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Category: Disintermediation (page 28 of 43)

April 30, 2007

Arizona appraisal bill, amended to allow web sites like Zillow.com to operate, passes House, returned to Senate

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Suburban Phoenix Real Estate Broker

Author website

Arizona State Senate Bill 1291, as amended to assure the legality of consumer-oriented Automated Valuation Models such as that used by Zillow.com, passed the Arizona House today by a vote of 52-3, with five members not voting. The bill will be transmitted back to the Arizona Senate for reconsideration there.

The amendments, proposed last Monday by Scottsdale Republican Representative Michele Reagan, include language that will exempt AVMs from appraisal licensing requirements with the stipulation that home valuations are provided at no cost and are not called “appraisals.”

The Arizona Board of Appraisal had issued two cease and desist letters to Zillow.com — but to no other free AVMs — demanding that the Seattle-based internet real estate start-up stop issuing home valuations in Arizona until it obtained an Arizona appraisal license. The Attorney General of Arizona had issued a similar letter to Zillow.com.

If the amended version of SB 1291 passes the Senate and is signed by the governor, free consumer-oriented AVMs will be able to operate without impediments in Arizona.
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April 27, 2007

East Valley Tribune slams Board of Appraisal over Zillow.com censorship, endorses Reagan amendments to SB 1291

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Suburban Phoenix Real Estate Broker

Author website

In general, newspapers influence people who are paying attention, a small but inordinately important minority. Today the East Valley Tribune, clarion of the populous suburbs east of Phoenix, came out strong for Zillow.com and other consumer-oriented Automated Valuation Models:

Arizona home buyers and property speculators are fortunate the state Board of Appraisers did something against their interests while the Legislature is still in session, so lawmakers can act immediately to put a stop to it.

The Board of Appraisers is going after Zillow.com, a year-old Web site that offers free estimates of market values for an estimated 70 million houses across the country. The state agency contends the site is offering property appraisals without an Arizona license, and has ordered it to remove these “zestimates” or face formal sanctions and a possible lawsuit.

But Zillow.com makes no claim that its estimates are based on actual visits to individual properties or research of their histories. Instead, the Web site gathers sale details about other homes in the same neighborhood that have recently changed hands, government tax valuations and other publicly available information, and then provides a rough prediction about a house’s value under current market conditions.

More:

Given recent reports about widespread mortgage fraud and foreclosures resulting from inflated purchase appraisals, the state Board of Appraisers should be working to increase the amount of information available to consumers rather than shuttering potential sources of knowledge.

At least the Legislature appears to see the wisdom of this. On Monday, Rep. Michele Reagan, R-Scottsdale, introduced an amendment to SB1291 that was endorsed by her House colleagues to protect free opinions about property values as long as the provider doesn’t claim or imply that they are formal appraisals.

Putting Reagan’s amendment into law would be a nice endorsement of free speech and the consumer’s right to multiple sources of information.

None of this is news to people following the story here, and, in fact, the most-recent events are not covered. But this is the kind of public outcry that can swing the balance against this silly stunt by the Board of Appraisal.
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April 27, 2007

Sailing the Red Oceans: Real estate start-ups, weblog shut-downs and getting Google to trust your site in advance

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Suburban Phoenix Real Estate Broker

Author website

I have news, but some of it is getting a little stale. My apologies. I have been buried, not that this is unusual.

As Kris Berg reports in her inimitable way, Redfin has relaunched, rebranded and all but reinvented itself, establishing a beachhead in Boston in the process. As far as I can tell, the big news is the company’s new logo, which features an image of Eve acting on the bad advice of a snake. Every picture tells a story, don’t it?

Sellsius has also launched its product offering, a kind of searchable, semi-permanent, for-pay Craigslist. This looks to me like a Red Ocean, but what do I know?

That much has been reported elsewhere. This hasn’t: Territory Real Estate has launched its flat-fee buyer-brokerage in Boston and greater Massachusetts. Proving the appeal if not the merit of the Red Ocean strategy (first explained to me by Zillow.com’s David Gibbons), Territory immediately goes on the attack — against Redfin.

But: Screw all that. There are matters of greater moment.

For instance, is weblogging headed for an icy, entropic death? TransparentRE says not, at least not for real estate weblogs. This much is obvious: Weblogging is a fad, like CB radio in the seventies. Anyone who didn’t expect it to fall off dramatically was self-deluded. But there are two important differences between weblogging and the ordinary Rubik’s Cube style of fad: First, viral blogging is a new communications medium, the backbone of the alternative media. And second, owners of commercially-motivated weblogs have an enduring interest in persistence beyond fad appeal. The number of weblogs doesn’t really matter, nor does the number of putatively “active” weblogs. Sites that draw a decent number of evanescent eyes from search traffic may generate income for their owners. But, in the long run, the only weblogs that matter are the ones that can attract a stable population of repeat visitors.

Two more and I’m out of time: A WordPress Theme Generator, so you can express yourself with unborrowed tastes. And the irrepressible, irreplaceable Dave Smith with a strategy to suss the Google Sandbox with a Trustbox instead.

To close, here’s a quote for Read more

April 27, 2007

State vs. Zillow.com will be a lengthy bout

by

Suburban Phoenix Real Estate Broker

Author website

This is me in today’s Arizona Republic (permanent link). This goofy little column often “breaks news” in the sense that I cover facts that have not yet been reported by the Republic‘s real estate reporters. Normally I keep this to myself, because I don’t want to frighten the people who were kind enough to give me the column. This week I told my editor that were were “scooping” the newspaper, and gave him resources for vetting the facts presented below. The consequence? At the top of the story is says, “Special to the Republic.” Top that, Hildy Johnson.

(Just between us, I’m pretty sure I’m mangling the citation of the standing law. It’s Chapter 32, not 36, but even then I don’t know how it should be properly cited. Newspapers have style books for stuff like this. This will do: ARS 32-3601 et seq.)

State vs. Zillow.com will be a lengthy bout

The ongoing saga of Arizona vs. Zillow.com will not end.

When the state Board of Appraisal recently revealed that it had sent cease-and-desist letters to the Seattle Web-based real estate start-up in July and November, it failed to disclose that it had language pending in the Arizona Legislature that would have conclusively outlawed Zillow.com and other consumer-oriented Automated Valuation Methods.

That legislation, Senate Bill 1291, seemed to be on an under-the-radar track to easy passage until its existence was discovered by the LittlePinkHouses.com real estate blog.

The proposed language would have substantially revised Arizona Revised Statutes Chapter 36, among other things defining an appraisal as “an opinion of value.”

Does that mean that two neighbors, talking about the price of the house for sale up the street, would be in violation of appraisal law?

What Zillow.com and other AVMs do is so far removed from what an appraiser does that in order to outlaw Zillow, the drafters of the legislation apparently found it necessary to outlaw ordinary free speech altogether.

Importantly, there have been no consumer lawsuits or Board of Appraisal complaints in Arizona against Zillow.com, nor has the Board of Appraisal moved against other consumer-oriented AVMs operating in the state.

A compromise was sought by Rep. Michele Read more

April 26, 2007

Are you an appraisal scofflaw? Are you sure you know what your client is doing with that Broker Price Opinion?

by

Suburban Phoenix Real Estate Broker

Author website

In all the excitement, I missed this precious little bit of news.

Nota bene:

A concern has been raised that real estate brokers and salespersons are providing opinions of value unrelated to the prospective listing or sale of property.

The horror!

My home is worth $475,000. I have no intention of selling. Come and get me, Coppers!
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April 25, 2007

What this state needs is more public ridicule! Arizona House to reconsider Zillow.com-proofed bill on Monday

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Suburban Phoenix Real Estate Broker

Author website

The news is simple enough: “Representative Stump moved that the House reconsider SB 1291 on Monday, March 30, 2007. Motion passed v/v.” That last little bit says the motion passed on a voice vote.

This again would be the Third Reading. If the amended bill passes by a two-thirds majority, it would have to go back to the State Senate for reconsideration, where it would also have to pass by a two-thirds majority.

Of course, Arizona has always drawn huge guffaws in the monologues of late-night talk show hosts, so we may just want to wait for Leno or Letterman to pick up the story…
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April 25, 2007

Arizona appraisal bill, amended to permit AVMs such as Zillow.com to operate in state, fails to pass

by

Suburban Phoenix Real Estate Broker

Author website

Arizona SB 1291 failed to pass Tuesday afternoon in the Arizona House. The bill would have required a two-thirds majority and passed by less than that. I’ll post further when I know more.

Further notice: Here’s what it all means:

To have passed, the bill would have had to have passed by a two-thirds majority. Then it would have gone back to the Senate, where is also would have had to pass by a two-thirds majority. This is a Constitutional bias in the Arizona legislature against new laws of any sort — generally a good thing.

Since the bill did not pass the House, this means the old version of ARS Chapter 36 is still in effect. It is this version of the law that Zillow.com is alleged to be violating by the Arizona Board of Appraisal.

That allegation has not been tested in court, nor have any of Zillow.com’s direct competitors been alleged to have violated ARS Chapter 36.

As another wrinkle, the amendments made yesterday to AZ SB 1291 that would have clarified that offering the output from an Automated Valuation Model at no cost is not an appraisal, subject to regulatory oversight, could be appended onto another bill. In other words, the existing language of ARS Chapter 36 could be revised to achieve the same effect as yesterday’s amendments.

This is a statement released by Zillow.com this afternoon:

From Lloyd Frink, Zillow co-founder and President:

The issues that Arizona Senate bill 1291 sought to address went far beyond questions about automated valuation models for real estate. The fact is we are still extremely pleased that the Arizona House of Representatives decided to amend SB1291 to recognize the value that sites like Zillow bring to consumers in providing free and easy online access to real estate data and home valuations. We remain confident that any future reviews will similarly recognize the importance that sites like Zillow deliver in creating better informed and educated real estate consumers. Nothing has changed and we will continue to make Arizona Zestimates available for free to all Zillow users.

Additional details RE: AZ Board of Appraisals:

We strongly believe that providing Zestimate home Read more

April 23, 2007

Zillow.com dodges bullet in Arizona: Amendment would permit consumer-oriented automated valuation models to operate without regulatory oversight

by

Suburban Phoenix Real Estate Broker

Author website

From a press release from the office of Representative Michele Reagan:

Arizona homeowners can still access their “zestimates” with the preliminary approval Monday of a bill that bars the Arizona Board of Appraisal from torpedoing online businesses that provide property value estimates.

An amendment sponsored by Rep. Michele Reagan to SB1291 allows web sites to offer free opinions regarding the value of real estate if it is not an actual appraisal. The bill impacts most notably Zillow.com, which provides free estimates of a property’s value.

“Companies like Zillow.com provide an easy way to get an idea of the value of a home anywhere in the country,” said Reagan, R-Scottsdale. “Government should not put the kibosh on such an informative online tool.”

The Arizona Board of Appraisal sent two cease and desist letters ordering Zillow.com to stop offering its free service in the state. The board is also considering suing the Seattle-based company despite its wide popularity in Arizona and around the nation. In addition, the board asked the Arizona attorney general to prosecute Zillow.com for offering “zestimates.”

“Zillow.com provides a valuable resource for Arizonans and an unelected board’s desire to hamper consumers’ efforts to get as much information as possible makes no sense,” Reagan, chairwoman of the House Commerce Committee, said. “Instead of protecting Arizonans, the Board of Appraisal wants to stifle access to valuable market information.”

The bill received initial approval Monday and is expected to get a vote on the House floor this week. The bill then goes back to the Senate for final consideration.

This is not over yet, but it’s movement in the right direction. If I can lay hands on it, I’ll post the link to the revised bill and highlight the change.

Further notice: The amendments are here: one, two and three. In addition to allowing for consumer-oriented AVMs, Reagan seems to have restored the balance of civilian oversight of the Arizona Board of Appraisal. For comparison: The proposed legislation prior to these amendments.

There are two changes to the language that stand out:

Page 3, between lines 41 and 42, insert:

“9. AN INTERNET WEBSITE THAT GIVES A Read more

April 23, 2007

KTAR Radio on Arizona’s attempts to stifle Zillow.com

by

Suburban Phoenix Real Estate Broker

Author website

I was interviewed by KTAR Talk Radio in Phoenix today about the State of Arizona’s attempts to shut down Zillow.com. We end up with a 37 second story, which actually turns out to be a fairly decent distillation of the whole story.

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April 21, 2007

Arizona Republic: Realtors side with Zillow.com

by

Suburban Phoenix Real Estate Broker

Author website

The Phoenix RE.net is heard from in a big way in an article that will appear in Sunday’s Arizona Republic about the State of Arizona’s attempts to stifle Zillow.com. Writes reporter Peter Corbett:

A state agency’s efforts to stop Zillow.com from offering property-value estimates in Arizona are drawing criticism from some Realtors who think regulators are overstepping their authority.

The critics also are targeting an Arizona Board of Appraisal reform bill they fear will muzzle anyone from offering an opinion about property values unless he or she is a licensed appraiser, Realtor or attorney.

Phoenix real estate broker Greg Swann said that the legislation, Senate Bill 1291, is narrowly written to block Zillow from offering its estimates.

It also could affect other online services from offering property-value estimates using what are called automated valuation models, he said.

“This is legislation to stop progress,” said Swann, adding that state regulators are being Luddites in trying to halt the advance of Internet commerce.

The Arizona House is expected to consider the bill on Monday, said Deborah Pearson, director of Arizona Board of Appraisal.

The legislation is not aimed at Zillow but rather is intended to update statutes that have not changed since 1991, Pearson said.

Realtor Swann of www.BloodhoundRealty.com, said that the bill is so tightly written that two neighbors talking to each other about a neighbor’s property technically would be in violation of the law.

Pearson said exemptions in the law would permit neighbors to talk about property values.

It may be that she thinks this to be the case, but the language of the legislation is very precise:

“Appraisal” or “real estate appraisal” means any of the following: (A) The act or process of developing an opinion of value. (B) An opinion of value. (C) Pertaining to appraising and related functions such as appraisal practice or appraisal services.

This is very clear. Any opinion of value brought forth by anyone not explicitly exempted by the law would be a violation of that law. To capture Zillow.com and other Automated Valuation Models, they had to write the law so broadly that it effectively outlaws all “unofficial” opinions of value.

Corbett continues:

The controversy about appraisals erupted Read more

April 16, 2007

Open Letter to Minneapolis Area Association of Realtors Regards RMLS Ruling 13

by

Mega-Producing Realtor

Author website

The following was sent to me by Steve Westmark. He was the very first agent interviewed by Howard Brinton for what is now known as Starpower. He is a very nice man, who spends a great deal of his time (and money) working for Habitat For Humanity. He and the other agents using the term “MLS” in their URL got a very raw deal from the shortsighted people who sit on the Board of Governors for the Minneapolis Area Association of Realtors.

___

Open Letter to Minneapolis Area Association of Realtors

Regards RMLS Ruling 13

My name is Steve Westmark, a long-time agent with Counselor Realty and prior to my resignation September 2006 a long-time member of the Board of Governors at the RMLS of MN (the “Board”). Because I am, and have always made my living as a practicing Realtor, I can say that my goal while serving on the board has been to protect the interests of “practicing Realtors” as my 1st priority (not necessarily for brokerage “owners and operators”). In July of 2006 I made a very difficult decision to resign my position on the Board in a last resort protest of Rule 13 because I believe the Rule is not in the best interest of Realtors.

I have spoken with many of you (my fellow members), there seems to be a number of misconceptions for my resigning from the Regional Board of Governors of the RMLS, and the ensuing lawsuit protesting Rule 13. I am writing the open letter in hopes that you will better understand why I believe Rule 13 is a detriment for all Realtors.

My History

I served and was Chairman of the MAAR MLS Committee for nearly a decade. I was involved with the task force to bring the Regional MLS into existence. As a Governor for RMLS I have served on the Technology Sub Committee, Executive Board, been involved with vendor selections, task force for bringing on new executive, but most of all wanting to be a representative for the real estate practitioner whose day-to-day use of the term “MLS” is vital and the main source for information for Read more

April 13, 2007

Arizona Board of Appraisal to Zillow.com: In your Zestimation, does this posturing make us look stupid?

by

Suburban Phoenix Real Estate Broker

Author website

From the Arizona Republic (tipped by Adam Tarr and Sharon Kotula):

An Arizona regulatory board has ordered Zillow.com to stop offering its online estimates of home values.

The Arizona Board of Appraisal has issued two cease and desist letters to the popular real estate Web site, claiming Zillow needs an appraiser license to offer its “zestimates” in Arizona.

“It is the board’s feeling that (Zillow) is providing an appraisal,” said Deborah Pearson, Board of Appraisal executive director.

This would be in contra-distinction to all the other Automated Valuation Methods operating in the state, some of which are actually used by lenders to underwrite home loans.

All last year, I wondered when the appraisers were going to rise up and rail about consumer-level AVMs. Today was that day, it seems.

This is Rotarian Socialism in action. The so-called regulatory body serves at the beck and call of the putatively-regulated industry. They have no hope of doing anything but making themselves look ridiculous in public, but they have to answer to their allegedly regulated masters no matter what.

If this kind of corruption is just now making you sick — you haven’t been paying attention…

Further notice: Official Zillow.com response from David Gibbons:

Lloyd Frink, Zillow’s President asked me to convey this official response to you, Greg:

“We strongly believe that providing Zestimates in Arizona is completely legal (and in fact an important public service), given that Zestimates are the result of our ‘automated valuation model’ and are not a formal appraisal. The Arizona Board of Appraisals relies on USPAP, the national professional standards for appraisers, and USPAP Advisory Opinion to determine propriety of activities. Here is the relevant opinion on this matter (Advisory Opinion 18): http://commerce.appraisalfoundation.org/html/2006%20USPAP/ao18.htm As you can see, it reads: ‘The output of an AVM is not, by itself, an appraisal.'”

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April 7, 2007

Are Glenn Kelman & Dave Barry Soulmates?

by

Mega-Producing Realtor

Author website

Dave Barry sues Realtor associations. He has been suing Realtor associations for years. I don’t know that anyone could say that he sues Realtor associations for a living because he almost always loses. And it is hard to imagine that any lawyer who had a pot to piss in would keep doing the same stupid thing year after year after year – even though it was obvious to any rational person that it could not succeed. If Dave would like to send me a threatening letter or sue me for what I am writing here, this is my contact information. Dave Barry is behind Trust MLS. This is his “Open MLS” program that he tried (and failed) to get on the ballot in California in 2005. Now he is trying it in Maine. A much smaller state where it would require a LOT less money to try and shove this down everyone’s throat. I believe (Dave, please notice I said I BELIEVE, not “IS“‘) Dave to be a charter member of the “What’s Yours Is Mine Club”. This is also sometimes referred to as “something for nothing” or simply “criminal”. I don’t know if it would actually be libel to characterize him as a litigious lunatic, so we won’t do that here. Certainly, the NAR lawyers and the various state association lawyers aren’t going to come out and physically say that. Almost all lawyers (at least in the U.S.) have a “lawyer to lawyer respect” rule that they follow. It just isn’t right to say something unkind or inflammatory about someone who finished law school and was admitted to the bar – not if you finished law school and were admitted to the bar.

The following was reported yesterday on Inman News:

He is also a part of Trust MLS, a group that is supporting the Maine ballot initiative and encourages supporters in other states to pursue similar measures. This group, along with real estate companies Redfin, Catalist Homes and Voyager 360, among others, had offered financial support to the institute, and Trust MLS plans to submit a bid to operate the proposed Read more

April 2, 2007

Redfin.com’s Real Estate Consumer’s Bill of Rights: A wolf in sheepskin clothing . . .

by

Suburban Phoenix Real Estate Broker

Author website

I am a hardliner on the subject of reform in the real estate industry. Over the last nine months, I have written at great length about, among other things, the skill-set required to survive in the future of full-service real estate, empowering buyers, dual agency, how the NAR makes war on the free enterprise system, divorcing the buyer’s agent’s compensation from the listing agent’s fee, rebuilding the MLS without the co-brokerage fee, eliminating the IRS safe-harbor for real estate brokers to induce them to take responsibility for managing head-count, and getting rid of real estate licensing laws — or at least the broker’s level of licensing — to promote better competition among agents and better due diligence among consumers in hiring agents. There’s all that, plus much, much more.

Why am I going through my bona fides as a reformer? Because I am about to denounce a failed, flawed, fractured, false reform that is to be proposed today by Redfin.com. At first blush, this “Real Estate Consumer’s Bill of Rights” sounds like a good thing — and it easily could have been a good thing. Instead, it uses a treacly moral suasion and calls for new legislation to ram the corrupt Redfin style of doing business down everyone’s throats.

Start at the beginning. Yesterday, Kris Berg, Ardell DellaLoggia, Kevin Boer and I had this email from Redfin.com CEO Glenn Kelman:

Hope you’re having a good weekend. We wanted to let you know, under embargo until tomorrow at 9 a.m. (or whenever Inman goes live with the news), that we’re launching a program on Monday called the consumer bill of rights.

It doesn’t argue the issue of commission rates; we don’t consider it our business what others charge. It mostly focuses on simple reforms that would ensure that consumers get complete and open access to information about properties and the process of buying or selling properties.

The reason we’re asking you guys about it is that we want other brokers to support these rights. This is something constructive and positive, not antagonizing and negative — which itself is a result of coaching you’ve given us.
Read more

March 30, 2007

Skilled Realtor bargain of lifetime

by

Suburban Phoenix Real Estate Broker

Author website

This is me in today’s Arizona Republic (permanent link):

 
Skilled Realtor bargain of lifetime

We own 65 Internet domains so far. Of those, 29 are actually hosted on the Internet, sites you can visit with your Web browser. The others are “pointed” at the hosted sites.

If you forget that I work for BloodhoundRealty.com but remember my name, GregSwann.com will take you to our main Web site.

We build custom sites for our higher-priced listings, which accounts for many of the hosted sites. We also have sites for our Weblogs and a site we use to test new versions of our software to make sure it’s ready to deploy.

We are a high-tech real estate brokerage trying to stay ahead of the curve in a high-tech era.

Looking over one shoulder, we compete against traditional Realtors. But looking over the other, the Realty.bots — venture-capital-funded Internet real estate start-ups — make the traditional real estate marketing message harder and harder to deliver.

Is Zillow.com, or another automated valuation method, a useful tool for pricing homes? No, but I have to be prepared to show why, perhaps first overcoming my client’s skepticism.

Is a $199 Internet listing as effective as the full-service marketing package we bring to the table?

My view is that a skilled, experienced Realtor is the bargain of a lifetime. Under one hat, you get pricing and sales expertise, advice about staging and repairs, an expertly executed marketing campaign, a professional negotiator, thoughtful and knowledgeable hand-holding through the escrow process — and more.

Unlike a Realty.bot, your Realtor has actually bought and sold houses — dozens or hundreds of times. With expertise that stretches from little things, like hiring a landscaper, to topics as big as the Internet itself, the professional advice you will get from a good Realtor cannot be matched by canned Realty.bots, no matter how much fun they are to play with.

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