The fundraising has begun for the building of the realtor portal:
Greg should disclose the secret weapon mentioned – because if the new website isn’t substantially better than Zillow, then we are wasting our time and money. His list of features is not impressive, and no one is going to leave Zillow – consumers or agents – unless he has a spectacular idea up his sleeve.
Having our own portal is a good idea and within reach if every agent chips in a few bucks. Are there enough who care? Most will assume it is a duplication of the MLS and not really needed.
But the reason we need it is because having our own portal would help create the ultimate club for agents. Let’s build the portal outside of the N.A.R. and other top-heavy administrative bodies that suck down profits yet provide little if any benefits to agents themselves.
You would think groups like N.A.R., C.A.R., Zillow, big brokerages, etc., provide some structure for the industry, but they don’t. Yes, there are rules, but nobody enforces them. Brokers who are supposed to be supervising their agents will look the other way if it means making more commissions.
We don’t even need rules – an agent’s reputation among their fellow agents is enough to keep them in line. The rule most broken is the sharing of listings with fellow agents, but that’s been abused for so long that most agents don’t remember signing that form when they joined the MLS. We will have to live with single agency (aka dual agency for now), but it is already upon us anyway.
More of the upstart companies are choosing to advertise on radio and TV, and distorting the truth is widespread. If we eliminate all the unnecessary money-grubbing entities, be honest with ourselves and the public about the (no) rules, take the gloves off and fight it out with our fellow agents for the business while cooperating on our own powerful portal, then the best agents would survive – which is ultimately what the consumers deserve.
There’s an old thing old people say, “nothing succeeds like success.”
I think it means, as you gain some success, you gain momentum, and the momentum not only keeps those who fall into mediocrity in the winner’s circle, the momentum allows them to crush someone who’s better, with ideas that are better, with far more talent–but lacks the momentum.
Anyway… unless this guy has genius web developers behind him, dynamic leadership skills, and some bored hedge funders backing him up, which it doesn’t appear as if he does, Zillow will crush him like a bug. From nothing else but adequacy, cash and momentum.
Conclusion: In the ‘David vs Goliath” story, David is an outlier. David is a statistical anomaly. Don’t be David.
Yeah, but we have to try something – it is our last-ditch effort to save real estate as we know it.
The real threat isn’t Zillow by itself. Zillow is only part of the commoditizing of the home-sale process. The big realtor teams are on one end making their practice look more traditional, with Redfin and other discounters on the other end. But all are doing the same thing – turning real estate sales into a conveyor-belt processing center with the least-experienced agents on the front lines.
From Rob Dawg:
Are people even going to listen when professionals try to explain that commoditizing the home sale process isn’t going to be to the individual’s advantage either selling or buying?
It’s really a matter of trust, for buyers and sellers. Agents and brokers want to be trusted with the most important (by far) transactions in our lives, but won’t stop attempts to manipulate by suppressing information (sales history, days on market, dual agency, etc.) My favorite new example is “10 garage capacity” for a 3 car garage and driveway. The only thing those words accomplish is to make sure that I don’t know how big the garage is. I guess it also ‘accomplishes’ a certainty that the agent/broker is not trying to help and therefore is not to be trusted. The only ‘secret sauce’ that is going to matter is full transparency. It may be impossible for someone who has financial stake in the transaction to be fully open, and that is why a third party moves into the more trusted position. Redfin is at the highest position of trust for me currently.
It may be impossible for someone who has financial stake in the transaction to be fully open, and that is why a third party moves into the more trusted position. Redfin is at the highest position of trust for me currently.
Redfin isn’t a third party, though they have played themselves as a real estate portal more than a brokerage. People like Greg the StopZollow guy even includes Redfin in the portal conversation, which is to Redfin’s advantage when trying to build trust.
But Redfin is more guilty of distorting the realty more than any other brokerage or portal.
Here are examples that aren’t that noticeable:
1. Virtually everything that comes out of Glenn Kelman’s mouth is a twist on the facts. Currently he is saying that Redfin agents sell houses for X amount more than traditional agents, without including any qualifiers. So how does he come up with such a statement? Is he just comparing the average or median sales price, and then deducing that their slightly higher average means something?
If that is the case, then you should list with a Rancho Santa Fe agent, because their average or median price is at least $1,000,000 higher than Redfin agents.
Admittedly, he is just the latest real estate mouthpiece to step up to the microphone with fishy commentary. Remember David Lereah? One of the worst offenders, and he worked for NAR, the supposed leader of the tribe. But Glenn is speaking on behalf of a brokerage and is trying to sway the consumer his way – he should be held to a higher standard.
2. From the NYT: “Redfin does employ more than 900 contractors, whom it calls ‘associate agents’ to support its employee agents, using them to conduct house tours, coordinate house inspections, and perform other tasks. The company is fighting several lawsuits brought by former associate agents who said they should have been classified as employees. Redfin declined to comment.”
Redfin may appear trustworthy because of their web presence, but on the street they have inexperienced people doing the real work, and the agent-employees back in the office writing the deals. Those agent-employees have never seen the house, and you are relying on them for advice? Yikes! The associate agents sure felt like they were doing the real work, based on those lawsuits. Of course, consumers don’t know this until they get in bed with them.
3. They used to charge 1% for the listing side, then they went to 1.5%, now back to 1%. The curious part is the increase to the 1.5% – why? We have seen the I-Pay-One formula fail twice in SD already, because there wasn’t enough income/profit to run the processing center with quality help. Redfin is content to lose money every year, and hope to make it up on volume. Maybe they can ride it out.
But here is the insider view on how it translates to their performance on the street.
The Redfin agent-employees get graded by their customers, and Glenn always makes a big deal out of that like it is the end-all sign of their performance. But they have been going backwards on how they treat their fellow agents – which doesn’t figure into their grading system. Want to show their listing? Call a third-party company. Want to ask critical sales questions? Sorry, in SD they don’t take calls, only emails. They will get back to you when they see fit. These are the two signs when any big real estate teams has lost sight of their primary function – frontline sales – and turn into a processing center.
Redfin isn’t the only one – most of the big agent teams are just as guilty with wanting little or no contact with agents, and I’ve already commented on the commoditizing of the home-sale process below. It isn’t good for anyone….except the team owners who rake in more profits.
But the difference is that Redfin tries to bundle it all up and make it sound like they are a new-age tech realtor who is different/better than the rest. But they aren’t – they are just doing a better job of selling it to you.
I apologize for the poor way I said what I said. Redfin is who I most trust, but only as a portal. Finding a trustworthy agent/broker is a lot of work, and the manipulation that is rampant taints the profession. But I’ve been (gratefully) reading Jim’s blog for years, and have had the opportunity to speak with him in person. He is head and shoulders above most of his ‘peers’. If he were the norm, this discussion would be moot. Not sure how to get there.
“Get good help!”
All this is true, and… we’re also in an era that I can’t quite get a grip on, except to say we may be in what I’d call the “Just Wing It” generation.
So as long as we have a population that feels–not thinks–feels that everything will work out well as they feel their way through life, with an attention span that averages about 8 seconds, there will be plenty of sociopaths around to exploit them. I’m just going by what I have always known to be true.
If that’s the case, we will never have a significant level of transparency beyond what we have now. Whomever comes up with a way to provide transparency will be thwarted, if someone can make money undermining it. That’s how America works, as far as I’ve experienced.
So playing the system as it stands to one’s advantage is the short-cut to overcoming the daily tomfrickery of the market place.
In your case, just slap “Peace… from Jim the Realtor” on the back end of this video, and you’re marketing on the cutting edge of the “Just Wing It” generation, and that might be about the best you can do, long term.
Our generation is dying, along with our ways. Thinking things through is for as*holes. The “Just Wing It” generation, on the other hand, is just getting started. A while back, I think I said Kayla should take a month off and go to the LA film school to learn film narrative. They claim they’ll show you how to make and cut a film in 30 days or so. I wasn’t kidding. It’s the future of real estate sales, imo. Kayla is very good on camera. I’d work that, since it puts results in her hands, instead of putting them in the hands of the general marketplace.
Not sure how to get there.
Thanks Mayze, and you can guess that I’ve been looking for a point to discuss the problems with Redfin/big teams for a while – my thoughts weren’t directed at you specifically.
When I first started this blog 12 years ago (9/24/05), I thought I better hurry up before every other realtor started doing it. I am still shocked that not only are we NOT buried with realtor blogs, but instead there are virtually none (hat I’m aware of) that educate consumers daily.
If realtors were committed to serving people, rather than making a buck off them, then we would have gotten there by now. But since I’ve been in the business, it has steadily gone the other way.
It is the same everywhere, and Daytrip’s commentary above couldn’t be more on target – businesses are more interested in giving you the razzle-dazzle, than the truth.