Wendy Cole is the former managing editor of REALTOR® Magazine.
Crossing State Lines
Paul Kraus and Janice Gatlin don’t let geographic boundaries define their business. When it comes to selling foreclosed homes, they work all sides of Lake Tahoe.
January 1, 2011
Paul Kraus and Janice Gatlin
Co-owners (Kraus is a broker, Gatlin is a sales associate)
Truckee Mountain Properties; Truckee, Calif.;
2010 gross sales: $27 million on 100 transaction sides (est.)
2009 gross sales: $21 million on 78 transaction sides
Number of offices: 2
Number of sales associates: 8
A brief history: Kraus obtained his broker’s license in 1988 and started a law practice in 1991, handling REOs and short sales as an attorney. Between 2003 and 2006 Kraus and Gatlin worked as sales associates with Prudential California and Coldwell Banker. They cofounded Truckee Mountain Properties in 2006.
An Unexpected Niche
When we started our business in 2006, we fully expected to be a general brokerage rather than market ourselves as REO specialists. But the changing market presented an opportunity, and Paul’s experience with foreclosures as a real estate attorney on the East Coast helped us. We’ve been able to develop and keep good relationships with a number of asset management companies. The recent threat of foreclosure freezes has caused us to be more mindful of the short-sale market and make more inroads in that area. We’re doing more marketing to make sure underwater sellers know that we can help them and that we have a lot of success in this area.
Importance of Relationships
While we understand the effect and value of technology, what sets us apart is our attention to the people part of the business, whether we’re dealing with distressed or conventional sales. We answer the phones and are very responsive, which helps us continue to get REO listings. We have good relationships with 50 or 60 agents in other real estate companies and let them know immediately when we have new REO properties. At any given time we have between 10 and 50 listings, and we sell them quickly. Our average time on market is 22 days.
We’ve each had careers in other fields. Janice has a background as an environmental regulator and research chemist who worked for Dow Chemical Co. She also owned a construction company. Her technical and analytical background is very helpful to the business. She is very organized and gets very involved in the details of contracts. Paul is an attorney and is more of the big picture person. He deals with the agent concerns more often and is more involved with business development and keeping the relationship with our asset management companies in good health.
No Boundaries for Business
We don’t have a strict geographic boundary. We cover a 360-degree area around Lake Tahoe. Part of it is in Nevada and is more of a primary home market. The rest is on the California side, which is known as a second-home and vacation area. We’re one of the few brokerages in our area that crosses state lines. Even though our two offices are 45 miles apart, we think of it all as one community since many clients own homes in both locations.
Reputation Beats Ad Dollars
We do some print and online marketing, but we don’t spend excessively. We want to grow our business evenly, and we’re not interested in getting a flood of calls we can’t handle. We rely on repeat business and cultivating our relationships with asset management companies.
A Nice Commission Split
We give our agents what they need, and they are free to ask for anything from us. We don’t charge them for advertising or basic yard signs. And we may pay for the costs of them transferring from another brokerage to ours if we really want them to work with us. Our commission splits are generous—no less than 75–25. If agents are new to the business and don’t have many leads, we give them some of our REO work so they don’t starve.
No Question is Off Limits
We pride ourselves on openness. We don’t mind if our agents tell us they flubbed something, and we don’t penalize them for telling us about a conflict they may be having with a buyer or seller. Our agents are not afraid to talk to us about any issue that comes up. We want them to come to us with questions and we tell them they should never be embarrassed to ask us anything. Most professional mistakes are made under stress. We do what we wish people did for us when we first got into this business.
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