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Category: Disintermediation (page 39 of 43)

September 3, 2006

If Bill Clinton ran Redfin.com . . .

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Suburban Phoenix Real Estate Broker

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Of the two “innovative” cowbird brokerages discussed in this morning’s New York Times, the stronger of the two is BuySideInc.com. They’re rebating even more of the buyer’s agent’s commission than is Redfin.com, but their actual profit center is in originating the loan — a well-understood, fast, cheap, office-job function. Even this is not without complicating factors, especially RESPA. But in pure dollars, BuySideInc.com will make more money per buyer than Redfin.com.

But if Redfin.com really wanted to isolate traditional listing agents, they would triangulate Clinton-style. Instead of giving two-thirds of the buyer’s agent’s commission to the buyer, they would give one-third each to both the buyer and the seller. That way, the seller would regard Redfin.com not just as another source of buyers but as a potential small windfall at close of escrow. The interests of buyer, seller, and Redfin.com would coincide, at least to that extent, and the listing agent would feel a very strong pressure to get his own ass on board.

I still think Redfin.com is not earning its commissions, using the standards of procuring cause that would apply to any other brokerage, but a strategy like this would be much more effective, in the long run, at getting away with it than whining to the New York Times…

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September 3, 2006

Work the numbers: Redfin.com is not much of a business . . .

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Suburban Phoenix Real Estate Broker

Author website

If the New York Times devotes 2700 words to a puff piece on Redfin.com, how many of those words would you expect represent the contrary point of view? If you said 1,350, to reflect the chimerical idea of balance, you haven’t spent much time reading the New York Times. If you said zero, you spend too much of your time reading Little Green Footballs. The Times would never, ever present a completely tendentious article without at least a feint at balance. Marlow Harris, whom I admire no end, gets to offer this extensive and comprehensive counter-argument:

Some agents say the biggest problem with Redfin is that it complains too much. “Someone may be trying to manufacture controversy, even going so far as to bait other real estate practitioners, invite ‘war stories’ on their blog and whine to Congress and to newspaper reporters that they’re being treated unfairly,” said Marlow Harris, a Seattle agent with Coldwell Banker Bain Associates who also runs the real estate blog 360digest.com.

I can’t imagine how much of Marlow’s time the Times wasted in order to stuff her mouth with a straw man, but I will bet a very tall dollar this is not all she had to say.

In reality, the piece is Redfin.com PR, but the hook is a couple who were turned away, like Mary and Joseph, by an evil innkeeper of a real estate agent. I’m going to fisk this article a little, not a lot, because it’s interesting.

First, did the Times lack the opportunity to present a contrasting point of view? Of course not:

But the seller’s agent refused to show it to them. Why would she turn away an eager buyer?

How about because she could double her legal liability for no additional compensation? Was that so hard?

“You can find out more on the Internet about an eBay Beanie Baby than you can about a $1 million house,” said Glenn Kelman, chief executive of Redfin, a licensed broker in Washington State and California.

Oh, good grief. I think the “secret” fields in an MLS listing are stupid, but there are damn few of them, and none of Read more

August 31, 2006

Zindicated! Is this Zillowed seller proof of the need for even greater Zillification?

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Suburban Phoenix Real Estate Broker

Author website

Frankly, no.

Christine at NY Houses 4 Sale cites a Realty Times article about a seller who immediately pulled his home off the market after a prospective buyer confronted him with a Zestimate $500,000 below his assessed value. His conclusion is that Zillow.com has made his home unmarketable.

My first reaction is simply to say, “Hysterical much?”

I think Zillow.com misleads consumers by implying that its Automated Valuation Method is a valid and useful way of pricing homes, but I can’t believe that there is any report or document produced by Zillow.com that cannot be completely dispensed with by saying, “Are you utterly daft? If you can buy a house in this neighborhood for half-a-million under market, I’ll help you move in. Now get serious or get lost.” On my planet we call that negotiation.

At NY Houses for Sale, Christine writes:

I am sure that soon there will be more and more complaints and I am also sure that as the market continues to change more and more buyers will be “Zillowing” their neighbor, mothers, brothers, sisters and friends houses. Just as I am sure of those things – I am VERY sure that there will be many buyers coming into homes that are listed claiming that they are over priced. But here is my answer.. “The house is NOT over priced – your Zestimate is UNDER priced”.

And all that will be great. Zillow.com wears a media-conferred halo right now. The more people talk about the incredible, obvious, bone-headed mistakes Zillow cannot help but make, the less people will rely on it — or affect to rely on it. At some point Zillow may elect to tell the truth in no uncertain terms about what an AVM can and cannot do — in order to retain at least a shred of credibility.

But as for this seller: Grow up, cowboy. If there were no Zestimates, the buyer would have tried a different lowball tactic. If you want your house to sell, pay $300 for a spot appraisal, price you home at or below it, and leave a copy of the full appraisal report Read more

August 31, 2006

Disintermediation? Defenestration? It’s all good . . .

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Suburban Phoenix Real Estate Broker

Author website

If, like me, you are stuck using Windows because dipsh*t developers write websites that are Microsoft Internet Explorer only — such as the Arizona Regional Multiple Listing Service’s Tempo system — rejoice in the arrival of Crossover for the Macintosh. It’s a WINE environment that permits you to run a single MS app within your OS-X operating system. Intel Macs only, obviously, and if you need more from the Windows world (poor blighter), you’ll still have to run Parallels or BootCamp. But if you are only one app away from ridding yourself of Windows, hold up your hand and wave bye-bye.

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August 29, 2006

Rethinking absolutely everything in real estate . . .

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Suburban Phoenix Real Estate Broker

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Jim Cronin is on the verge of something big at The Real Estate Tomato. So is, Eileen Tefft at Rain City Guide, working from a completely different direction. PressReal.com anticipates the demise of the MLS system within months, which seems unlikely to me. But: It remains: These are exciting times to be in real estate. In another post, The Real Estate Tomato solicits testimony on blogging success. I think the best success of real estate weblogging is in this unfiltered, unimpeded exchange of new, better ideas. I come to this banquet every day with my nickel, sometimes just four scuffed pennies. I leave every day stuffed to the gills from a millionaire’s feast. Everything after that is — you guessed it — dessert…

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August 27, 2006

How much future is there in a job that millions of very smart people are willing to do for free?

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Suburban Phoenix Real Estate Broker

Author website

Cathy brought home the Sunday newspaper, and I spent a few minutes pulling out the sections I wanted to read. Which sections? The circulars from Best Buy, OfficeMax, Staples and CompUSA. We buy the daily newspaper never, and the Sunday paper maybe twenty times a year. I have absolutely no use for the news part of the newspaper, it’s just the package the real news comes in: What can I buy where for how little money?

In fact, I read the Arizona Republic and the Las Vegas Review Journal every morning, along with with whatever other news seems most apposite to my dealings. But I read everything on-line. And as much as I hate the hoops I have to jump through to read newspapers on-line — this by comparison to the extreme convenience of my RSS feed reader — reading them on-line is by far superior to wrestling with the antique form-factor in which they are sold.

Moreover, I do not intend to ever pay for a newspaper again unless it contains advertising circulars that can save me money. In the long run, even those will come to me in a format I like better, even if it’s only email, and that will be the end of the Sunday paper at our house.

There’s a disintermediation message in here, by the way: When I was a young turk in the graphics industry, the old timers would tell me that computers could never replace print because, after all, you can’t print a coupon on a CRT screen. It betrays something about their belief in the added value of works of the mind that they thought the thing of greatest worth that could be printed was a coupon, but — guess what? They were wrong anyway. Staples, for one, can’t seem to stop emailing me electronic coupons.

But here’s where I’m really heading with this: In general, I do not intend to pay for ordinary information. Period. If you want my money, you have to deliver something that I can’t get anywhere else — and that I can’t get along without. Or you have to deliver it Read more

August 24, 2006

Dood! Web 2.0 is Totally! Freakin! Awesome!

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Suburban Phoenix Real Estate Broker

Author website

“So Cameron says you’re like totally into real estate?”

My geeky son had brought an even geekier friend home from school. Somehow he ended up in my office. “Is that a question?”

“Dood! It’s like an observation! But, like, I’ve been playing with some of those real estate web sites? And I think I could, like, build my own?”

He talked like that, every sentence a question or an exclamation. He orbited without periods. I said: “How interesting.” I think that sounds sufficiently like “go away” that a kid could take a hint. Didn’t happen.

“So like picture a site called pussywillow.us?” He held up his fingers in Dr. Evil scare quotes. “The fun and friendly way to find out how much your house is worth!”

I said nothing. That didn’t work, either.

“So you like type in your address? And then the software gives you a totally random value? And then, like, the web-cam is watching you? And if you scowl or frown or something, the value goes up? But then if you’re like smiling and happy it goes down? And it’s all totally random, it’s just like messing with your head! And then? When you get disgusted and quit? Then it takes the webcam video and posts it on youtube.com! Totally! Freakin’! Awesome!”

“Wouldn’t you need a model release?” I could have kicked myself for encouraging him.

“Dood! What are you talking about?”

“Wouldn’t you need permission to show the video?”

“Oh, man! You don’t know nuthin’ about Web Two! Dot! Oh!”

Okayfine. “You’re right. Go find Cameron.”

“No! No! Wait! I got another one, right? So, like, imagine a game? It’s built with like mapping software? And the game generates geocodes at random and takes you to those places? And your job is to destroy every house you see? But, like, what’s really going on is, for every house you destroy, the game is sending like a purchase offer for a random amount of money to that house! It’s like reply.com, but even stoooopider!”

Just then Cameron showed up, bless his heart. He said, “Leave my dad alone.”

“Dood! He was like totally buyin’ it!”

Like totally.

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August 24, 2006

A Zillified real estate brokerage: If you lay down with dogs, you wake up with fleas . . .

by

Suburban Phoenix Real Estate Broker

Author website

The other week I had a warm call off of our web site from a potential seller. I took his information over the phone, then talked a little about objectives and time-frames. I told him we would get back to him later in the day. I comped the house and read the listings history, including a cancelled listing earlier this year. My gut feeling was that the seller was way over on price, especially for this market, but I hadn’t seen the home to know for sure (ahem).

I had to show, so Cathy did a drive-by on the home, and on the basis of that, she decided that we could not do the listing: Non-homogenous use of the land, over-improved and over-priced.

She called the seller to tell him we were taking a pass, and he was shocked. He didn’t quite come out and say so, but it was clear to Cathy that he had been under the impression that a Realtor would take just about any listing. In brutal language — that all Realtors are whores.

We are not. We turn down more listings than we take, and absolutely everything has to make sense before we will take a listing. We spend a lot of time and money to make our homes sell, and we lose a lot in reputation if they don’t. This is marketing, not peddling — and not pandering.

That leads to this: Joel Burslem reports on Zillow.com’s latest conquest: Prudential California/Nevada Realty. Joel offers this:

Does this mean the real estate industry is prepared to accept Zillow as the final authority on home values? I’m sure Greg over at BloodhoundBlog will have something to say about all of this.

In answer to the question, of course that is not what they’re doing at all. As with the daily newspaper, a citadel of fact except for the horoscope column, what they’re doing is pandering to the masses — whom they regard as morons, which opinion is betrayed by the pandering.

The truth is, I have no problem with Zillow.com if it is properly understood as an Automated Valuation Model, to be used with Read more

August 23, 2006

How to exterminate a cowbird — a comedy in three acts . . .

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Suburban Phoenix Real Estate Broker

Author website

Act I — Why Realtors hate discount listings…

People think ordinary on-the-ground Realtors hate discount listings because of the discount. That’s may be true of many real estate brokers, but real-life Realtors have two much better reasons to hate discount listings. First, the Buyer’s Agent will have to do all the work for both the buyer and the seller. And, second, in so doing, the Buyer’s Agent might well inherit the liability of being an Undisclosed Dual Agent. The Buyer’s Agent has the choice of either answering every question from the seller by saying, “I do not represent you” — thus causing the transaction to grind to a halt (which is a violation of the Buyer’s Agent’s fiduciary duty to the buyer) — or by saying, “Even though I don’t represent you, here’s what you do.” If the seller later decides he was ill-advised, it won’t be the discount Listing Agent who gets sued.

Act II — The hidden secrets in MLS listings…

Given that IDX systems (like ours) are ubiquitous, precisely what is it that the NAR and all the brokers are fighting so hard to keep secret in MLS listings. I’m sure things differ among MLS systems, but the two big secrets the NAR wants to keep from non-MLS-members are these: 1. The number of Days on Market. That’s the Listing Agent’s secret. And 2. The contact information of the Listing Agent. That’s the Buyer’s Agent’s secret. In the latter case, you might think what is implied is that Buyer’s Agents in general believe that they stink so bad that their clients would betray them in a heartbeat if only they knew how. That’s only half the issue, though. The other half is the fear that, if the buyer knows how to approach the Listing Agent directly, the Listing Agent will make a sweetheart deal with the buyer in order to double-dip on the commission while disintermediating the Buyer’s Agent. This is why MLS systems have rules regarding Variable Commissions, since, in that circumstance, the Listing Agent is disclosing to Buyer’s Agents (but not to their clients; this is another secret datum) Read more

August 23, 2006

Google Base API released

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Suburban Phoenix Real Estate Broker

Author website

From Google Blogoscoped:

Google released the Google Base Data API. This allows you to programmatically create new items, and edit or delete existing ones. You can also query for items with specific attributes.

I read this as Google looking for open source or proprietary apps to extend the power of the Google Base DB to end-users. Those applications will be the skunk works for a more consumer-friendly Google Base.

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August 22, 2006

Tomatillos: Seven steps to a Realtor 2.0 salsa of success . . .

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Suburban Phoenix Real Estate Broker

Author website

With a solemn nod to Dustin, the First Man of real estate weblogs, I wanted to cite posts of merit that have been bouncing around in my brain. I’m not as ambitious as Dustin, though, so I want to go to one place only for now: The Real Estate Tomato. Weblogger Jim Cronin is a vendor, and this might ordinarily put him on my suspect list. But he is so forthcoming with valuable information that two things come across very clearly: He cares more about you getting results than his getting a sale, and, in consequence, he’s probably just the vendor you want if you do decide to make a purchase. I’m not his cheerleader — nor even his customer. But I have been enriched by his generosity on his weblog, so I’d like to share some of those riches with you, if you haven’t seen them.

(Sotto voce: I’m taking this to ActiveRain, too, where Jim is alike unto Saint Francis Xavier, a warrior missionary.)

With that, Tomatillos, little tomatoes:

The titles are mine, so don’t blame Jim. There is much, much more to be explored, including excellent SEO resources. How far back did I go? August 1st. There is plenty more in the archives of The Real Estate Tomato…

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August 22, 2006

If the cute little baby wants to chew up your copyrights, who are you to complain?

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Suburban Phoenix Real Estate Broker

Author website

Marlow Harris at 360Digest has an incisive post about the incipient conflict between copyright-holding brokers and national dot.com real estate listing aggregators:

But what does the agent do who has signed a TOS Agreement with their broker indicating that the Broker owns the listings and the broker does not want their listings advertised on Trulia? Z57, Advanced Access, Number 1 Agent and many more website developers have submitted their feed to Trulia, to allow them to display their listings, in violation of many of these individual agents TOS agreements. Winderemere, J.L. Scott, Coldwell Banker Bain, and many other local and national companies have NOT authorized their listings to appear on Trulia, but they do, under the auspices and with the consent of these website developers, but not the agent’s brokers.

Trulia dilemma for everyone involved.

It’s a plus for individual agents as all leads are sent directly to them. But it’s an unauthorized use of listings. Most of these website designers provide an opt-out box if the individual agents want to do so, but how many even know it’s there?

As more individual brokerages realize that their listings are being shown on this (and other similar portal sites) without their permission, I wonder if they will be more persistent in enforcing their copyright.

The other end of this conflict is that the seller has the reasonable right to expect that the broker will promote the listing by all available means. And in the case of feeds generated by web-site vendors, it’s hard to complain about the onerous burdens imposed by those feeds being automatic and free.

But Marlow’s larger point stands. An MLS is a club composed of self-selected, dues-paying members. Its lawful existence should be protected by the Free Association clause of the U.S. Constitution. But I agree that a real estate listing is the unique work product of the listing agent and should be protected by copyright laws.

We end up with babies and bath-water, I expect. The entire Googlified model of the internet consists of stealing copyrighted material, aggregating it to draw eyes, then selling those eyes to advertisers. This is a perfect Tragedy of Read more

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