Wednesday, February 23, 2011

Informational Interview with Mr. Harlan Anderson

David Mueller-Flores
FIN 180 - MW @ 2
Dr. Hansz

The following is an informational interview that took place on February 16, 2011 at Realty World Sweeney Anderson. The sole owner, Mr. Harlan Anderson, was gracious enough to allow me to pick his brain for valuable information regarding his company and the real estate industry as well as valuable information for any student studying real estate with interest in joining the industry. Realty World Sweeney Anderson is located in Hanford, California and primarily provides services in Kings County. Over the course of the interview Mr. Anderson describes his company, his path to becoming a broker, recommendations for students interested in becoming a real estate salesperson/broker, as well as how the real estate industry really is a “people’s business.” I would like to thank Mr. Anderson for his time and the valuable information he was willing to provide.

Q: What is Realty Worlds operational territory and do you deal in commercial or residential real estate or a combination?

A: Realty World is a franchise that has had various levels of dominance, success, and then going down and coming back up again. Right now, there are actually two Realty World entities in the world, if you will. One of them and it is completely separate from the other one is the one I’m in and it is Realty World of Northern California and Northern Nevada. It is a franchise with all of the training and other benefits that you get from a franchise. The Northern California and Northern Nevada extends from just about here in Kings County as the southern tip to the Oregon border to the ocean on into Nevada, meaning Reno, Sparks, Carson City, that part of Nevada. The rest of the world is Realty World America. In fact, I was just recently off Florida on a cruise and in fact I saw a Realty World office in Fort Lauderdale, Florida so it is out there quite a little bit. As far as the second part of the question the commercial or residential; we do commercial but we specialists in residential so I’d say 90 – 95% of the transactions we facilitate are in residential real estate. Mostly single family, and then also on into the duplexes, triplexes, even up into the apartment complexes.

Q: What was your educational and work experience path to your career as a real estate broker?

A: Ok, after high school I attended the University of Minnesota; and went through four years and graduated in 1968 couldn’t make up my mind so I ended up with a double major in Biology and Psychology. Just due to circumstances, especially the Vietnam War and getting drafted and those kinds of things that a lot of people were facing; as soon as I graduated I taught junior and senior high school up in northern Minnesota for a year. Then, I spent four years in the Air Force. Got out of the Air Force and spent about 14 years in various aspects of both juvenile and adult corrections. How did I get into this end of things becoming a real estate broker? Well, I won’t get too far into it right now but I got burnt out frankly on corrections I couldn’t put my finger on anything that I had for sure accomplished in that field. You got a paycheck so you knew you knew you were doing something but you couldn’t put your finger on I manufactured this widget, I facilitated this transaction, I did that. I just got burnt out on the corrections and just ended up in Real Estate for that reason. It is very rewarding you do more than just get a paycheck you also get a ton of job satisfaction.

Q: What attracted you to real estate as a career?

A: Well I touched on it in a response to the last question but I had been working here in California for about a year in Child Protective Services for Tulare County and I was getting very frustrated with that I think it was just an extension of the burn out that I was experiencing with corrections. I was just thinking on the way home from work that wouldn’t it be nice, I wonder if there is a profession out there where you work with people who actually wanted your services not where your services were hoisted on people but where people actually wanted to work with you in your profession because that wasn’t the way it was with corrections. Corrections it’s a service that is, well, they did it to themselves but again your services were mandated by the courts and real estate has been the exact opposite of that, you work with people who very much want your services and it is very rewarding in that regard.

Q: What do you enjoy most about the real estate industry?

A: Working with people on all levels. I do very little listing and selling myself anymore. In fact, since I am the sole owner of the company what I pretty much concentrate on is supporting my agents with what they need. It’s really an enjoyable field in that you know that you’re doing something for somebody and they are appreciating it whether they are another one of my agents or they are a buyer or a seller.

Q: Which aspects of real estate have you found to be the most and least rewarding and why?

A: It tends to be much more positive reward than negative but on occasion and maybe we tend to forget, as real estate brokers and agents, how stressful the purchase or sale of a property can be for someone. Lots of times the least rewarding part of it is when clients misdirect their frustrations and stress and start to shoot the messenger, if you will; start to get blamed for things that you have absolutely no way of controlling. You always do your best and the longer you’ve been in the field and the longer you’ve been doing it the more things you learn about how to avoid pitfalls in various aspects of transactions but some things can either really happen or are perceived to have happened by a client and they just splatter on you and sometimes that gets to be very unrewarding. Again, you have to realize that a real estate transaction is possibly of the largest financial commitment a person will ever make in their whole life is buying or selling their own home and some people get stressed and splatter on people. Most of the time it doesn’t happen but when it does its frustrating and it keeps you awake at nights.

Q: As a result of the current recession and the housing market decline; what has your company Realty World done to insure its survival during this rough time?

A: Realty World is, I am one of 360 companies in northern California northern Nevada, so let’s talk specifically about my company, which is Realty World Sweeney Anderson. What have we done to ensure our survival? Well, we tried to get a little bit more creative in attracting clients to us and our product and what we do as opposed to probably our biggest competition is other franchisees from other companies, such as Century 21 or Coldwell Banker. A lot of what we do is so personal that our success hinges on our individual agents the people that they know and the people they work with on an individual basis all adds up to having the company itself be a success or surviving even if you will. It’s such an individual, hands on, people to person to person, people to people relationship that has to be formed during a transaction that everything is just going to depend on how an agent handles the tough times that are always going to happen in this field.

Q: What do you believe needs to happen in order for the residential housing market to return to how it used to be?

A: Well, Looking back you can certainly see as a real estate person that is full time in real estate you can almost look back five to eight years ago and could’ve almost predicted that this is ultimately what would happen. The government, quasi-government entities out there, Fannie Mae and Freddie Mac, softened and softened, and loosened and loosened requirements to get into owning property versus renting. That they were almost if you could fog a mirror and had a pulse you would be able to get into a home. They made it so easy that they almost would pay you to get into a home. There was a period of time back when, five to eight years ago, where out of pocket you could quite easily buy a home out of pocket for less money that to get into that same house as a rental. Meaning, to rent it you’d have to pay your first full month’s rent and probably a security deposit equal to about that amount. So that if you were going to get into a house that was renting for 1200, you’d probably need about 2500 total to get into that rental. You could actually get into a house by that same property with less money out of pocket than to get into a rental. It just made it so easy; the government made it so easy. How do we get out of this? Well, I’m just going to make a blanket statement. The government has to get the devil out and just let things happen the way free enterprise and capitalism would dictate. And we’re going to be fine. Quit trying to tell us and force things and just let things happen and we’ll adjust to them.

Q: Is there any particular region, state, or neighborhood that has caught your interest in possibly in doing business there and why?

A: Well, I’m going to guess that the way to respond to this question is that first of all every person who is in real estate is licensed to do real estate in one particular state. I’m guessing that people that maybe live on a border of a state might have gotten their license in both North Dakota and South Dakota, for instance. If they are real close to the border and would be doing business in both areas they’d go through the licensing process in both states. But there is no reciprocity between states, so therefore even if I were interested in doing real estate in Wyoming, I couldn’t without starting all over and getting a real estate license of some form in that area. I have enjoyed working in Kings County, California in real estate during the ups and downs, hills, valleys, cliffs, everything; in that, our prices have tended to have fallen off the edge of the cliff but not as bad as some of our neighboring communities; even the bigger communities. In fact, our prices tend to be higher, more solid than Fresno, Clovis, or Visalia, I don’t know why. We have tended to not drop as much as some of those other areas and in fact if you could manufacture the same house in the same neighborhood in each one of these communities. Hanford, Lemoore versus Fresno versus Clovis versus Visalia, the house in Hanford, the house in Kings County would be a little higher.

Q: What is currently the extent of the region in which your company, Realty World, is involved and what aspects of this area do you like or dislike?

A: Realty World in general, northern California northern Nevada, I’ve already said what part of the world is but Realty World Sweeney Anderson tends to be Kings County, stressing Hanford, Armona, Lemoore, we do a lot of business in Corcoran we do some business in Avenal. We also extend beyond county lines in some areas, and this Realty World Sweeney Anderson now just this office, we tend to go up into Laton, we tend to go on up into Fresno County at Riverdale, we do some business in Coalinga, but beyond that we don’t do a whole lot. We end up in the neighboring communities in Visalia and Tulare once in a great while; but mostly Kings County.

Q: What is the level of education you recommend for a student who is interested in Real Estate as a career?

A: To get to where I would like a person to be, in fact there are quite a few people in here with bachelor degrees, not necessarily bachelor degrees in business/real estate. But bachelor degrees in everything else you can think of. Mine again I said it earlier is Biology and Psychology were my two areas in college. I like to have a bachelor’s degree, I really do, in terms of people I like to train and work with and bring along in the field of Real Estate.

Q: Based on your personal experience is there a particular field of study that you feel would be advantageous for the student to focus on?

A: I know that in this area, Fresno state has bachelor’s maybe even Master’s degrees in business with emphasis in real estate. I’ve known a person or two that I think when they have gone through that and gotten their bachelor degrees in business/real estate. That you can’t do any better than that in terms of focusing on this field and I think it probably gives you a good real basic understanding of everything you’re going to eventually need to know. Now, having said that, the business aspect of it. Another way of approaching real estate since it is a contact sport, you have to have contacts with other people and be able to communicate and form relationships with other people is in the social sciences would be a second place, sociology and psychology, those kinds of things.

Q: What do you feel are key characteristics and attributes of a successful real estate salesperson/broker?

A: The personality characteristics, people either have got to not be shy around people they’re just meeting. In other words, be able to form quick relationships and kind of facilitate the formation of a relationship. Shy people tend to have to really work at that. Other people who really enjoy meeting new people and providing whatever services to those new people are going to be a step ahead. I don’t care how well you know the field of real estate. If you don’t know people and you don’t know what it’s going to take or you’re not comfortable forming relationships with new people, you’re going to be the smartest person on the island. But the trouble is you’re going to be the only person on the island too. So it doesn’t help to know all this stuff really, really well without knowing how to form relationships and develop a relationship, trusting back and forth between yourself and a wide variety of different personality types just out there in the community. So you just got to work with a lot of people that’s the key to being successful in real estate. On the flip side of that is you got to know a lot of stuff so you have a lot to offer those people. Somebody brand new in real estate doesn’t have nearly as much to offer because they don’t have the body of knowledge in their heads that they can draw on to do a really good job for people. However, a new person sometimes is the very best person because they don’t have forty different families they’re dealing with right now. Their new client may be the only client they have and they can spend eight hours a day, seven days a week just on helping that one client. It kind of balances out but to be successful ultimately you got to work with a lot of people and form a lot of relationships and have excellent people skills. Even more important than what you know is effectively who you know.

Q: What expectations do you have of your staff?

A: What I expect from my staff is something that we tend to do when we are initially meeting someone and we are disclosing our relationship and our role with them in this transaction. And that is that we are to put that client’s best interests ahead of everyone else’s including our own. So if something would be good for me, it’s going to maybe make me a lot of money versus going to make you a lot of money as the client. I’m going to forget about what’s going to happen with my pocket book ultimately that is the way for long term success in the business. We find ourselves on occasion where we talk someone out of selling their house because we just say in this market, under these conditions, keep it. Wait and see what the market does over the next two to three years. And the way to keep it is you can rent it out for a period of time. In other words, give people their alternatives, all of the alternatives we’re going to be giving them hopefully are going to be in the best interest of the client. We have a fiduciary duty to our clients and basically that’s it. Their best interest within the bounds of fairness and honesty. But their best interest ahead of everyone’s best interest including our own.

Q: What is the typical career path of someone who is joining the real estate industry?

A: There is none. There is no typical career path really because I’ve seen everyone from someone and she was a good agent; she got married real young, back in Arkansas or somewhere, and had never graduated from high school. I think she just barely had a G.E.D. She developed a very good way of dealing with people being a bartender. By the time she hit the real estate industry she was probably about 35 and was just an excellent counselor, which you learn to be as a bartender. So weird, but she turned into being a very good real estate agent and you can just imagine everything from there on up to someone with a master’s degree or whatever. Usually in social sciences make very good real estate agents. The best real estate agent in the county in the last five years was a person whose background was in music but excellent, excellent people skills, very intelligent, and everything just worked for her.

Q: What kind of strategy would you recommend for someone interested in joining the real estate industry and searching for a job?

A: Well, First of all, typically a person who gets their license and wants to get into real estate. In Kings County, anyway, and probably throughout California and maybe even beyond you’re going to have no problem finding a broker who wants to take you on as a potential agent. It isn’t going to be like the 500 people lined up outside a store with their job applications and the store is filling three positions. It’s not going to be like that at all you’re going to be in demand so there won’t be a great deal of searching for the job. You’re probably going to be wanting to search for the broker and/or the company that best suites you rather than thinking that you’re going to have to wander around for six months interviewing, it’s just not going to be that way. The strategy, what you need to do is you need to get your license. The license is you have to have three courses. And you’re probably well aware of this/ you have to have real estate principles successfully completed and passed that, real estate practice successfully completed and passed that, and then one other broker course, which can be about another ten different courses out there that all satisfy the requirement. Then, you have to study for and pass the state exam. That is the tough part, it is not easy. It’s something you have to do. Once you have those two things out of the way, the courses and the passing of the state exam, then you have to apply for your license. It takes about, depending on how you do it, two to about eight weeks to wait for the license. Once you got those things done you’re done, you are licensed and ready to begin. There are some other expenses you have to anticipate that is normally most offices are realtor offices, which means you have to become a member of the National Association of Realtors, the California Association of Realtors, and then your local board or association of realtors. You also will have another expense in joining and maintaining a multiple listing service, so that you can do your job effectively. So it costs about a thousand dollars, beginning to end, from the time you start until you are fully licensed and ready to go.

Q: Our class has discussed how real estate is a “people’s business” can you please describe the importance of networking as well as customer relationships management?

A: Real estate definitely is a people business. You have to, in fact I emphasize to agents at the very beginning when they’re first getting started, when you’re first making contact with your first potential clients and customers. You have to meet, greet, and establish report. If you forget to do that or shortcut any of those things chances are you’re going to have difficulties forming a professional, working relationship. They’re not going to know or trust you and you’re not necessarily going to know and trust them. And you’ve got to spend a lot of time meeting them, greeting them and establishing report. That is the people business and how to get things started. There are kind of two categories of people who are new in real estate at any time in history; and those are people that are from here and people who are not from here. And the people who are from here have a head up whether they realize it or not, whether they utilize it or not. They have what we call a sphere of influence and people who they graduated from high school with, went to college with, played pee-wee baseball with, go to church with, go to whatever other kind of organizations they might have gotten themselves into. In other words, people from here have a bunch of people who already know them and that’s really the way the place they should start. People who are not from here don’t have that advantage and have to join the Kiwanis club or join something to start to develop a sphere of influence. And then the way to be successful in the industry is this; you take every single client you end up with very, very seriously and you want to give them the best service, and the most time, and the most respect, the most information you can possibly give them. And just develop, you start with meeting, greeting, and establish report, and you continue to develop the relationship during and throughout their entire transaction and you just work on everything from there. What do you do at the very end after they’re happily in their new house or after they have happily sold their old house and are in their new house. Is you ask them for referrals, you got to otherwise your business is going to be very stagnant and you don’t be crass in asking for referrals. But you say, “Now, you know I’ve really enjoyed working with you through this transaction, Mr. and Mrs. Jones, here’s the thing I thrive on clients; I need more, I need more. Do you have any friends or family that you know of that are thinking about buying or selling real estate now or in the near future?” And you just ask for referrals, and you have got to do that because if you don’t you’re really impinging the growth of your business.

I would like to thank Mr. Anderson again for allowing me the opportunity to conduct this informational interview with him. The information he provided me with has reinforced everything that I have been studying with real world perspective. I particularly enjoyed learning about Mr. Anderson’s career path as well as his perspective on how real estate is a “people’s business.” Mr. Anderson allowed me to video record him during the interview; However, because of the length of the video it would not upload to either this blog or to YouTube. I will provide Dr. Hansz a copy of the DVD for anyone that may be interested in seeing this interview.

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