Tuesday, March 18, 2014

Welcome Home Radio Talk Show, hosted by Don Scordino

Listen to 940 AM ESPN radio this Saturday, March 22nd from 9:00 am to 10:00 am where the activities of the Gazarian Real Estate Center and Student Society of Real Estate will be the topic of the day.  Guests will include Andrew Hansz, Director of the Gazarian Real Estate Center, Cameron Scheidt, current Real Estate student and Diane Ray, President of the Student Society of Real Estate.

Every Saturday morning, Welcome Home Radio hosted by Don Scordino and various guest speakers entertain and educate the listeners on news regarding our local real estate market.   These topics are informational for consumers and real estate professionals alike.

Wednesday, March 12, 2014

Mark Massie Assignment

Then and Now: Grail Fernwood Shell Oil Company Appraisal

By: Joshua Tabers

Although this is the Mark Massie appraisal assignment, the appraisal report that I studied was done By Grail O. Fernwood, a colleague of Mark Massie, in 1961. The property was a 120’x150’ parcel on the southwest corner of Palm and Bullard Avenues in Fresno. This appraisal was done for Shell Oil Company and their interest of building a service station. At the time, the parcel was just a vacant lot and the area surrounding it was farmland. To the east and northeast was developed land. At the north east corner of Palm and Bullard there was already a functioning service station and the lot on south east corner of Palm and Bullard had been approved for a service station. An appraisal was done for the value of the land and also for the value of the property with a service station.

5783 N Palm Ave, Fresno, CA 93704  Grail Fernwood used the sales comparison approach method for his appraisal. The appraisal for the land value was $3,000 which was based on the prices of other properties with consideration of the conditions of the property. The property needed minor grading and had good drainage and visibility as well as accessibility to gas, water and electricity. For the appraisal of the proposed service station, Fernwood looked at the selling prices of 10 different service stations that sold in past years. He also looked at the asking prices of 7 different service stations that were on the market at that time. Along with that, he researched 8 different service stations that were being leased with 1 of them being the service station on the north east corner of Palm and Bullard Avenues. With all of this information, Fernwood came up with an appraisal for the proposed site to be valued at $45,000.

Through countless research, I was unable to find any evidence that Shell Oil Company carried out the service station on the southwest corner of Palm and Bullard Avenues. Currently, there is a Valero Gas Station on that corner with the property that Grail Fernwood appraised nearly 53 years ago. Since there is currently a gas station on that same poperty Fernwood appraised, it is fair evidence that Shell Oil Company built their proposed service station. Although the highest and best use for this property was not requested for this appraisal, a service station may have been its highest and best use since there is one there over half a century later.

According to findthebest.com, an estimated current value for the property is $1.51 million with the value of the land being $470,456. The last selling price was $780,000 which was on March 7, 2001 and the last major renovation was in 1989. The property value of $1.51 million seems high compared to the last sale and also what other gas stations in the area are selling for. At the current inflation rate of 3.96% the property would have been appraised at $360,983.25 and the land value would have been $24,065.48 which are much lower than what the values estimated today. This property value would have increased by 418% which would have been 8% per year. Although this is, improvements and maintenance on this property would make this amount lower.



Grail Fernwood: Shell Oil Company Appraisal.

Ratterman, Mark R., MAI, SRA. The student Handbook to The Appraisal of Real Estate, 13th edition. 2009.



Tuesday, March 11, 2014

Informational Interview (Fin180 Blog Post#1)

Jacob Balfanz

Interview1: John Balfanz is founder and owner of John Balfanz homes located in Bakersfield CA. He develops residential neighborhoods and builds homes. Started in 1989 the company has built over 1000 homes in the local area.

There is a saying that if you want to make one million in real estate you start with two million, do you agree or disagree?
Disagree. U can make a million with 30k. It takes time.

Are there things you do differently now when buying land than what you did when you bought your first piece of land?
I look for better properties that are easer to develop. Having oil on the land or backing up to major streets makes the process last longer.

What do you think are the best character traits to doing business in your field.
Build to the highest standard.  Strive to always please the client. 

Many developers went out of business in 08-09, why do you think that your company survived?    
I renegotiated debt and and saved enough cash to continue building.  

How do you feel the housing market will act in the next year?
It seems to be a little flat now but hopefully it will be steady during the remainder of the year.

If you could have done one thing differently over the years what would it be?
Try to buy when the market is down and resist buying a lot of land when times are good. 

How many times a year would you say you change your prices?  
I evaluate prices every month and try to get as much as I can.  Sell every home for maximum dollar. 

What factor(s) make you change your prices?  
If I feel there is strong demand for my homes I get very aggressive with raising prices.  If I get too aggressive and my homes don't sell I usually add some incentives to the home or lower the price.

Interview2: Evan Selander is a real estate salesperson for Landmark Properties. He is new to the profession and is starting out his career by branding himself and dealing with new clients.
How did you become involved in real estate?
My father is a real estate broker and told me a lot about real estate. During the summer after my sophomore year, I decided to get my real estate license. I eventually passed the necessary classes and the license test, and earned my license. I then joined Landmark Properties as a real estate salesperson.

There is a saying that if you want to make one million in real estate you start with two million, do you agree or disagree?
I started my real estate career with a couple hundred dollars. It doesn’t take much to be involved in real estate.

What do you think are the best character traits to doing business in your field?
I am Quick learning, practical, sociable, great-communicator, and attention to detail. Real estate is all about getting the deal done. You have to be sharp and creative with each buyer in order to get the job done.

How do you feel the housing market will act in the next year?
I can see it only going up. Right now, there are more houses sold then going on the market. This is going to provide listings with more and more serious offers, driving prices up. The change will not be too drastic, however it looks good for sellers.

Do you ever feel overwhelmed in your career?
At times, there are a lot of challenges with starting off as a salesperson. A lot of networking and marketing is involved in order to get clients. You can not make money without having clients to help buy or sell their house. It’s a bit overwhelming fighting for clients who are decades older than you, but it has its benefits.

What do you think would be the best opportunity for a low-income college graduate in the real estate market? 
The best opportunity is to start with an internship for a local brokerage. Get the feel for the industry, and then decide if you want to pursue a license in real estate.

How Do You Get Your Real Estate License?
In order to get your license, you need to first take three real estate classes: real estate principles, practice, and a real estate elective. After all three are passed, you apply for the license test. If you pass the test with a 70% or better, you can then send in the application for your license.

How do you make money as a salesperson?
You make money by selling a house or helping a seller find a buyer. You then make a commission based on a negotiated agreement. Commission commonly runs anywhere from 4-6% of a houses ending sales price.

What’s the most important part of real estate?
Location, location, location. Customer service and proper negotiation skills are also the key aspects of the deal.

Monday, March 10, 2014

Informational Interview ( FIN 180 Blog Post #1)


Real Estate Investor, Entrepreneur, and Instructor

How did you get started in this field?  

My first purchase was a tri-plex that I still own, but my dad had a rental when I was growing up, so I began doing minor construction at an early age.

What was your educational background?  

MBA – Entrepreneurship – Fresno State + some private real estate investing classes

What are your major responsibilities?  

I find the deals, analyze them, make the purchase decisions, and run the projects (rehab). Ongoing, day-to-day management is outsourced.

What is the most rewarding aspect of your job, least rewarding?

Creating great homes for people…being rewarded financially for it.  Least rewarding – when a tenant destroys a property…

 What might you change?  

I might be more selective about where I purchase properties. I’ve purchased great deals in bad neighborhoods in the past…the headaches can outweigh the financial reward.

Would you choose this career again?  

This is not a career for me…it’s a business I run on the side.

What is a “typical” day like for you?

I look at properties every day. I get emails about any new MLS listings that fit my criteria. I might drive by the best possibilities for investment. I also talk to my main real estate agent every day or two to see what he sees in the market. If he finds a deal before it is listed on the MLS, he calls me, and we typically drive it and put an offer in before it goes to MLS.

What obligations does your work put on you outside of the actual job?

Not sure how to answer this. It’s not a job for me…it’s just what I do to invest money. I enjoy it. I have to answer emails on weekends/vacations sometimes. I even have phone calls to make/receive quite often. But – it doesn’t feel like work, so I don’t mind it. Generally, the calls and e-mails take a few minutes to take care of, so they don’t tie up too much time.

What are some lifestyle considerations for this career?

You have to keep a lot of cash. I’ve seen other investors spend their proceeds on new cars, fancy cabins, etc., and then get into financial trouble because they run out of cash for the business. So…we live pretty humbly compared to others in the field.

What are some common entry-level positions in the field?
N/A – maybe a realtor.

What kind of salary range and benefits are typical of an entry-level position in this field?

Salary – as little or as large as your business system allows. Benefits – same.

What kind of an individual (skills and personality) is best suited for these entry-level positions?  

Must be good with communication and with people. Also – must be very organized and have good time-management.

What are the most important factors used when hiring?

When I hire someone, integrity means more to me than anything else. I have to be able to trust the people I hire. I can help people develop skills, but you can’t teach a person to be moral. Also, I try to hire people who I know are really good communicators – it eliminates a ton of problems.

What is the best educational preparation for a career in this filed?  

Get an entrepreneurship degree and take classes in real estate investing.

Which classes and experiences would be most helpful to obtain while still in college?

See above – plus…work on project at home, so you know a bit about construction. You don’t have to swing a hammer when investing, but you should know about the work involved.

What have you found to be a major weakness of new hires in this field?

Not entrepreneurial enough.

What is the future outlook for this career?  

Great – real estate is always a good business to be in…up or down markets.

What are the areas of potential growth and decline?
If we start to deal with “sprawl” in Fresno, we’ll have more opportunities for rehabbing.

How do you see jobs changing in the future?

Same basic principles, but they will require more entrepreneurial skills than anything else.

Thursday, March 6, 2014

Informational Interview ( FIN 180 Blog Post #1)

Daniel Hanjiev, Real Estate Broker with Guarantee.

How did you start in this field?

The way I was introduced into the field was by a friend of my. He and his wife took a real estate course and he asked me if I wanted to take class with them. I was interested in real estate in that time and I done some things in the field personally, had exposure to it. Really took it for personal knowledge didn’t think of getting into business, I sign up and all three of us took the course. That’s how I got exposed to it, was back in 1990.

What’s your education background?

Me and my friends started with Century 21 courses,  Real Estate Principles class, basically a class required to start. Then we took a ton more, I know Fresno City College offers a two year degree in Real Estate. Again I took these classes in 1990, I done everything up to State exam, I took these classes to start in business.

Different sectors of the market still have to adjust
 but growth potential is all ahead.

What kind of individual skill/personally suited for your career?

I think this is where you can divide it into several levels. Personality wise, person has to be somewhat outgoing, not be afraid to be engaged in conversation with people.

What is the future outlook for this career?  What are the areas of potential growth and decline?

As far as real estate professionals right now is really great time to get in. The market is moving there are sales.We just went through market correction, growth potential is very plausible for many years to come before we see another wave of correction. For anybody to get in right now it’s very good timing when you can get in and have sales. Just because of where we at in pricing and the growth potential that's still in front of us.

Different sectors of the market still have to adjust, but growth potential is all ahead. Commercial real estate has to go through adjustment while single family residence went through adjustment and in line for steady growth. 

What are some lifestyle considerations for this career?

It gets a little bit challenging, involves a lot of discipline to set up time for yourself and for your family. This profession can fully consume you into business, definately not a 8 to 5 type of job. You really have to treat your personal life as your business life
be confident in what you are doing

Advice for anyone starting in Real Estate field?


Once you get in make sure everyone in your sphere of influence knows you are in business, obtain further education, get familiar with contracts is very important and be confident in what you are doing. The rest will be history from here.

What is your future goals in career?

Personally grow my business with database and stay connected with my clients in my sphere of influence. In five years or so outcome will be just a result coming out. Put-in proper approach into position will yield results.

Who are your usual customers?

The given market we have right now, there are a lot of investors who have positioned themselves well. There are other investors who had adjust and are coming out right now to get back. From now on you’ll get to see a lot of primary residents purchasing, it all depends on timing of the market, pricing in the given market period. 

My focus is continuing education 

Which professional journals and organizations would be most helpful in evaluating the field?

I like Business Journal there are a lot of material on real estate, there a lot of resources online as well. I usually look into interest and mortgage related information. There are publications for investors and I usually try to look for local market in our location. My focus is continuing education.

Anything else you want to add?

Good approach in this business is also be in business for yourself what I mean by that is be an investor. Actively participate in real estate besides serving your clients.