations

·         Develops and maintains a basic management philosophy to guide association personnel toward optimal operating results, employee morale, and member satisfaction.

·         Prepares reports and other supporting material for committee and board use.

·         Negotiates and recommends Board approval for contracts

·         Establishes and approves workloads, work methods, and performance standards

·         Gives direction to and works closely with vendors, outside contractors, firms and individuals providing service to the association.

·         Directs the association’s communications programs

·         Performs other duties as directed by the president and the board.

·         Assists in the search for a permanent AE

V. REPORTS TO President and Board of Directors

VI. SUPERVISES All Staff

Perspective On The Housing Market – Localized Solutions Needed (Part 2)

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by Donna Robinson - 21 September 2011

As I noted in part one of this two part commentary, the U.S. Housing market is not one big market, but rather a large collection of individual markets with individual problems which will respond best to individual solutions customized for a specific local market.

With this fact in mind, I’d like to list some ideas for how to address housing problems at the local level. Ideas which can be implemented locally by the local groups who are most affected and have the most to gain by implementing these solutions.

Local solutions for housing © Andy Dean - Fotolia.com

First, let’s address the over arching government solutions being attempted now, and from there we’ll move into a localized approach.

As I write this, media reports indicate that the Federal Reserve is considering taking action that will reduce interest rates further. While low interest rates have been the traditional way to spur housing sales in the past, the problems this time are much more systemic. Unemployment and under-employment are preventing a housing recovery. Lowering interest rates further is not going to make any significant difference in housing sales, if buyers can’t afford to buy or don’t qualify to begin with.

The low interest rates are taking a different toll this time, by eroding the income of seniors and those who expected income from savings and investments to carry them into retirement. We are seeing a big trend towards reverse mortgages for seniors above the age of 62, who thought income from their savings would carry them through retirement.

Low interest rates have wiped out that income to a great degree, and as a result, we are seeing a new wave of reverse mortgages as seniors “pawn” their homes to the bank, to generate additional income. This trend will soon become another housing crisis waiting to happen if it continues unabated.

Further, the secondary mortgage market has little incentive for new investment when interest rates are virtually at zero. The risk is simply not worth the paltry rewards. While I realize that there would be some near term pain to allowing rates to increase slowly, I believe that housing would benefit in the long term, because rising interest rates would provide seniors and other savers with more income from their investments, and would generate more investment in the secondary mortgage market, which would make more capital available for mortgage lending. This could in turn, lead to more sales in housing, leading to more jobs, and help speed an economic recovery without unhealthy increases in housing prices. But this is highly unlikely under Ben Bernanke, so the local players are left to take constructive action to help their local markets.

Realtors must take more of a lead role in helping identify local market problems, and develop local market solutions. No single group has more “boots on the ground” than the National Association of Realtors. Real estate agents are the one group that has the data and the man-power to address local real estate market issues throughout the entire U.S. Yet they don’t take advantage of this power. Most agents are kept busy worrying about the latest rule changes related to earnest money handling or fair housing laws. But it’s agents who know their local market better than anyone else. They know what is selling and what isn’t. They know where the problem areas in their market are.

Local Realtor boards should be organizing a local task force to identify their local market issues, and come up with creative solutions for those local problems. Then coordinate their efforts with the lenders, attorneys, builders and local government development authorities or planning and zoning boards in their local market to help formalize real solutions at the local level.

Builders are another group that has suffered tremendously from the housing down turn, yet their lack of attention to fundametals in supply and demand, as well as median local income was one of the primary problems leading to the housing crash. Uncontrolled building without regard for buyer demand and local affordability is a recipe for disaster.

Local builder's associations need to act more responsibly © nenovbrothers - Fotolia.com

Local Home Builder Associations should make an effort to keep their members abreast of the key market fundamentals that will directly effect builder success. Primary among those are the overall supply of new homes available for sale, relative to buyer demand, and local income levels, which will dictate what local buyers can actually afford to pay for housing. Builders must learn to maintain a balance between supply and demand, and build homes that their local market can afford to buy.
Otherwise, they will be doomed to repeated boom and bust cycles.

The last building boom was a feeding frenzy that got out of control and left a stripped out, dead carcass of half finished neighborhoods in it’s wake. If the local builders take a more balanced approach to building, and manage the supply of new homes more effectively, they won’t have to worry about going belly up and taking their local bank with them. The supply-demand-affordability fundamentals must be managed to insure that the construction industry does not have a continuing boom-bust cycle every few years.

Real Estate Investors can contribute as well, by taking up the over-supply that exists now in the form of foreclosed homes and distressed properties that are sitting on the market. Investors should act responsibly as well, by not engaging in shady or questionable tactics that may be taught at high priced seminars, but are simply not beneficial to their customers or their overall business stability.

Investor Associations should focus more on investing with integrity and honesty, and a customer service attitude fitting of any american business enterprise that wants to be successful for the long term. Allowing seminars that promote big money at the expense of distressed sellers and ignorant buyers is not only irresponsible, but it contributed significantly to the housing market crash. I know. I’ve been a member of a number of investor associations and I know first hand how many seminars there were that encouraged irresponsible behavior for the sake of quick profits. Millions of investors went broke follow the so-called “gurus”. Many of the biggest gurus themselves have gone bankrupt with the schemes they were allowed to teach to others.

Real Estate investing is a great way to build a small business, contribute to employment in the construction sector, and build real wealth when it’s done correctly. Investor Associations should emphasize the fundamentals of the housing market, so that investors can make better investing decisions and build stable businesses. Promoting get rich quick schemes may “sell better” but it was the investors following the irresponsible advice of greedy gurus and promoters who were the first to feel the effects of the housing market crash.

Today investor association participation is at an all time low, and it’s primarily because they ran their members into the ground with shoddy investment advice and gimmicks that simply did not work while ignoring the market fundamentals. There are still investor associations in virtually every large city in the U.S. They have the capability to influence investors for good, but the question is, will they do it?

Finally, if Congress really wants to do something to help the entire U.S. Housing market, they should reinstate the home buyer tax credit, with NO requirement to pay that credit back. The one bounce we’ve had in housing sales data was during the months when the home buyer tax credit was in effect. As soon as it expired, housing continued it’s downward slide. It’s funny how the government can’t seem to get rid of bad programs that waste taxpayer money, but when it comes to a tax credit that actually did help, they have no problem at all with getting rid of it.

While there are many other potential ideas for helping generate a housing recovery, the bottom line is that the fundamentals will always dictate the best choice of strategy for maintaining a healthy and vibrant housing market. The long term solution is to pay attention to the local market fundamentals and make adjustments to your business or investing strategy accordingly. Ignoring the fundamentals is what got us here. Knowing the local market fundamentals and working with those fundamentals is what will get us out of this funk, and keep us out.

The old saying is true, pigs get fed, hogs get slaughtered. The housing market crash was nothing more than a slaughter house for real estate hogs in lending, building, investing and buying, who tried to take more than their local market fundamentals would allow.***

ep. 16, 2011 - Part Two: The Interim AE--A Case Study

"I'm sorry," Al said. "I really am. But my wife has this great offer for a three-year work assignment in Paris, and I'd like to go, too. It's an offer she can't pass up, and I want to be with her.   I hate leaving the association high and dry, but...." The leadership looked at each other, bewildered. There was no transition plan, needless to say: a transition roadmap was something that the board had on its 'to do' list, but had remained fairly low as a priority while other concerns attracted resources and energy. Now what would they do? Al planned to leave them in just a few weeks, and time was running short. To make matters worse, the association was in the middle of a strategic planning activity. It has become clear to leadership that the industry profile was rapidly changing: the real estate brokerages had become leaner and more dependent on technology, the sources of income from MLS operations had diminished due to a regionalization program, and the focus of the organization was becoming more directed to providing support services for consumers as well as members. All of these trends were requiring a restructuring of the association's resources and direction. It was a time of significant change. Al could not be leaving at a worse time. How would the association replace his knowledge and leadership? And how could the leadership find someone of a senior executive level to guide them through finalizing and implementing the strategies to accommodate the dramatic changes that were taking place in the real estate industry? The National Association of Realtors provided the association with an answer: the Human Resources department suggested hiring an interim Association Executive to manage operations until a permanent hire could be put in place. "We've experienced the retirement of several successful CEOs," NAR told the association president. "Why not consider hiring a professional to lead you through this transition?" NAR presented the board with several resumes, and the association was able to secure the temporary services of a seasoned AE with 25 years of Realtor association management experience. The interim AE came to the association with a clear understanding of the temporary nature of the appointment and of the work which the association needed: to continue operations of current programs and services, to guide the organization through the remainder of the strategic planning process, to organize and train staff to better serve the new directions the association was taking, and to assist in revamping the internal organizational structure to increase its capacity to meet new challenges. And the over-riding mission of the interim AE: to guide the group through a successful search process resulting in a permanent hire for the top management position. What did the association gain from this solution to suddenly losing its Association Executive? 1. The association bought time in which to make a considered decision in hiring the right person. It did not expend volunteer resources in trying a do-it-yourself solution, and it did not spend unnecessary time and political capital in hiring the wrong person in haste. 2. The association brought the right skill set to the job at hand, which was to manage the transition period and prepare the way for the permanent AE. 3. The new permanent AE was positioned for success. The association had defined its goals, written a clear job description for the new CEO, implemented a fair and thorough search process, discussed with staff the need to meet the requirements of new goals, and instilled confidence in the members. 4. The association benefited from the advice of an objective and experienced short term manager. 5. The association (and the interim manager) were able to focus on key priorities. Because there was a clear 'end date' to the relationship, and an established set of benchmarks, the association did not get bogged down in side issues and unimportant disruptions. It was a very productive transition time for all concerned. Granted, this article is billed as a case study--your organization may not fit this exact description. But there are many situations when an interim AE may be an excellent solution: When a long term, well-loved AE is leaving the association, and distance is needed (There's an adage for that: “I don't want to follow Bud. I want to be the person who follows the person who follows Bud"); When there is significant political disruption accompanying the departure of an executive; When immediate leadership is needed, and it is clear that the hiring process will take a long time; When the association is evolving and the long-term needs are unclear, as are the extent of the organizational resources needed to meet those needs. In recent years the Realtor organization has experienced the loss of many seasoned AEs, often baby-boomers who have reached retirement age. The Realtor organization can use these people as resources in many ways: as consultants, as mentors, and as interim association executives who can share their knowledge, leadership and experience at times when local and state organizations most need these qualities. (If your organization needs help in developing a transition plan for planned and unplanned replacements of your chief staff executive, I can help. Contact Judith@judithlindenau.com. If you need further information on an interim AE program, contact NAR's Human Resource Department for more information. Fee-based consulting services are also available from NAR: contact Donna Garcia, Director Human Resource Services, at dgarcia@realtors.org, or at 312-329-8311. )

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