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July 29, 2007

Cyberhomes vs. Zillow – Dueling Valuation Tools for Your San Diego Home

by

Realtor, Associate Broker

Author website

For the uninitiated, the title is a bad joke. Moving on…

At our most recent office meeting, between the property pitches and the vendor pitches, our office manager promoted our company’s new affiliation with Cyberhomes. Now, being too lazy to do a site search this morning, Cyberhomes has undoubtedly been talked about ad nauseam here. And, as I have confessed many times lately, I have been too time-challenged to be the good little feed reader “reader” I should be of late, so the subject of Cyberhomes has probably been beat to death elsewhere. That’s the beauty of ignorance – I will barrel bravely ahead.

Prudential California Realty is in Beta with their Cyberhomes affiliation. For now, a home valuation feature has been added to the Prudential website but, ultimately the feature will be included in all individual agent pages. It is being promoted to us as superior to Zillow in that (according to our office manager) it incorporates “MLS data as well as public records”. I found this confusing. Aren’t MLS sales ultimately a matter of public record and, therefore, inherent in the Zillow model as well? With the help of a colleague, we stumbled on what he meant.

My colleague and I decided to play a little Zillow. In our version of investigative reporting, we proceeded to embark on some exhaustive comparative analysis. By exhaustive, I mean, we decided to look up the value of both of our own homes on both Zillow and Cyberhomes. Elbow to elbow, armed with dueling computers, undaunted by the challenges which might lay ahead, we Searched.

In each case, our homes were valued approximately $150,000 lower on Cyberhomes than on Zillow. Bummer. Being blessed with the keen eye for detail, we suddenly realized that we live in the same subdivision and in the same model, one block apart. Where scientific method is concerned, we are the Suxors. What about a different neighborhood? I threw out the address of an active listing I have a mile away. Ready, set, show us the money! His “Zestimate” returned a number in the ballpark while my CyberValue (back off, I’m copyrighting that) Read more

July 29, 2007

There’s no place like homepage: Insanely great Guerrilla Marketing tactic for locally-focused real estate weblogs

by

Suburban Phoenix Real Estate Broker

Author website

From ProBlogger:

I met a blogger recently who had a blog with a very local focus. His Guerrilla Marketing Tactic was to do a deal with three internet cafes in his area to make his blog the home page on all of the computers. In return for this he gave them some free advertising on his blog. The same blogger made a similar deal with the local library who also made his blog the home page of their public internet computers. This worked particularly well for him as his blog was on his local area.

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July 29, 2007

By-owner home seller is no match for a skilled listing agent

by

Suburban Phoenix Real Estate Broker

Author website

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

 
By-owner home seller is no match for a skilled listing agent

We’re about to list a home for sale in a fairly pricey neighborhood, so we are very aware of our competition.

We knew a similar home was ready to go on the market, but we were convinced it would be marketed as “for sale by owner,” so we didn’t feel threatened.

Why not? Because a by-owner seller is no match for a skilled listing agent.

I’m willing to concede that there are some unskilled listing agents, but that doesn’t matter to us. We compete against professionals, not amateurs.

In fact, the seller instead went with a limited-service listing, which is slightly — but only slightly — more likely to succeed.

By now, go-it-alone sellers are thin on the ground. You can get a true MLS listing at a range of discount prices, from $3,000 down to $99.

So why is a limited-service listing unlikely to succeed? In this market, a home must be marketed perfectly from Day 1 or it will sell slowly and at a deep discount, if at all.

Except for the MLS listing itself, the home will be offered by owner in every respect: priced wrong, prepared wrong and inaccessible to buyers and agents.

This is not a necessary consequence, but it is very common.

In the case of our newly listed competition, the home is offered at $200,000 over its market value. It will not be a threat to our listing.

But it wouldn’t be a threat even if priced right. A professional home marketer will bring too many weapons into battle for an amateur, no matter how dedicated, to compete.

Even worse, a limited-service listing shouts out a warning to buyers’ agents to stay away.

Why? Because it is being marketed by an amateur. The seller will have no one to turn to for advice, exposing the buyer’s agent to double the legal liability in the transaction.

There’s nothing wrong with negotiating the best price you can get for a full-service listing. But in our opinion, limited-service listings are a false economy in this market.

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July 28, 2007

From the StarPower Conference: Reasons for optimism in the current real estate climate

by

Suburban Phoenix Real Estate Broker

Author website

From Howard Brinton’s closing remarks tonight at the StarPower Conference, here are Gregg Neuman‘s Top Ten Reasons for Optimism:

  • 10. 3,600 fewer agents in my market
  •   9. Downward pressure on commissions is gone
  •   8. Developers/builders welcoming us again
  •   7. Discount brokerages vanishing
  •   6. FSBOs are extinct or nearly so
  •   5. Foreclosure/short sale market thriving
  •   4. Great market for buyer’s agents (you can negotiate)
  •   3. Declining prices opens market to more first-time buyers
  •   2. Sellers willing to listen to reality
  •   1. Sellers need us now and THEY know it

Realtor optimism, yes. For sellers, not so much. But it is a real improvement over crying in your beer that times are tough.

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July 28, 2007

Making the connection: The objective of real estate weblogging is visceral and viral, not rape and run

by

Suburban Phoenix Real Estate Broker

Author website

This will have to be brief, because I’m crushed for time, but we’re promoting Real Estate Weblogging 101 at the StarPower Conference this morning, so it’s a topical topic.

The premise: The commercial value of real estate weblogging comes from making a visceral connection with future clients, ideally leading to viral results, not spam-trolling for short-term leads. In other words, where keyword-packed tapioca content may score well for now on search engines, and may bring in filled-out web forms, it will not create the kinds of enduring connections that result in repeat and referral business for generations. Certainly none of the people brought in by search engines will become loyal readers or subscribers to the weblog: There’s no there there. Even worse, spamvertising in weblogs surely repels at least as many people as it seems to attract, and the people repelled are very probably the ones most likely to yield significant viral results over the years. You’re not only not building bridges, you’re blasting the bridgeheads.

There’s more: What happens when Google changes the rules? When a vendor crows, “Ha, Ha! We tricked Google!” the demise of that particular trick is foreseeable. When Google discovers that favoritism towards weblogs is bringing spam to the top of its results, it will change the way it weights weblogs. Locally-focused webloggers like Jay Thompson who have made the effort to build a following will chug on unabated. Keyword-packing spamvertising weblogs will dry up and blow away.

This morning’s post from Jay is good example of how to do this job: The keywords are there, but they’re there because the post wouldn’t makes sense without them. Jay is providing real value to his readership, practical, relevant advice. Even so, the post should search very well. But here’s the interesting part: Even though Jay is writing about the news of the day, if someone should happen upon this post by search a year or two from now, it will still be serving the visceral, viral function: Jay Thompson cares about his clients, and he is working to provide meaningful benefit to them with his weblog. That’s a very powerful Read more

July 27, 2007

A peek into the inverted world of venture capital: “Business plans are overrated, and profits perhaps even more so”

by

Suburban Phoenix Real Estate Broker

Author website

Infections Greed:

VCs are professional nit-pickers. Give them something to find fault with, and they’ll do it with abandon. I generally tell people to come to pitch meetings with less information rather than more. Sure, you’ll get pressed for more, but finesse it. Presenting a full and detailed plan is, nine times out of ten, a path to a “No” — or at least more time-consuming than having said less.

Profits are a different issue. Being profitable too soon gives investors, rightly or wrongly, an idea of what the margins are on the business, as opposed to what they could be in some perfect world. As a result, it takes a mighty force for them to not start wading in with discounted present value worksheets, and the like, thus hammering your valuation and generally making funding much more complicated (and equity consuming) than if you were wildly unprofitable.

How could a story like this not have a happy ending?

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July 26, 2007

When you’re not busy searching for Maricopa County real estate, you can have yourself a great Maricopa County picnic: Just whip up some tasty Maricopa County sandwiches and pack some frosty Maricopa County beverages, but remember to keep an eye out for those nasty Maricopa County scorpions

by

Suburban Phoenix Real Estate Broker

Author website

Comes news today that a keyword-packed fake weblog is every bit as attractive and satisfying as an inflatable spouse. I don’t doubt it for a minute, but if the objective is to snare random morons by deception, I think a “stealth” web site is a better-yielding joy-doll.

I swear to god it’s Groundhog Day in the real estate industry — 1974 every damn day, over and over again. Does real estate weblogging offer a path to transparency? Not if it’s just another sleazy gimmick.

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July 25, 2007

Testing the StarPower premise: Is success contagious?

by

Suburban Phoenix Real Estate Broker

Author website

A tuxedoed Russell Shaw holds forth at the newcomer’s reception at tonight’s opening session of the StarPower Conference. An important principle of the StarPower method is the idea that success is contagious, that highly-motivated Realtors can hoist themselves to the next level not just by learning new skills and techniques, but also by learning from and modeling the behavior of mega-producers like Russ.

I’m skeptical of anything that sounds like mumbo-jumbo, but I do love the idea of learning new skills and techniques, and I deeply admire many of the people StarPower has brought to Phoenix.

As an example, we got to meet Joe and JoAnn Calloway tonight. In Phoenix, they’re famous as Those Calloways, another team, like Russell’s, that does hundreds of millions of dollars in business every year. As much as Russ is big, blustering and brash, the Calloways are small, gentle and very quiet. You would never, ever peg them as Realtors, yet they completely dominate some of the richest zip codes in Scottsdale.

Immediately to Russell’s left in the photo is Richard Pomisel, with whom I took pre-licensing more than six years ago. Do the math: A class of around 30 students. Many didn’t pass the school test. More didn’t pass the state test. Still more didn’t get licensed. The failure rate for new licensees is 85% in the first year, very high thereafter. And yet two people out of one pre-licensing class are still working.

I don’t want to oversell StarPower. This is very much old-school real estate. Even where they think they’re being hi-tech, they talk about things like “stealth” web sites, marketing-by-trickery. But the bulk of the curriculum is a devout belief in the power of business-like systems for organizing and growing a real estate practice. Cathy and I have taken a divide-and-conquer approach to the classes to bring home the most new information.

I don’t know if success is contagious, and I don’t have much truck for mumbo-jumbo. But I will tell you one “law of attraction” that never fails: Nothing brings out immediate real estate needs like a real estate class. StarPower runs all day Thursday, Friday Read more

July 25, 2007

Keeping Up With What Frank Doesn’t Know — Earth Round — Circles Sun

by

Real Estate Investments Broker

Author website

There’s a mindset that has always befuddled me. It’s origin seems to be grounded in the belief that if I’ve believed X for years, than something proclaimed to be superior to X just can’t be true. Furthermore, the evidence I point to, is how many people agree with my belief in X.

Huh?

The world’s population believed the earth was flat, and that the sun circled it. They were wrong. However, when Copernicus found empirical evidence to the contrary, he was wrong, because he was virtually alone. (Sometimes I think Greg Swann is directly descended from Copernicus.) 🙂 The central argument against him was — all, 100%, totally — false data based upon a long held belief — which was based upon subjective interpretations of bad science — and anger at having their food dishes moved. How dare Copernicus?!

Those arguing for 401(k)’s as superior to F.I.U.L.’s (Now, often referred to as E.I.U.L.) are no doubt sincere in their beliefs. The problem is, when they retire, they’ll notice the guy next door who opted for the insurance approach, and realize very quickly, sadly too, I’m sure — they were sincerely wrong.

I watched NOVA last night, and they said without reservation that the earth is still round, and it revolves around the sun, not the other way around.

My hope is, this post hits its intended target: Those who run companies. Employees who are relying upon the experts made available to them — by their employers.

Before I continue, let me correct a mistake made in one the previous two posts. I’d misread a ‘3’ for a ‘2’ and subsequently wrote 20 instead of 30 years for one of my examples. My error — as I reviewed the document, it indeed read 30 years, not 20. This resulted in misstating one of my numbers. This didn’t change the outcome of the piece though, as you’ll shortly see for yourself.

As we get into the nitty-gritty of the actual comparison of 401(k)’s and F.I.U.L.’s, let’s establish exactly where I’m getting the numbers, and if the source I’m using is credible. 🙂 I do this because it became Read more

July 25, 2007

What should you do when the real estate news turns out not to be as bad as you had feared?

by

Suburban Phoenix Real Estate Broker

Author website

A. Smile in good grace:

Today, in its Existing Home Sales report for June 2007, the National Association of REALTORS noted that mortgage rates are lower by 0.02% than in June 2006.

I guess I knew that, but wasn’t paying attention to it.  I had wrongly assumed rates were higher because this recent run-up was so long and extreme.

B. Fear harder:

A lot of media, including BusinessWeek, reported that large numbers of mortgages would reset at higher rates, potentially forcing huge numbers of borrowers into default. A popular number widely reported was that $1.5 trillion worth of loans was due to reset in 2006 and 2007, according to the researchers at Economy.com. That’s about a quarter of all mortgages outstanding. Mozilo says that in reality more than two-thirds of the borrowers with adjustable mortgages refinanced their loans before their payments spiked. For example, the company notes that only 26% of prime mortgages that were due to reset to higher rates in 2007 are still active. Among subprime loans, 36% are still active. That suggests that most people have, in the words of analyst Samuel Crawford, “refinanced…out of the way of danger.”

Of course it’s easy to blame the media and analysts like Economy.com for suggesting there may be problems with adjustable mortgages. The reality is that even if many folks with toxic loans did refinance, there are still millions of other borrowers getting squeezed right now.

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July 25, 2007

I’ve Been Working Too Hard! Ask the Wall Street Journal.

by

Realtor, Associate Broker

Author website

Thanks to Athol for this definitive guide on how to sell your own home without all of the inherent hassles and baggage of dealing with a professional real estate agent. And, I do mean “thanks” since, being a wee-bit short on discretionary reading time this week, a Permalink has to slap me upside the head.

Kudos to the Wall Street Journal for finally giving us the bottom line on this crazy real estate transfer process. If you read the blogs or listen to the industry, or even if you have merely used an agent in the past to assist in the sale of a home, you might have been left with the impression that the process is complex, involved, and fraught with potential difficulties and liability. Even I have fallen into this trap. We can make it hard, or we can make it easy.

Accordingly to WSJ.com, it is all so very simple really. Just follow these three easy steps, and your home is as good as sold! No muss, no fuss, and no “6%” fee, which they point out is “a hefty penalty for selling your home”. Who wants penalties?

  1. Find out what your home is worth. There is … a group of free services on the Web, such as Zillow.com, that allow you to estimate the value of your home by comparing it with neighboring properties.
  2. Market your property. The goal when marketing your home… is to “drive as many buyers as possible to your ad,” so make sure you choose a site with a lot of traffic, and augment your listing with high-quality color photos and a compelling description. You might even try a “virtual tour” if you’re willing to pay a little extra.
  3. Transfer the title. Once your home is sold, you need to call in the professionals… Regardless of who handles yours, you shouldn’t pay more than about $500…

That’s it! Zillow that house, take some color photos (not black and white, and absolutely no pencil sketches), consider one of those newfangled virtual tour thingies, and cash in the loose change from between the sofa cushions. Congratulations! And to think I just Read more

July 24, 2007

Verizon and YouTube Finally Hook Up

by

Real Estate Rainmaker

Author website

director's chairVerizon and YouTube, sitting in a tree… K-I-S… well, you get it. After endless rumors, it’s official- starting next month, Verizon users (with compatible phones) can upload video from their phones directly onto You Tube. Simply modify your YouTube account to accept this stream, then text “YTUBE” for videos to instantly populate from your phone to the ‘net! Yeah, it seems a little Back to the Future to me too. Hello… McFly!?!?!?

VCast owners know you can already view YouTube material with your phone and will delight in being able to share your videos from anywhere! Verizon has contracted with Veoh to create a mobile video-swapping network, so I suspect this is just the beginning!

What does this mean to Real Estate? Virtual tours may be grainy, but your phone can instantly show clients what you’re seeing. Inspections can be attended vicariously, tours can be done from afar, and best of all- your out of town clients can have instant proof that yes, the sprinkler heads were in fact fixed and you can get your butt over to the closing table.

Or, if you’re more like most of the public (or like me), you’ll film a hampster, instantly upload it to YouTube and be famous in 30 seconds. We’ll see if this is a productive tool, but it sounds like it could at least be entertaining!

July 24, 2007

First the Starpower Conference in Phoenix, then Inman Connect in San Francisco: Posting frequency may be down for a little while

by

Suburban Phoenix Real Estate Broker

Author website

Starting tomorrow and running through Saturday, Cathy and I will be at the Starpower Conference. Russell Shaw is one of the Stars, so he’ll be there as well. I may write about some of what transpires there, but I wouldn’t be at all surprised if my output is curtailed.

Almost immediately after that is Inman Connect. Kris Berg, Brian Brady and Dan Green will be in attendance, so you might get a chance to meet them there. Even so, I don’t think they’ll be live-blogging the event.

But: Brian Brady will be presenting at the Show Me The Leads event. And Dan Green will be a part of 10 Tips From Bloggers.

I’m not going to Inman, but I’ll be monitoring every little breathless announcement of useless new sucker-bait for Realtors and lenders. I have no use for trade shows, but I had a great time last summer making fun of all the goofy crap vendors try to peddle at these things.

In any case, if posting is a little light over the next seven or eights days, you’ll know the reason.

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July 24, 2007

A Realtor’s Guide to Creating A Market Through Lease Options

by

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

Author website

Realtors can increase business by solving problems. This twenty minute presentation is a recording of the lease option webinar I hosted on Meet Brian Brady, my webinar site.

We teach Realtors how to use lease option financing as an alternatve financing method. Of course, we didn’t invent this simple idea. We stole it from here and perfected it here, back in the late 1990s.

July 24, 2007

Ask the Audience: How do you defend your own paycheck?

by

Suburban Phoenix Real Estate Broker

Author website

This came in as an Ask the Broker question:

Thanks for having this site.

We found the house we like and we made the offers and counter offers, finally getting to a place where we got stuck. The seller does not want to came down on her price and we cannot pay more. We are $20,000 apart.

What I would like is for all parties involved — the buyer, the seller and the two agents — to come to the table to make up the difference.

Have you heard of a situation like this?

Alas, I have.

I can be pretty free about using commission dollars to solve problems with transactions, but there are constraints. I will rebate every cent of an untoward commission or bonus, and I don’t hesitate to pay out of my own pocket to make problems go away.

But: My money is mine to do with as I choose.

I can address the problem posed by the question with a very simple analogy:

If your employer decided to buy a company car for his own use, would he be justified in asking you to kick in $1,000 toward the purchase price?

That clarifies that.

But take up the problem as a Realtor or lender: What would be the optimal response to an appeal like this?

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