We ‘Play It Safe’ When It Comes to Louisville New Construction

Today in Louisville (Jefferson County) there are 3,594 single family homes for sale on our MLS.

  • 63% of them have basements.
  • 49% of them have more than one story.

Let’s look at homes built in the last 10 years:

  • 69% of them have basements.
  • 67% of them have more than one story.

A few more basements but a lot more 2-story homes. What I’m really thinking about is how similar all the new home are. Other than comparing a Traditional Ranch to a Traditional 2-Story home they are all so homogeneous as to take the ability to choose almost completely out of the equation.

I do applaud what Norton Commons has done with their planned community. There’s nothing like it in our city. Sure, you pay top dollar (price per square foot is much higher) but I can make an argument for it.

But looking at this year’s Homearama homes, it’s really tough to separate one from another. Garages are tilted here and there; then I see some Tudor or Craftsman stylings to the facade but as far as floorplans go, they are just so similar. What do you think?

The other option is that I’ve just seen too many homes and they’re all blurring together. Either that or we’ve finally evolved to the top usability option in home design.

Nah…

How long before Louisville news goes truly hyper local?

Hyper-Local Louisville - Summerfield by the Lake
If I have any say, hyper-local is coming to Louisville real estate.

Now that we all know that it’s just a matter of time before the Courier Journal dies a long slow death, where will you be getting your local news from?

The trend towards hyper local content shall continue but only will start taking mind share if those that do so do it right. Groups like Kentucky Sports Radio pretty much own the keyword phrase “kentucky sports” and have several venues to content delivery.

Even with the giant brands like Urbanspoon and Yelp hitting on the Food niche, the local institutions likes Louisville Hot Bytes, Edible Louisville and Consuming Louisville have far richer content and more of it.

The issues remain that owners of these brands want to do more than simply dominate their niche and thus dilute a pure brand into one that’s watered down. Positioning 101 states that the marketing battle takes place in the minds of the consumers who have something akin to ladders for specific products or services.

News is far to broad. “Sports news” is closer but Kentucky sports news is even better.

Sites like InsiderLouisville do a better than of communicating the late breaking, local news items in Louisville faster than any of the competition and they are divided clearly by topic.

But what I’d like to see is the Primary Brand be something like, Louisville Food Reviews by Steve Coomes with InsiderLouisville being the sub-brand. I wonder if they’ll listen to a pitch?

My own entry into this discussion can be found at LouisvilleHomesBlog.com where I give news and analysis on Louisville real estate. Sure, there’s a taste of Louisville home improvement, Louisville mortgage rates or Louisville interior design thrown in, but only as it relates to Louisville homes.

I’ll admit, it’s good but could be better.

Maybe that’s what I’ll work on while I’m supposed to be taking my yearly South Carolina vacation?

Louisville Tops Best Bang for Your Buck Vacations

Homearama at Norton Commons
Louisville is a great city with so much to offer. I never knew that it was the best vacation spot though. Gives me some ideas to think about.

Wow! I knew Louisville was a great city but #1?!? Now I’m blushing.

This just out from Livability.com; they reviewed 500 cities and awarded Louisville, KY is a Year-Round Staycation! Sure, if you have deep pockets you might select Honolulu but who has money these days?

Rich history, modern culture, free attractions and deep discounts make Louisville, Ky., a prime vacation destination for families.

Home of the world-famous Kentucky Derby, Louisville prides itself in all things equine. Take a historic walking tour of Churchill Downs with admission to the Kentucky Derby Museum. Kids under five are admitted free, and AAA members receive discounts. Join in the citywide Derby Week celebration at the Kentucky Derby Festival and Thunder of Louisville, the largest fireworks display in America.

If this doesn’t make you proud of your city, I don’t know what to tell you. Share the news!

Quick Hitter Post of the Month

Photo of Quick Hitter
Quick-hitter has far more baseball than basketball photos in the image search so that’s what I went with. But we all know that basketball is a far better sport. We live in Kentucky, after all.

There’s so much going on that I couldn’t possibly give it all the time it deserves in this post. So I’ve decided to bullet this post like Dirty Harry, Rambo or John McClain, whichever silver screen star you prefer.

Let’s get to it!

  • March Madness is in full swing! Yes, I understand that college basketball has nothing to do with Louisville real estate but we live in the basketball state of Kentucky and the state’s two big rivals are both in the Final Four. The world may end after this game on Saturday.
  • The real estate market in Louisville is picking up! Yeah, like you didn’t already know that. I’m sure you already subscribe to my monthly email newsletter, right?
  • Just moved to REMAX Champions! We want to be your real estate champion! Well… actually I just made that up. Kinda hokey, in my opinion. What I’d really like to be is your Trusted Advisor in Louisville Real Estate. Much better.
  • We have so many people in our extended family that we have a birthday celebration several times a month. This month was Kim and Gigi! Love you both!

Readers Beware: Media Writes For Money or Influence

Great looking Louisville home with vinyl side
Sure, it costs less to clad the exterior with vinyl side than brick but not half the price of the entire home.

I’ll admit it, I’m an idealistic. Whether that’s a genetic or learned behavior, I’m not in a position to deduce. But I am, and at the mid-way point of this life, I doubt that’ll change.

It’s my desire that the media is supposed to report the unbiased, unembellished truth.

The truth, as it turns out, is that the media fits the facts to their agenda, whether that’s selling more newspapers, getting more hits on their Web sites or influencing people to their cause. I can’t say it any more simply than that.

Today’s example is truly a mild one. But because it falls under that mantle of Louisville real estate, it caught my eye.

Eric Flack wrote “Law not on side of property owners hurt by vinyl homes” earlier this month. Sticking up for the everyman against big corporations has been the modus operandi for many in the media since Day One.

But what’s interesting to me about this piece is how the case was made with such exaggeration. Flack apparently interviewed Louisville Metro Councilman James Peden for the story; there are direct quotes in it. But look at this paragraph.

Peden said all brick homes that sold for $300,000 in Washington Green are having their property values pulled down by vinyl homes that sell for half that. Peden said the cheaper homes bring down property values so much existing homeowners often can’t sell or refinance because they’ve lost so much equity.

Doesn’t that read like, switching a brick clad home to a vinyl clad home reduces the home’s cost by 50%? Absurd!

That tells me that the truth must bend to make their point.

Next time you’re chatting with a builder, ask them how much more brick is than vinyl and they’ll confirm that brick is generally 2x-4x the cost of vinyl but that’s only the exterior cladding, not the cost of the entire home.

The main thrust of the story is whether or not developers have the legal right to modify a subdivision’s deed restrictions due to market changes but that question doesn’t seem to get answered. Incite aggression and the WAVE3.com Web site gets more traffic.

See? Even I got hooked by their strategy.

2011 Louisville Real Estate Agent Salaries Report

I was very interested in the results when I began writing “So how much do Louisville real estate agents make?“ last year.

It had long been my belief that the majority of sales were garnered by a small handful of real estate agents.

Running the numbers again this year for 2011, I saw similar results. Keep in mind that these charts show sales volume, not salary. If an agent sold five, $1 million homes that would be $5 million in sales. (That would also be an outstanding year!)

But, determining their salary would require estimation.

Let see how this year’s tally concluded. These numbers take into account only agents who completed a deal in the calendar year, not agents with no sales or whose licenses were in escrow.

Chart of Top 20% of Louisville real estate agents portion of all 2011 sales
Chart of Top 20% of Louisville real estate agents portion of all 2011 sales.

Chart of Top 10% of Louisville real estate agents portion of all 2011 sales
Chart of Top 10% of Louisville real estate agents portion of all 2011 sales.

Chart of Top 5% of Louisville real estate agents portion of all 2011 sales
The Top 5%, 130 agents, had just under 1/3 of all sales volume, or an average of $8,359,094 sales each during 2011.

We are now forced to make a few estimates in order to translate sales volume into salary. Understand that commissions aren’t paid directly to the agent, but rather by law to their broker.

Then the broker “splits” the commission with the agent. Splits are negotiated between the agent and their firm. New agents most often start with a 50/50 split, while more experienced agents can negotiate a much better arrangement.

For the purpose of this article, and because there is no public data available on this topic, I’ve chosen to split the total commission 65/35. Using this percentage, I created the following chart.

Chart of 2011 Louisville agents salary distribution
As you can see from this chart, salaries remain relatively flat until you reach the top performers then increase dramatically.

Under this equation, the top performer in Louisville garnered a $425,146 salary in 2011.

In reality, it was likely much higher as brokerages are driven to bring in the most successful agents, which helps their firm in both revenue and prestige. Those agents can negotiate better splits. Therefore, on a sales volume of $21,802,330, it wouldn’t be unreasonable to guess Louisville’s top agent made more than $550,000 last year!

Please remember that these dollar amounts are gross sales, so taxes, expenses, mandatory fees, and insurance, bring this number down, sometimes considerably.

2011 performed very almost identically to the previous year in the percentage of sales.

	2010	2011
Top 5%	30.7%	30.5%
Top 10%	45.8%	45.6%
Top 20%	63.2%	64.5%

Maybe the Top 5 percent and Top 10 percent couldn’t keep up with last year but the Top 20 percent gain more than a percent.

Also interesting to note, was that 2,737 agents had deals in 2010, while just 2,594 did this past year. That’s a 5.5 percent drop in the Louisville’s real estate workforce.

2011 Louisville Award for Real Estate Agents, But It’s Not Worth the Plastic It’s Made With

2011 Louisville Award for Tre Pryor

Wow! Look at that! I’ve just been given the 2011 Louisville Award for Real Estate Agents. All I have to do is log into their Web site, commerceaward.com and enter this code they have for me and… wha…??

You mean I have to pay for it?

Why would anyone need to pay for the award they’ve been given? Didn’t their email just say:

Tre Pryor – Rick Shaw Realtors has been selected as the 2011 Louisville Award winner in the Real Estate Agents category by the US Commerce Association.

Did Christian Bale pay for his Oscar? Did Tina Fey pay for her Emmy?!? This is an outrage!!

Oh, wait a sec… I see now. I have to pay for it because it costs so much. That way, these fake little companies can make some money handing out worthless awards to gullible recipients. Aha!

Does anyone actually give them their credit card?

Well… so I don’t have a trophy for being the Best Real Estate Agent in Louisville 2011 but I’ve got their graphic. And by golly, I’ll display this thing proudly for all of 10 posts until it drops off at the bottom of my blog’s homepage.

Year in Review, 2011 Edition

Chart with highs and lows
Every year has highs and lows. How was 2011 for you?

2011 was a busy year. In fact, despite the market being down again here in Louisville (see this handy dandy chart that compares Jefferson County monthly home sales back the previous 6 years) I actually had my best year yet. Yeah me!

I want to use this post to look back and see what worked and what didn’t. If you know me, you’ll already know that I’m a straight shooter. I don’t steer. I don’t spin. And I don’t care for people that do. So here we go!

2011 Lousville Real Estate Highs

  • Louisville Homes Blog Founder, Tre Pryor, Interviewed by MSN for Real Estate Article
    This one just happened! I’m honored to be considered a subject-matter expert (SME) for real estate, not just here in Louisville but nationally as well.
  • Serving Some Great Clients
    I was blessed to work with some great clients over the course of this year. I’m especially pleased that many of these good people realized that I do put them and their needs ahead of my own and are referring me to their friends and family. You know who you are… you’re the best!
  • Silas Joined the Family
    Family ranks high on my priority list. So when we are blessed with a new family member it’s a personal highlight! My nephew Silas was born this year. Psyched again to hear a little say, “Hey Uncle Tre!”
  • TrePryor version 3.0
    Found a solid database programmer who’s working hard to help me deliver a new version of TrePryor.com in the new year. My plans are for it to be the best real estate Web site in Louisville. (I know I promised it this year but finding quality help can be a challenge.)

2011 Lousville Real Estate Lows

  • Sales Continue to be Sluggish
    There was hope that real estate sales would strengthen in 2011. That didn’t pan out. This December, we’re in the same position as last December, hoping next year will be better.
  • Psychotic Clients, Disloyal Clients
    For people not in the industry, it’s almost impossible to understand how good agents put themselves out there for their clients, generally without any guarantee of compensation. That’s part of the business but it’s not easy, especially for me, because I treat ALL of my clients with the best that I have. This past year I’ve wasted hundreds of hours serving clients who either knew from the outset they were just “playing games” or decided to treat another human being like a machine, with little regard for the agent’s feelings. It can be very hurtful and it’s one aspect of this business that I will never like.
  • Economic Uncertainty
    Global economic problems affect us all. Our economies are so linked that problems in Europe hurt us here in the States. Unemployment continues to be a plaque no matter how our current administration tries to place blame on others. This uncertainty hurt us in 2011 and will likely continue to hinder our economy in 2012.

All in all, the good outweighs the bad. Optimism trumps negativity. And I choose to be excited about what next year will bring. How about you?

I Do Have Some Great Clients!

Photo of another home sold by Tre Pryor


Another Louisville home sold by Tre Pryor. My great clients took this shot and brought it by.

Was just thinking about some of my great clients and one brought by this photo and thought I’d like it. And I do! It’s especially gratifying when my clients trust my expertise to help them achieve their goals.

In this case, their dream home came next!

Agents: Do You Have a Real Estate Plan for Yourself?

Photo of Diana Ross
Diana Ross was a diva from a different era. Did she have a musical career plan?

Bet you didn’t think I’d be writing about Diana Ross songs on this real estate blog, huh?

Not sure why I thought of this, but since last month I wrote about a U2 song and back in April I quoted The Beastie Boys, I thought I’d continue the theme. There are no 6 degrees of separation between these two.

Here’s the relevant quote:

Do you know where you’re going to?
Do you like the things that life is showing you?

How does this pertain to real estate? Good question my friend.

As it turns out, there are a million and one ways to conduct yourself in the world of real estate. From the way you prospect for clients—cold-calls, flyers, bus signs, radio advertising (to name just a few)—to the way you handle the clients you’ve obtained.

I know agents who work so many clients at the same time they couldn’t possibly have anything more than a surface relationship with them. I doubt they even know their client’s children’s names. They’re too busy working this client to closing then jumping to the next.

The reverse can also be a problem. Spending too much time with any single client can be hazardous to one’s business health because there’s a real chance they don’t buy/sell. It’s my assertion that the average Realtor doesn’t get paid for 66% of their time/work. Surprised? I was too!

So, back to the song. Do you know where you’re doing do? Do you have a plan? It doesn’t have to be an Ivy League business plan with all the data plotted but it needs to be spelled out and written down.

If you don’t have a real estate plan for your career, I predict you won’t like “the things that life is showing you.”