|This article was published on: 09/01/2006|
Tales from the waterfront
How I Sold It: A Villa and Its Contents
Seattle-area superstar paved her path to an $80 million year — including a $7.6 million sale in June — by adopting her father’s strong work ethic and willingness to take risks.
BY JEFF ORDONEZ
Editor’s Note: In this REALTOR® Magazine Online exclusive series, Colorado broker Jeff Ordonez talks with practitioners who sold the highest-priced property in their MLS in a given month. This month, Tere Foster, CRS®, GRI, with Windermere Bellevue West in Bellevue, Wash., tells Ordonez about a $7.6 million sale — and the business lessons she learned from her father, a Russian immigrant.
You set a precedent by selling a $7.6 million waterfront home in Bellevue. Tell us how you got the listing?
It was a referral from a California practitioner. We’d never worked any deals together, but we had a mutual respect. One day, he called and asked if I would co-list this property with him.
Did the sellers list with you right away or did you have competition?
We did have competition. There are a couple of others in the area who I compete with on a regular basis.
Why did the sellers select you?
I think a lot of it had to do with personality and enthusiasm. Plus, I showed them we were technologically advanced. I work very hard to keep up with the latest technologies, and they really liked that. I also showed them I could create a standalone Web site just for their property and thereby give the property a very special position in the market. I hired a photographer to do a photo shoot and put it all together.
How’s the housing market in Bellevue?
Very strong. We have nationally recognized schools, high employment, and 10 new high-rise projects going up at the same time. Microsoft is hiring another 5,000 people this year. It feels like a sellers’ market right now.
So can you share with us the terms of the listing?
Yes, I never take anything for less than one year. With some of the publications I use for my marketing, it can be three or four months before our listing hits public view.
What publications did you use?
Leading Estates of the World, a local athletic magazine, and the local newspaper.
Do you typically run a lot of ads?
Absolutely, but I do it a little differently from my peers. They advertise listings. I do that, too, but I also advertise my brand and what it represents, making my business visible to the public.
How about Web site marketing?
I have my own site, www.FosterRealty.com, that I promote on everything and Windermere has www.Windermere.com. My listings show up on both. Both have a very nice look and have features that buyers and sellers like. For example, the Windermere site has different ways for people to search properties. That’s important since people absorb information in different ways. There’s an interactive map search in which a person can click on a map of a 10-state area and zoom in to a desired location. Another is an easy four-step process that guides the consumer through the search. Yet another is for people who like to type and want to type in their search criteria. We also have luxury homes, rental properties, commercial properties, open houses, and vacation and second home properties. And the site offers a way for users to create accounts, save favorite listings and searches, and receive e-mail updates automatically. It’s a very nice system for the user.
Who designs and maintains your personal Web site?
I use a local company. I’ve had a Web presence for about 10 years now, and over the years I’ve had it redesigned four or five times. Once the site is built and running, all that’s required is updating our listings. One of my assistants does that. I also have one person in my office in charge of directing the Web designer as changes are needed.
I noticed that only some of your listings have virtual tours. Why is that?
Some homes don’t show well on camera. I highlight the ones that do. Privacy is also an issue. With one $17 million listing we have right now, we’ve had to take baby steps. As the client feels comfortable with the idea of exposing his home to the public, we take another step toward making it more visible. My clients have a good reason to be concerned about their privacy, so I enforce a strict confidentially policy in my office.
How much money did you spend to market this listing?
I’d estimate $10,000, but I really can’t really tell you specifically. I look at the overall profitability of the business and allocate a percentage for marketing. My plan is always to spend no more than 30 percent of the business income for salaries, advertisement, Web services, and so on.
Did your marketing find the buyer?
No, the buyer was a local and knew the area and the home. He learned the home was for sale by word-of-mouth. Networking can be very powerful.
Give us an idea how the negotiations went.
There was a lot of negotiation on almost everything. With custom homes like this one, a lot of the decor, furniture, high-tech items, boats, pool equipment, and so on fit the house—so buyers often want the decor and the toys to stay. For example, there was custom-built furniture the buyers really wanted because it fit the home so well. In this kind of situation, a transaction can go from a business deal to an emotional deal fast. The sellers put their heart and soul into each piece of furniture, so it becomes a difficult emotional event when they have to let go. In my 20 years of experience, I’ve learned you never ever negotiate personal property upfront. You always negotiate the real estate contract first, then the inspection, then the appraisal. After all that is finished, then you negotiate personal property. I’ve seen good deals fall apart in a hurry because buyer and seller couldn’t agree on personal belongings.
What was the most important aspect of this deal?
Momentum is the most important aspect of every deal. You have to keep the momentum going. It’s like tennis; you have to keep the ball moving.
Your Web site says you regularly close $60 million per year. How do you do it?
Actually, last year I closed $80 million, and this year I’m on track to close another $80 million. My dad had an amazing work ethic, so I grew up with that attitude. Plus, I have an incredible team to run my daily operations. I have six assistants, and they’re all licensed. I have a client services manager, a transaction manager, a marketing manager, and three executive assistants.
How did you get to this point?
I first built a small health-and-fitness business. I just happened to catch the aerobics craze back in the late 1970s, early ’80s, and it turned into a significant business. I worked hard at making myself and my business very visible. By the time I was in my 30s, I was tired of jumping up and down, and I was a single mom with a teenage daughter who needed me. So I relinquished my business rights to some of my instructors in exchange for certain royalties. I activated my real estate license, stayed in touch with the most affluent customers, and slowly began to convince them one by one that I was the person they needed to promote and sell their properties. They had already seen me in action promoting and running my fitness business, so I capitalized on that.
How much capital did you start with?
Not much. I had a few hundred dollars.
What was the first thing you did?
Right away, I created my own brand. I created a logo and stationary to go with my identity. Everyone thought I was wacko. At the time there wasn’t much self promotion, but I knew I had to promote my business just like any other business on Main Street. That’s especially important now when there’s three times the competition.
Fairly soon after starting, I wanted an assistant. I knew that if I had help with marketing and farming, I could sell more. When I hired my first assistant, it was a true leap of faith. I barely had any money and was closing very few deals. I took the leap, and almost instantly I noticed a difference. I saw more activity and continued to build my business around that. I always kept in mind the old saying “11 contacts a day is $150K.” So I’d strive to make 11 new contacts a day. I remember many nights finishing my mailers at 3 a.m. It was a lot of work.
What would you consider to be the most critical ingredient of your success?
My education. I majored in social sciences. When I first started, I noticed that residential real estate had a close contact element to it, and at times it could be very emotionally charged. So with my counseling background, I felt I had a very special match. I also noticed, and still do to this day, that most licensees focus on the house and not the client.
My counseling background taught me to ask the right questions and listen to the responses. So, for example, I’ll ask buyers to tell me about their typical day, how they live, what their traffic pattern is like, what their kids do. Most of time, I find they spend half their day driving. So together we determine the best location for the entire family. From that perspective, finding the house is easy. My clients know that I know what’s important about their investment.
What other lessons have been valuable to you?
My dad was a Russian immigrant (see sidebar “From Russia, With Love”). He would say, “Command the English language, and be in business for yourself. That’s how you make it in America.” I also think about the Winston Churchill attitude of never, never, never quit, even though sometimes you might feel you’ve got a “kick me” sign on your back. Don’t take it personally. This is a very emotionally charged business, and sometimes buyers and sellers get mad at each other. We have to be kind, patient, and the best problem solver we can be.
From Russia, With Love
As a child, Tere Foster learned the value of hard work. Here, she talks with Ordonez about that and other lessons from her father.
Your dad had a big influence on you. Tell us about him.
His name was Daniel Golden. He and my mom escaped the Bolshevik revolution and made it to Ellis Island. They went from there to live with a family member in Oregon. After World War II, my dad had an opportunity to buy a pawn shop in Washington. He went for it and moved the family. I grew up in this area and have been a resident ever since.
Was he your entrée into the real estate business?
Yes. He started with the pawn shop and turned it into a music store, and then he built that into a small chain of music stores. But he always told me “never do retail.” That was the mantra in our house. Retail is a hard way to make a living. You have to tend to retail everyday, including nights, holidays, and birthdays. For the time invested, the return is very little. In his late 50s, he sold the music stores and got involved with real estate. He never got his license, but he was an avid investor. He became so successful that many members of our community would seek him out and invest with him. At one time he had more than 20 partnerships going at the same time. He was very wise, and people trusted him. He loved the game of real estate.
Obviously, you loved it, too.
I grew up with real estate: apartment houses, duplexes, warehouse buildings, office buildings, that sort of thing, so it was always in my life. My dad always felt that the true American dream was to own real estate. As an immigrant, he considered America to be the most amazing country. I got my license when I was 21. My dad really felt it would help my future.
Did he impart other important lessons that affect your business today?
Absolutely. He and my mom taught me that you need a team to run a business. As a little girl, I’d watch my mom do the bookkeeping while my dad was the dealmaker. So my mom taught me about accounts receivable and accounts payable, while my dad taught me how to buy and sell. He would say, “Tere, the most important aspect of property is the ground. You can always change the structure, but the ground will remain fixed. Look at a piece of real estate for the ground, not the structure.” Another one of my dad’s saying was “Make money while you sleep.” I love my dad. He was a great man.
Note: Foster’s dad passed away in December 2005 at the age of 92, but his legacy lives on in Foster and her children. Foster says her dad was always grateful to have the opportunity to live and work in the most fabulous country in the world.
About the author: Jeff Ordonez is CEO and broker-owner of TheLuxuryBrokers.com, where he helps match licensed real estate professionals with millionaire prospects. You can reach him at 719/661-2685 or JOrdonez@theluxurybrokers.com
Read more: Tere Foster talks about the lessons she learned from her father in "From Russia With Love."
Read more 'How I Sold It' articles