Friday, October 4, 2013


October has arrived, and with it we saw our first dusting of snow this morning.  

It's the fourth quarter of the year.  The most dangerous quarter of the year for real estate agents, but also the quarter which offers the most opportunity. The truth is that no time of year needs to be managed more carefully than the fourth quarter, when many agents get lazy, start to coast, and focus on the holidays instead of focusing on their business.

Several years ago, a real estate mentor of mine taught me to think of September 30th as "New Year's Eve" and October 1st as "New Year's Day".  Ever since then, I've subscribed to this belief.

It is undeniable that the actions you take right now - today - are going to have a significant impact on what kind of year 2014 is going to be for you.

All too many agents will shut it down for the holidays, fatigued by the busy-ness of 2013 and the stresses and strains of our crazy market.  It's easy to coast right now, to focus on Trick or Treaters and turkeys and holiday parties and presents... until you wake up January 1 with no closings, no business, no leads and nothing in the pipeline. 

It is not an exaggeration to say that some agents are going to go five months without a paycheck because of a simple miscalculation made on October 1st.  "I've worked hard, this year's over."

No, it's not.

It's okay to take a long weekend, or maybe even a week (if you have someplace really good to go), but be careful.  With just a little bit of neglect, the weeds will take your garden.

Take a deep breath, have gratitude for the amazing market of 2013... but then get back to work.  Decide what your business is going to look like in 2014.  Put serious time into a business plan.  Set real goals with real deadlines.  Know that if you chose to back off, there's someone out there working right now, talking to future clients, perfecting a marketing plan, showing homes while others shut down.  

Come January, when the bills arrive and the holiday hangover sets in, we'll know who's been working and who has not.  The numbers will not lie.

Get to work. 

Tuesday, October 1, 2013


Some people love them, some people hate them, but almost everyone has an opinion about them.  We’re talking about Homeowners Associations, and in Colorado, it’s estimated that 2.2 million of the state’s five million residents live under some kind of HOA arrangement.

But did you know that there is virtually no government oversight and only minimal regulatory control over these powerful community management companies?

Somewhat surprisingly, only three states – Nevada, Florida, and Virginia – have government regulation and oversight of HOA’s.  In Colorado, it’s estimated that there are over 1,250 individual management companies, although the state admits it doesn't know exactly how many management companies are in business.

To better assess what’s happening in a highly unregulated environment, this year Colorado formed the “HOA Information Office and Resource Center”, which initially has a staff of three, a total budget of under $200,000 and no legislative power to investigate.  At this point, it’s basically an information-gathering entity, purposed to try and determine where regulatory oversight might be warranted and what kinds of legislative solutions might improve the HOA experience. 

Right now, things like status letter fees, transfer fees, association document fees and HOA fining authority are all virtually independent of government regulation.   

As a real estate broker, I see incredible disparity in the way HOA’s function.  Some small community-based HOA’s operate with a few part-time volunteers and a shoestring budget.  Other “Mega Management Companies” run hundreds of HOA’s with layers of community managers, sometimes charging borderline-outrageous fees for status letters, association documents or transfer fees. 

Because HOA’s can create a primary lien in Colorado, HOA’s actually have the power to foreclose for unpaid fines or association dues.  Therefore, if the association chooses to “fine someone into foreclosure” for failing to paint, taking too long to paint or painting the wrong color, chaos can ensue - and right now the consumer has very few places to turn for help.

It's a complicated mess, and it's one reason many buyers avoid HOA's altogether.

FHA financing has been a hot topic of conversation over the past few years, as much more restrictive FHA lending guidelines have caused well over half of all condo developments in the metro area to lose their FHA approval.  That means no FHA loans, which means about one-third of the market is essentially frozen out of these communities.  

To address this, some condominium HOA’s in Colorado are attempting to regain their FHA approval by restricting the number of units that can be used as rentals. That sounds great, unless you are landlord and you bought your unit to rent it out.  

There are also complex social dynamics which involve HOA’s, such as what authority (if any) an association has in regulating marijuana use in multi-unit buildings, or whether smoking of any kind can be prohibited.

All to say, HOA management has become increasingly complex and problematic, and state regulators are looking for a proper role to play. 

Regulation is certainly not always the answer.  But without clear guidelines, there are risks that many homeowners are simply unaware of when it comes to purchasing a home in an HOA community.