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Category: Enduring Interest (page 10 of 10)

August 6, 2006

What’s wrong with real estate weblogs? I might run this way and that, but never hot and cold . . .

by

Suburban Phoenix Real Estate Broker

Author website

Mike Price at Mike’s Corner posted a fascinating interview with Russ Cofano of Rain City Guide on the subject of real estate weblogging and the ‘bloginars’ Russ and Dustin Luther, also of Rain City Guide, have been running. The interview is extensive, and I’m only going to touch on a piece of it, so you should go read the whole thing.

The meat of the matter for me is Russ going through his ideas on do-s and don’t-s for real estate weblogs. Like this:

Here is a list of 10 posts that make for great blog content:

Stories
Data (Charts, Tables, Maps)
Book Reviews
Current Events
Neighborhood Descriptions
Local Events (Fun Stuff!)
Links
Interviews
Advice for Buyers/Sellers
Advice for other Agents

I don’t hate this stuff, but some of it seems to tread dangerously close to the turf Seth Godin calls a Cat Blog. Couple that with “Advice for other Agents” and we trip on the schizophrenia that seems to afflict many real estate weblogs — and BloodhoundBlog is guiltier than most.

Witness: Most real estate weblogs are run by agents or brokerages, and at least one meta-goal is to scare up business. But what is interesting to potential clients is very different from what is interesting to the weblogger. Data, current events, neighborhoods — all that stuff is great, but news about it is not in short supply, and it’s not always easy to come up with an original take on it. On the other hand, the business of the real estate business is endlessly varied and fascinating — even though it might be boring or even completely off-putting to potential clients. We seem to end up talking two games, client-focused material that can too-easily slip into blatant advertising, and inside-baseball commentary for well-schooled insiders.

(I’ve thought about writing a Wiki-fier in PHP that would pre-process a web posting, tagging delimited terms with Wikipedia look-ups, in case I’m assuming that readers know the jargon I’m using when in fact they don’t.)

(The Latin root of the word discursive, as in discursive prose, is discurro, which literally translates to, “I run this way and that.” Discursive prose is the means by which we tame our scattered minds Read more

August 4, 2006

Real estate photography snapshot: Composition is salesmanship . . .

by

Suburban Phoenix Real Estate Broker

Author website

Coming back to this, I wanted to spend a few minutes on photo composition techniques. That’s almost absurd: Who doesn’t know how to take a picture? Almost everybody, it turns out. We’re not talking about Ansel Adams levels of perfection, we’re talking about taking real estate photos that sell the property but don’t require a lot of back-end effort on your part. That means that we want to take a photo we’re ready to show off as-is, not one that requires cropping or re-touching in PhotoShop.

Here’s an obvious rule first: A camera is not a gun, and a house is not its target. If you look at published real estate photos, again and again you’ll see the house centered in the frame with miles and miles of do-nothing sky above it. This is wrong. Fill the frame with whatever it is you’re drawing attention to. If you think you might want to crop the image later, why not crop it now by filling the whole frame?

We like drama, so often we’ll get in really close at a point of view much lower than normal (it’s called crouching or kneeling; even old people can do it). In this case we also blasted hard with an electronic flash — even in bright sunlight outdoors — in order to bring out the details that would otherwise be in shadow.

Another way to lend drama to a scene is to go higher than eye-level and look down. Most digital cameras have a video viewfinder, so it’s easy to frame photos while holding the camera overhead.

If the ceiling is interesting, it should be in the photos. The wide angle lens on your camera will include the floor and ceiling of your interior shots, so you should be watching for things to bring out. Here in Arizona, ceiling fans are worth money, so we make sure we show them off.

Here is the value of a very wide angle lens: We can see this whole bedroom in two photographs. The human eye is much more adept at apprehending visual information than any camera. Our eyes-forward range of vision is Read more

August 2, 2006

Real estate photography snapshot: Choosing a camera . . .

by

Suburban Phoenix Real Estate Broker

Author website

I keep meaning to write about real estate photography, and I keep not getting it done. Let’s consider this a first cut, to which I may return more than once.

Mark Reibman of Rain City Guide has written two great posts on digital photography for real estate, and we can only pray that he does more. I lack his talent, but the wonderful thing about photography is that quality can be an emergent property of quantity: Any one photo I take might stink, but if I take 500 shots, one of them might accidentally kiss the forehead of greatness. Film and prints were cheap, but digital photos are next door to being free. We can take lots and lots of photos and cull down to those that present the property in the best possible light.

Camera selection is always a problem. The two most-advertised features of digital cameras, mega-pixels and zoom lenses, are the two you need least.

Except for print reproduction, the best size for a real estate photo is 640 x 480 pixels — which is 0.3 megapixels. Ideally, your everyday camera should be able to produce that size image without post-processing. The photos on your web pages can be bigger than this, but not by much. If you try to load 20 images on a page, with each image weighing in at one megabyte or more, you’ll overtax most web browsers — well after you’ve overtaxed the patience of your audience.

What you want from a lens is not a long zoom but the widest possible angle. Most digital cameras have their widest angle setting at 45 – 55mm, if the lens were on a 35mm film-camera equivalent. A few cameras get down to 38mm. This is inadequate. What you want is 28mm or less — with reservations. The Fuji FinePix E500 shown in the sidebar is an excellent everyday real estate camera. It gets down to 28mm, which is very good for most rooms. The flash recycles fairly quickly. It will do 4 megapixels at the high end, which is good enough for lower-quality print work. But it will also work Read more

July 25, 2006

Debunking Zillow.com . . .

by

Suburban Phoenix Real Estate Broker

Author website

Zillow.com got itself a ton of new venture capital yesterday, so today seems like a fine time to deconstruct its praxis.

When Zillow was brand new, Catherine Reagor, the dippy local real estate reporter for the Arizona Republic wrote:

Want a reality check? Go to zillow.com, a new Web site with a program that calculates a home’s value for free. It values several Valley homes for tens of thousands less than the price listed on them.

At the time, I said this in response:

If you want to know what your house is worth, do not go to Zillow.com, which delivers completely useless estimates of value for free. Even Net Value Central, a tool used by professionals, lags the market by a month or more. The only way to price a house is to work as rigorously as possible from current and recently-sold listings for extremely similar properties. If you price your house to sell from sources like zillow.com, you will give thousands of dollars away. If you rely on zillow.com to tell you how much to offer on a home, you will see it sold to someone else.

(You can prove all this to your own satisfaction, if you like. Most of Ms. Reagor’s mistakes seem to come from falling in love with ideas she doesn’t check out. Here she tells us that she ran Zillow.com on live listings and found it came in much lower than the listed prices. How did it do against sold listings? She didn’t check, but you can. Run Zillow.com on the sold homes documented in your local section of the Republic. You’ll see that, time after time, Zillow.com is substantially under real-life market results. It’s a useless toy, which Ms. Reagor might have discovered on her own had she bothered to test it properly.)

Just lately, I needled the Zillowites a little more:

All right, here’s the deal with Zillow.com:

I decide I’m going to buy you a pair of designer jeans, nothing but the best for you. I know that fit is important, so I go to three of your best friends to get their sizes. Not yours, theirs. I strike Read more

July 25, 2006

Word-slinging in the Rain — or: How I learned to stop worrying and love the blog . . .

by

Suburban Phoenix Real Estate Broker

Author website

None of this is new to me — except for the parts that are.

I’ve been writing on the nets since before there were nets. Since BBS systems — I ran two of them at different times of my life. Since CompuServe was a time-share system called MicroNet that charged $3.00 an hour for half-duplex transmission at 300 baud.

(Think about that! “Baud” is Bits of Audio Data. My first modem had an acoustic coupler that attached to a phone receiver and transmitted data with actual, annoyingly audible sound. It raced along at 300 bits per second, which sounds slow but is actually about half-again faster than a really fast typist. The connection through which I am by now continuously enthralled is only about 10,000 times faster than that.)

I’ve been writing on the nets since the time when you would log on, suck down everything you wanted to look at as fast as you could, read and respond off-line, then log back on to blast back your own contributions without wasting a second. I’ve been writing on the nets since waiting up for the “off-peak” hours represented a substantial savings.

The funny things is, when the technology was that grossly inadequate, that obscenely expensive, I was writing maybe 8,000 words a day, seven days a week. And as lousy as everything was, it was a whole lot better than working on a 900 pound IBM Selectric typewriter.

I can barely believe the things I did in those days. With my trusty soldering gun, I built myself a little NULL modem that I could configure on the fly, so I could liberate access wherever I found a temporarily mute dumb terminal. I was young and possessed at the time of a multi-faceted morality, and I tended to think of electrical power and underutilized bandwidth as mine to appropriate.

I wrote through generation after generation of computer hardware and network topography, avidly connecting machines that were never meant to be connected and connecting my own computers to a topology that was still called Arpanet when I first started playing with it.

I worked in Usenet for years, and I Read more

July 21, 2006

Who pays whom for real estate? Follow the money . . .

by

Suburban Phoenix Real Estate Broker

Author website

The second in my series of articles devised to tick off real estate brokers appeared in the Arizona Republic today. (Here is a more permanent link to a longer version of the article.) Torquing the brokers is not really my intent, just a secondary consequence. Next week we get to Ardell DellaLoggia’s issues, which may just spark a riot at the Arizona Association of Realtors.

Here’s today’s article in full:

The conventional wisdom in real estate is that the seller pays the sales commission to both the listing agent and the buyer’s agent. Is that really the way things work? To find out, follow the money.

Imagine a closing conference. Normally, we don’t have these in Arizona. Buyers sign their documents at one time, sellers at another. Neither party need ever set foot in Arizona, for that matter.

But for the sake of discussion, picture a settlement conference. Let’s invite everyone who has a seat at the table, so to speak, so we can see who pays whom.

At the head of the table is the escrow officer, who will be getting paid escrow fees and title insurance premiums.

Next comes the County Recorder, who will receive a recordation fee. At the next seat is the County Assessor, who will receive property tax payments. Then comes the insurance underwriter, who will get the hazard insurance premium.

The seller will get a big pile of money, some of which will be passed along to the seller’s mortgage lender.

The two Realtors will both get paid, of course.

The buyer’s lender arrived at the table with a big satchel of cash, but the lender will be taking some of it back in the form of loan origination fees and pre-paid interest. Moreover, the money the lender brought is really the buyer’s money. It was lent on the surety of the home and the buyer’s income and credit.

In fact, everyone seated at that closing table is going to be pocketing money — with one exception.

That one exception is the buyer, who pays for everything else, either out of pocket or on credit. The seller doesn’t pay the Realtor commissions — or anything else. Read more

July 21, 2006

21 reasons to bank on the Phoenix real estate market . . .

by

Suburban Phoenix Real Estate Broker

Author website

HousingPanic, a particularly vitriolic BubbleBlog — which is saying something — asks:

Realistically, how overvalued are Phoenix home prices?

Obviously, I consider this a profoundly silly question, but to lurk among the BubbleBloggers and their seething commentariat is to acquire an education in a slice of America invisible from this side of the sewer gratings. Notwithstanding the idiotic economic analysis, which is really no worse than the static-market fallacies paraded as profundities in the pages of the Arizona Republic, these sites — and not just HousingPanic — are infested with a cult-like fever to inflict suffering — at second hand, to be sure — on people who are in fact guilty of nothing except failing to have drunk the BubbleBlogger KoolAde.

That’s all one. I don’t care. The whole of the last century was dominated by the bad behavior of viciously angry wretches, but look where it got them. The BubbleBloggers will someday bawl balefully in private, but they will never, ever admit that they have been very publicly very foolish. You will know and I will know and in the secret chambers of their hearts they will know they were wrong all along. But as long as you don’t hold your breath waiting for that contrite admission of error, you should be fine.

Here’s where I do start to care. Whenever the subject of Phoenix comes up in a BubbleBlog, the assembled Brown Shirts pile on, for whatever reason. This is their perfect right — even though I think they’re wrong. I love this place. I came here for three months in 1988, and I could not wait to get back. The first time I set foot here, on March 13, 1988, I knew I was home. We moved here for good on April 1, 1991, and I cannot imagine living happily anywhere else. Our relocation page is my extended love letter to the Phoenix area, warts and all. I’ve been writing lovingly about this place since the day I got here, and I’ll keep it up at least until the day before I die here.

Which brings me back to HousingPanic’s question. We keep Read more

July 19, 2006

Location, location, location: Refusing Dual Agency puts Realtors above reproach . . .

by

Suburban Phoenix Real Estate Broker

Author website

I may have stirred up a hornet’s nest on the subject of No Dual Agency. Jim Duncan at Real Central VA posted his thoughts, and the sellsius° real estate blog posted a round-up, asking Are Buyers Customers or Clients? From Arizona, taking a trip Back East is also taking a trip back in time: Agency as it is understood in New York has been absent from this remote cultural backwater for at least 15 years.

That’s as may be. I work in Arizona. Plus which, if seller sub-agency is not already in the past in your state, buyer agency is definitely in your future. There’s a new sheriff in town.

This is all to the good, by me. The slim justification for our licenses is consumer protection, and it seem obvious to me that exclusive representation is the only way to achieve truly transparent protection for both of the parties to a real estate transaction.

Ardell DellaLoggia, in comments posted here, seems to disagree:

Due to the internet access of homes for sale, the trend is UP and not DOWN with regard to buyers calling listing agents direct vs. seeking separate and distinct representation. When the Buyer Consumer chooses to call the listing agent, if you outlaw Dual Agency, you leave them with NO representation at all.

It sounds good to say “outlaw Dual Agency”, but it leaves the Buyer Consumer back where they started, if and when they call the listing agent direct, with NO representation whatsoever.

I see that as a false dichotomy. In that circumstance, the listing agent can either refer the buyer to one of several trusted buyer’s agents (we do this) or simply advise the buyer to seek separate representation. The Buyer’s Broker’s commission is already built in to the MLS listing. There is no reason for the buyer not to seek representation.

Prove my point, Greg. Buyer calls you on your listing and only wants to deal with you personally when making an offer on your listing. Where do you go with that scenario if Dual Agency is “outlawed”, without leaving the buyer high and dry with regard to representation in the Read more

July 18, 2006

Are traditional Realtors being undercut? There’s always room at the top . . .

by

Suburban Phoenix Real Estate Broker

Author website

Let’s see… Our customers are leaving us in a steady march. They’ve found an alternative that is easier to use, more convenient, overall just a better fit to their lives — and to top it all off, it’s much cheaper than our product.

What should we do?

Here’s an idea. Our customers are telling us in no uncertain terms what they want: More! Newer! Better! Faster! Cheaper! So let’s do the same things we’ve been doing all along, only less!

From Reuters.com:

The New York Times Co. plans to narrow the size of its flagship newspaper and close a printing plant, resulting in the loss of 250 jobs, the company said in a story posted on its Web site late on Monday.

The changes, set to take place in April 2008, include the closure of a printing plant in Edison, New Jersey. The company will sublet the plant and consolidate its regional printing facilities at a plant in Queens, the paper said.

The newspaper will be narrower by 1 1/2 inches. The redesign will result in the loss of 250 production jobs, the company said.

The New York Times said it expected the changes to result in savings of $42 million.

The narrower format, offset by some additional pages, will reduce the space the paper has for news by 5 percent, Executive Editor Bill Keller said in the article.

The Times will join a list of several other papers from The Washington Post to the Los Angeles Times that have reduced their size as they cut newsprint and other production costs and try to stem a loss of readers and advertising to the Internet and other media.

It might be fun to chortle about someone else’s troubles — and who doesn’t love seeing the New York Times get it good and hard?

But what they are doing is what the real estate industry, in general, is doing. In both cases, the consequences are likely to be unhappy. The Times would argue that theirs is strictly a financial decision, but it’s one that is likely to be repeated over time, a persistent policy of retrenchment. And even if its customers are not consciously Read more

July 14, 2006

In the 21st century world of real estate, nothing says ‘roadkill’ like a dead dinosaur . . .

by

Realtor, Staging Consultant

Author website

Why do velociraptors no longer roam the earth? Because they couldn’t change. For all their ferocity and intelligence, they were not able to adapt to their changing world. Not able because they were not blessed with the human triumph of will, they couldn’t want to change, and so they became extinct.

What’s a Realtor’s excuse?

In today’s world of Web 2.0, disintermediation, and DOJ scrutiny, anyone in this industry who doesn’t believe the real estate business in the 21st Century is going to be dramatically different from the last century is going to be in a world of hurt. The only way to survive will be to embrace that change.

Ardell DellaLoggia started an excellent thread on Seattle’s Rain City Real Estate Guide, where she has a conversation about buyers’ reps changing their worldview on buyer compensation.

Clearly, the Buyer Agent truly treating the buyer as a client, is the key to the future of our industry. As long as agents continue to think that the seller is paying their commission, when they are representing a buyer, they will continue to treat the buyer as a second class citizen in the real estate transaction.

Be sure to read the entire thread to get the most out of it.

But, closer to my own heart is Allen Wright’s post on RealBlogging, which also recommends we re-evaluate the method of Realtor compensation. Closer to my heart because he asks the essential question:

As a real estate professional maybe we should take a step back and ask a more serious question, “What value-added-service am I providing?”

I like being in a commission based industry. I like being paid for my results, not just my efforts. There are 1,200,000 of us all expending some type of effort, a consumer might assume. But who is actually creating value for his clients through that effort?

Some business models such as discount service brokers and the Redfins of the industry have answered this question by saying “we’re not going to give you added value, but we’ll give you what you have come to expect from Realtors for less than Realtors typically charge.” For some consumers, this Read more

June 30, 2006

Let’s go get sued . . .

by

Suburban Phoenix Real Estate Broker

Author website

In a comment below, Jon offers this:

What are you talking about? Lawsuits against emongoo, zillow and refin? None of them are doing anything wrong…sorry to say. I looked at emongoo, zillow and redfins sites and I don’t see anywhere where they say they give legal advice.

First, I only cited legal advice with respect to emongoo.com – and we’ll come back to that. We should exclude zillow.com from this discussion, because, for now at least, they are doing nothing but running a look-up service with no legal consequences that I know of.

But redfin.com has considerable legal exposure, as does buysiderealty.com and anyone emulating the general redfin.com business model. The first and most obvious problem is the legal doctrine known as procuring cause. These sites are a procuring cause lawsuit – or perhaps a procuring cause class action suit – waiting to happen. They go out of their way to flout the rights of cooperating brokers, openly advising buyers to see homes at open houses or by contacting the listing broker directly. The NAR Code of Ethics forbids brokers from letting a procuring cause dispute impede a transaction, but there is nothing to prevent the aggrieved broker from pursuing damages after the fact. I’m not saying this will happen, but their noses are wide open.

(As a side note, the way I read buysiderealty.com’s web site, their real business is loan origination. My guess is that the real estate brokerage side of the business will be one or more separate operating entities, with the broker being hung out to dry in the event of a lawsuit.)

The entire discount sector of the real estate industry – on-line and brick ‘n’ mortar – faces huge risks on the subject of agency law. It is difficult to argue that you did everything possible to advance your client’s interests when you did everything possible to avoid knowing what your client’s interests actually are. From the outside, you might want to shout caveat emptor! But the law of agency in real estate is by now much closer to caveat venditor.

There is actually added risk for the discounters, as Read more

June 29, 2006

Ten trillion times a tiny loss is a huge loss . . .

by

Suburban Phoenix Real Estate Broker

Author website

I have been devoting a lot of my time to some ascendant ideas in Real Estate loosely based on the Web 2.0 model of internet commerce. The ideas are ascendant, but they’re not necessarily good. I weigh in on the skeptical side for now, but I’m watching all this with interest. I’ve been wrong before.

Of all the fascinating things I’ve seen, the most impressive was the painstaking deconstruction of the redfin.com numbers. We can scale those results any way we want and they still stink. Any brick ‘n’ mortar accountant could do the math. As with Web 1.0, it doesn’t matter how many different ways you shout down the numerical analysis, ten trillion times a tiny loss is a huge loss.

So: One procuring cause lawsuit–and there are apt to be dozens… One negligence lawsuit–and the business model is proudly based on negligence… Emongoo.com is actually in worse shape, since they’re taking quite a bit less money but openly promising legal advice. The aggregators and sites like zillow.com are probably safe–though possibly not profitable. But sites attempting anything like agency have the same legal exposure as B&M brokers, but with a lot less money to cover the losses.

It’s an interesting problem…

Here’s another one:

The real estate industry has always been about seller representation. This was true historically, but it’s still a huge source of lawsuits among the old-timers. The idea of dual-agency–itself a huge fount of lawsuits–is an attempt to cling to double-commissions in the age of buyer agency.

But here is where we’re headed, at least for now: In the world of redfin.com, emongoo.com, HelpUSell, etc., buyers will have full representation, but many sellers will be essentially unrepresented.

The immediate knee-jerk answer to this would be to make buyers pay for their own representation, but, of course, now more than ever buyers arrive at the closing table with no cash at all. Good income, good credit, but little or no cash.

So why should sellers pay for the buyer’s agent? For the same reason they always have, agency law be damned: For the introduction.

So how does this shake out?

On the one hand, sellers might think Read more

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