High-profile real estate group teaches important lessons on business success
Friday special topics post: I asked Bobbi Albano, MBA of California Curb Appeal some questions about the commercial and residential real estate market. There's a lot of great information in here about the current market, but more importantly, there are some major takeaway lessons about how to grow a successful business. Bobbi is truly a business leader and her insight is invaluable. Enjoy!
How long have you been in business, what sets your office apart from others in the industry, and how can readers find you/contact you?
Bobbi: California Curb Appeal Real Property Specialists has been in business for 3 years. (You can email Bobbi here. Website is here.) We have a unique business model where our agents are paid more than the industry standard, while training and mentoring are given more freely to any agent who requires or requests it. There are a few things that set us apart.
First, all of our agents have higher education. We recruit this way, because I have learned that people who value themselves enough to invest in themselves, are the kind of people who do well in any industry where ethical behavior and fiduciary responsibility are a must.
Second, our structure is different than most brokerages. While each agent is an independent contractor, we act as though we all work for the same goal. This makes each agent do everything they can for their fellow agents and team members. We work under the philosophy that when one of us wins, all of us win.
Finally, we have a proprietary selling system that works extremely well. It is an online bidding platform, that when used gets more for the listing, is transparent for the buyers and the agent is able to save their client money be reducing the selling costs. We are the only company using this system in the Inland Empire and our clients love it.
In terms of the real estate side of your business, where are your clients buying right now? Has anything changed about that since the pandemic?
Bobbi: We are seeing buyers consider areas that they may not have chosen in another buying environment. We see folks choosing homes in the lower-priced areas, and areas that are not as easy to get to. For instance, Adelanto. Adelanto is a community located off of US395 heading toward Barstow. This area isn’t known for it’s housing, and prices in that area tend to be considerably lower than in other parts of the desert. Also, San Bernardino and Highland areas seem to have quite a bit of interest. In areas like these, we generally see many investors pick up these homes to use as flip properties or rentals. Recently, we have seen first-time home buyers choose homes in these areas. The more popular areas such as Rancho Cucamonga and Upland continue to see lots of buyers, but most are out-bid and these homes are going to folks that are able to pay more than the appraised value or that have additional cash to throw on top of their downpayment and closing costs so that they can outbid the other buyers.
A lot of first-time prospective homeowners think they need to put "20% down" (20% of the value of the home) when they buy. Is this true? If not, what is the normal down payment % that you see? Has that number changed since you've been in the industry?
[Editor’s Note: Bobbi first gave an overview of the different standard types of mortgages: FHA, VA, and Conventional. FHA is very accessible for first-time buyers, for example.]
Bobbi: To answer the question, I would say the average cash amount that I see is $15,000 or 3%. Closing costs make up around 3%, so if the buyer can qualify for a downpayment assistance program, they can use their cash stores for closing costs. Or, if they can qualify for downpayment assistance and closing cost assistance, then they can use their cash for moving expenses or for fixing the place up, which is what we try to do in most cases. This is only an average, and there are folks who have saved up to $40,000 to $50,000 to buy their first home.
When you sell a home or advertise a rental, what are the top 2-3 factors that you highlight?
Bobbi: The most important thing we find that buyers or tenants want is safety; for themselves, for their families and their pets. So, we always talk about the neighborhood. Next, we have to let them know how many people will fit into this property, so we talk about the size, number of bedrooms and bathrooms and if there is a yard. Next, we always highlight any special things about that particular property… for instance, if it is newly remodeled, we would want to mention that. Or, if the property has access to a pool or an ADU (accessory dwelling unit) or a casita. Finally, we need to mention the price. Most people want something just slightly above their price point
Recently we've heard a lot about the struggles of small businesses, and we haven't heard a lot of success stories. Do you have examples of businesses that have really thrived during the pandemic, and what has been the ingredient(s) of their success?
Bobbi: We have a restaurant that we are selling that listed with us in late 2018. We went into escrow in early 2019, and by spring, the buyers had backed out and the restaurant was struggling to make ends meet. They fought and fought all through 2019, 2020 and now in 2021. I have seen this business on the brink of bankruptcy. However, in 2020, they raised their prices to be in line with the market, hired new employees and jumped right back in! 2021 is looking to be a banner year, having gross revenue higher than anticipated and nearing $500,000 for the year.
California Curb Appeal Real Property Specialists also had a moment in 2019, where we had to make a decision to sign a new lease, or to go 100% virtual. We decided to take a chance and sign the lease. We have thrived, and I don’t think we are the only ones. Many businesses have done well after nearly losing everything.
We have an automotive shop, a floral artist studio, and a online printing company currently listed. In the past year, we have sold a consignment store and a fitness center. Both sales brought a good, fair price. Neither were sold as a response to the pandemic, rather the owners were ready to retire.
Thanks so much to Bobbi for her wonderful answers! She is a real leader in the industry.