There’s a very interesting post over at Reyn Bowman’s blog about the sources of negativity about Durham. Reyn, of course, is the leader of the Durham Convention and Visitors Bureau and for 20 years has researched and documented the sources of negativity about the Durham community.  One conclusion is that much of the word of mouth trashing of Durham comes from a very small percentage of the population in nearby communities that use that all to common tactic of building themselves up by tearing others down.

Reyn has always had to walk a line similar to what is being attempted in this blog. How do you point out the sources of negativity without calling attention to the negativity itself? Reyn and the DCVB are just like I or any Durham real estate agent in that we are trying to sell the community. Without much real effort at SEO (search engine optimization) DurhamLuxRE.com is consistently landing on the first page of results for several key search phrases. This means that buyers from all over the world and not just local sellers can easily stumble upon it. My original purpose in launching the blog early in the Spring was to convince sellers in Durham and their listing agents to sell the community and not just houses. This is especially important with the luxury home market in Durham which has been in the doldrums for a number of years. Because of this, I’ve been shifting the emphasis to what is great about this community and added a special report on buying luxury property in Durham. But every once in a while we have to remind ourselves that there are those in nearby communities, including real estate agents, that see the good things happening in Durham as a challenge to their own sense of superiority.

There are a number of people like Reyn who have spent a good part of their professional careers not only promoting Durham but helping create the real substance of our claims to be a great place to live and work. It’s time for all agents in Durham to take advantage of it in every piece of copy they write about a listing for flyers, email campaigns to other agents and listing information that is now easily syndicated on dozens of web sites. There is much more detail on how to do that contained in the Luxury Home Report available through this link or the link in the left sidebar.

For over 20 years Reyn Bowman has been the leader of the Durham Convention and Visitors Bureau and nobody has spent more energy urging the citizens of Durham to shed our sheepishness and confront those from neighboring communities who badmouth living in Durham. Lots of stuff is coming on line to brag about but some things have been around a long time. One of those is the annual American Dance Festival. If you follow this link to the ADF home page there is an incredible slide show of photographs by Sara D. Davis.

Reyn covers this topic in a recent post on his blog. It’s worth peeking at. In fact, it’s worth subscribing to Reyn’s blog by adding it to a “feed reader” on your computer. The one I use is free from Google and lets me keep track of a number of blogs that relate to Durham and real estate marketing. His post also includes a link to an article from the New York Times on this years festival.

If you can’t find enough positive information about Durham here on the Durham Luxury Real Estate blog, you can always find more on Reyn’s Bull City Mutterings.

The lead editorial today in the Durham Herald-Sun is headlined “Durham’s message is getting around.” It sites a poll that seems to confirm that the residents of Wake and Orange counties increasingly have a favorable view of Durham. It cites the efforts of the Convention and Visitors Bureau, The Chamber of Commerce and Downtown Durham, Inc. for doing a better job of telling Durham’s story.

One can agree with everything the editorial states but still have mixed feelings about it’s appearance at this point in the game. Why now? The editorial writers didn’t just notice the dramatic developments or the impact they would have on our neighbors to the east and west.

Of more concern, however, is why more Realtors, especially in the luxury market segment where homes need wide exposure, aren’t actively promoting Durham and her neighborhoods more aggressively around the Triangle. The copy I see on “e-flyers” and on Realtor.com is still focused on the bricks and mortar and ignores half the experience of owning a home in the Durham Community. Amenities like the DBAP sell the community. Many people risked their reputations and political careers to push the DBAP and now the Performing Arts Center. It could be that we’ve been defensive for so long that we’ve forgotten how to be proud of our community. How often do we encounter phrases in copy like “prominent Durham address” or “in the heart of historic Hope Valley.” This is not false pride. This is not spin. This is not hype.  This is the duty we owe to our clients to show their homes in the best possible light.

The Durham Luxury Home Report for 2008, discusses in more detail specifically how to use the Durham’s growing list of amenities to promote luxury home sales. This is available in a pdf format and does not require that you register or provide any information.

As we pass Memorial Day, the Summer solstice and Independence Day, the dog days of summer are upon us. We’ve also had more consecutive days with rain than many of us can remember. But even if drought fears have receded a bit, sales of luxury homes in Durham have been sparse and July and August are not typically strong months even in the best of times.

Last year in the second quarter 15 homes in the $700,000+ category where sold in Durham. This year it was 7 and the dollar volume was down 49% from $14.7M to $7.5M. Since there were 11 sales in the first quarter, the year-to-date comparisons are not so dramatic; 21 sales in 2007 compared with 18 this year and dollar volumn down just 18.8%.

Both Orange and Wake Counties saw significant drops in the sales of luxury homes in the same pattern. There are two differences, however, between Durham and the other two markets. The first is that Durham listings in this luxury category represent only 8.4% of the homes while it has over 17% of the total listings in the three counties. Second, it had only 4% of the sales in this category in the second quarter. With 86 homes on the market there is enough inventory to satisfy the demand for more than the next two and a half years.

These statistics shouldn’t surprise anyone in the real estate community that has been following the luxury market in Durham for the last several years. What does surprise me is that there doesn’t seem to be any change in the marketing practices employed by the listing agents that are active in this segment in Durham. Durham is undergoing a revival led by events downtown many of which have been mentioned in posts on this site. The quality of the luxury housing stock as well as convenience to shopping, entertainment and the major employment centers, in most cases is as good or better than anything in Wake or Orange counties. The difference is that Durham is dealing with an out-of-date image that holds back sales. Sooner or later that image will catch up with the facts on the ground and the market will improve. Listing agents that market the entire experience of living in Durham and not just the bricks and mortar of their listings will be the first to benefit and help move the whole market forward.

From a marketing perspective the long term solution is to do a better job of promoting Durham and its unique and growing list of assets. The Newcomer’s Guide to Buying Luxury Real Estate in Durham available through the link in the sidebar is my attempt to provide one arrow in the quiver necessary for this effort. It may be a little too personal to plagiarize verbatim but I hope every agent who lists in this market creates something similar or an improvement upon it and distributes it widely.

However, market share and long term strategies to promote Durham’s renaissance are irrelevant to the family with a home currently on the market. There are strategies that are not widely applied today that break with tradition as well as employ new technology to better position and promote a listing. The other report available on the sidebar, The Durham Luxury Home Report 2008, describes some of the details about how to do this. Both reports are offered with no obligation.

Seth Godin is an author, marketing guru and blogger whose posts are often short and sometimes cryptic but always interesting. This is a short post from June 20th that has relevance in the Durham luxury home market today.
Your sales force and your customers may scream that you need to lower your price.

It’s not true.

You need to increase your value. If people don’t want to pay, it’s because you’re not delivering enough value for the money you’re charging.

You’re not selling a commodity unless you want to.

How does this advice apply to real estate, especially luxury real estate?

As the CEO of a small business with one purpose…to sell your home…in a slow market it is quite conceivable that your marketing director/listing agent and potential customers would put pressure on you to lower the price. The irony is that often you don’t have to add value as Godin suggests, all you have to do is point it out. Levittown, PA was the original “commodity” suburb, with row after row of similar houses…six models actually…built after World War II. Luxury homes are the antithesis of commodity homes. Yet so much copy written about luxury homes focuses on commodity features such as size and rooms and not the experience of living in the home or the community. Size and quality in the shelter component of a luxury home are a given. The added value comes from the less tangible things. To get the best price the marketing materials need to illustrate these things.

(more…)

Lot’s of buzz last week at Rotary about the Somerhill Gallery grand opening event the previous Saturday at the old Venable warehouse in Downtown Durham. The relocation of this long term fixture of the Chapel Hill cultural scene to Durham is just another thing to brag about when marketing Durham’s luxury homes. This video was the fourth of four posted on YouTube about the move. View this one here or click YouTube and view all four.

The Venable Center is another project of Scientific Properties, one of the development companies making a big impact on Durham. Click on the link for more about Venable Place and other Scientific Properties projects.

Caught in the dialog on the video is the strong possibility of the opening of another new restaurant in Downtown Durham adjacent to the gallery. Can’t wait to visit myself.

Barbara Corcoran, according to Fortune Small Business via CNN.Money.com is the self-proclaimed queen of New York real estate. Corcoran founded the Corcoran Group 35 years ago and sold it in 2001 for $66 million. To put it mildly, she is colorful. The profile reports that when sales of her business book Use What You’ve Got were disappointing she renamed the paperback version If You Don’t Have Big Breasts, Put Ribbons on Your Pigtails…obviously not concerned that the males left in the industry might not look for her advice. The gist of the article is that her new ambition is to become a TV personality. Indeed, she’s a regular commentator on the Today Show on NCB where I saw her this morning.

The segment this morning was addressing the issue on everybody’s mind these days about buying and selling in a down market. There is no question that Ms. Corcoran is up to the role of providing an interesting segment on TV but there are some reasons to question some of the advice. First of all, all real estate markets are local and general advice from somebody with 35 years of experience in one of the most atypical markets in the country should be examined closely. But she is thought provoking. (more…)

I began this blog a few months ago after watching the luxury market in Durham for several years. For most of that time I was a licensed agent but not actively seeking clients.  For almost two years I was helping manage another firm and my bosses wanted me to focus on that and not my own clients.   I left that firm and did a renovation of an investment property that I sold last year.  As I refocused on what it would take to market homes in the luxury segment it became clear that there was nothing wrong with the “inventory” in Durham. The real problem was the Durham “brand.” I began to feel strongly that reviving the luxury market in Durham was going to require that sellers in Durham and their agents adjust their marketing to address this directly. The Durham Luxury Home Report suggests a number of ways to do this.

As the blog started to appear in the search results for key phrases, I realized that potential buyers were going to find the site too. I needed to add some emphasis to why this is such a great place to live.  I started posting more about the things that make it desirable and made available another report for Newcomers to the Luxury Market in Durham.

The information needs of sellers are different than those of buyers.  Straddling the line between providing candid marketing advice to sellers and selling the community to buyers is difficult.  Ironically, I think it reflects one of the things I love about this community. We have a remarkable capacity for arguing out our problems in public. For the last few years, the finer neighborhoods in Durham have been one of the region’s best kept secrets. It’s time for us marketing real estate to help share with the world what is great about this community.

A friend and reader of the Durham Luxury Real Estate blog forwarded an article to me about branding in real estate. The analysis was primarily intended for large national developers but it made some points worth considering in our effort to improve the marketing of luxury properties in Durham.

This blog has taken the point of view that one of the reasons, if not the primary reason, that the luxury home market in Durham is not more vibrant, is that the Durham “brand” has not caught up with the emerging reality. This is not a unique observation. During the last couple of years the Durham Convention and Visitors Bureau has headed up an effort to brand Durham as the city “Where Great Things Happen.” The group that developed this slogan and the the graphics associated with it represented a broad spectrum of community groups. As you might suspect, some compromise would be necessary to reach a consensus. Nevertheless, if promoted aggressively and adopted widely, this will improve the situation. To put some legs under it, it needs a more concrete emphasis. Just like marketing homes, the community needs to emphasize what marketers call a “unique selling proposition.” (more…)

After college and teaching for several years I decided that I wanted to try the corporate world. When I went shopping for appropriate business attire, a close family friend advised that when I bought a suit to always ask the merchant to throw in a shirt and a tie. Sometimes it worked and sometimes it didn’t.

By that time I had already bought my first home and between then and now I’ve owned about 15 different personal residences. Not once did I question the commission that the real estate agent got in any of those transactions. I really can’t explain why not. With that many transactions a little negotiation on a few of them might have bought a lot of shirts. But I probably wouldn’t have negotiated for shirts either if my friend hadn’t suggested it. (more…)

Fortune Small Business recently ranked Durham number 12 in the country in its list of the 100 best places to live and launch a business. The complete list and the write up on Durham is linked here at the CNNMoney website.

The short write-up is what you might expect about the high-tech environment, cultural opportunities, restaurants, college sports rivalries, etc. There are a couple of links on the page that are also quite interesting. The first is to comments submitted by readers as “Talk back. What do you think of Durham.” Some are very negative but most of the negative ones are from people that used to live in Durham or live in Raleigh. (more…)

Originally the link in the left sidebar to the Durham Luxury Report for 2008 took you to a landing page which captured a name and email address that had to be verified before access was given to the report. The system provides statistics on who has shared this information and downloaded the report. There was a small handful of people who shared their email addresses or an invalid one that never downloaded the report. When I added the second report, the Luxury Homebuyers’ Guide, the link I provided on the left went directly to the report and did not require an email address or verification. Without any promotion at all this report has been downloaded twice as much as the other in just a few short weeks.

Since my primary purpose is to get this information about turning around the luxury market in Durham into people’s hands, I’ve changed the link on the sidebar to take you right to the report which is in PDF format and can be downloaded, printed, saved or just read online. I should warn you, this is not a simple topic and the report is long…not book length…but not just a few paragraphs either. So, if you passed up getting the report because you didn’t want to share a valid email address, now you don’t have to worry about that and you can be anonymous. Click here or on Luxury Marketing Report in the sidebar to get your copy.

The Herald-Sun offered Paul Andrews the opportunity to talk about why he and his wife chose to live in Durham and how they feel about the decision now. Paul  moved here from the Northeast almost 20 years ago.  His “Other Voices” column on the editorial page of today’s paper adds to the chorus of people who have reflected on the developments that have occurred in the last twenty years and those underway now that are making this a pretty special place to live. It is truly heartening to see more people actually admitting that they enjoy living here and that it’s not quite so fashionable to take that cynical “only in Durham” attitude during any discussion of the city’s problems. (Although, I did hear exactly those words from a Durham native in a meeting in Raleigh this weekend.)

It’s true that all real estate markets are local. We always have the choice to spin the glass as half full or half empty…or we can just keep our mouths shut. No one will ever accuse me of being a “new age” type but I do believe that the momentum for positive community development and even good government rides on the tide of positive community feelings. If any group has a vested interest in seeing this happen it should be real estate marketers. Thanks to Paul Andrews for his contribution to a positive message. For my contribution see the sidebar for a newcomers guide to luxury homes in Durham.

If you are interested in how luxury homes are being marketed locally you can spend about a half hour on line and learn a lot. As a Broker and REALTOR I have direct access to the information in the Triangle Multiple Listing Service but a better way to get the broad picture is to use the REALTOR.com search which is available to anyone. This morning there are 84 Durham County listings of at least $700,000 or more. Interestingly, if you do the same search on REALTOR.com you get 90 listings. The difference appears to be that on REALTOR.com there are several Colvard Farms listings that are there because they are in the 27713 zip code and have a Durham address. (There are a total of 139 homes over $700,000 for sale in Chatham, by the way.)

On Realtor.com here are some things to look for: (more…)

In its April 28th edition, Business Week reports on a study in the Proceedings of the National Academy of Sciences that may require re-thinking a little bit the economic theory of the diminishing marginal value of the dollar and price elasticity. In the study the subjects who were students were placed in an MRI machine and given sips of red wine. One of the wines was presented twice, first as a $5 per bottle wine which was its real price and then as $45 per bottle wine.

All the subjects said that they preferred the “more expensive” wine. This was mirrored by increased activity in their prefrontal cortexes. In other words, the perception created the reality. The fact that they thought they were sipping a more expensive wine really was more pleasurable.

The article also quoted Baba Shiv, an associate professor of marketing at Stanford, where the study was conducted. “There’s a temptation among marketers to keep reducing prices,” he said. “We’re saying be careful before embarking on that strategy.”

In an earlier post here we speculated how the sellers of a luxury estate near Lake Tahoe arrived at the nice round number of $100M for a price. Wouldn’t it make more sense to drop the price by a thousand dollars and make it eight figures instead of nine? Not necessarily. Isn’t it interesting that that the price might be part of the product and not just related to the product for the same reason that the points on a buck’s rack are important to a trophy deer hunter. When I see a luxury home priced a thousand or a hundred dollars less than a round number, for example, $899,900 instead of $900,000, I alway think of the Wal-Mart smiley face with the “falling prices” sign in their TV ads. The more unique a luxury home is, the more difficult it is to objectively determine a “market price” and until the right buyer comes along even deep price cuts may have little impact. Unlike most segments of the housing market, price is less a factor in the marketing mix for luxury homes.