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Author: Greg Swann (page 169 of 209)

Suburban Phoenix Real Estate Broker

December 15, 2006

Web sites offer exciting options

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Suburban Phoenix Real Estate Broker

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This is me in today’s Arizona Republic (permanent link). Sadly, this is news. In other words, this is the first mention of the Zillow.com upgrades in the Republic.

Web sites offer exciting options

Depending on whom you talk to, the real estate industry is undergoing a revolutionary change – or is not.

The “Realty.bots” arrived in force in 2006, national Web sites offering free home evaluations or free for-sale listings for homeowners.

Some Realtors and consumers view these as harbingers of great change. Others yawn and dismiss them as gimmicks.

Zillow.com, one of the biggest of the Realty.bots, just upped the stakes with an upgrade that will add the following new functionality:

  • Owners or listing agents for any of the 67 million homes in Zillow’s database will be able to list those homes for sale at no cost.
  • Owners will be able to post a “Make Me Move” price on their homes, the price at which all objections to selling will have been overcome.
  • Zillow is creating a real estate “wiki” to serve as a sort of Wikipedia.org-like encyclopedia of real estate.

The wiki — a user-built and maintained encyclopedia — is a nice idea that may grow into something great in time.

The Make Me Move feature seems like a gimmick right now, although it may turn into a vibrant clearinghouse for homes.

But the big news is that owners and Realtors will be able to list their homes on a site that already draws around 3.2 million visitors a month.

On the one hand, that number is huge. It rivals Realtor.com, the 900-pound gorilla of real estate Web sites.

On the other hand, it could be a big yawn: Millions upon millions of homeowners and buyers are not going to Zillow.com or to any real estate sites.

Surely this will change over the long run, and Zillow is positioning itself to be the one-stop-shopping national real estate Web site. This bodes ill for Realtor.com and all of the other Realty.bots.

Real estate is local, not national, and a real estate transaction involves hundreds of intricate details for which expert advice is essential.

So what does all this mean for consumers and Realtors? Time will Read more

December 14, 2006

Everybody loves Ramen . . .

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Suburban Phoenix Real Estate Broker

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Here’s a true fact of life for almost everyone with a real estate license: This job pays really badly.

Here’s a true fact of life for a favored few people with real estate licenses: This job pays really well.

I don’t know if we can safely count ourselves among the favored few just yet, but being Realtors is throwing off a lot of cash for us, and that cash is throwing off a lot of opportunities to make more cash.

Last year was phenomenal, of course, and this year hasn’t been awful for us, considering how awful it was for other Realtors in Phoenix. We got a lot choosier about listings, which helped keep our money in our pockets, and we’ve both done more than we ever have before with new builds.

But: Do Realtors “deserve” all the money they make? I’ve had transactions — two closing later this month — where my total involvement was around five hours. I’ve had others that have run to hundreds of hours over the course of years. But looking at my added-value by hours or tasks or ergs of energy expended is a mistake. The value I bring to the transaction comes from knowing what to do, how, when — and why. Our clients do a lot better because of our involvement, and they are gracious enough to say so.

For now, our earning goal is $1,000 a day, each, call it $700,000 a year, gross. Obviously our expenses are huge, as are our taxes (grr!). Worse yet, we’re not hitting that goal yet. And to put things in perspective, Russell Shaw’s annual broadcast advertising spend approaches our total earning goal.

In the near term, I think we can double our numbers to something like $1.5 million a year, before taxes and expenses. From there, with a couple of assistants each, we might be able to push things to that amount, gross, each. In other words, without growing our head-count very much, we might be able to knock down $3 million a year in gross commission income. The net from that might not be all that great, considering, but it Read more

December 13, 2006

David versus Goliath: Rolling out a brand-new map-based search portal when everyone is looking the other way . . .

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Suburban Phoenix Real Estate Broker

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The universe of map-based listings portals was upended last week with the announcement that Zillow.com was coming into the game, along with 58 million of its little green friends. Whatever long-term effects this might have, the short-term consequence has been a deafening silence from all directions. We haven’t even heard the blustering ‘guy talk’ one might expect in these circumstances (“Two legs?! Only losers need two legs!”).

But there is in fact a place even harder than the hard place the Realty.bots found themselves in last week: Imagine being on the verge of rolling out your brand new map-based listings portal when Zillow made its announcement.

This is the predicament Galen Ward and Doug Cole found themselves in last week as they prepared to go live with ShackPrices.com, a brand new listings portal based in and (for now) devoted to Washington state.

Here’s the company’s official press announcement:

ShackPrices.com is a snappy Google maps-based real estate search site that makes finding a home better by augmenting each real estate listing with data about what is nearby, including the distances to nearby landmarks, nearby schools and nearby bus stops. ShackPrices also helps home buyers learn about cities and neighborhoods through links to reviews, statistics and photos.

We cover all of Washington State right now and we plan to expand to other states in the coming year. As part of our mission to make finding and buying real estate easier and better, we will be introducing a service to help home buyers find the best local real estate agents in the coming year.

Readers here will know Galen Ward from his contributions to Rain City Guide. And the site is everything we would expect from Galen, fast and robust, esthetically beautiful and rich in practical details. The fit and finish is beyond excellent, in stark contrast to Zillow’s offering, and the extra features — neighborhood details, nearby amenities, etc. — are the best I’ve ever seen.

The site draws upon MLS listings, so the inventory is very large from day one. The browser window is tab-based for maximum information density with a minimum of confusion. The underlying AJAX programming makes Read more

December 12, 2006

Who needs Realtors . . . ?

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Suburban Phoenix Real Estate Broker

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I was talking with a reporter yesterday about the idea of disintermediation in real estate. I brought up the question of what is the ideal closing date, just as a quick and dirty illustration of why buyers and sellers need professional advice, even if they think they don’t. This morning’s Ask the Broker question provides more examples.

Here’s another one:

Cathy has a house closing on Friday. She’s the lister (sold in 21 days!) and the buyer came in without a contingency on the sale of another home (yay!). But: They live out of state right now and they have an out-of-state lender (boo!).

The sellers are buying their next nome in Boise, and that transaction is contingent on the sale of their home in Arizona.

Without discussing this with either Cathy or with their buyer’s agent in Boise, the sellers scheduled their closing in Boise for — guess when? — Friday.

They scheduled their movers to deliver their stuff to their new home in Boise on — guess what day? — Friday.

Now god loves the uninitiated in real estate transactions, and he graces them with the unshakable faith that things always work perfectly, as and when planned.

Especially with out of state buyers.

Especially with out of state lenders.

Especially with contingent sales.

Most especially with simultaneous closings — in two different states.

Consider the disclosure chain: The out of state lender to the Arizona buyer’s agent to Cathy to the Boise buyer’s agent to the Boise seller’s agent, with Cathy also keeping the lender on the Boise property (our favorite lender, Logan Hall of SallieMae Home Loans) in the loop, and with each Realtor and each lender keeping their respective clients up to date. Every new development has to traverse this chain. Everyone is on good terms, and they’re all pulling in the same direction against the forces of inertia and Murphy’s Immutable Laws.

So: Who needs a freakin’ Realtor, anyway? The MLS wants to be free! Once that happens, we can push the middlemen (count them in the previous paragraph) off to the side, and real estate will change hands just as easily as securities, airline tickets and cheesy Read more

December 12, 2006

Ask the Broker: Can I call the listing agent on the carpet . . . ?

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Suburban Phoenix Real Estate Broker

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I made an offer for a listing that stated the place has “brand new carpets” (not newer or new, clearly “brand new”). I found out after asking many times and when it didn’t make any difference money-wise that the carpet was installed when the seller moved in which is 1.5 years ago. Am I crazy to be totally upset by it? The seller has a dog and the carpet doesn’t look great. Can I file a complaint somewhere for her false advertising?

Okay, first, this is an excellent argument for working with a buyer’s agent. I would have walked into that house the first time and said to you, “This carpet is not new.” Brand new carpet smells like formaldehyde, for one thing, but it also has a sheen on it that wears away in just a few weeks of normal use. There is no way an experienced Realtor could mistake new for newer or used carpet. There are too many tell-tales that tell the tale on carpet that has been lived on.

So can you file a complaint for false advertising? My guess would be no. At the bottom of the real estate listing, it will have said, “Buyer to verify all pertinent details” — or language to the same effect. We have more buyer protections now than pure caveat emptor, but not many more. The inspection period provided for in your purchase contract is your opportunity to discover whether the horse you are proposing to buy really does have a leg at all four corners. If it doesn’t, and if the deficit is material — meaning it matters to you — then you should cancel the contract or seek redress.

This again is another good reason to have professional advice. If you’re paying a market price for a home that is not delivering market value, you should either cancel or renegotiate. If you are paying well under the market price, you might resolve to grin and bear it.

The seller’s agent also pulled a convenient offer out of her hat every time she needed to pressure us, but I don’t have any proof Read more

December 9, 2006

Zillow.com versus Realtor.com: Nothing grows in the shade of great tree . . .

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Suburban Phoenix Real Estate Broker

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I think part of the problem, in understanding the radical nature of what Zillow.com did this week, is that we are conflating unlike things. As an example, when I speak of a National MLS, I am not talking about local MLS systems.

For one thing, the sine qua non purpose of a local MLS system is to advertise the co-broke commission to other agents, keeping it secret from consumers. This objective is not even on the radar of home searchers, whether they are looking at local IDX listings or a national site like Realtor.com.

Kevin Boer posted an excellent analysis of why Zillow will not replace local MLS systems. I agree, for now, but that’s not really the issue. In the second place, if we were to split the buyer’s agent’s commission from the listing agent’s commission, the entire rationale for exclusive local MLS systems goes away.

But in the first place, home searchers are not going to any listings systems to find out about commissions. To the extent that a local MLS system corresponds to a market as Kevin sees it, to that extent a national home listings service is an entirely different type of market. If the one facilitates the essential activities of real estate brokerage, the other exists to introduce home searchers to the real estate market, to particular real estate products and to real estate vendors.

They are not the same market, so conflating the two is an error. If you want, we can call the idea of a National MLS system something else: National Property Listings Service — NeoPoLiS, “new town” in Greek.

The point is that harping that Zillow can’t do this and Zillow can’t do that is completely true and completely pointless: Zillow isn’t doing those things, nor could it, nor should it. What Zillow might be doing, and only time will tell if it can pull it off, is creating a national clearinghouse for listed homes — which will be brokered by off-site — and normally local — means.

In comments to one of my posts, Dustin Luther raises some plausible objections to my arguments. His counter is that Read more

December 8, 2006

You were saying . . . ?

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Suburban Phoenix Real Estate Broker

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Chickens? Eggs? How about poached eggs on toast…?

BloodhoundBlog’s team coverage of the Zillow.com upgrades:

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December 8, 2006

Price downturn less than scary

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Suburban Phoenix Real Estate Broker

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This is me from this morning’s Arizona Republic (permanent link). I wrote this on Monday, and since then the end of the month errors in the MLS have been corrected, so the percentages in the fourth paragraph have been revised to reflect the changes.

Price downturn less than scary

Here’s a question that cannot be far from every homeowner’s mind: How low will home prices go?

Despite all the media hype, values haven’t gone down very much. For the types of homes of greatest interest to West Valley homeowners, our recent appreciation boom continued through December 2005. Since then, values have gone down only marginally.

What’s the damage so far?

For newer, three-bedroom homes, we’re down 10.27 percent from the peak. Year over year, prices are down 8.72 percent.

Here’s the good news: Looking at two-year results on these homes, values are up 29.37 percent. Over three years, prices are up 59 percent.

(All these figures come from our Market Basket of Homes, which is available online at www.bloodhoundrealty.com/MarketBasket.php.)

But the burning question is, have we found the bottom of the market?

That’s a complicated question.

Doomsayers insist that housing prices will plummet or at least undergo a regression to mean appreciation.

What this means is that if West Valley homes “should have” appreciated by 6 percent a year, we will have to give back the gains of recent years, either by a quick drop in values or a long stagnation.

On the other hand, inventories of Market Basket homes are down precipitously from earlier this year. Sales are fairly high, compared with November 2003. Builders are clearing their excess inventory at a rapid clip. With a decent spring selling season, we could be through the worst of this downturn.

However, inventories are still very high. So, if you try to sell now, you will be in fierce competition with other sellers.

It’s probably wise to resist the urge to tap that equity in your home. Interest rates are very low, so you might refinance to get a better loan, to eliminate a second mortgage or to reduce higher-interest debt.

It remains to be seen if we’re out of the woods. But, so far, the Read more

December 7, 2006

Zillow redux: A post-diluvian retrospective . . .

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Suburban Phoenix Real Estate Broker

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Drew Meyers is doing an excellent job of cataloging the Zillow coverage. My plan is to ponder issues arising in posts and comments, here and everywhere. No guarantee that I’m not missing something, so it would be a great favor if you would point out my lapses.

Zillow understands PR. They’ve had company bigfeet out doing media drop-ins for a while, and, for the weblogging community, David Gibbons separately briefed Ardell DellaLoggia, Cathleen and me, and a third weblogger in San Francisco, identity undisclosed. The point of all this was to spread advance news of the upgrade, but to have it embargoed until 10 PM last night. I’m sure the resulting blog-frenzy suited them just fine, but, even knowing what was going to happen once news broke, there was no way I was going to miss this show.

But: This is why I wanted to go at the thing in the greatest depth I could achieve, right from the beginning. The fact of the matter is, the center of gravity in the real estate world shifted last night — away from Chicago and toward Seattle. It was only a partial shift, and it might turn out to be only temporary, but the professional porcupine that is the National Association of Realtors lost a double-hand-full of quills last night. If it continues to lose more than it manages to grow back, soon enough it will be nothing more than a naked rat. Then what?

The person I was most interested in hearing from last night was Galen Ward, and I said so right away at Rain City Guide. He didn’t disappoint, delivering a trenchant analysis without the advance notice Ardell and I had:

Zillow has the best shot at getting the chicken or the egg (you need one to get the other). Most non-MLS sites (Trulia, Propsmart, ForSaleByOwner, etc.) have had the nasty problem of beginning with no listings and no searchers (no chickens or eggs). Each has tried a novel and somewhat successful way of getting searchers or listings – crawling sites for listings, offering free listings, pay-per click ads to lure searchers, etc. None Read more

December 7, 2006

Bearding the BawldGuy in the land of the never-setting sun . . .

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Suburban Phoenix Real Estate Broker

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BawldGuy Jeff Brown was in Phoenix yesterday, and he made time to sit down with Cathleen and me before he flew back to San Diego. We had a wonderful time talking about real estate and inhaling Cheesecake Factory desserts.

I’d tell you more, but I accidentally sold a house today, so I have to open escrow and then go buy 93,000 packages of Top Ramen.

In any case, I’m showing this picture for two reasons. First, the BawldGuy really is that bald. And second, he really is that much fun to be around.

I like him so much I may even share some of my Top Ramen with him…

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December 7, 2006

Early morning Zillow news round-up . . .

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Suburban Phoenix Real Estate Broker

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I have a walk-through this morning, so this is just a list of what I’ve seen out there this morning. I’m sure there’s stuff I’m missing, and the real news will come when people have had time to play with the new feature set. No particular order, no presumption of agreement or endorsement, just wall-to-wall coverage.

Drew Meyers’ list of links has been expanded.

Ardell has a list of her own going.

Much more: ZillowBlog, LA Times, Ardell’s other weblog, MSNBC, Seasttle Post-Intelligencer, HotPads, SocketSite, TransparentRE, Ubertor, Three Oceans Real Estate early and later, Sellsius, Galen Ward at RCG (cited last night, also), Real Central VA, Matrix, 360 Digest, BlueRoof.com.

BloodhoundBlog’s team coverage of the Zillow.com upgrades:

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December 6, 2006

2006 is the Year of Zillow: The 900 pound AVM has been upgraded to be a free listing platform and the presumptive national MLS system . . .

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Suburban Phoenix Real Estate Broker

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The News

An upgrade made tonight to Zillow.com‘s on-line home evaluation system will add the following new functionality:

  • Owners or listing agents for any of the 67 million homes in Zillow’s database will be able to list those homes for sale at no cost.
  • Owners of any Zestimable homes will be able to post a “Make Me Move” price on their homes, the price at which all objections to selling will have been overcome.
  • Zillow is creating a real estate wiki to serve as a sort of Wikipedia.org-like encyclopedia of real estate.

From the company’s press release:

Leading real estate Web site Zillow.com today announced a major upgrade, allowing homeowners and real estate agents to post homes for sale for free. Additionally, in redefining what it means for a house to be “For Sale,” Zillow? is enabling any homeowner to post a Make Me Move? price.

“To date Zillow has created a Web page for almost every home in the country – close to 70 million – on which we’ve placed public records data and our Zestimate? home valuations,” said Rich Barton, Zillow’s co-founder and CEO. “With today’s new release we are opening up every home’s Web page on Zillow.com for owners and their real estate agents to plant virtual ‘For Sale’ signs in their Zillow front yards for free.”

In addition, any homeowner can now post a Make Me Move price. “What number would it take for you to call the movers and hand over your keys?” asked Lloyd Frink, Zillow’s co-founder and president. “Make Me Move is our twist on the traditional ‘For Sale’ sign.” A homeowner can easily post a Make Me Move price without exposing any personal information. Zillow then enables interested buyers to contact the owner through an email “anonymizer.” There is no charge for the service.

All postings, be they “For Sale” or Make Me Move, provide free uploading of pictures, home descriptions including “what I love about my home,” and neighborhood commentary. Additionally, real estate agents who post homes they are representing for sale can publish their own contact information, link to listings on their own Web sites, and upload a photo Read more

December 6, 2006

Ask the Broker: Can I cancel my listing agreement . . . ?

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Suburban Phoenix Real Estate Broker

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I am currently in a contract with an agent who is not only disappointing me with her lack of enthusiasm and professionalism, but seems to be giving up on my house as well. She keeps saying she doesn’t know what else to do, short of lowering the price of the house dramatically, which I’m not willing to do — we’ve already come down by about $100,000 — not sure we can go much lower than that! So if we’re mutually unhappy/dissatisfied with the arrangement, what are my options? Do you think it will be easy to “legally” get out of the contract? I have a few more months left, but I am hoping to get out ASAP. I really feel that listing with her is a waste of time. What do you think I can do, and is this a common situation?

Very common situation right now, I’m afraid.

I’m going to assume you signed an Exclusive Representation contract, a normal listing agreement. Unless there is explicit language in that contract providing for unilateral cancellation, it can only be cancelled by mutual consent.

As a matter of course, all of our employment contracts include this language:

This agreement will be terminated without recourse upon written notice by either party.

If you’re done with me, I’m done with you. Another way of doing something similar is a buy-out clause: You can unilaterally cancel upon payment of a contract buy-out fee. That may seem unfair, given that your house hasn’t sold, but your agent went out of pocket on the listing expecting to have six months (or whatever) to recoup that investment. For my own part, I don’t want to take your listing unless I’m convinced I can hang a “SOLD!” sign within a month.

But there may be a way out of this labyrinth. My very first listing cancelled on me. I went to my broker at that time and said, “The seller wants to cancel, but it’s your listing contract, not mine. What do you want me to do?”

And the answer he gave me was beyond wisdom, in essence a one-sentence encyclopedia on how to run a Read more

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