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Category: Disintermediation (page 14 of 43)

April 4, 2008

Zillow Mortgage Marketplace: One Way Transparency Like A Bad Online Dating Site

by

Commercial Real Estate Finance Expert
Structured Debt and Equity
Licensed Real Estate Broker in AL, CA, and FL

Author website

Zillow Mortgage MarketPlace rang the opening bell and loan requests came flying in the door. I was pleasantly flabbergasted! It’s no secret that I’m a Zillow-phile; I believe they are leading the way to transparent loan and real estate transactions.

I’m tenuous, however, about spending too much time there. My comments at BusinessWeek:

Brian Brady, managing director at San Diego’s World Wide Credit, a national lender and broker, said he signed up for the Zillow mortgage marketplace a few weeks ago and has mixed feelings about it.

Advice Needed?

He said it has the potential to be a great tool for both consumers and lenders. But he’s concerned that borrowers will be seeking quotes without first getting advice from mortgage professionals about the loan that best fits their needs.

He’s also concerned about the kinds of leads the site might generate.

“Zillow is going in the right direction, in that the consumer gets to rate us as [loan] originators,” Brady said. “I certainly wish it were a mutual rating system because customers need to be rated, too.”

Take a second look at my final comment. Consumers should be rated, too. The challenge for quality originators, today, is time. With so many loan applications that are unable to be funded, we have to be judicious about where we spend our time. My concern is that I’m shooting craps with loaded dice when I engage in anonymous quoting; I have little upside. If I deliver a great quote, I am rewarded with an opportunity to “sell” a new customer. If the customer is disingenuous about her information, I am accused of delivering a “phony quote” and am rated poorly, within the community.

Wade Young expands upon my concern on Lenderama:

When I pull the actual credit, I’m not going to be able to make good on what the Zillow consumer will most definitely consider to be a “promise” made by me via my rate quote. The lady gives me one star (undeservedly, of course), and I move on to other things.

Wade is more concerned about the Read more

April 4, 2008

Because of who I am, because I will not keep my mouth shut, I might understand better than most of us what it means to be an American

by

Suburban Phoenix Real Estate Broker

Author website

Witness:

“Hu spread malicious rumors and committed libel in an attempt to subvert the state’s political power and socialist system,” the court verdict stated[.]

Every time you take notice that there is no gun barrel pressed to the base of your skull, you might say a prayer for the soul of George Mason.

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April 3, 2008

Black Pearl Marketing Minute: Want to learn how Zillow.com bakes a sweeter, tastier browser cookie? Scratch the FUD from your recipe

by

Suburban Phoenix Real Estate Broker

Author website

I wanted to expand on my post from last night on Zillow.com’s use of web browser cookies with its new Mortgage Marketplace free loan quotes software.

So you know going in, I have a huge contempt for people who try to sow FUD — fear, uncertainty and doubt — about new technology. In the podcast linked below, I’ll give you the grand tour of the browser cookie bakery:

  • What cookies really are
  • Their implications for privacy and secrecy
  • How Zillow is implementing browser cookies
  • And, most importantly, how you can deploy browser cookies in your own marketing

If you insist upon living in a demon-haunted world, you’re probably not going to get much out of this. But if you understand that, as a side-effect, Zillow is teaching you a great deal about hi-tech marketing, then put on your thinking cap and think.

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April 3, 2008

Heard on Broad Street: “Zillow.com may in fact be reinventing — and perfecting — Capitalism”

by

Suburban Phoenix Real Estate Broker

Author website

Back in the 19th century, when the stodgy New York Stock Exchange was already ensconced in the lap of luxury, the traders who would one day form the American Stock Exchange were stuck out in the rain.

Literally. Stock brokerages that couldn’t afford a seat on the NYSE instead rented offices on either side of Broad Street near Exchange Place. Clerks hanging out of windows would communicate bid and ask prices by hand signals to the traders working outside on Broad Street. Rain, sleet or snow, the traders effected their exchanges.

Last Summer I poked fun at Zillow.com’s CEO Rich Barton for a vision he had of a 19th century marketplace. This is Barton’s quote:

“I see an old-style marketplace formed, a city market like Pike Place Market. I actually dug up an old photo — Pike Place Market at the turn of the last century. People were gesticulating. People were buying things. People were gossiping. Negotiations were happening. Big billboards were advertising things above the marketplace. That’s the picture I have in my head.”

Give the man his due. I’m thinking Zillow’s Mortgage Marketplace is more like Broad Street than the Pike Place Market, but it definitely is a true bourse — the maximum flow of information between buyers and sellers with the minimum of friction — or even overhead!

I wrote last month that Zillow.com is leading us toward the realization of Capitalism’s promise. Everything we claim as a defect of Capitalism is in fact the confluence of two other systemic defects:

First, a small few people want to behave badly, which fact permits other sleazy people to malign honest traders who are themselves innocent of all wrong-doing.

And second, physical impediments to the flow of information prevent the overwhelming majority of overwhelmingly honest people from distinguishing the innocents from the crooks.

Software systems like Ebay and Zillow’s Mortgage Marketplace mitigate the second defect, leaving the bad actors fewer and fewer places to hide.

The Mortgage Marketplace is a small thing, so far, and, as with everything in the RE.net world, it looks much larger to us than it really is. But consumers — and lenders! — have Read more

April 3, 2008

Zillow Mortgage: I Wasn’t First, So I Want to Be Last

by

Commercial Real Estate Finance Expert
Structured Debt and Equity
Licensed Real Estate Broker in AL, CA, and FL

Author website

Zillow Mortgage announced its Mortgage Marketplace today with the ceremony of the opening bell on the NYSE.  I applaud them for bringing transparency and reputation management to an industry that needs both.

Originators, who have been around the block, understand my title; I’ll wait and bring the best offer, last.

April 2, 2008

Zillow.com takes advertising demographics to never-before-seen places

by

Suburban Phoenix Real Estate Broker

Author website

The other bit of news to come out of Zillow.com is this: The real estate start-up is collecting, deploying and reselling advertising demographics in unique and interesting ways.

The vast quantities of demographic information — income, property values, credit scores — that will be collected in the new Mortgage Marketplace software will be stored in browser “cookies” on the user’s own computer. In other words, Zillow will not be storing this information in its own databases, but will retain control over it by means of software that will be able to access the cookies in future sessions on Zillow.com.

What this means is that Zillow will be able to deliver highly-targeted advertising to its users, zeroing in on products and services that would be most appealing to that user’s sex, age, income and other demographic characteristics.

This by itself will make Zillow extremely profitable to advertisers, who seek assurance that their promotional efforts are aimed at the right prospects.

But Zillow is also making these cookies available to other advertising vendors, such as Google’s Adwords system. By this means, other advertisers will be able to deploy the demographic information Zillow is collecting to target their own ads.

Obviously, the reselling of this demographic information is also a profit-center for Zillow.com — reports of whose financial demise may turn out to have been premature.

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April 2, 2008

Zillow.com’s long-awaited mortgage lending service offers anonymous customized loan quotes to consumers, affording loan originators the opportunity to compete transparently for free mortgage leads

by

Suburban Phoenix Real Estate Broker

Author website

Seattle-based real estate start-up Zillow.com tonight releases its long-anticipated mortgage lending product. We’ve known for nearly a month that Zillow’s offering would include working loan originators in some fashion. What becomes clear tonight is that Zillow will basically be acting as a hands-off intermediary between mortgage-seeking clients and loan originators.

Consumers using Zillow’s new Mortgage Marketplace will be able to anonymously solicit bids for loans from participating lenders. The consumer will fill out a detailed form disclosing all pertinent financial details.

The form will be submitted anonymously to participating lenders, who will, in their turn, produce quasi-pro-forma loan quotes, submitting them, through Zillow, to the consumer. The consumer will then have the choice to make direct contact with particular lenders to decide whom to do business with.

To a very large degree, the information asymmetry between lender and borrower is done away with, since the loan quote will detail every fee associated with the loan. Moreover, Zillow will be implementing a reputation-management system whereby borrowers will be able to rate their lenders on their performance.

In return, the lenders will receive Zillow’s mortgage leads at no cost.

The new service is expected to come on-line at 9 pm PST tonight. I made screenshots in the product demo teleconference I attended today, but my expectation is that these will be obviated very shortly.

 
Elsewhere: Todd Carpenter, Rich Barton, John Cook, Drew Meyers, TechCrunch, Rhonda Porter, Spencer Rascoff, Joel Burslem, Kevin Boer, Jay Thompson, Rhonda Porter (again), Pat Kitano, Morgan Brown, Trace Richardson.

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April 1, 2008

State-mandated licensing of interior designers is our only possible protection from life-threatening color clashes

by

Suburban Phoenix Real Estate Broker

Author website

Via Coyote Blog, Clark Neily of the Institute for Justice argues against occupational licensing for interior designers in the Wall Street Journal:

Imagine you were a state legislator and some folks asked you to pass a law making it a crime to give advice about paint colors and throw pillows without a license. And imagine they told you that the only people qualified to place large pieces of furniture in a room are those who have gotten a college degree in interior design, completed a two-year apprenticeship, and passed a national licensing exam. And by the way, it is criminally misleading for people who practice interior design to use that term without government permission.

You might stare at them incredulously for a moment, then look down at your calendar and say, “Oh, I get it — April Fool!” Right? Wrong.

These folks represent the American Society of Interior Designers (ASID), an industry group whose members have waged a 30-year, multimillion-dollar lobbying campaign to legislate their competitors out of business. And those absurd restrictions on advice about paint selection, throw pillows and furniture placement represent the actual fruits of lobbying in places like Alabama, Nevada and Illinois, where ASID and its local affiliates have peddled their snake-oil mantra that “Every decision an interior designer makes affects life safety and quality of life.”

Legislative analysis by a half-dozen states that rebuffed ASID’s attempts to cartelize interior design — including Colorado, Washington and South Carolina — has failed to support ASID’s claim that the location of your couch or the color of your bedroom walls is literally a matter of life and death. As the Colorado Department of Regulatory Agencies put it, there is “no evidence of physical or financial harm being caused to . . . consumers by the unregulated practice of interior designers.”

Lacking any factual support for its sweeping public welfare claims, ASID and its supporters often resort to fear-mongering.[…]

If there were any credible evidence that unregulated interior design presents a genuine risk to consumers, ASID would certainly have found it by now. They have had plenty of time (more than three decades), resources (dues for Read more

April 1, 2008

Where Were You When The Real Estate Industry Morphed?

by

Real Estate Broker

Author website

Life is good — I’ll be going to the Master’s next week. It’s been a few years since I’ve gone. A friend has some family connection with passes and if one of his business clients back out, he gets me in. Business is picking up also. I just got a contract on one of my “flips” before I even finished and put it on the market, so now I’ll change hats and be a buyer for a while looking for another one.

Leads are coming in on a regular basis, a mixture of strong leads, not so strong and weak. They are all possibilities. I’ve even had time to browse the web and see all the distinctions without much difference being made. As topics run thin we tend to make finer and finer distinctions to prove….what? Superiority? Most likely. Hell, I always think I’m superior. Well, not really, I just like to think I am a lot of the time. In my better moments I realize I’m perpetually on a learning curve. Just as soon as I’m ready to crown myself as “Expert” I hear something from left field that sends me back to the drawing board, to tweak, re-think, adjust.

Perhaps that’s the highest value of this great learning environment called the internet, we’re contantly evolving and becoming better, never crowned for long as “Expert”. However, the more we learn the closer we get to being knowledgable enough to know what we don’t know and how to find the missing pieces.

One thing that fires my imagination and pulls me into the good and the bad of the internet is the growing “conversation”. From Maine to Florida and from Georgia to Oregon, to Canada and overseas, people typing away, posting and responding, creating conversations that for certain specific interests like real estate become Great Conversations with various ideas and concepts being woven throughout. There’s no central authority managing the conversation, there’s no hierarchy of experts, only diverse voices growing, hopefully, not into a Tower of Babel but in different directions of movement and progress until the best ideas and concepts begin forming a great change for the better.

It’s a such a Read more

March 25, 2008

Redfin.com beats the field again, this time in both Seattle and San Francisco: Buyers pay less and reap commission rebates, too

by

Suburban Phoenix Real Estate Broker

Author website

Redfin.com has news this midnight, but it’s the sort of thing I would normally ignore: It’s basically the kind of rah-rah-for-us stuff I leave for the vendor cheerleaders and the mainstream media. But: I gave Redfin a lot of grief last year when they made a similar announcement, so today I’ll give them a bit of their own back:

Online real estate broker Redfin Corporation today published an analysis of the last 12 months’ public real estate records in Seattle and the San Francisco Bay Area that shows its buyers and their Redfin agents negotiated a better price than buyers who used other brokerages. Redfin’s average negotiating advantage was $5,048. The company also reported a 95 percent customer satisfaction rate for users of its home-buying service, and an average commission refund of $10,520.

This is the actual news, which you will not find in any news source: Redfin beat the field for the second year in a row. Is it plausible that particular agents beat Redfin? Not just plausible, highly probable. I don’t know of any teams of buyer’s agents like the kind of team Russell Shaw runs for listing agents, but a team like that would be much more useful for comparison purposes than the entire field of Realtors in three MLS systems. But give Redfin its due: The company deploys the kind of task specialization common to every sort of business except residential real estate brokerage. It’s very hard to resist the idea that specialist negotiators, more often than not, could out-dicker ordinary jack-of-all-trades Realtors.

And all of that is caviling, and wasted caviling at that. Stand in awe as Redfin.com CEO Glenn Kelman illustrates the high art of PR triangulation:

“Why do Redfin customers consistently tend to negotiate a better price, in different markets and different market conditions?” said Redfin CEO Glenn Kelman. “Last year, we concluded it was because of our agents, whom we pay bonuses based on customer satisfaction rather than commissions. Others argued that it was because of our deal-savvy customers, who benefit from Redfin’s transparency to take a more active role in the deal. Today, we think it’s Read more

March 22, 2008

Would You Hire Yourself?

by

Real Estate Broadcaster and Investor

Author website

There is an ongoing argument as to the value of a real estate agent in today’s real estate market. It can’t be settled with rhetoric and mantras. In order for there to be an effective resolve, the Realtor industry must reach out to the American consumer and seek to validate the need for their existence in a transaction.

This should not be a hard feat. However most agents, for some unknown reason, find it to be beneath them to quantify their “value” much less dollarize it. When posed with the notion that they may be required to actually prove their worth, many ignorantly say that doctors and lawyers and professional athletes don’t have to justify their fees so why should they. Oh really?

Is that the answer you want the Consumer to walk away with? If you are not willing to justify yourself to the Consumer, how about justifying your commission and worth to yourself?

Would you hire yourself? Be honest. You know what you have done…lately. Don’t tell me, the Consumer or yourself that you USED to be great. At one point Carl Lewis was the fastest man in the world. At one time Bear Stearns was a respected fixture on Wall Street. At one time you may have been a high performing agent.

Banks only allow appraisals going back 6 months, some are only allowing data that goes back just 3 months. In doing a realistic appraisal of yourself, it’s not accurate to say what you have done. The Consumer wants to know what you have done LATELY.

So let’s assess ourselves accurately, shall we?. In order to do so we’ll need to collect actual qualified data. Not just a self-adulating pat on the back. So let’s ask ourselves some questions and come up with a dossier as to why we would even entertain hiring ourselves.

1. Experience:
a. How long have you been a real Estate Agent?
b. When were you licensed and has your license been continually active?
c. Please explain any interruptions in service since the time you were first licensed
d. What, if any, continuing education or niche specific training have you taken and completed Read more

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