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NEW YORK EDITION

WHY YOU SHOULD NEVER SHUN MILLENNIALS A POWERFUL MARKETING TOOL — DEFER TAXES WHEN SELLING A RESIDENCE

COVER STORY

HALEY HUNTER RUTHERFORD

5 STEPS TO ACHIEVE LONGTERM SUCCESS AS A REAL ESTATE AGENT FOUR CHALLENGES AND SOLUTIONS FROM THE FRONT LINES OF THE REAL ESTATE INDUSTRY


NEW YORK EDITION

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HALEY HUNTER RUTHERFORD

CONTENTS 4) WHY YOU SHOULD NEVER SHUN MILLENNIALS

20) 5 STEPS TO ACHIEVE LONG TERM SUCCESS AS A REAL ESTATE AGENT

14) A POWERFUL MARKETING TOOL — DEFER TAXES WHEN SELLING A RESIDENCE

22) FOUR CHALLENGES AND SOLUTIONS FROM THE FRONT LINES OF THE REAL ESTATE INDUSTRY

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By Bob Corcoran

Why you should never shun Millennials 4

You gotta love real estate. You wake up every day and you’re guaranteed to see something different going on in this wonderful industry. It’s never boring. One of the changes we’re seeing as fall nears is rising home prices – up 4.1 percent the last time I looked. No big surprise there – inventory levels remain low. But I also suspect we’ll start seeing rising interest rates before the year is out. So with these two trends you have to think about buyers. How do you find and attract buyers? It’s always a vital question for REALTORS®, but especially in these market conditions. Top Agent Magazine


A group of buyers you should mine with a heavy pick and big shovel is millennials – those ages 25 to 34. Oh I know, there are studies that show millennials aren’t buying homes. Some economists say they’re delaying homeownership because they’re also delaying marriage and having children. The good news is that practically everyone, no matter their age, still believes that homeownership is part of the American dream. Millennials are smart – and the research bears that out. As a group, they’re better educated than boomers. And I believe sooner or later they’ll enter the market. They know the numbers and they know in the long run owning beats renting. Plus, the fact remains, NAR and several other groups have said the largest group of potential first-time homebuyers in the market today are, you guessed it, millennials. Zillow Chief Economist Stan Humphries says 42 percent of millennials say they want to buy a home in the next one to five years, compared with 31 percent of Generation X (35 to 50-years old). This is why it’s key you keep millennials in your sphere. So what do you need to know to find and attract millennials? Here are a few tips you might find helpful: Know that they have a lot on their plate. They’re just starting to figure out their careers because the job market was tight when they finished school. And they’re likely considering marriage or starting a family. Plus, they probably have some school debt. So go easy on them. A home purchase is just another big item to them. Be an educator, not a salesperson. No one likes an aggressive salesperson, especially millennials. They want useful information that can help them through the process. That’s it. No pushing. Use infographics and social media to offer millennials helpful data about the market and the home buying process and benefits. Top Agent Magazine

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Think urgency. Interest rates are projected to go up and we all know (and millennials, too) higher rates take away buying power. Millennials don’t like to lose and they’re all about saving. Have an online presence. The overwhelming majority of millennials start their home searches online. Create a solid online strategy that begins with a good search engine optimized website with strong calls to action. Include social media (join popular groups and forums), blogs, email and online advertising. Sell neighborhoods and communities, not just homes. A new NAR survey says millennials prefer walking over driving by a substantially wider margin than any other generation. And they’re the most likely age group to use public transportation. They want short commutes to work, and want to be able to walk to shops and restaurants. They also like living in attached housing. Before I let you go, I have free information on generational selling. Simply visit http://getbobsnotes.com/generationalselling. Let me hear from you. Are you targeting millennials? How can you start improving the way you’re marketing to them? Are you comfortable with them? Do you feel you understand them? If not, what can you start doing today to be a better REALTOR® for millennials? Please send any comments or questions you have to Article@CorcoranCoaching.com or www.facebook.com/ CorcoranCoaching. Copyright©, 2015 Bob Corcoran. All rights reserved. Bob Corcoran is CEO of Corcoran Consulting and Coaching Inc. www. corcorancoaching.com/programs, 800-957-8353), an international consulting and coaching company that specializes in performance coaching and the implementation of sound business systems into Real Estate Companies, Mortgage Companies and Small Businesses. Corcoran Consulting is headed by Bob Corcoran -- a nationally recognized leader, speaker, author, coach and consultant. To find out more about Corcoran Consulting & Coaching, call 1-800-957-8353 or visit us at www.CorcoranCoaching.com 6

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HALEY HUNTER RUTHERFORD Top Agent Magazine

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Haley Hunter Rutherford entered the real estate industry at birth. But although the successful New York City real estate agent earned her license at age 18 and held onto it while earning her degree in Communication from Boston University, she officially began her real estate career in 2010. “My mother, Rana Hunter Williams, has been in real estate now for more than 35 years,” says Haley, adding that Rana would bring her to showings when she was a baby. “There are brokers throughout the city who know me as the baby in the little blue snuggly!” Appropriately, the recent recession is much of the reason for Haley’s decision to move out of corporate communications and into real estate. 8Copyright Top Agent Magazine

After graduating from college and starting in a corporate PR role specially created for her in the fragrance industry, in 2009 her hours were trimmed. “At the time, to fill my hours, I decided to put my license to use and see what I could do in real estate,’” says Haley, who worked both jobs for a year before dedicating herself to real estate even after an offer to increase her hours with her corporate job. In 2012, Haley worked with Rana to establish the Rana Williams Team with Keller Williams NYC, where Haley discovered terrific opportunities. “Keller is very entrepreneurial,” she says. “You can run your own show within their support system.” She maintains a heavy presence throughout Top Agent Magazine


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“We’re living in a world where everything is wrapped into your cell phone or computer, where virtual reality is reality. I make an effort to be as present as I can be in every transaction and relationship.” Midtown, the Upper East Side and in the Flatiron District. “That said, I was born and raised in Manhattan and know the city very well,” she says. “Give me a task anywhere and I’ll figure it out while implementing the best service!” In 2015, the Rana (comparatively small) Williams Team managed to rank as the #2 Keller Williams Copyright Top Agent Magazine Copyright 10

NYC team and Haley herself ranked #10 out of 600 agents in their office for volume. Haley’s service has led to referral and repeat business now exceeding 85%. She says that her energy, enthusiasm for real estate and commitment to each customer are the characteristics Top Agent Magazine


clients mention most when working with her. “I think my sincerity comes across,” she says. “Trust is the #1 factor when choosing a real estate agent.” She dedicates herself to doing the right thing by everyone she encounters and applying her tenacity to every transaction. “Some agents may give up or lose steam when things get tough, but that’s when I’m more tenacious than ever!” Whether helping people through hurdles on negotiations or finding a contractor to make repairs, Haley aims for seamless and full concierge-style service. “I like being the hand people hold through the entire process,” she says. “Agents are important and influential from A to Z, making sure everyone from the mortgage Top Agent Magazine

broker to the attorney to the building manager is doing their job and creating an enjoyable transaction.” She invests energy in ensuring people make smart decisions during one of the most emotional transactions of their lives. When working with sellers, her marketing includes not only casting a wide global net online and producing compelling materials, but story telling that allures buyers on an emotional level. And with both buyers and sellers, listening, extensive follow-up and negotiation expertise are Haley’s keys to success. In the future, given her love for New York City and global travel, Haley’s plans include one day opening up another Keller Williams “market Copyright Top Agent Magazine 11


center” in Manhattan and traveling worldwide for business to further create and fortify relationships with as many agents and possible customers as she can. “I’ve made connections with agents on a global level,” she adds. “I met one agent on a trip to London who recently referred a buyer to me!” Finally, Haley makes a point of sharing the mindset that inspires her both professionally

and personally. “We need to be present,” she says. “We’re living in a world where everything is wrapped into your cell phone or computer, where virtual reality is reality. I make an effort to be as present as I can be in every transaction and relationship.” Being present to the people she works with and the people she loves leads to greater productivity and happiness. “Nothing is worth craze and intense stress,” she says. “I want to live with as much ease and grace as possible.”

To learn more about Haley Hunter Rutherford, visit hhrutherford.com, email hrutherford@kwnyc.com or call 646.737.9672 www.

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A Powerful Marketing Tool Defer Taxes When Selling A Residence

By David Fisher

Winston Churchill once said, “There is no such thing as a good tax.” Of course, he also said, “I like pigs. Dogs look up to us. Cats look down on us. Pigs treat us as equals” so Winston was a pretty sharp guy. For purposes of this article, however I will focus more on taxes and less on pigs although there are probably more similarities than differences between the two. Pork is more than just the other white meat. I don’t mind paying my fair share of taxes but I want my taxes to go to things like fixing infrastructure, educating poor kids or feeding the hungry. However, it seems that much of our tax dollars go to pork projects to help members of Congress get reelected so that’s why I have become more focused over the years in my practice in helping my clients defer taxes when selling real estate and other highly appreciated assets. 14

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Most of us are familiar with what is called a 1031 exchange. A 1031 exchange is a great opportunity to defer capital gains taxes,state taxes and depreciation recapture when selling an investment property and by following IRC 1031, the seller can purchase another investment property of equal or greater value and defer the previous mentioned taxes to some point in the future. It’s a great opportunity for the seller and it’s a great opportunity for the real estate broker to buy additional property for their clients. It’s a win-win. But what if the property being sold is a primary residence or a property that does not qualify for a 1031 exchange. We all know that a primary residence might be the largest investment that many will make and hopefully the primary residence will appreciate in value over the years. Even though there are various exemptions and exclusions for capital gains when selling a primary residence,it’s quite possible that there could be a sizable capital gains and state tax liability once the residence is sold. For example, I worked with someone recently who bought a home wisely and now, a couple of decades later, is selling the property and after crunching the numbers is facing a $4 million capital gain. The property is in Texas so the seller is looking at a capital gains tax of $800,000 (4 million x 20%), no state income tax in Texas but add that in for the 43 states that have a state tax and also the CPA said that there might also be the alternative minimum tax as well but he wouldn’t be sure until crunching all of the numbers. If so, that’s additional income tax due. So if the property sold was in California, you can add about another $400,000 in state taxes. If the property was in Colorado, you could add an additional $200,000 in state taxes and so on. Top Agent Magazine

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We all know that a primary residence might be the largest investment that many will make and hopefully the primary residence will appreciate in value over the years. But take the taxes due to the next level. Let’s say that this individual paid $1 million in taxes, he is 60 years of age and will live for another 20 years. If he could defer that $1 million in taxes and invest that amount wisely, that could be $3 million or more that could be passed on to his heirs at his passing. Remember that this is only the taxes deferred and not the rest of the sales proceeds. So the question is this... Can a property owner defer taxes when selling a high end residence or luxury property that does not qualify for IRC 1031. The answer is YES. It is absolutely possible. Having said that, there are a number of moving parts to accomplish this tax deferral strategy and the seller’s CPA and /or attorney would have to be involved but yes, it’s possible. Imagine if you will the day you started selling real estate and you decided to work as hard as you could and put as much money away into your retirement plan as is possible. You would make whatever sacrifices needed in order to make as large a contribution to your retirement plan as allowed and when you had $3 million in your account, you were going to retire and do all the things that you choose not to do until you retired and had enough money to enjoy life. 16

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You opened your monthly statement and you couldn’t believe your eyes. There it was... $3 million in your account. You made it. So you worked more hours than anyone in the office. You talked to potential clients that no one would talk to. You kept your car a couple of extra years before buying another one and you took shorter vacations rather than longer more expensive ones so you could make larger contributions into your retirement plan. Sound familiar? And this went on for 3 decades until one day, it happened! You opened your monthly statement and you couldn’t believe your eyes. There it was... $3 million in your account. You made it. You could now retire and do all the things you put off until now. You could not contain your excitement as you dialed your CPA with the great news. Your CPA was thrilled at your good fortune and mentioned to you that he had a tax form you needed to sign and then you could begin your well deserved retirement. So he says to you...I need you to sign and date the form and then write a check made payable to the US Treasury for $900,000.00 and as soon as the check clears, you retirement can begin. You feel like you were just hit by a truck. You try to speak but nothing is coming out of your mouth. Your CPA explains that a couple of years ago, Congress passed a tax law that said that before a taxpayer can retire, they must pay a 30% tax on the lump sum amount in their retirement plan. So you realize that you actually have $2.1 million in your account and probably need another 10 years of working to net the $3 million you want to retire. You’re devastated. Top Agent Magazine

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“Have you considered the potential capital gains tax liability you will have when you sell.” Well, there’s good news and there’s bad news. The good news is that there isn’t a 30% tax on retirement plans for now. I made that up. The bad news is that your sellers could be facing as much as that 30% tax on the capital gains they have earned when you sell their property. You don’t want to pay that tax so why would you let your clients pay that tax now that you know it might be able to be deferred indefinitely. But imagine the powerful tool you now have in your briefcase. You’re talking to a prospect who is selling a high end property in LA, Aspen, Miami, New York, Chicago or any other location in the country and you want to list that great high end residence. The problem is that as good as you are, there are 3 other talented brokers that are also competing for the listing. Those 3 make outstanding listing presentations and the prospect is absolutely impressed with all of them. Now it’s your turn to hit the ball out of the park and you make Babe Ruth proud. As you’re finishing, you ask the prospect one final question. “Have 18

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Again, this tax deferral strategy may not be for everyone but if it helps you make 1 sale a year, that’s a great opportunity for all involved. you considered the potential capital gains tax liability you will have when you sell.” The prospect responds that his CPA informed him that there will be a rather large tax bill to pay and he just has to take a deep breath and pay it. You then smile and ask him if he knew that he might be able to defer those taxes. He looks at you a bit stunned and asks you to explain and you do. Even if he decides to pay the tax, you have set yourself apart from the others and I can tell you that we have a number of success stories where the agent took the time to show concern for the prospect after the commission check would be paid and got the listing. Again, this tax deferral strategy may not be for everyone but if it helps you make 1 sale a year, that’s a great opportunity for all involved. As I mentioned earlier, there are a number of moving parts to this strategy but a short phone conversation probably could give us insight to the viability of this strategy in a specific set of circumstances.. Now go sell a great property, defer the capital gains and state taxes and invite me to dinner. But please don’t serve pork. Churchill probably wouldn’t approve. Best wishes until the next time we visit. Copyright©, 2015 David Fisher. All rights reserved. David Fisher is the founding partner at Creative Real Estate Strategies. His firm specializes in helping brokers all over the country buy and sell real estate for their clients in a tax efficient manner. He can be reached at david@cresknowsrealestate.com. His cell is 713-702-6401 and there is more information at www.cresknowsrealestate.com Top Agent Magazine

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5 STEPS TO ACHIEVE LONGTERM SUCCESS

AS A REAL ESTATE AGENT Real Estate can have a reputation as an industry with a high turnover as far as agents go. Being a ‘people person’ with an entrepreneurial spirit is a great start, but what some fail to realize when starting out is that this is a business. So if you’re in it for the long haul, you need to treat it that way. Here are some key steps you need to take to have your own successful real estate business.

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FIND A MENTOR

Once you get your license and hang your sign at a Brokerage, you’ll find that you’re pretty much on your own. That’s why it’s a good idea for new agents to find a large Brokerage that offers in-house training and mentorship or a boutique brokerage that has more seasoned agents who are eager to take a new agent under their wing. Being able to shadow a more experienced agent is invaluable and allows you to mirror what you’ve seen and run through the numerous scenarios that will arise when you are representing a client.

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CONTINUOUS TRAINING

This is a business that is constantly changing, so it’s smart to always stay ahead of the curve when it comes to new technological innovations and systems. There are even numerous online resources, where you can keep up on your trade, such as blogs by top producing agents that are a treasure trove of information. A confident agent with an in-depth knowledge of the business is one that easily earns the trust of their client, leading to repeat and referral business, which will be the bread and butter of your business.

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BUILD A STRONG ONLINE PRESENCE

Yes, referrals are the basis of your business, but building a strong online presence and marketing yourself to new clients is also important, especially before you’ve built up a strong referral base. Facebook, Snapchat, Instagram, and other social media tools are great way to get leads both for your listings and for yourself. It’s even a good idea to buy several domain names when you start, so that when you’re ready to build a website, you can ensure you have the names you want. Obviously the internet is also a great resource to find leads. Before you find a niche for yourself, it’s important to take advantage of every avenue there is. A lot of successful agents started off doing things no one else wanted to take on like foreclosures, expired listings or lower priced homes. But as you’ll find out, helping those who need it most is a great way to build a loyal client base, that will not only come back to you when they are ready to sell or buy again, but will be your biggest cheerleaders when it comes to referring you to friends and family.

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BUILD A SOLID FOUNDATION

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SET GOALS

One thing you’ll find in this business is that doing a lot of work up top, will lead to a more successful outcome down the road. That goes for marketing plans for your listings, as well as your business as a whole. It might not be the fun part, but it will allow you to one day focus on what you do best, dealing with your clients. Set up your CRM and the other systems you want to use from the get go. Getting these things established before you’re hopefully a busy agent is the best time to really learn them and decide what’s best for you.

Once you build a strong foundation and are establishing your client base, it’s important to continually set goals that help you implement your business strategy. You can even invest in a real estate coach if you need someone to hold you accountable. It’s also important to constantly reevaluate what you’re doing. Set up a monthly audit, where you go over what is and what isn’t working. As we mentioned above, this is a fluid business and things are constantly changing, the same can be said of your business. What worked a year ago, might be losing you money as your business grows.

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Four Challenges and Solutions from the Front Lines of the Real Estate Industry By Walter Sanford

There should be more profit-refining rather than adding a new layer of overhead or technology. Sometimes, the basics are not addressed when looking to increase the company’s or individual agent’s net returns. 1. Lack of training from top agents. Many times, the agent who was average in production but great at the process becomes a training manager. There are broker/owners who just don’t have the time to train; there are the top producers in the office who don’t have the time or motivation to train; and then, there are the previously mentioned managers who took that job because it was as financially lucrative as production. Too many agents are not receiving superstar training in lead generation. I have coaching clients who receive training on process rather than lead generation at their offices. There are many solutions, two of which are detailed below: A A brokerage system that brings the top agents into the training and recruiting business -- the two best known systems are Keller Williams and EXIT Realty. It is easy to reproduce these systems by giving better splits for listings sold or pieces of profit on new hires given to the introducer. B Set up systems in the office that promote production like meetings where everyone puts their best buyer and best seller together; where the office performs certain lead generation systems until agents commit to them like expired solicitation; where top trainers are brought in and agents are held accountable to new ideas. 22

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2. Reliance on purchased leads. Agents have lost their ability to prospect for sellers from hot demographics, because they buy leads from consolidators. If the purchased leads are good one year, they will go up in price or decrease in the number of leads in the next year. Agents need to prospect hot seller demographics blending “new school” with old school tools like direct mail, phone, follow-up, database, and closing abilities. The value you can offer certain seller demographics should be discussed at training meetings. 3. Offer macro-economic services. An agent has the ability to offer great information on a local level. It is the only way to compete with national websites. Whether you develop neighborhood websites or a newsletter based on local statistics, honing your local value is the only way to beat national efforts. 4. Financially struggling agents who don’t understand budgeting, planning, and investing. Many agents are struggling financially and they cannot devote their full attention to maximizing client satisfaction. They do whatever it takes to make the deal; they are in panic mode. With office services in place like setting up agent savings systems at close, training on tax-deferred investments, promoting real estate investing for groups, and budgeting analysis – offices have more agents who don’t live commission to commission. These agents are always better at making deals when the deals are based upon client satisfaction and not agent survival. Before you attend another webinar from a trainer or a tech guy (who never sold real estate) as they try to make your job easier – take a step back and start firming up some of the basics. Copyright©, 2016 Walter Sanford. All rights reserved.

Walter Sanford has been designing and implementing real estate systems for 30 years. One of the most successful REALTORS® and now wealthy from his systems, Sanford teaches his systems and strategies through his products, seminars, and personal coaching producing the best results in the industry. Do what works, do what is proven. Hire Walter Sanford. Call our office at 800.792.5837, email walter@waltersanford.com, or chat with us online at www.waltersanford.com. Top Agent Magazine

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