When happiness comes, what will you do?

Happiness is the moment before you need more happiness. Don Draper, Mad Men

Early this morning, without leaving the house, I found myself in a cafeteria-type hall with dozens of seminar attendees on break for lunch. The lady who plopped herself down on the chair next to mine slouched back and sighed, “I’ll be glad when I can get away from my boss.” She said she was tired of being afraid. Her pursuit of happiness had tied her to the whims of an unscrupulous employer. This overly stressed woman had the attention of everyone nearby. Her stress had affected her mental and physical well being.

At the next table, a man wearing a white straw hat, and gray whiskers waited until the woman had finished her sigh. With his chin in his hand, and his elbow on the table he asked, “When happiness comes, what will you do?” My dream self immediately began to contemplate that question. My real self woke up and went looking for paper and a pen to write the question exactly as I heard the dream man ask it.

A new twist

Do we wait for happiness to do stop doing what makes us unhappy? Do we expect to be happy before we begin to do what we believe is our meaning to life? Do we know what we would do if we found the happiness we think we are in pursuit of? Maybe we don’t even know what we would do if happiness found us.

The message I take from this interaction with dream people is that happiness is a choice and waiting for or pursuing happiness before doing what I believe is meaningful to life is a waste of time, ability, and opportunity. Last year I made commitments to cut ties with people who live lifestyles fueled by the assets of other people. This year I took steps to use the lessons I learned from people who will never be happy with what they have. Happiness arrives whenever I let happiness in.


Who’s Problem Is Being Solved?

Every business exists to solve a problem. Do we know who has the problem the business owner aims to solve? Some real estate firms want you to solve their problem; they’re easy to see when marketing like this:  Help! We need listings!   There is nothing about this plea for help to solve a Realtor’s problem that inspires anyone to step up and be part of the solution. But that has never stopped brokers from appealing to sympathy.

Who is the product and who is the customer?

Self Inflicted Problems 

In the real estate world, a listing agreement or a buyer agency agreement is comparable to a business order, and business orders are revenue-producing documents. Businesses have expenses, and paying those costs is dependent on revenue. To generate revenue, a REALTOR needs business orders. Without agency agreements, the agent and Firm have a bill-paying problem. When expenses outpace income, the problem is self-inflicted and not the consumer’s responsibility to solve. 

 To Serve or Be Served

A business built to generate revenue with the hopes of making a profit has a fundamental difference from a company established to solve a problem other people have. The attitude of scarcity permeates through a firm that claims to exist to serve. For the company created to solve a problem for other people, the mindset of abundance prevails. 

Just ask, Why do you exist?

By claiming to think differently about real estate and doing the same, everyone is as useful to people with a problem as changing the font helps improve poor writing. Slogans are meaningless when everyone can say the same thing about themselves. To know a person is there to serve you or be served by you is easy to figure out. Begin to discover if you are the product or the customer by asking a REALTOR what they know about the reason their firm exists. Ask the agent why they are in business. If the answer isn’t about being a solution to your problem, you’re a solution to their problem. 

Essential Real Estate Exists to be a choice for homeowners who want to keep more home equity and a preference for homebuyers who want to own the home of their choice without overpaying. 

The Power of Choice Over Conformity.

A lack of competition results in higher prices, inferior products, and suppression of innovation. Having a choice is a powerful force. Until notified otherwise, Americans are free to choose the services they want to pay for and products they want to own; bigger, smaller, yellow, blue. But what happens when the choice is limited to a blue or a lighter shade of blue.

Henry Ford gave us the Model T. When he was running them off of the assembly line as fast and as cheap as possible, he told the consumer they had a choice. They could have their auto in any color they choose, as long as they chose black.

Essential Real Estate began as a solution to a choice problem in the residential real estate service market. There is no shortage of color of real estate firms in Madison, WI. Color might be enough of choice to satisfy the car buyer in the 21st Century. Different colors and a variety of sizes do not benefit the consumer in price, service, product, or innovation; the four areas necessary for a favorable consumer market.

We believe real estate service, as licensed, is not something that can be limited and still be called real estate service. Time and again, the world proves that adding non-essential chores, frills, and activities to anything has a definite impact on increasing cost, and an insignificant difference in improving a product, service, or consumer experience. Conforming to expectations is a choice we rejected. Essential Real Estate is a choice for home sellers to keep more of their home equity and spend less on broker commission… a lot less.

Hold That Thought. Wait to commit to paying a set commission to a buyer agent until you see the terms of the Offer.

There is no requirement that a listing broker offers compensation of any amount to list a property on the Multiple Listing Service—the National Association of Realtors response to a claim in a new class-action suit.

However, once the broker publishes the amount of compensation in the MLS, the listing broker may not alter the percentage or dollar amount without the approval of the cooperating broker.  

A listing broker who publishes a promise to pay any money to a cooperating broker must have the seller bound (through the listing contract) to pay the same amount, or the broker will be liable to pay the compensation. A random search of homes sold since January 1, 2020, in seven Madison geographic areas gave me these results: 179/202 (88.6%) listings are published with 3.0% as the Offer of compensation to cooperating brokers (buyer agents and sub-agents). Fourteen sellers paid 2.5%. In two sales, the reward was 3.5%, and in 21 deals, the listing agent published compensation was less than 2.5%. 

There is Nothing Magical About 3.0%

I contend the reason there is nothing magical driving the 3.0% number. There is a flawed assumption driving the fact that nearly 90% of all home sellers commit to paying 3.0% commission, which may be more than necessary before they ever see an offer. The fact that 88.6% of sellers in this group promised to pay 3.0% commission does not prove that they could not have sold the property on the same terms and netted more had they promised to pay less than 3.0%. 

Keep your promise, but hold on to that commitment

Clients of Essential Real Estate, LLC are fully informed of their options and the reality of how the broker compensation and cooperation works. We prefer our clients to know that they are not obligated to promise to pay any amount before seeing the terms of an Offer. An informed home seller may be wise to wait until they see the terms of an Offer before committing themselves to pay a commission more costly than the Offer is worth. 

The Buyer Agent’s Commission is Seller Home Equity

Because real estate licensees are ethical and operate their business within the rules of license law, the commission offered by the seller or the listing agent has no consideration in their decision to present your home to their client. If there are facts to counter my assertion, please share them. American home sellers could save hundreds of millions of dollars in home equity every year by reserving their right to negotiate the commission after seeing the terms of an Offer. Clients of ours have the opportunity to keep more of their equity by knowing facts and not believing fiction. 

If your agent was trained, you’ll pay while they learn.

Training a pet works like this:  When I say SIT, you sit, when I walk, you HEEL. At intersections, we do the SIT thing every time. Why? Because that’s what the trainer said. 

Training a REALTOR is similar. On this line, you put an X in this box. You write this word in this blank. You include this contingency every time. Why? Because that’s what the trainer said. 

Professionals invest their own money and time in learning.  

The price of training a REALTOR will be at the expense of clients and customers. Training may be sufficient to give a person just enough awareness to get started, but not enough to make a difference for the client and customer when knowledge is necessary, and it’s always essential. We built our business knowing the fact that the real estate industry is training-minded. Training is practical for getting boots on the ground in higher numbers quickly. Boot camp is for foot soldiers in training. Elite soldiers are taught, challenged to think, to learn, and make mistakes at their expense, not at the cost of others. 

In easy markets, a trained agent may make enough money to keep coming back and doing the same thing without trying to learn more. In tough markets, they quit. They quit in the last recession only to return when the market rebounded. The skills they did not have before were costly to clients then, and the lack of those skills and the new skills they aren’t learning cost the public again. 

You don’t know what they don’t know until you need what they can’t do

A fundamental failure in any service business is failing to learn the WHY behind what we do. When you know WHY something is as it is, you learn to know when and where something fits and doesn’t fit. Knowing WHY is the critical element in avoiding traps of a likely unappealing outcome.  

They won’t see it until it’s too late

The person who is represented by a trained agent is at a disadvantage. They won’t know the consequences until they feel them, and their agent won’t see what’s coming until it’s too late…for the client. 

All transactions are not alike.

You can protect yourself from paying the price of education for your real estate agent or attorney by listening for what they don’t know. You can tell if they are trained or educated. The trained person has few ideas. They can’t explain WHY they do what they do, other than to say, that’s the way I was trained…or that’s that way our company does it. The trained person is probably well versed in lead generation and manages a lead capture system. They do this, that, and the other thing, and when they capture a lead, they do what they’ve been trained to do the way they’ve been trained. You may never know the cost you paid for this training. 

Expect More

Expect the real estate professional you hire to have ideas about using your strengths to your advantage. Expect them to know you are not the same as the client they once had who did X, Y, Z. Expect them to be able to see what’s hidden and clearly explain complex scenarios. You will get what you pay for, and you will pay for what you get. At Essential Real Estate, we think you should be the beneficiary of our investment in learning. The results of our clients’ experience prove we exceed expectations. 

Merrian-Webster changed their definition of racism

We can’t talk about the American experience of prosperity in the decades after World War II, without recognizing the prosperous impact of homeownership. And to that, we are wise to acknowledge segregation eliminated the opportunity for black Americans to prosper as the white Americans who were not living next door. The mood is right in the world today to raise our understanding of the eternal consequences of our actions.    Merriam-Webster (the dictionary people) just took a giant step in changing racism’s discourse by modifying their definition of racism to include systemic oppression. When an institution is trusted, respected, and looked to as reference turns how they define racism into thorough recognition of consequences, we are on our way to a more excellent dialogue.  

The strength of definitions is their inflexibility. No one benefits from words meaning one thing under one administration and another under the next. Over time everything we believe is put to the test in the streets, in the classroom, and courts. The concept of racism was more or less understood and accepted in 1968 to be this but not that. It’s natural that given any boundaries, humans will work around the edges to push the limits and breach the walls until the definition of a word is no longer suitable because now what is openly racist is shaded by slight nuances. 

Examples of Begging Love Letters to Home Sellers

Twice in my career, love letters to home sellers became the go-to idea Realtors turned to as a way to give some of their buyer clients an edge in competitive markets. Today we are seeing home sellers request letters be included with Offers to help the seller select the people who will be the right fit for the neighborhood. Some people need to know more than how favorable the price and terms to show a person’s commitment to getting safely to closing. And if that need to know includes what they believe (Christmas=Christian, Family=male dad, female mom, at least one child, and a pet, higher education=better fit, etc.), the decision to negotiate has everything to do with discriminatory factors.   

The intent may not be crystal clear.

Every person who wrote a letter to appeal to the sensitivity of a home seller did not intend to violate Fair Housing laws. Every Realtor who encouraged and helped clients write letters, or helped home sellers select the lucky buyer based on the buyer’s messages and photos is not racist. But every note and every chosen picture included for the seller to consider has an intent. And it is that intent a licensee may get the opportunity to prove or defend when they facilitate a decision to negotiate with this buyer but not that buyer on factors that are unfavorable to a protected class. 

It’s Not Always Easy to See

A Google search took me to this page of Dear Seller Letters. I’m not going to say what I think is easy to see. Read the letters and decide for yourself if the letters play into the systemically oppressive attitudes that have forever kept black and other minority Americans from owning homes they are well qualified, prepared, and committed to owning. 

Price: The Participation Trophy

What was the offer price? Tell your neighbor or friend that you just accepted an offer on your home. They will first want to know the price. If you received an offer on day one, the next question is, Do you think you priced it too low?  Our neighborhoods are full of armchair real estate experts. Their experience is limited and personal. “When we sold our house….”. They have little to no evidence to form their opinion, but why would that stop anyone? (I rarely pause on topics I know nothing about. )

Whatever the outcome is when you sell your home, the result that matters is the one that matters to you. Other people want to see your trophy price. They want to discuss the errors you made and how much higher the trophy is of another person they know or that of someone who someone knows. You’re not going to impress anyone with the price of your sale. Troubling yourself with the price trophy is a sure way to miss the opportunity of attaining the biggest prize that goes to the wise negotiator. 

The real prize is a price you like and the terms that keep you out of risk and uncertainty.  

There are at least ten pages to an offer to purchase. More likely, that number swells to nearly three times ten. All of the conditions of an offer matter to a home seller’s bottom line, peace of mind, security, and the freedom that comes with assurance. Chasing the high shining price will distract you from the trips and traps at your feet. And when you are distracted, the buyer gains control, and you move forward or not based on the buyer’s will, not your own. 

Price matters. I get that. But the price is the surest way buyers have found to get their offer accepted, eliminate competition, come back later (when time is not on the side of the seller), and renegotiate. The strategy is universal and questionable as ethical or legal. 

Every offer has the information you need to know if you are likely to experience the desired outcome or the disappointment you fear. You can compare offers and see the committed buyer and the one who is committed to gaining an accepted offer with room to negotiate later. Expect your real estate professional to uncover the hidden gem hindrances buried in the purchase agreement. Be wise and get all that matters to you in price and terms. Give what you can to get what you need and lock the other party into a contract that is sure to get to closing. If it’s any help, no one is impressed by that participation trophy price. 

Let’s end the discriminatory practice of including letters and photos with Offers.

The Fair Housing Act  

Let’s start this conversation by being sincere about our history. The National Association of REALTORS opposed the Fair Housing Act of 1968. Discriminating against people based on skin color after the passage of the 1866 Civil Rights Act and continuing after the 1968 Fair Housing Act caused millions of Americans to miss the prosperity our parents and grandparents gained during the fast-rising home equity run-up in the post World War II housing boom. The consequences of falling further behind in earned equity continue to be suffered several generations later. We owe great amends for the damage we caused and the inequality we perpetuated. We can do better

Steer Me Wrong

 In 1934, Article 34 of NAREB’s Code of Ethics stated: A realtor should never be instrumental in introducing into a neighborhood a character of property or occupancy, members of any race or nationality, or any individual whose presence would be detrimental to property values in that neighborhood. 

1962 Version of NAR Code of Ethics Article 5 shows how far we progressed:


The Realtor should not be instrumental in introducing into a neighborhood a character of property or use which will clearly be detrimental to property values in that neighborhood.

This equally illegal whitewash changes nothing. 


Spring 2020. Could your clients write a letter to the seller to tell them more about themselves? My client wants to know so they can select the buyer who would be a good fit for the neighborhood.

Can we not see racism even on our porch? Racism lives another day when Realtors participate in gathering evidence to prove a person is or isn’t a good fit for a neighborhood.  You can check the Code, the Rules, and the law; you will find nothing that comes close to fitting people into a neighborhood as a responsibility of a real estate licensee. There are plenty of rules and regulations that make judging a person by their race, creed, the color of their skin, unfit, or fit to live in a neighborhood an illegal act of discrimination. 

Letters and Photographs

 Choosing to sharpen our real estate transaction law and negotiating skills is a sure route to smarter more effective ideas to give our clients an edge in competition. Some ingenious ways we think we’re giving a client an edge are no more than appealing to a person’s implicit bias. A few years ago Realtors began touting the Love Letter From Buyer to Seller as a surefire way to tilt the Seller’s emotions in a Buyer’s favor.  The idea, I’m told, is that the letter creates a  personal connection between the Buyer and Seller that you can’t achieve with an Offer to Purchase where price and terms are known and little else about the interested persons. Some highly productive Realtors attribute their success in part to the letters they have their clients write and for extra assurance, it’s sometimes recommended the Buyer include a photograph of the happy family. A picture is worth a thousand words and some of the words add up to foul language. 

There are Realtors who promote writing the perfect love letter to the seller with a narrative implying or intending to be interpreted as I am the better buyer because I like what you like, or I have a family like your family,  or I look like you, or I look like someone who fits in your neighborhood.  If going down this road was Fair-Housing safe, there would be a page in the Offer to write these letters and insert photos.  Attempting to tilt the tables in one person’s favor based on how they look, or how lovely their children are looks a lot like encouraging discrimination against protected classes. And, yes the practice is prevalent. 

This is from an actual blog:  …They might be thrilled to know that you are, for example, recently married,… The same author wrote: … Sellers might be more motivated to sell the house to a family who is weeks away from the birth of a third child …  (More motivated than to sell to someone who isn’t married, is married without children, or has children who look different than the other children in the neighborhood perhaps?)

The Terms of the Offer Show The Buyer’s level of commitment

Everything a homeowner needs to know to select the buyer they want to own their home can be found in the Offer to purchase if the person who drafted the Offer has the necessary skills to express what matters most. We believe a commitment to close matters most once price expectations are met. Who the buyer looks like or whether they are married with children are irrelevant.  Looks only become of interest when all offers look pretty much the same or when people who know better find ways to justify going down the low road.

Love Letters and Photographs are Non-Essential

At Essential Real Estate, LLC  we teach our buyer clients to construct Offers that show and tell the Seller that they are the readiest, willing, able Buyer who can show their commitment to getting to closing with little or no risk for the Seller. Essential Real Estate does not participate in perpetuating discrimination. We do not suggest that our buyer clients write letters to the seller. We caution our Seller clients to make their decision on verified facts related to price and terms and the buyer’s commitment to close. As Realtors and licensees, we will not forward photographs with Offers. We don’t want to see photographs of people with Offers that come in on our listings. We believe the best thing we can do for our buyer clients and seller clients is to practice real estate within the law and avoid discriminatory practices that hide in the shadows of supposedly innocent intentions.

We welcome the opportunity to talk about this topic with you.  Our practice does not stretch limits. We do business within the rules and laws because it’s the right thing. Our clients and those who benefit from our service appreciate the protection and security we provide for them.  We want you to be one of those clients.

NOTE: The National Association of Realtors does not shy away from accountability for their history of being on the wrong side of fair housing until not so long ago. This is a link to the Archives of NAR Code of Ethics over the years.

Balance Your Offer Price and Costs

Home sellers judge Offers when given a choice, on the Price and Costs. We know a price is a number, a dollar amount. Some costs are dollars, but all costs are not measurable in hard numbers. The more severe risks are associated with contingencies or conditions. Uncertainty is a risk with subjective values. The higher the need for certainty, the more “expensive” your cost-contingency is to the Seller.

Is Your Contingency Costly?

I know it’s good for me if I get to choose the closing date. Of course, controlling the choice of a closing date could be valuable to the Seller. If it is, I can reduce the cost of my Offer, and increase its appeal to the Seller by granting the Seller the opportunity to select a closing date even if the time is only within a range of times. (Any day between the range of July 2, 2020, to July 31, 2020). The degree of value is unknown, maybe even to the Seller, but it will become known eventually. Freedom to choose is always essential. When you can defer the choice to the other side, you reduce risk and the cost of your Offer.

If it’s crucial, the Seller can counter. But they may not.

When I give you a choice to include or exclude this or that you could defer the decision to the Seller. Yes. If the Seller does not like what you proposed, they may send a counter offer. If the Seller does not counter and rejects your Offer to accept another buyer’s Offer, we can always start over on another property. Starting over means, you decide the subjective value of the cost.

Guessing Right Is Rare

We make our guesses on our knowledge, and on what we believe to be necessary. We make those opinions based on how important something is to us. As an example, I may think you should be willing to wait for me to prove that I have the money to buy your property. I may think thirty days is a reasonable time to expect you to remain in a holding pattern. If you think ten days is all you can tolerate, my opinion might be the one thing that prevents me from getting my Offer accepted. Guessing right is uncommon because we use our value judgments to guess. If I use your value judgment to guess, the odds of my guess being correct are significantly higher.

Balance Price and Costs

Paying more than we have to and less than we need to are regrettable actions. We all want to pay less than we had to. Unfortunately, we do not know the magic number of the “just-right price” until the Seller reveals their decision; and the Seller won’t decide until they have all of the facts. 

You’re Not in Competition When You Think Like The Seller

Keep this in mind: We don’t lose to another Offer. We drop out of favor by not taking advantage of all of our strengths to make our Offer less costly than other offers are to the Seller. I believe it is easier to write a quickly rejected Offer than it is to write an acceptable Offer. The easy offer requires no thinking and no understanding of the person on the other side of the table. I may not be able to offer the highest price but to beat someone on price, just reduce the costs related to your contingencies or the value of the lack of contingencies.