Errors in Judgment

First things First.

This Jeff’s Journal is longer than usual.  The reason why is I’m writing this on Friday morning sitting at PBI going through absolute madness.  Yup, we got to the airport at 3:45 am for a 6:00 am flight to the Great White North (Calgary and then to the Canadian Rockies). First, Neil Young cancelled on us, and a then a worldwide outage followed suit.  We made backup flights to Calgary and Edmonton and a pop up later flight to Calgary.  The airport was bedlam. New flights popping up with no assigned gates and strategies like splitting up at different gates or even back to the ticket counter as the phone wait was six hours. Cash instead of credit cards was all that worked in Atlanta at the airport stores. All the gate and flight update monitors crashed. The best line of the day was one guy throwing in the towel in Atlanta upon learning he had to go from Terminal T to B. The guy sighed. “I’m just going to the bar…!” So, with 8 flights booked and an hour and a half worth of sleep, I have nothing to do but write for you.  Hopefully things don’t come in 3’s! Anyway, on with Jeff’s Journal….

Earlier this week, the condolence texts and emails started to flow through.  Grammar school friends, my attorney Howard Bernstein, and acquaintances asked if I was related to Dorothy Lichtenstein, the late philanthropist and spouse of the famed pop art painter, Roy Lichtenstein? And if so, they were sorry for my loss.

When I was in Junior High School, my art teacher was a massive man named Mr. Hawkadahl.  Mr. Hawk as we called him was a former offensive lineman for the Green Bay Packers. He was excited to meet me, a young student because of my last name and asked if I was related to Roy Lichtenstein. The Bart Simpson in me said he was my Uncle.  That would turn out to be an enormous error. Now, I have no artistic talent. None.  My first painting was of the golf course that I looped at that summer with a stick figure red golf ball washer, green with flag, blue sky, and yellow sun in the corner.  It was awful but I got an A+ as Hawk thought I was a protégé artist and maybe I could introduce him to Uncle Roy where Hawk could get his big artistic break. Guilt started to flow through and that is when I took my deserved retribution as a result of my error in judgment as I confessed.  Hawk did not find it funny. My grades cratered and Mom and Dad came back from student teacher night telling me that the art teacher said I was the class clown. This was my George Washington, Cherry Tree moment.

Another error happened this past week when I tried to clean my metal wind chime. I got on YouTube and it said to use white vinegar and then baking soda.  Me, and all of my non-talents with arts and crafts, soaked the wind chime in 45% white vinegar.  OMG.  That stuff is potent. Some of it spilled on our side walkway and it removed 2 layers of stamped concrete paint. While the rust initially was removed, it gave way to a new orange stain. And when I mixed in the baking soda, everything started to bubble as I caused a dangerous noxious Walter White chemical reaction. I handed the chime to Ari, the professional landscaper/handyman who knows this stuff better.

We all make errors, and it reminded me of Buyers who try to represent themselves in a transaction and make slipups that are much more costly than my art grades and metal chime.  Here are the top 7 idiotic blunders a buyer makes when they represent themselves….

7 Idiotic Buyer Errors

1. CMA (Competitive Market Price)

The worst mistake I ever saw occurred with a guy from Sweden in PGA National. A home was listed for $2.5 million back in 2012. He bought it for $2.1 million from the seller through his listing agent and thought he saved money by going direct.  The problem was, it was worth maybe $1.1 million at the time. He called me after to see if he overpaid!  I did help lower his tax base by $700,000.  I asked him why he bought without representation. He said he got $400,000 off which seemed like a great deal.  Listing agents just want to sell the house and are not your advocate. Hiring a professional who understands how to work comparable products and understands how to do so and to dig deep is crucial.

2. Dates

There are all sorts of dates to keep track of. First, deposit. Second, deposit and transfer of escrow safely. Then you have inspection dates, survey dates, HOA application dates, membership application dates, mortgage application, mortgage approval date.  It’s a lot to keep in mind.  I’ve seen people on the hook to purchase with no means to do so because they were not approved for the mortgage/needed more time but forgot to cancel by the date.  The worst was one who missed an escrow payment because she was busy at work and then sent it in after the fact.  The seller was able to grab the monies because the buyer was out of contract.

3. Florida Contracts

Many states have “On or About, or On or Before.”  Some let you change the closing date or have Binders. Florida has none of the above.  Don’t close on the effective date and you are out of contract, deposit, and more at risk and out of luck.

4. Neighborhoods

People buy neighborhoods first and homes seconds, but purchasers on their own often don’t figure that out.  The listing agent doesn’t care about you and just wants the sale. The first thing a good agent does is ask a lot of questions about you and make sure to put you in the right community.  People who don’t understand the vibe of the subdivision often find themselves putting the house back on the market and doing a second move.

5. Restrictions

Brutus, your “therapy dog” isn’t allowed although you went under contract and thought “who would turn a small cutie down?” You find out you can’t paint your front door blue. Then, you aren’t allowed to rent your home out or put in a nicer paved entry.  No one is going to look out and tell you these things.

6. Liability

Agents have E&O (Errors & Omissions).  Once, we had a case where the Seller put down that 2 parking spots were available in the mls but there was only one in the contact.  The agent had to fork over $30,000 for the parking spot. Agents have E&O.  Purchasers do not.

7. Shrink
   Agents serve as coaches and mental health counselors. Buyers left to their own devices appear desperate, move too slow, or blow deals by underreacting or overreacting and not blowing off steam to a third party. Moving is also #3 on the stress list behind death (#1) and divorce (#2). Without an agent, #3 often leads to #2 or #1.

Take it from me. Let your dream home transaction be a beautiful seamless masterpiece and not a trashy runny painting.

Finally, a few thoughts flying back to the Microsoft airline crash outage. The people at Delta were just incredible. Calm under pressure and worked magic with limited resources to help everyone. In Atlanta we were confirmed on a flight without boarding passes and no gate.  I became stressed at that point. A pilot saw that and literally took us under his wing. He walked us to a help desk and then told us the gates where the Canadian flights were. We in turn helped another family out. You always hear these doomsday Armageddon no technology stories with everyone fighting for themselves. It was the exact opposite. That’s a wonderful Sunday takeaway.

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Jeff Lichtenstein, originally from Chicago, got his start in the home furnishings textile business where he traveled over 35 weeks a year selling fabrics. After the family business was sold, Jeff moved to Florida and became a real estate agent. Today he is the owner and broker of Echo Fine Properties, a luxury residential brokerage voted best brokerage of the year. Jeff manages a non-traditional model of real estate that mimics a traditional business model. Echo has 80 agents, an average of one million dollars per transaction and over 500 million in annual sales. Between traveling for work and annual family trips to national parks with his wife and 2 now adult children, Jeff has visited 49 states. He is also one of the few Chicago White Sox fans you’ll ever meet.  Some publications he has been quoted in.

Author of business & leadership book How Making a Sandwich Can Change Your World –  The Amazing Success of the PB&J Strategy – Available to Buy Now!

Feel free to ask him a question directly at jeff@EchoFineProperties.com including a complementary  valuation of your home.