Monthly Archives: February 2006

Technology Sucks!!!

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OK…Got that off my ample chest.

I know you guys just love the technological advances, but some days I just want to kick it all back to the 80’s. If you “kids” can say “I Want MY MTV!”. then why can’t I say “I Want My MLS BOOK!!!”

You guessed it. The mls is DOWN! It’s a beautiful sunny Sunday, I’m ready to show houses, and the system is acting up. Guess I’ll have to go to my own website, www.SearchingSeattle.com, and find properties to show.

We are getting a new super-duper, upgrade to the mls. Well thank you very much Rappatoni boys! Who asked for it! The whole system will be screwy in the meantime, for what? So we can say we “added” something? So the background color can be different or the buttons can be “cooler” and rad or whatever you kids say today.

Then I call the mls to gripe, so I don’t have to do it here, and they are closed for President’s Day from Sat. through Tuesday.

Are the upgrades really worth the inconvenience? Then we all have to take a class to learn how to use the stupid new upgrade…OK, I’ll find the homes the way that you do.

I bet the darned new upgrade is just a fire wall designed to help keep Robbie and his RSS feed out 🙂

RCG may have completed the real estate blogging trifecta, but which horse is going to win?

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About a week ago I noted that the Zillow Blog added Rain City Guide to its sidepanel and that I hadn’t found out about both the Redfin Blog or the HouseValues blog because they hadn’t spread any link love. As Rain City Guide hasn’t done much to deserve traffic from either site, I didn’t really expect my comments to make much impact, so I was pleasantly surprised to find that both blogs added Rain City Guide to their sidepanel in less than a few days, thus completing my Seattle-real-estate-search trifecta!

I start with this story because it highlights two timely points I want to make: (1) all real estate is local and (2) business blogs can be shockingly responsive in ways that simply is not possible with a standard business website.

And just as all real estate is local, I’m happy to say that all interesting real estate search technology appears to be local as well. I’ve seen some fun tools come out of New York and California (or should we say CaliYork), but I don’t think it can be argued that the future of real estate is being developed right here in Seattle.

So who is going to win the real estate technology race? Will it be:

I don’t pretend to have the answer, but I sure enjoying keeping score. 😉

The second (and only tangentially related) point I want to make is that business blogs are now the norm for tech companies. When done right these blogs are much more than just a place to put press releases and instead give some great insight into the corporate personality behind the company. Go ahead and read the first few blog entries from each of the big three real estate search sites:

(I’m waiting…)

Here’s is what I read… The Zillow people are a zany, tech bunch who really believe that they can crack the real estate nut through increased data crunching and processing power. The Redfin people have figured out a better business model and now only need to expand so that they can demonstrate efficiencies of scale. The HouseValues people have a laser-like focus on present marketing opportunities, so they really don’t spend much time thinking about the future. Had any of these three companies been blogging a year ago, I’m sure their blogs would read the same! And more interestingly, I’m fairly confident that if I read the “latest” three or four entries from those same three blogs one year from now, those will also read the same because the culture that created those blogs is the same culture that created those companies. There is a real honesty in blogging that is hard to mask. Both a company’s strengths and weaknesses show through in their blogs!

However not everyone sees blogging from this vantage point. Recently, Daniel Gross of Slate signaled the beginning of the end of the business blog, by focusing on all the problems with blogging. But by focusing on the financial aspects of blogging (which often don’t make sense), he misses out on the overwhelmingly positive marketing opportunities associated with adding a friendly face to an otherwise impersonal website. I’m so glad that these three big real estate tech companies out of the Seattle area have all begun blogging because it gives some great insight into the soul behind the companies.

"Klaatu Verata Niktor"

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Before we read Osman’s piece on Buyer’s Agency, let’s do a little review.

Does the seller or the seller’s broker really pay the buyer agent’s commission? To suggest, as Osman does, that the buyer is getting a “free ride” (down the garden path), is too simplistic.

earth

The day we envisioned that buyers would control their half of the transaction, we, the real estate industry, spent about 30 days toying with the concept. Then, in a New York Minute everyone turned on a dime and backpeddled to their comfort zone. That place where the seller and the seller’s broker controlled everything.

When you start talking about Buyer Agency in this Country, you might as well be spouting “Klaatu Verata Niktor”, as only agents seem to want to talk about it, while the general public’s eyes glaze over.

Buyer’s want a house, sellers want a buyer, and agents want to talk about agency.

Osman, buyer’s pay the buyer agent fee, not the seller. Unless we think of it that way, buyer’s will never be empowered in this Country, regardless of this whole data control “smoke and mirrors game” everyone is playing.

There are still many old curmudgeon rules in play, that prevent the buyer from truly controlling that fee, but let’s not suggest that buyer’s are getting anything for “free” please. The day the buyer takes possession and the right to pay a big mortgage payment every month, he starts paying for that fee in his monthly payment. The fact that he finances that fee, does not mean he doesn’t pay it…he pays it with interest!

Until we recognize this fact, buyer’s will remain Klaatu’s and will never become true Jedi’s.

"Sarasota Realtor sues local real estate association"

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In response to Giles comment and question, here is an Inman article from December 2004 giving the whole story. Lois had been emailing me some strange things. She then went into a coma and passed away. I believe her suit was dropped at that point. I’m pretty sure the Association won on the Kentucky suit. Not sure what happened in Spokane. Not sure how Barry can do these in so many states, aren’t lawyers restricted to the state where they are a member of the bar?

“A Florida Realtor is suing the Sarasota Association of Realtors for allegedly forcing local real estate agents to buy memberships in the association as a condition of purchasing lockbox keys and multiple listing service data.

The suit, filed Wednesday in federal district court in Tampa, Fla., seeks $5 million and class-action status, amounting to $4,500 for each member of the class, and names 14 association directors as defendants. Lois M. Hekker, broker with Buyer’s Agents International Realty in Sarasota, is the plaintiff in the suit.

A representative from the Sarasota Association was not available to comment on the suit Wednesday afternoon.

The complaint cites the 1991 federal appeals court decision in Thompson vs. Metropolitan Multi-List in Florida, which held that a Realtor association that had monopoly power over its MLS could not force real estate agents to purchase memberships in the trade association as a condition of gaining access to the MLS. The complaint alleges that the Sarasota Association and other Realtor associations in Florida evade the Thompson decision by tying lockboxes and historical MLS data to purchases of membership.

The suit seeks an injunction ordering the Sarasota Association to sell lockboxes and historical MLS data without requiring MLS users to purchase trade association memberships.

“In order to practice her profession as a real estate broker, plaintiff needed to buy lockbox services and MLS comparable data from the Sarasota Association, which forced her to purchase trade association services she did not want,” the complaint states.

Agents purchasing the local trade association services also must purchase state and national association services, totaling about $424 per agent in 2004, the complaint states.

Sarasota Association members rent electronic lockbox keys from the association, which purchases them from GE, according to the complaint. Lockboxes are attached to the front door of a for-sale home and contain a key so agents can show the home to prospective buyers. “Licensees who purchase lockbox services have lockbox keys that open all lockboxes in the area covered by the MLS,” the complaint states.

The 21-page complaint cites other states where courts have declared it illegal to tie the sale of trade association services to the sale of the MLS, including California, New Jersey and Colorado.

San Francisco-based attorney David Barry of Barry & Associates represents the plaintiff. Barry has filed more lawsuits against Realtor associations than any other attorney in the country. He has racked up a number of losses with the exception of one case in San Diego that accused the Sandicor MLS of illegal price fixing. Barry has attempted repeatedly but unsuccessfully to obtain class-action certification in the Sandicor lawsuit.

Barry filed two similar lawsuits this year against the Northern Kentucky Association of Realtors and the Spokane Association of Realtors in Washington, alleging antitrust violations through Realtor association and MLS membership ties-ins. Both suits are pending and neither has reached trial.

The plaintiff in the Kentucky suit is Sherry Edwards, broker of Florence, Ky.-based Buyer’s Corner Realty. Edwards seeks return of association membership dues from the past four years.

Real estate brokers Mathew Prencipe and William Koshman of Prencipe Realty and Robert Cooke of R.H. Cooke & Associates are the plaintiffs in the Spokane suit, which seeks up to $8.7 million in damages and an injunction ordering the association to sell MLS memberships to agents whether or not they join the Realtor association.”

Real Estate Search is an evil hard problem

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google evilOne of my pet peeves about most real estate search sites is that I can’t search on what I want. All of them, ask the same 4 or 5 questions. Where is your house located? How much can you afford? How many bedrooms? Blah, blah, blah..

Well, I’m going to attempt to change that. I want to find houses with CAT-5 wiring built in! I want to find houses with home theaters & wine cellars. I want to find a home with air conditioning (believe it or not, summer is coming). And now, I can. I proudly present our new search remarks feature.

Using the power of SQL Server‘s Full-Text Indexing features, this is now possible. Granted, our search is a long long ways away from being Google good, but it’s a start. If somebody wants to throw a lot of money at me so I can turn around and buy a copy of Endeca In Front or a Google Search Appliance, I suspect we’d get a lot better.

For example, when I looked for “cat 5” and found a house that doesn’t have a black cat. I looked for “home theater” and found a lot of homes (but not lot of homes with home theaters). Do a search for “media rooms” and you’ll find a lot rooms (but not as many media rooms). Obviously, you need to pick your words carefully to get what you want. Also, I need to start adding words like “home” & “room” to SQL’s noise word list since those words appear on nearly every listing’s remarks section. But, let’s face it, writing a search engine is hard. Eventually, I’ll tweak things so I can get Google or Microsoft to do my dirty work.

In the mean time, I hope finding your dream home got a little easier.

Robbie
Caffeinated Software

Zillow MLS membership – done

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Zillow gossip of the day (already reported by Dustin in the comments): Rumor has it that Zillow is now a member of the NWMLS and they’re aiming to get a license in every state.

You could spin this as the story of a company that promised an MLS-free “revolution” settling on improving the current system, but business-wise, I think it makes sense; going it alone is a much higher risk strategy that could lead to spectacular failure and would definitely be an uphill battle. This means they can have all the listings of brokerage sites, a way better interface, and sell leads and maybe make more of the process.

In my mind, consumer-centric web design is Zillow’s true innovation in the real estate industry. Even the biggest sites still view the internet as a way to snag customers into using their “real” business. No broker or agent site approximates the consumer-centric feel of Amazon.com circa 2000 or Google and Yahoo today, although I think the race is on to get there. I give Zillow a good shot as it looks like they’re first to market with a trully consumer-oriented, national real estate search site.

-Galen
ShackPrices.com

UPDATE: John Cook of the Seattle PI picked up this story and has some interesting quotes from Zillow vice president Jorrit Van der Meulen, NWMLS Chief Executive Jack Johnson and Redfin Chief Executive Glenn Kelman. Well worth a read.

Buyer Tip – Successful Negotiation of the Home Inspection

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You can ask for the moon in Phase 1 of the inspection contingency. But if the seller’s response to that is less than satisfactory, you need to get specific in your response to the seller’s response.

Let’s say you give the seller a big laundry list of “stuff” that is “wrong” with the house under Phase 1. of the Inspection Contingency.

Seller comes back in Phase 2. offering to fix only one of those things.

To be successful at getting more than that in Phase 3, you should go back with a very specific, and pretty much final request, such as:

I will buy the home “as is” with regard to all times noted in the inspection if the price is reduced from $514,000 to $512,000.” Or “I will buy the home “as is” with regard to all other items noted in the inspection contingency IF Items #2, 7 and 9 are repaired prior to closing and receipts for those repairs are delivered at closing with at least a 30 day warranty on those repairs”. There are many and better ways to state this, but be specific about what you want the seller to actually DO when you get to the final round.

The long winded version is on my blog. Trying to cut down on the verbiage over here. I tend to “overstate my case” to put it kindly, which results in blog-clog 🙂

And don’t forget…as with any negotiation…timing is everything.

Golf Balls

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Ok, this post is really not about golf balls but they are part of the story. A recent case illustrates how courts are putting more obligations on buyers of residential property to understand the condition of the property notwithstanding the seller’s customary obligation to provide a disclosure form to the buyer.

This case involved a buyer who was purchasing a house on a golf course. I can already hear you thinking that anyone who buys a house on a golf course surely knows that one thing follows: errant golf balls. The seller did not consider errant golf balls being a problem and therefore did not disclose them in the property disclosure statement. Although they fell into the yard with some frequency during the summer, he did not remember that they caused damage to the house, his family or even their dog. When buyer first viewed the house, he noticed a ball in the street and even inquired as to “whether the balls fly here.

The Importance of Making Stuff Up as You Go Along…

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Jon Strum of the LA Real Estate blog put together a very interesting article manifesto that outlines what it will take for real estate agents can be successful in the future. It is a fascinating article and was picked up by both the NYT real estate blog and Redfin’s blog.

While he was picked apart in the comments section of the NYT’s blog, I think a lot of what he has to say is extremely relevant and that the successful real estate agents of the future will be the ones that learn how to re-invent what they do!

Jon’s point that “real estate professional is in the unique position of adding massive value on behalf of their client to the final outcome of the sale or purchase of a home” is extremely important. Many people are simply not equipped to buy and sell their own home on their own and are going to benefit from the assistance of a professional. While programs like Redfin Direct that allow people to buy and sell homes via the internet may some day capture 10 to 20 percent of the market that still leaves 80 to 90 percent of the market requiring more assistance. (This comment is not meant to invalidate Redfin’s business model as 10 to 20 percent of the real estate market is a HUGE chunk of change!).

broken water wheelThe crazy part is that anyone would disagree with Jon’s general premise that real estate consumers are becoming better equipped (information-wise) and they are going to continue to demand more “value-added” services from their agents. The vast amount of money that is currently spent on “branding” techniques by agents (ads on postcards, billboards, magnets, super-market dividers ???, etc) will inevitable need to give way as the commission structure on many deals change and successful agents learn how to operate on a much leaner budget. People are going to turn to the internet to find out about not only the value of their home (Zillow?), but context around how that value might change (blogging?). People moving to a new area are not only going to want neighborhood information (homepages), but context around those neighborhoods (blogging?). The agents who figure out how to use the efficiencies of scale that the internet can provide are the agents who will be successful into the future!

So what are the internet tools that agents should be using? I had a great email today from a Seattle real estate agent who has a very prominent position in the local search engines (he or she shall remain anonymous). They mentioned that they had been following Rain City Guide for a while, but it took them a while to figure out what I was doing… That brought a big smile to my face because I’m not sure that I’ve figured out what I’m doing! I’ve seen a huge growth in Rain City Guide traffic as we’ve added some wonderful contributors, but I’m convinced that there are still hundreds of ideas and opportunities that I’m yet to take advantage of. Will Rain City Guide learn about those opportunities? You can bet on it!

My advice? Agents who do not want to get lost in the internet shuffle that is sure to take place in the near future should get involved in internet. But don’t waste your time posting your marketing materials on-line because people rarely read that stuff when you spend good money to send it to their homes! It seems like a no-brainer to me that agents should start blogging… But do more than that… Put interesting and challenging ideas on your blog. Blogging may not be the panacea for the future of real estate agents, (there is a lot more to being a good real estate agent than being an engaging writer), but by blogging to learn more about the internet, you will learn about the trends that are shaping the industry!

South Lake Sammamish celebrates annexation by City of Issaquah

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The South Lake Sammamish Association (SLSA) has worked tirelessly to make this happen. As a part of unicorporated King County, they were frustrated with inadequate police patrols, road maintenance and similar public services. Last fall the Greenwoord Point-South Cove Annexation area voted to join the City of Issaquah and now it’s time to celebrate.

On March 1st, 6:30-9PM, the city will host an open house at Pickering Barn (just east of Costco) to welcome everyone. Issaquah’s mayor and other city officials will be there to celebrate and answer questions about city services.

In addition, SLSA will be hosting a ribbon cutting ceremony and parade on March 4th from 10AM to Noon. There will be refreshments and activities for the kids including tours of a fire truck and police car. See their website for details.

It’s great to see community involvement pay off for residenets on Lake Sammamish.