{"id":65,"date":"2006-06-29T21:29:36","date_gmt":"2006-06-30T04:29:36","guid":{"rendered":"http:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/?p=65"},"modified":"2007-05-13T20:17:46","modified_gmt":"2007-05-14T03:17:46","slug":"ten-trillion-times-a-tiny-loss-is%c2%a0a-huge-loss","status":"publish","type":"post","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/65\/ten-trillion-times-a-tiny-loss-is%c2%a0a-huge-loss\/","title":{"rendered":"Ten trillion times a tiny loss is a huge loss . . ."},"content":{"rendered":"

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<\/a>. The ideas are ascendant, but they’re not necessarily good. I weigh in on the skeptical side for now<\/a>, but I’m watching all this with interest. I’ve been wrong before.<\/p>\n

Of all the fascinating things I’ve seen, the most impressive was the painstaking deconstruction<\/a> of the redfin.com<\/a> 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.<\/p>\n

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<\/a> 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<\/a> 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.<\/p>\n

It’s an interesting problem…<\/p>\n

Here’s another one:<\/p>\n

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<\/a>–itself a huge fount of lawsuits–is an attempt to cling to double-commissions in the age of buyer agency.<\/p>\n

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.<\/p>\n

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.<\/p>\n

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

So how does this shake out?<\/p>\n

On the one hand, sellers might think Read more<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

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. […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_crdt_document":"","jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[4,7,5,27],"tags":[],"class_list":{"0":"post-65","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"hentry","6":"category-disintermediation","7":"category-enduring-interest","8":"category-real-estate","9":"category-redfincom","11":"no-featured-image"},"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"jetpack-related-posts":[{"id":69,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/69\/lets-go-get-sued\/","url_meta":{"origin":65,"position":0},"title":"Let’s go get sued . . .","author":"Greg Swann","date":"June 30, 2006","format":false,"excerpt":"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\u2026","rel":"","context":"In "Disintermediation"","block_context":{"text":"Disintermediation","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/disintermediation\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":18332,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/18332\/overnight-news-were-you-rooked-by-an-ibuyer-so-was-everyone-else-and-all-of-you-may-have-grounds-for-litigation\/","url_meta":{"origin":65,"position":1},"title":"Overnight News: Were you rooked by an iBuyer? So was everyone else \u2013 and all of you may have grounds for\u00a0litigation.","author":"Greg Swann","date":"July 20, 2021","format":false,"excerpt":"If you sold a home to an iBuyer over the past 12 months, you were probably rooked \u2013 and you may have grounds for litigation. If the iBuyer did not explicitly disclose to you that listing on the MLS would be to your best financial interest in a madly accelerating\u2026","rel":"","context":"In "Group Therapy"","block_context":{"text":"Group Therapy","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/group-therapy\/"},"img":{"alt_text":"Ya think it's easy?","src":"https:\/\/i0.wp.com\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-content\/uploads\/2020\/08\/BHBNewTopImage-300x225.jpg?resize=350%2C200","width":350,"height":200},"classes":[]},{"id":2553,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/2553\/big-news-ignore-all-that-fine-print-tear-through-all-that-red-tape-redfincom-supports-safari-at-last\/","url_meta":{"origin":65,"position":2},"title":"Big News: Ignore all that fine print, tear through all that red tape — Redfin.com supports Safari at last!","author":"Greg Swann","date":"January 30, 2008","format":false,"excerpt":"Oh, wait, that's not the big news from Redfin.com. In fact, I reported the really big news last night:Redfin will either make money or it won\u2019t, and, in the long run, if it endures into a long run, it will become more like traditional real estate even as traditional real\u2026","rel":"","context":"In "Disintermediation"","block_context":{"text":"Disintermediation","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/disintermediation\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":3154,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/3154\/what-happens-when-a-lion-of-the-industry-sticks-his-head-in-the-lions-own-mouth-glenn-kelman-joins-bloodhoundblog-as-a-contributor\/","url_meta":{"origin":65,"position":3},"title":"What happens when a lion of the industry sticks his head in the lion’s own mouth? Glenn Kelman joins BloodhoundBlog as a contributor","author":"Greg Swann","date":"May 21, 2008","format":false,"excerpt":"This is one of those completely obvious ideas that only takes about a year to bubble up to the surface: We write about the real estate industry. We are not very shy about advocating change in the real estate industry. Redfin.com CEO Glenn Kelman is one of the key exponents\u2026","rel":"","context":"In "Blogging"","block_context":{"text":"Blogging","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/blogging\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":281,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/281\/if-bill-clinton-ran-redfincom\/","url_meta":{"origin":65,"position":4},"title":"If Bill Clinton ran Redfin.com . . .","author":"Greg Swann","date":"September 3, 2006","format":false,"excerpt":"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\u2026","rel":"","context":"In "Disintermediation"","block_context":{"text":"Disintermediation","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/disintermediation\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":10658,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/10658\/whos-afraid-of-redfincom\/","url_meta":{"origin":65,"position":5},"title":"Who’s Afraid of Redfin.com?","author":"Brian Brady","date":"December 21, 2009","format":false,"excerpt":"Bob Haywood, an Owasso, OK real estate agent makes a case for why you should be aware of Redfin.com.\u00a0 Bob articulates, from behind the cloaked wall on Active Rain, why Redfin.com is the REAL agent of change in the real estate industry.\u00a0 Read what Bob has to say: You should\u2026","rel":"","context":"In "Disintermediation"","block_context":{"text":"Disintermediation","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/disintermediation\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]}],"_links":{"self":[{"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/posts\/65","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/comments?post=65"}],"version-history":[{"count":0,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/posts\/65\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/media?parent=65"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/categories?post=65"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/tags?post=65"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}