Tuesday, July 4, 2017

Something No One Wants to Talk About...Reduced Commissions

A very interesting article in July's The Real Deal. We don't criticize our competition, we're just cognizant of the fact and have listened to clients who want an alternative approach to the brokerage process. As an agent at a large firm I had fair level of success and I could have easily continued building my career. I decided to take a risk and change the landscape and build a model based on what I thought many buyers wanted. It's about more than rebates. If you could just hand out checks at closing and do $90M a year in sales, believe me more agents would be doing it! Our clients know the difference.

I am coming up on a 10 year anniversary with The Burkhardt Group; to date I have spent ZERO dollars on advertising! Please have a look at our testimonials page to see the raving fans that we have created. It did not happen over night.

The buy-side brokerage model was ripe for disruption, that is easy enough to understand. Just like the travel business, financial services, book selling, transportation, hospitality etc. It is not simply about trying to undercut other agents or being desperate; it is about innovating.

Selling real estate is not that complicated, 90% of apartments don't need large marketing budgets to sell. They need to be priced correctly, be desirable and listed so the entire brokerage community can participate. Oh yeah, and be on Streeteasy where more buyers than you can imagine will be able to view, schedule an appointment and discover the history of the unit.

On the buy-side  you need an agent that can do a fairly rudimentary analysis of the property, has the experience to add or subtract value based on both mathematical calculations as well as the non-tangible aspects of  the purchase. The agent also has to be trusted to put the clients best interests before their own and not be afraid to tell it like it is. Meaning if the home is a lemon, best to pass and move on. Or if the valuation is silly advise a bid based on reality not the aspirational sales price of a seller.

Offering a reduced commission scale when coupled with outstanding service is not bottom feeding or being desperate. Quite frankly it cuts two ways; unscrupulous listing agents that 'buy a listing', giving the seller an unrealistic sales price in an attempt to secure the listing.

The world is changing, the brokerage model will also continue to change and evolve. It's only natural. No business can survive when they don't keep up with the times. Increased competition thins out the heard and makes us all stronger. And the strong and nimble will thrive.

Best,

Keith Burkhardt
917.770.4951
Call me, I love to talk about real estate.

Friday, June 23, 2017

Many Thanks to Our Wonderful Clients! #188 Agent Wall Street Journal/Realtrends!

It has been quite a journey. When I first conceived of the Burkhardt Group I was met with many naysayers and skeptics who thought it would never work in NYC.  That you could not operate a 'buy-side' brokerage and last, only listing agents succeeded over the long term.

The problem with that hypothesis is there was never a buy-side focused company that was tailor made for buyers and their specific needs. I also focused on all the complaints I received from buyers or read on those early Streeteasy forums. I tackled each one and made changes until I hit on a model that worked seamlessly and addressed these shortcomings. 

We have seen quantum leaps in financial services, transportation services, shopping (Amazon) and travel services that have made it easier and more cost effective to transact. I brought that concept to real estate. 


Thursday, June 22, 2017

10% Down on a NYC Condo? Yes!

Many agents will look at you like you have 3 heads if you tell them you are financing 90%. That said outside of NYC a large portion of homes sales are done with 90% financing, in many cases even 97%.

So here is some hope for those that want to buy, however don't have 20% down or would simply like to save some cash for renovations.

We have now completed 3 deals where our clients secured 90% financing and it was pretty smooth sailing. Now these were all on deals where the seller was willing to accommodate because other options were limited. The quote I have pasted below is from a buyer who just closed at 338 Berry street;

"Keith, Norman, Christian

It was a pleasure working with you!
Thanks for your help throughout the process, and answering all our newbie questions & anxieties.
We are all packed and moving in tomorrow!

We were able to go with 10% down.   
Sunny @ Citizens actually came through, and moved very quickly for us.  They did give us a bit of a fright with an underwriting document request Friday @ 6pm.  It freaked me out, but Sunny said it was not a big deal, and the file would clear on time.  Overall was very happy, and they were extremely responsive.

Guardhill was also offering 10% down, though moved a bit slower and had higher rates.  Beyond them, I believe PNC is also doing 10%.  

SoFi was too much of a blackhole, so I didn't bother proceeding with them once the other lenders came through.  

Interestingly it seemed like most of the banks that wouldn't do 10% really wouldn't do 15% either (except on sub-$1M).

All the best,
Steve & Cristina"

Saturday, June 17, 2017

This Says it All

Hi Burkhardt team

Shveta and I wanted to thank you for all your help in our long journey to find our apartment. We ultimately found something that we hope will be the perfect place for our family.

I must say that your business model is ideally suited for today's environment. As we discovered through the process, in the industry there is ample technology solution to the discovery of new listings, yet the bid and closing process remains very inefficient. Your firm is set up to focus on the parts of the process where it is most helpful, with a no-frills-when-not-needed style, which combined with the rebate model is exactly what the competitive NY market needs.

Also the team is lean yet offers the complimentary skills that is needed to deliver a complete service. Keith you have always provided very genuine advice. Christian - you have been an example of cool headed and efficient execution at crunch time. Lance you have diligently showed us to more than 50 apartments during weekdays and weekends.

Once again, thanks all of you. I will be more than happy to provide references if you should require.

Puneet

Monday, June 5, 2017

This is What We Work For

"Keith,
Thank you very much for the warm wishes. It was truly pleasure to work with you, Christian, and Norman. We appreciate all of your guidance, expertise, and support throughout the entire process. The beautiful handwritten card with the check that Christian handed to us at closing was a wonderful surprise.

I also appreciate your recommendation for Weidenbaum & Harari. Barry and his team were great.

I will definitely be sharing the positive experience we had working with you and recommend you highly!
Best regards,
Stephanie"

Saturday, May 6, 2017

There is No Advantage to Working Without Your Own Broker!

Yet again I receive a call from a disgruntled buyer who thought they would have an advantage by working directly with listing agents. Guess what? They found out the hard way there is ZERO advantage, actually most brokers/agents bully direct buyers. Especially​ when you try and use the fact you're unrepresented as leverage, tell the agent they should earn less so you can get a discount; see how that works out for you.

I certainly understand if you want to work alone as a preference, though you're not truly alone as you'll be working with the listing agent.  The case I reference above, the buyer needed to close the gap on bid/ask, she realized with us she could ($22k rebate). If we're involved the deal gets done. Instead she annoyed the agent asking for a reduction, challenging the valuation and insisting on a discount because they didn't have their own representation. Remember the listing agent works for the seller, helped price the home.  Listing agents and sellers are especially emboldened in this strong sellers market.

When we get involved it's a win-win for everyone, seller gets a deal done with a happy buyer, listing agent gets the deal done with a happy buyer and neither has to dig into their pocket to get the deal done. We have a model that allows us to reduce our commission and still offer a full service, 100% transparent experience. Please read our testimonials, look at the variety of transactions we have completed.

So, you want to fly solo by all means go for it. Quite honestly you do not need a buyer broker to purchase a home in NYC. But know that you will not receive preferential treatment or a discount.

Please feel free to call me to discuss the experience we can offer you.

Best,

Keith Burkhardt
917.770.4951

Friday, May 5, 2017

It's Been Awhile.....

It has been a very active market, certainly the bias has been towards sellers as the market is in a never say die mode. There is lots of speculation as to when 'the next leg down' will be; so far it is all just talk.  We are having our busiest Spring on record, currently with 11 outstanding/accepted offers, 18 deals in contract.

We have also listed our first property at 101 Warren street and now have the entire model worked out along with all the logistics of effectively listing a home. As discussed previously here we are 100% confident we can compete with any brokerage firm in the business. People were skeptical when I started the buy-side model and it has been a huge success, I expect nothing less from our listing service model. It ain't rocket science kids...Call me and I will run you through what we offer.

Best,

Keith Burkhardt
917.770.4951

Data from www.urbandigs.com

Supply
5,407
LISTINGS ON MARKET AS OF YESTERDAY
 8.1% from prior month
 7% from one year ago
Pending Sales
3,473
LISTINGS IN CONTRACT AS OF YESTERDAY
 8.7% from prior month
 5.6% from one year ago
Days on Market
71
MEDIAN DAYS ON MARKET AS OF YESTERDAY
 7.8% from prior month
 22.4% from one year ago
Price / Square Foot
1,367
MEDIAN PRICE PER SFT AS OF FEBRUARY
 0.1% from prior month
 1.4% from one year ago
Monthly Contract Activity
968
CONTRACTS SIGNED IN APRIL
 13.6% from prior month
 12.9% from one year ago
Monthly New Supply
1,640
NEW LISTINGS IN APRIL
 3.2% from prior month
 3.8% from one year ago
Median Sale Price
1,117,978
FEBRUARY MEDIAN SALE PRICE
 0.3% from prior month
 3.6% from one year ago
Monthly Sales Volume
877
FEBRUARY SALES VOLUME
 12.4% from prior month
 11.5% from one year ago
Volatility Index
1.57
ACTIVE-TO-PENDING RATIO AS OF YESTERDAY
 0.6% from prior month
 1.9% from one year ago
Off-Market Inventory
3,370
OFF-MARKET LISTINGS AS OF YESTERDAY
 1.3% from prior month
 31.9% from one year ago
Monthly Median Listing Discount
3.40 %
FEBRUARY MEDIAN DISCOUNT
 0% from prior month
 61.9% from one year ago
Monthly Absorption Rate
4.50
ABSORPTION RATE AS OF FEBRUARY
 15.4% from prior month
 25% from one year ago
Discount to DOM
0.00 %
MEDIAN DISCOUNT UNDER 30 DAYS IN Q1
 0% from prior quarter
 100% from one year ago
Sales Over Asking Price
18.91 %
SOLD ABOVE ASK IN Q1
 10.7% from prior quarter
 27.7% from one year ago