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Category Archive: ‘Realtor’

Redfin IPO

The Redfin IPO has been announced, and people are wondering what effect it could have on the home-selling business.  Notorious Rob started with the impact on brokerages:

http://www.notorious-rob.com/2017/07/the-impact-of-redfin-post-ipo-part-1-brokerages/

I agree with Rob that the real-estate-portal battle could be a two-horse race between Redfin and Zillow – the others just don’t seem to be interested in spending enough advertising money to get ahead.

Rob called his post ‘Part 1’, so he’ll have more on the topic as we go.  I’m not sure where he’s going with it, but I’ll add my two cents:

  1. Redfin will help retire the old guard. The median age of all realtors is 53 years old, according to the NAR, which means 600,000+ realtors nationwide are in their mid-50s and older.  They will struggle to keep up.
  2. They will help drive down commissions.  Redfin is, and always has been, a discount brokerage.  In an environment where you never hear agents talking publicly about their commission rate, Redfin is now advertising theirs on TV (and it’s higher than it used to be).  The non-Redfin agents who have little else to offer the consumer will be forced to match.
  3. They have helped to create and expand the team concept. For better or for worse, the agent-teams are here to stay; with the most-experienced agents back in the control room, and the new agents in the field.  The jury is out on whether this approach is what’s best for the consumer, but it is the future of home sales.
  4. They can process an order.  If consumers are satisfied that they don’t need expert help, and only want help closing a sale, then Redfin can handle the paperwork. So can every other agent.
  5. They have the killer instinct.  Their version of ‘Instant Offers’ has the potential to be a good seller-lead generator, if sellers don’t mind the bait-and-switch.  I expect they will also offer a Coming-Soon Club too, which could really rock the boat.

What Redfin is not:

  1. They haven’t changed the service.  The day-to-day business of selling homes hasn’t changed. Listing agents market their homes to a wide audience, and buyer-agents help their buyers find the best fit – Redfin or otherwise.
  2. They aren’t neighborhood experts. They send out their least-experienced agents to show houses, which is treacherous for the buyers who are in unfamiliar territory.
  3. They aren’t angels. Redfin agents do the same ‘sold before processing’ tricks that other agents do. One day, a district attorney is going to have a field day with this topic, and agents will be shocked to find out the real definition of fiduciary duty.
  4. They’ve never made a profit. They offer mortgage, title, and escrow services now, and it’s the way most brokerages can add to the bottom line – if they can get good help.
  5.  Their model/brand is untested in a tough market.  Once the market turns, we’ll see how they do.

You could probably accuse all agents, to some degree, of the ten items above.  I’m not down on the individual Redfin agents – the experience I’ve had with them has been mixed, just like with non-Redfin agents.  We are probably more alike than different – I’m an employee, with medical benefits, of a non-traditional brokerage with a consumer-facing website used to create business.  Maybe I should IPO? 🙂

In fact, the actual Redfin agents are pretty far down my list of concerns.  If we ever have a realtor revolution, this is who we should be fighting:

  1. NAR, CAR, and local associations – they refuse to provide us quality assistance, won’t enforce the rules, and won’t battle those below:
  2. Glenn Kelman, Spencer Rascoff, Warren Buffett, Rupert Murdoch, venture capitalists, and everybody else who is making a killing off us without ever selling a house themselves.  In many cases, we are paying them to disrupt us. We could get along fine without them.
  3. MLS companies who already have our listings, but don’t even try to compete with independent real estate portals.  Insane!!
  4. Major franchises who don’t provide industry leadership or real help.
  5. Bad agents.

These are the people who are the real threat to the 1.2 million realtors in America.  Unfortunately, like politicians and other rich people in power, they will be allowed to pick us apart from their mansions on the hill.

Posted by on Jul 12, 2017 in Jim's Take on the Market, Listing Agent Practices, Realtor | 15 comments

Zillow/Sandicor Breakdown

For those of you who use Zillow as their go-to real estate portal, you may have noticed that we had a wild and wacky weekend – and the party is still going!

It was on May 1st that Zillow started uploading our listings directly from our MLS, Sandicor.  The new system prevents agents from inputting new listings, or marking our existing listings as pending.

On Friday there was a breakdown in the uploading process, but it wasn’t across the board.  Here are the real estate companies and the effects:

Coldwell and Berkshire – they both had their corporate direct feeds set up before May 1st, and it looks like they are running fine.

Sotheby’s – some new listings have been uploaded since Friday, and some haven’t. No rhyme or reason as to who was affected.

It looks like all other companies are NOT having their listings uploaded to Zillow, nor are they being marked pending automatically like they were previously – and you can’t do it manually either.

I did open house in La Jolla both Saturday and Sunday, and I had visitors on both days asking why my listing wasn’t on Zillow.

It’s a mess, and let’s add these extras too:

  1. The problem previously reported here about how listings get deleted on Zillow once they are marked pending in the MLS has not been resolved.
  2. More and more people are inputting their listings on CRMLS (the SoCal alternative MLS), which leads to duplicate listings which screw up the MLS stats but at least the listings are accurate on Zillow.

The mix-up is isolated to the San Diego market, and could be part of the uneasy union between Zillow and Sandicor, who was a reluctant partner in the past.

But both entities stated publicly that this auto-upload package was good for all, and a big step towards accuracy on Zillow.  We’ll see how long it takes them to fix it – today is Day 6.

For those who think this might be an opportunity for a competitor to take advantage, read this:

http://www.notorious-rob.com/2017/07/random-thoughts-on-redfin-going-public/

Save

Posted by on Jul 5, 2017 in Jim's Take on the Market, Realtor, Train Wrecks, Zillow | 2 comments

The Future of Realtors

Notorious Rob has a series of posts about the new CEO for the National Association of Realtors, and the future of the realtor industry.  The interesting part is that the current president of the N.A.R. responded, which only brought up more questions.

Rob’s blog with his three posts is linked here.

This is his most-recent post that addresses the president’s response, and Rob’s call to action (I left a comment):

http://www.notorious-rob.com/2017/06/a-response-to-bill-brown-2017-nar-president/

The first two posts get into how Bob Goldberg became C.E.O.  But the post linked above could be a catalyst for change.  Hopefully the N.A.R. folks are listening, and are serious about doing something to help agents!

Posted by on Jun 29, 2017 in Jim's Take on the Market, Realtor, Realtor Training, Realtors Talking Shop, The Future | 1 comment

Lockbox Security

With the big cyber-attack today, let’s touch on a local security issue that is hard to believe.  It didn’t happen to me, but to a listing agent I know.

It involves the new mobile app for our MLS, which is touted as a more convenient way for agents to access the lockbox when showing the home at their scheduled time.

The mobile app allows a realtor to obtain an entry-code for any lockbox on the system – whether the agent owns the lockbox or not, which is a big change.

The breach of security happened when a buyer’s-agent obtained an entry-code to a lockbox on an active listing – but she wasn’t at the house, and didn’t have an appointment.

She gave the code to her buyers, who let themselves in when the sellers weren’t home – and the house was owner-occupied!

Then she did the same thing a second time, giving the potential buyers the code to enter the home on their own – when she is not physically on site and has not made an appointment.

The sellers came home while the buyers were in the house – it wasn’t pretty!

Posted by on Jun 27, 2017 in Jim's Take on the Market, Listing Agent Practices, Realtor, Realtor Training, Realtors Talking Shop | 13 comments

Hire Jim to Sell Your House!

When a buyer’s agent calls the listing office to inquire about making an offer, the usual response is, “Send it in, and we’ll get back to you.” More questions don’t reveal much else, and the buyer’s agent is left wondering if there is any hope of selling a house.

There is big money being thrown around these days, and how your listing agent operates determines your fate.  Sellers should hire a agent who demonstrates what they do to sell your house for top dollar, not just process your paperwork.

Here’s an example of how I work:

Posted by on Jun 24, 2017 in About the author, Jim's Take on the Market, Listing Agent Practices, Realtor, Thinking of Selling?, Why You Should List With Jim | 6 comments

Real Estate Marketing Movies

With so much focus on HGTV real estate shows, it’s inevitable that our marketing will go Hollywood too:

A woman in a red dress twirls with a dark and mysterious man through light-filled hallways. Music flutters and surges in a romantically lit courtyard overlooking the twinkling city. A mischievous coda plays, and then the credits roll.

It’s a classic scene plucked straight from Hollywood. But this eight-minute mini-movie is far from a silver-screen blockbuster.  It’s a real estate advertisement for an $8.5-million, 1.5-acre compound in Encino:

Successfully marketing a mansion now requires much more than panning shots from an iPhone or even expensive videos shot by drone. Real estate agents with luxury listings are now experimenting with full-on property movies — films featuring actors, story arcs, scores and Tinseltown-caliber cinematography.

“The classic old-school walking tour of the house is becoming more and more obsolete — with all the content that’s thrown at us these days, it’s hard to hold someone’s attention with that,” said Kristine May, who directed the Encino shoot and owns If I May Films in Woodland Hills. “People get attached to a story, and they want to stick around and see what’s happening.”

So what if the narrative and performances are sometimes more Razzie than Oscar? Real estate agents contend that movies showcase their properties in a way that helps buyers envision themselves there.

Real estate agent Ben Bacal, an early innovator of high-gloss property films, worked with married clients Ori and Nafisa Ayonmike to craft a $20,000 film to market their home in Hollywood.

The Ayonmikes star in a fictional narrative that begins with Ori skulking through the sleek, contemporary rooms of his 5,500-square-foot, five-bedroom estate. In the next 11 minutes, Ori tells Nafisa he wants a divorce, a passionate fight ensues, Ori gets kicked out and Nafisa chucks her massive diamond ring into the pool.

Amid all the high drama, production company Rafiki captures the home’s 20-foot ceilings, high-tech security system, marble fireplaces and tony Hollywood Hills neighborhood. The video of the property listed at $3.65 million has generated nearly 61,000 views since being posted on YouTube last year.

Online video platforms have become a key component in property sales. Some 36% of home buyers used YouTube, Vimeo or another video hosting website in their search last year, despite only 8% of real estate agents using film in their marketing strategies, according to the National Assn. of Realtors.

Bacal posted another movie trailer-esque listing video last year for a Bel-Air property, in which two children develop Ferris Bueller fevers and spend the day playing hooky. The pair splash in their infinity pool, shoot golf balls over the Los Angeles skyline from their lawn, try on outfits in their generous closets and have a puppy delivered by drone.

The 14,230-square-foot spread sold in December for $39 million.

Typically, the filmmaking cost is covered by either listing agents, sellers or both. Movie-style real estate videos can cost anywhere from $5,000 to upward of $30,000 to make, directors estimated.

Read full article here:

http://www.latimes.com/business/realestate/hot-property/la-fi-hp-movie-trailer-homes-20170624-story.html

Posted by on Jun 23, 2017 in Jim's Take on the Market, Listing Agent Practices, Realtor, Realtor Training, The Future | 2 comments

Price Coaching

A friend is trying to buy a house on the east coast, and finds himself in…..guess what…..another bidding war.

He was hoping the listing agent would give him some help.

He asked, “What will it take to win?”, which is a logical question. But of course, the agent told him that she couldn’t answer that question, and for him to make his best offer and let the chips fall where they may.  We’ll call that blind bidding.

But isn’t it in the seller’s best interest to administer the most effective process in order to achieve a top-dollar sale?  If buyers have a price to shoot at, or some pricing hints, it is more likely they will respond favorably.

An open auction is the ideal solution.  The competing bids are out in the open, and animal spirits take over.  The environment changes from buyers wanting to pay their price, to doing whatever it takes to win the contest.

We have a long ways to go before open auctions become routine.  In the meantime, listing agents can be transparent and help both buyers and sellers.

But agents are only familiar with blind bidding, and just hold out hope that a buyer might go crazy and submit a bid way over the list price – which could happen if the property was deliberately under-priced.  But the vast majority of properties are priced at retail – on those, there are multiple offers submitted due to the lack of other quality choices, not because the price is too low.

With blind bidding, offerors will only bid a little higher and hope to keep the purchase price in line with comps.  If they don’t know what the other offers are, and are bidding blindly, it is natural for them to be conservative – especially when you consider we are probably in the later stages of our bull market. Buyers are miffed at the lack of transparency, and only add a little extra mustard to their original offer.

As a result, with blind bidding, sellers are leaving money on the table.

Why do we allow this?  It’s because it’s the way we have always done it.

Listing agents should provide transparency to buyers, and let the animal spirits take over.  Buyers would appreciate the candor, and bid with abandon to win the property.

It’s an old wives’ tale that we aren’t allowed to share the other offers with every buyer. But I challenge anyone to show us where it says that sharing offers is forbidden.

This is at the bottom of our required Form PRBS:

We disclose to every buyer that their offer may not be confidential, and they agree.  Why, then, do agents insist that they can’t share the information?

It’s because they aren’t comfortable with conducting a slow-motion auction.

They’ve never done it before, they’ve never heard of it, and it is too easy to just take a blind bid that might be slightly over their list price.  That’s good enough, isn’t it?

No, it’s not.

Of course the sellers deserve top dollar, yet we refuse to employ the best strategy to achieve it. Don’t get me started on how many properties we see that are “Sold Before Processing”, where the listing agent tilts the table to avoid any bidding war.

But it is also not fair to the buyers.

How many buyers have you heard say, “I would have paid that much”, after a sale closes.    Both sellers AND buyers deserve better…..but are agents going to put in the extra effort?

Get Good Help!

Posted by on Jun 13, 2017 in Bidding Wars, Jim's Take on the Market, Listing Agent Practices, Realtor | 3 comments

Statewide MLS

I am a proponent of San Diego realtors joining the CRMLS (with 80,000+ members) because their system is vastly superior to the crappy MLS version supplied by our Sandicor. But here’s an alternative reason why we should adopt a statewide MLS – because consumers know more than realtors:

It’s My Business, the campaign for statewide MLS listing access in California, traveled to the C.A.R. Meetings in Sacramento in May 2017.

Industry leaders were asked “What is the Future of the MLS?” Hear their answers, plus what they think about 3rd party listing websites and how they’ve changed the business of real estate.

Including testimonials from:

Bryan Forrest – Director of C.A.R.
Monet Love – Director of Pacific Southwest AOR
Max Zaker – Board Member of Pacific Southwest AOR
Claudia Zaker – REALTOR w/ Keller Williams
Brenda Meyer – Past President of East Valley AOR
Joe Prian – President of Scenic Coast AOR
Mike Carunchio – President of North San Diego County AOR
Kevin Williamson – Director of North San Diego County AOR
Rich D’Ascoli – CEO of Pacific Southwest and N. San Diego AOR
Kesha Toler – Broker Associate, Scenic Coast AOR
Jan Farley – 2017 President Elect of Pacific Southwest AOR
Mike DeLeon – Past President of Orange County AOR

Posted by on Jun 11, 2017 in Jim's Take on the Market, Realtor, Realtors Talking Shop, The Future | 1 comment

C.A.R. and Instant Offers

He says C.A.R. would “oppose any such development that eliminates many consumer protections”. Well, are you opposing the Zillow Instant Offers? It doesn’t sound like it. As usual, the leaders of the realtor business are comatose while outsiders strip us down for spare parts.

There is an easy solution. Everyone provide ‘instant offers’.

I have regular buyers for North San Diego’s coastal region that will happily pay 10% under value, and investors that will pay 20% to 30% under value. Both will close in 5-10 days. Contact me today!

June 7, 2017

Fellow REALTOR®,

C.A.R. President Geoff McIntosh

No doubt you’ve heard about Zillow Group’s “Instant Offers” pilot program for home sellers where, with or without an agent, homeowners can entertain instant offers and sell their home quickly. This program – which is essentially a new take on another “I’ll buy your house for all cash, below market value” business – is a small segment of the marketplace. The reactions we have received so far falls into either the camp of strong opposition or strong support. For those who are opposed, the pilot has been the subject of much consternation by REALTORS® since its announcement because it creates a path that eliminates the critical role an agent plays in the transaction – another step toward disintermediation.

Many see this as an antagonistic step against the very industry that fuels the site with listing content and premier advertising money, only to promote the prospect of excluding REALTORS® from the transaction. For those who see it that way, they have the option of rethinking their participation with the site. Those holding the other opinion have reported that they see business opportunities to enhance their work through this program. No matter how you look at it, we can all agree it’s bad for consumers who need to get sage advice, excellent customer experience, and top dollar when they’re selling their home, especially when consumers have to pay an exorbitant cost to participate in the program.

C.A.R. has been asked for its take. First of all, there is no substitute for the tremendous value REALTORS® bring to what is usually the largest, and often the most complicated, transaction a consumer will ever make. The program seems to be geared toward investors or investment groups who are willing to make more speculative investments. Any move which promotes eliminating REALTORS® from their role as a trusted navigator in this complex undertaking would ultimately harm most consumers, leaving them without a duty-bound advisor just when they need one most. C.A.R would oppose any such development that eliminates many consumer protections and will ALWAYS advocate for the unparalled value of using a REALTOR®.

This is the perfect opportunity for you to discuss with your clients the value proposition that a REALTOR® brings to the table and look at expanding the services you are uniquely able to offer investors and investment groups.

Sincerely,

Geoff McIntosh
Geoff McIntosh
2017 President
CALIFORNIA ASSOCIATION OF REALTORS®

Posted by on Jun 7, 2017 in Jim's Take on the Market, Realtor, Realtors Talking Shop, Zillow | 0 comments