What will be more helpful to a home buyer when trying to select a house? A seasoned real estate broker or a computerized residential real estate robotic algorithm?
According to a recent test in Denver, the robot beat the humans in providing more homes preferred by the buyer.
The test was conducted by QValue, a Denver automated valuation model for the real estate industry created by Creed Smith and publicized in Inman News.
During the test last month, the recommendations of three Denver real estate professional brokers were compared with the homes recommended by the computerized algorithm. The recommendations were then ranked by the “buyer,” (who in this case was played by John Rebchook, formerly the real estate editor of the Rocky Mountain News who now runs the DenverRealEstateWatch.com site).
The robot beat the humans in the test, according to Smith.
“The algorithm’s recommendations consistently placed two homes within the top three buyer choices each day, and placed as the buyer’s number one favorite home every time all three days. This tells me the algorithm can indeed suggest homes based on emotionally triggering qualities buyers desire (qualitative criteria),” Smith said in a statement.
The test didn’t factor in other myriad other responsibilities offered by real estate brokers, such as drawing up real estate contracts and other duties.
As of (yesterday), you’d have to go back 3 full years to see rate sheets any lower, on average.
May 10th, 2013 was a very bumpy day for rates, and it capped a week that served as the starting point for the ‘taper tantrum’ (several months of rapidly increasing rates as markets adjusted to the idea that the Fed would be ending its bond buying program).
With a range of 3.5 to 3.625% (at no points), today’s top tier conventional 30yr fixed quotes are right in line with those seen on May 9, 2013.
Just one more rerun before Kayla introduces our new listing tomorrow night.
This is the 7th most-watched video on Bubbleinfo TV, and is a greatest-hits tour through the REO-listing days. In April, 2008, the Bank of America had dumped twenty of their REOs in my lap, and over the next 12 months the JtR foreclosure extravaganza ensued.
A month after this video premiered here on the blog (March, 2009), I was on the front page of the L.A. Times, which led to the spot on ABC News Nightline:
It was the 2,527sf three-story house that backed to the I-15 freeway – the one where we had 200+ people attend the open house.
The final tally at the Zillow page was 3,745 views, and 77 people had saved it as a favorite home, which are both extremely-high counts. (Josh was the seller)
Yesterday, we marveled at how the bidding war ended up. The listing had hit the MLS on a Saturday, we had the open house on Sunday, and by Monday we had six offers.
Because not every bidder knew there was competition, we gave everyone the chance to submit their highest and best offer by Tuesday at noon. I like to keep a tight timeline and promise buyers that we’ll select a winner promptly in order to retain as much urgency as possible.
The list price was $549,000.
At the end of the highest-and-best round, we had a $565,000 financed offer, a $570,000 cash offer, and a verbal $571,000 cash offer (the other three stuck with their $549,000 or $550,000 original offers).
The agent who wrote the $570,000 offer was 80 years old, and was using forms from five years ago. I actually had to hand-write his original offer for him, but thankfully he was able to scratch out a one-sentence H&B.
Because I had concerns whether he could make it to the finish line, I pressed the $571,000 agent to get his deal in writing. But he called back with bad news – his buyer, a savvy, multiple-property owner, decided it was too rich.
I called back the $570,000 agent, knowing that I’d be carrying his luggage for the next three weeks. But he had more bad news – he took his buyer’s family to the house, and they vetoed the sale.
With the other three bidders unwilling to budge, we signed the $565,000 financed offer…..before they changed their mind!
Most people would have been tempted to hold out. Yes, it would have been sexier to close escrow in 2-3 weeks with a cash buyer. But after 200+ open-house attendees and 50+ showings, are there two in the bush?
Though my phone hasn’t rang like this since back in the REO days, there was no disputing the facts – most people didn’t make any offer, and those that did weren’t in love enough to go crazy. It was a trend that was likely to continue.
In spite of casual observers telling me we were giving it away, or it was too cheap, the actual results were telling. The duty of the listing agent is to check the ego at the door, and focus on the facts.
We should see more and more articles touting the advantages of the marijuana trade becoming legalized – real estate sales, tax revenue, and jobs. While it sounds like something only for those desert towns now, let’s note that it’s a world-wide opportunity – the broker says he had buyers fly in from Germany!
Carlos Bravo, the owner of a tow company here, was at work late last year when a real estate agent came to him offering half a million dollars for 5 acres of undeveloped, brush-pocked desert — five times what he’d paid for the land six months earlier.
“I thought he was joking,” Bravo said.
The man came back the next day, making it clear he was not.
A few days after he had signed the paperwork, Bravo said, another man offered him $1 million.
As the first city in Southern California to legalize large-scale medical marijuana cultivation, Desert Hot Springs has been inundated by marijuana growers and developers. They are buying up dusty desert land — some with no utilities or roads — in hopes of cashing in as California’s marijuana growers come into the open under new state regulations.
“It’s pretty chaotic,” said Coachella Valley real estate broker Marc Robinson. “I’m getting tons of calls from all over the world, all over the United States. My newest clients flew over from Germany.”
Despite a sizable need for new infrastructure to support the indoor growing projects, the rush has officials in this downtrodden town dreaming of new income.
“I can only imagine what we can do with the tax revenue,” Mayor Scott Matas said. “We’re in need of parks, our roads are dilapidated. All around — our sidewalks, curbs, gutters.”
The city is pushing hard to help developers get their projects up and running as it increasingly faces competition from a number of desert cities also eager to bring growers to town.
Back in the day when things used to be civil, you could sell a home that was occupied by a tenant.
But in today’s environment, it is better to wait until they vacate, and then put the house on the market. Here’s why:
The elevated urgency of today’s market causes a whirlwind of activity during the first week. A rash of showing requests and realtors stopping by without appointments shuts down any tenant cooperation quickly.
Then the tenants start looking around for a replacement home, and realize how hard and how expensive the next move will be. They are mad, and want to blame the sellers.
By the time they leave, the condition of the home isn’t what it could have been either, if they had left happily.
Staging is a critical component too, and unhappy tenants aren’t going to leave the home in great condition for the few showings that do take place.
Fewer or lower-quality showings means fewer offers, which isn’t good for the seller.
Our policy today is to vacate the property first, make it look spectacular, and then put it on the open market.
Can’t find the perfect home? Have you thought about building your own?
Hearty thanks to Josh for answering the basic questions about his project, and building your own custom home! And financing is available!
P.S. I use the term ‘stinking’ with great affection. Buying a tract house is by far the best solution for the vast majority of busy, hard-working Americans!
For a couple of days last week, it seemed like there was flood of new listings, but they come in fits and starts. It turns out the overall weekly total was about the same as it has been the last couple of years (when averaging over the last six weeks):
Average Number of NSDCC New Listings Per Week (April/May)
2014: 109
2015: 94
2016: 104
Last year looks more frenzied-up, but it depends how you measure. Here are the total number of all residential listings in San Diego County listed between January 1 and April 30th:
SD County Total Number of New Listings, Jan – Apr
2014: 11,749
2015: 12,028
2016: 11,902
Generally-speaking, there is still no flood.
Click on the ‘Read More’ link below for the NSDCC active-inventory data:
