Jeff Stone – A Real Estate Story
Jeff Stone 30 Years of Real Estate- A Look Back and a Message for the Future
(Note this is very long but all true)
Real estate has gone through massive changes over the last thirty years like most other industries. This is a true story looking back over those thirty years, following the career of a real estate lifer. It is full of chance happenings, opportunities, the funny things that happen along the way, plus a look at the lessons that were learned and how they apply even today.
I head off to college (Denison University in Granville, Ohio) in 1968, not knowing anyone attending the school or that it is a “safe place” to go for kids graduating from Eastern prep schools. I never knew there were eastern prep schools but I liked the brochure and my soon to be ex-brother-in-law attended there and said that it was good. In four years, I learn to relate to the upper class, go on two peace marches and graduate with a degree in psychology.
Faced with life decisions, I decide to be a teacher and will have to get some money to attend graduate school so I enroll in Professional Bartending School to learn a trade to earn money for graduate school, graduating second in my class. (One lemon twist away from co-valedictorian). Landing a job in a nice restaurant with an owner who has the best memory and customer service skills in the industry, I slowly get to be an average bartender but learn a lot about people and life.
Two things happen- figuring out that at the time there is more money in bartending than teaching and one of the customers of the bar hands over a $25 tip for telling him that one of the other patrons is thinking about selling his house ($25 was a lot of money in 1972). The man giving the tip owned a real estate company and suggested getting a license would be a good thing for me.
1973 finds me bartending and selling real estate and not doing a great job at either. My experience with house styles consisted of big and small. Mortgages? What are they? I still remember a client telling me back then that at 7% she thought rates were too high and was going to wait for them to come down. (Should I call her?)
The first time out with clients who I met in the bar, at the very first house, I was so nervous that as I backed up to leave, I ran over the owners’ son´s bike ($75 was a whole lot of money in 1973). After six months, finally a sale- $23,000 to the assistant chef in the restaurant and it takes 10 days to get the offer presented because the owners are out west on a camping trip.
By 1974 real estate is starting to make a little bit of sense and the bar generates a constant flow of prospects who can´t get away from me and for some strange reason find a bartender somewhat of an authority figure. Problems start to happen when some of these good prospects want to look at just one more house and work starts at 5 PM. (Decision to make $5 per hour plus tips or $2,000 commission). Outcome: Jeff is fired as a bartender.
1975 headline-“Jeff becomes the top salesperson at his one office company”. I learn the value of press releases. Small fact not disclosed to the public is that that same year that most of the full time sales people either quit or went to a competitor. I find out that other agents were making higher splits than me (imagine that), confront my boss who decides he will give me the money I would have been making if I stay for the next six months. Not a headline-” Jeff is fired after five months and twenty days”-but all is not lost because he has a listing coming the next week that sells in 2 days at full price for more commission than he lost.
The new company is the biggest, most dynamic in town. In this new office of 8, there are all full-time, motivated people and we never see the manager or owner because they hang out in the fancy, main office. Some of my new associates, people might have been classified as barracudas at the time. Anyway, a lot is learned from this new group of associates.
Their average sale price was at least double mine and they got all the relocation business. There was only one month that I attained top sales person status (it was the year of the great snow in Chicago and my client who was from Atlanta had to buy, rented a car and picked me up after I climbed through the window to get out and tagged along as the client found the house he wanted). None of the other sales people had such nice clients and our office had only one lesser-priced sale for the whole month.
Personal sales reached $1.5 million in 1976 with an average sale price of about $40,000. I was selected by my older peers to head up the meeting of our office of disgruntled agents with the owners from headquarters. (Peace march experience was cited as a factor.) Before long the company wanted to expand further out away from its base of operations. In 1979, I was chosen to open a new office in a strange town in a far away county. First step was to get a brokers license, which meant choosing a school. I chose LaSalle Extension University, which advertised on matchbooks (whatever happened to match books?), finishing the correspondence course in record time and passing the license exam on the first try.
1979 finds me managing an office with absolutely no experience, a few salespeople that our other offices were glad to see go, in a town where no one had ever heard of our company. Also this year, I marry a woman I dated back in college (quick decisions were not my strong suit). While on my honeymoon all but two of my salespeople quit, leaving the door open and no note. Not discouraged, I get seven listings in the next two weeks and have signs all over town. Alas, I ran out of gas but luckily the company was acquired by Coldwell Banker on St. Patrick´s Day in 1982.
The company thought I had done such a good job that they did not acquire the office I was running. As luck would have it, they wanted me to run my old, successful office. The office was in a two story, converted duplex that had at one time served as a school for the local farmers. The new office sounds good until you factor in that all of my old friends had gone off to join the hot new franchise in the area, ReMax. The office average age was now close to sixty and only one person there had ever had more than six transactions in a year plus the old manager was kept on to be the assistant manager. The first month in the new office we tied a company record- NO sales.
Interest rates started climbing. 14%, 15%, 16% were the choices. The new company held monthly manager meetings (the company had approximately 30 offices) and within the first couple of months I attended a private managers meeting where it was suggested we get rid of the company president. (Started to seem to me that people aren´t always happy with management.) No one mentioned that it was not good politically to attend. All the managers seemed so much smarter and seemed to know everything about running their offices. I would come home at night and tell my wife that I would never get this figured out and I was destined to be fired.
Slowly I started to hire people who had potential. I looked for people who were a good match for the community and were motivated. “Revolutionary” things we did were to track appointments and require written plans.
About this time, adjustable rate mortgages began to make sense. The average real estate agent was slow to warm up to the new loans but we found a lender who would lend for 5 years at 12.5% (going rate at the time was 15%) and would readjust after 5 years at a new rate for another five years. Meeting after meeting, training session after training session, we went over these mortgages, and finally, they got it. Sales poured in and the other companies and offices couldn´t figure out how we did it.
Rates came down, prices went up and grateful sellers came back to us in droves. Highlight of those years was a shoving match between clients on the stairs over who could get into a conference room to write a contract. In 1987, I was manager of the year in Chicago. By 1989, our little office was the number 1 Coldwell Banker office in the nation in listings sold per person. I still have the eagle trophy that I was awarded at the Mosconi Center in San Francisco complete with missing chip of marble, which cracked off when I fell on the stairs leaving the arena. Hit my wife´s foot causing massive amounts of blood and a huge dose of humility.
Back to reality and trying to duplicate the results the following year. They say it is harder to stay on top than to get there for good reason. Sales people wanted more money, more stuff, and the combination wasn´t good. Things unraveled in the next couple of years and exodus number two to ReMax commenced with a vengeance. If you are ever thinking of changing companies, “I just need a change” is very effective. I probably heard it 12 times over that period.
A funny thing happened however, new people came to work in the office despite all the people leaving proving a couple of things-one, the public´s perception of what happens in the real estate market lags the reality of what is happening and two, success begets success. Business did not fall apart and the new people fit into the system we had developed and became even more successful than the people who left.
Awards based on per person production came year after year. We had the number one sales person in the whole Chicagoland company plus numerous others in the top 5%. Salespeople earned a lot of money. Life was good. Competition was tough but we really learned how to sell real estate.
About this time technology was making an appearance in the real estate scene. Way over my head, I didn´t even know how to check the oil in my car. How was I supposed to figure out this mystery machine? One day, I made the mistake of standing up at an all company managers meeting and suggested we hire a couple more computer consultants like the “cute” one we had. Ouch! After the president had finished neutering me (a few of my fellow managers wanted to make sure I wasn´t going to cry or have a break down after the meeting), I decided I was going to learn and I would outlast her,the president, and if she ever fired me she would have to hire me back because of my technology expertise. After countless technical support disasters, I began to get a pretty good grasp of technology.
Then because nothing in real estate stays the same, things were shaken up. My company “acquired” one of its competitors in 1996. Good for us, except that the management of the competitor was in control. Bad for me. In a masterstroke of management inflexibility, several years prior I hadn´t hired the woman who now was my regional manager because she wanted to be a part-time agent.
There were now two company offices in my town. I was confident because my office was profitable and award winning and the other office had a manager with less than two years of management experience (in fact, I had hired him into the business) and his office was not so profitable. After six months, I had my big meeting with upper management. I´m not sure what was said after they said they were thinking of going in a different direction but I figured out that more change was in store.
Good things happened although it wasn´t readily apparent at the time. I was offered the manager job at a neighboring office, which meant meeting a whole new office, not profitable, with only three people I knew and would be replacing a manager who was well liked. I had the weekend to think about it. Amazing how times like this help you crystallize what is important. I took the job, changed my work habits- no more Sundays, more time with my family and back to the basics.
After a somewhat rocky start (even with my best material and a healthy dose of compassion for their change-I was greeted like someone from a distant planet), things improved. I adapted my style to theirs plus brought back the things that had worked best at my last office. The office started to do better and it became like my new family.
Meanwhile, back at the old office, things didn´t go well. The manager of my old sister office also got the “we are going in a different direction” speech. We were replaced by a manager from a larger office who was replaced by a regional manager. After about six months, just prior to moving into a brand new state of the art seven thousand square foot office large enough to combine two offices of disgruntled sales people, the local president called me to see if I was interested in going back to straighten things out.
This time tears in my new office as I left (they had figured we were from the same planet after a few months) and agents in my new combined office actually cheering as I was announced. (What was up with that?) Things went very well with the merger and the new office thrived. We made it to number four nationally for our size within a couple of years. That was a one year phenomenon because after the success I recruited too many people and we moved up in size class for awards.
The following year the manager of my former short-term office quit. I got a call from the president this time to ask if I would manage that office again and continue to manage my other office. My technology adventure from earlier had pushed me to develop a passion for technology which came in very handy running two offices. This real estate business sure has ups and downs.
Managing two offices really makes you focus on systems. I did that for a year. That year went by faster than any in my real estate life. After a year, an agent we groomed to take my place in the smaller office was ready to take over. So for the fourth time in a few short years, I pulled out my coming or going speech and said goodbye.
I had so much more time I didn´t know what to do with myself. More time to decide what I wanted to do with my life. I decided I really liked the challenge of working with high producing agents. In our spare time, my wife and I had fallen in love with an island thirty-two miles out in Lake Michigan. So after a couple of peaceful years of running just one office, I decided it was time for a change. (This seems to be a theme running through the course of this story).
I wanted to pursue my passions. What were my passions? My wife (same one from way back in 1979), my kids (who appeared more than nine months after my wife), technology (started way back when I decided I would show the tongue lashing president a thing or two), working with high producing agents (developed over the years of running high producing offices), and spending time on our island out in the middle of Lake Michigan.
I needed a plan and some breaks. The first break came when an obscure memo came across my desk –actually an email which said if you attained a certain age, worked for the company for so many years, you were able to continue medical insurance until you were 65, still a ways off for me. Having a diabetic wife there was no way I would be able to get or afford insurance if I had left my job before sixty-five. I figured I had to be about the same age and experience level of the national upper management who would be some of the few who would qualify for the program. Actually this memo took care of another passion-my wife- getting good medical care increases the odds she will be around to enjoy life. My sons, ever mindless of such things, benefitted, too.
The other three passions were also somewhat related. Technology, working with high producing motivated agents and living on an island in the middle of nowhere needed something to fall into place –high speed Internet connection. To be able to live on an island and work long distance, it is vital to have a high-speed Internet connection. Most technology today depends on the Internet except on remote islands. Not only do we have a home on the most remote inhabited island in the Great Lakes, it is twenty-five minutes from town, so there are no cable or DSL connections for us. A second generation satellite Internet system became available on the island, which would allow me to use technology as I needed it to work and to work long distance because I had an effective way of communicating.
Working with high producing agents, I would need to be up on the latest and greatest as well as the classics. I bought thousands of dollars of books and tapes, subscribed to newsletters, studied, read and generally reassured myself that I could be an asset to my high producing agents.
Like any good planner, I picked a date and wrote a plan. My date was tax day, April 15, 2006. I found out about the high-speed Internet service in the fall but it seemed too early to sign up since I wouldn´t need it until the spring. I figured I would give my company a good two months notice, which meant the middle of February. I continued reading, planning, listening and putting together a plan for a coaching, mentoring and web site business.
Right after the first of the year I went on the web site to sign up for my new high speed Internet. Oh oh! “Service- over-subscribed, we are not taking any more subscribers.” Devastation! My wife walked in and wanted to know who had died. After a sleepless night, I formulated a plan or really a pathetic sob story I would tell the Internet company and I would plead like never before. The next morning I make the call. When the lady answers the phone, I am ready to launch into my sob story. She asks where I live and says, “That´s good, we only have one person signed up on the island and need more, so we can do it if you can get us a couple more people.” No problem. April 15 came and I started Next Level Solutions for Real Estate after one last good-bye speech.
Since starting Next Level Solutions, the fun continues. Technology stories aren’t as entertaining as real estate stories but whether it is real estate or technology you can be assured that things never go exactly as planned.
We were selected to be a vendor in a huge expo which gave us an opportunity to meet with many agents needing technology help, close-up, which was a big advantage for us versus national website companies since we offer so much more value for agents –we are confident aren’t we. The expo went extremely well, lots of agents were very interested in using our services. They were all directed to our website to see what we offered in greater detail.
The morning after the expo I was up at the computer at 5:30 AM, not sure I was up because of my age or I was just so excited to handle the new business that surely would have come in over night. One small problem –our site was down. We used a national template company for our site at that time; all 30,000 sites across the country were down. No one could see our products. All that good will down the drain. Who would want to work with a company that had a non-working website? After a string of original, non-repeatable language, unanswered calls to technical support and 14 hours the site was back up. A truly bad day.
The next day, ever the optimist, I was up again at 5:30. This time I turned on my computer, I smelled something funny, looked at my computer just in time to see a puff of smoke and a blank screen. Beyond the new use of bad words, I just stared in disbelief. All my current work up in smoke! Nothing to do but take the computer into my good friend, Mr Cho, when he opened at 10 and to set up one of my other computers to at least get email. I arrive at the computer repair shop hoping for the best. As Mr. Cho comes to the front, I manage to drop the compuer tower onto my hand, smashing my finger nail –luckily not on one of the 2 fingers I type with. More bad words.
Later that day, I received a call saying that none of my data was lost and I was back in business. We now have everything backed up in triplicate and have switched our site to one of our own custom sites which has never been down. Our business has moved from updating template sites to about 90% custom sites and we are quick to tell our clients to back up and do it often.
So what can you take from this long-winded but true story. Real estate has and always has had twists and turns along the way. If you look for them, there are opportunities in almost everything that happens to you. Everyone gets his or her share of good and bad breaks.
Look for the opportunities in major changes like technology and financing. By staying up with or learning what is new, you have a chance to survive and flourish. Keep an open-mind when changes happen.
Don´t burn your bridges. Life and real estate is sometimes like a Dickens story with the characters reappearing out of nowhere. You never know when the people who you feel have done you wrong will come back to you with a different outlook.
Awards are great to receive. They aren´t always fair. In the long scheme of things, awards are not a good way to judge a situation. OK, they are kind of fun.
Salespeople are not always going to be happy with management. Sometimes no matter what you do, you are not going to be appreciated. Sometimes it is just time for a change. Just remember at the other place there are probably disgruntled agents, too.
Develop a passion for what you do. Real estate can be a bad job but a great career. If you are passionate enough about what you do, you too could end up living out in the middle of the lake with a spouse/significant other you love, doing what you love to do, appreciatings your now adult children, and at an age that you can enjoy life.
Have plans, write them down. Focus your business on appointments. Develop systems. Take time off. How many times have you heard, “no one says that they should have worked more on their death bed?” Be flexible. Find the humor and fun in what you do.
So why would you write a story like this? It is fun to remember some of the things that happened. There are lessons to learn from the past –sort of like history class except you don´t have to remember the time and dates. When we talk, you can be confident that I understand what you are going through and I believe things have a way of working out.