Monthly Archives: January 2011

Tools May Be Great, But…

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The most frequently pressed number in a voicemail system: "0" for Operator

Now that I am a consumer in the real estate market, having moved from New Jersey to Texas (like so many others) and therefore having placed my house in the hands of a Realtor, I get to have some cool experiences. I wanted to share one of them with you all, especially the real estate professionals, because it struck me that this is probably not a perspective you get often from your buyers or sellers.

Tools. They’re great. I know many of you use tons of them. But you are going to want to consider how the consumer on the receiving end might perceive them. I got an email today from my agent, Sue Adler — or more precisely, I did not get an email from my agent, Sue Adler — which triggered this post.

Done correctly, tools can and do help you work more efficiently, more effectively, stay in touch better, and improve customer service. But more often than not, tools can make you seem impersonal and distant, like you just don’t care. And that’s probably not a good thing in something like a real estate transaction.

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On Time Performance and Service Providers

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There are a few things that we all put up with, which puzzle me. Why do we tolerate computer crashes from our mobile phones? Why do we put up with rude government workers? And finally, why do we accept as normal that service providers of all kinds would not show up on time?

Consider my experiences connected to the recent move.

I call up and order new cable & Internet for my new house in Houston. Comcast is decent with things like this, but even then, they give me a window of four hours for when the installer would arrive. And the installer, as usual, doesn’t arrive until the very last minute. In the past, I’ve had the installer completely blow the window and show up three hours late, or not at all, forcing me to call Customer Service numerous times to check on where the hell the installer is.

I order carpet installed in my New Jersey home. The appointment is made for Friday, and I’m given a time slot of “between noon and 1pm” — which shocked me with how precise it is. Well, with 10 minutes to go to noon, I call the installer to see where he is, and he tells me, “I won’t make it on time, but I can get there by 5pm.”  WTF? Why give me a time slot of between noon and 1pm, and then not bother to tell me you’re going to blow it bigtime? Did you not know that you weren’t finished with the prior job at say 11am?

I order U-Haul storage pods for moving. Dropoff is scheduled for Monday. Monday comes and goes, and in the afternoon, I call U-Haul to find out where the hell my pods are, since I need them to actually move things into them. “Oh, sorry, we had a glitch in the system and won’t be able to deliver them until tomorrow.”  Tomorrow comes… and starts to go…. It takes three phone calls before I finally get a hold of someone who finally decides to drop off the damn pods.  Once finished, I call and schedule a pickup for Tuesday. Tuesday comes and goes. Wednesday comes and goes. I call, I call, I call. Finally, I’m told that they’ll pick up on Friday.

Why do we put up with this? Are we not paying these people?

I have a few suggestions for the service provider industry, including one for real estate.

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Brief Thoughts on Google’s Retreat from Real Estate

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Yes, brave Sir Google turned about / And gallantly he chickened out

As I’m sure you all have heard by now, Google has decided to beat a hasty retreat from real estate:

In part due to low usage, the proliferation of excellent property-search tools on real estate websites, and the infrastructure challenge posed by the impending retirement of the Google Base API (used by listing providers to submit listings), we’ve decided to discontinue the real estate feature within Google Maps on February 10, 2011.

That ain’t a lot of time to announce a pullback, so… either this decision has been brewing for a long time, or a new executive team somewhere in the Google hierarchy has decided to prune and trim all over the place.

Given that I’m one of those who thought Google’s Real Estate Place Pages was a big story, I suppose this retrenchment requires rethinking things. But I don’t know how much it changes things, really.

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Trulia, Syndication, Confusion

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Sami Inkinen, co-founder of Trulia, has written a blogpost about the future of syndication where he raises some important questions about where the real estate industry is headed with distribution of listings:

Now that listing syndication has become a mainstream practice and “syndication sites” like Trulia have grown to serve millions of users, an old question has raised its head again, namely: Is syndication good or bad for me as a real estate broker?

In many recent conversations with brokers and industry leaders, it is clear to me that some people are frustrated and concerned with the direction of listing syndication. (Emphasis in original)

Sami goes on to make a number of points that ultimately fail to answer the question he posed, and further fails to support the conclusion he draws. Nonetheless, given the importance of Trulia to the industry, and the importance of Sami within the company, I think it’s worth reading the whole thing. (Note, you will need to skip over some of the more salesy aspect of the post and focus on the points Sami is making, rather than the promotion of Trulia and its products….) I’ll be here, after the jump.

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Four Random Reflections on Moving

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Farewell, And Thanks for All the Fish!

So tomorrow is going to be my last day in New Jersey as a resident, unless something really dramatic happens and I get incarcerated here. I have a bunch of random, somewhat conflicted, thoughts going on and figured I’d share four of them here with you.

This got long, partly because I’ve gone through quite a bit, and partly because I’m going to be driving sixteen hours a day for the next three to four days. So blogging will be difficult, to say the least.

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A Quick Personal Announcement & Shameless Plug

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Just wanted to make a quick personal announcement coupled to a shameless plug. I have decided to take on a great little company as a 7DS Incubator client, but go well beyond the norm for such an engagement, because I believe this company has the potential to bring about real change to the industry. When I wrote that we will see no exciting new technology in 2011, I had to leave these guys out because of my relationship with them. Well, I can now say that this company will bring some exciting new things to the real estate industry, in 2011, and I am going to help them do it.

The company is National Buyer Listing Service, or NationalBLS. The founder and CEO, Duncan Logan, is one of the smartest guys in the business who few people know well. Hopefully, that will change soon. And as of this morning, I am the interim President & COO of NationalBLS, on a part-time basis.

What is NationalBLS? Well, the current company info says this:

NationalBLS is the first national database of prospective residential real estate buyers. We allow buyers to input their requirements for a home and anonymously broadcast those requirements to the web. Sellers in the market, or those thinking about entering the market, can find active able buyers and approach them privately through our system. We promote the use of real estate agents and brokers but also enable sellers to transact on their own. Our primary focus is to create a central marketplace to increase liquidity in the residential real estate market for everyone’s benefit. We intend to achieve this by partnering with all market participants.

Online real estate has always been property-centric: listings, listings, property info, public data, and more listings. Or, with the rise of social media, online real estate has incorporated marketing and promotion of real estate agents and brokers, as well as brands. The enormous missing piece has always been buyer demand. It takes two sides to complete a transaction, but as an industry, we have near-zero insight into what it is that the buyer wants until well after the fact, through the actual closed price transaction.

I believe that NationalBLS is a potentially transformative technology. I believe that its products and services can be modified to fit in neatly to how the industry works, and should work. And I can’t tell you how excited I am to be helping a brilliant entrepreneur like Duncan with achieving his vision in a hands-on, more-than-advice, way.

I will still be working through 7DS Associates for my consulting clients. There may be some clients I cannot take on, and some issues I cannot work on, due to my role at NationalBLS raising conflict issues, but as of now, I am confident that no conflicts exist.

I wish I could tell you all more, but there will be plenty of time for that sort of thing. But it’s some pretty exciting stuff. :)

Thanks, and definitely, more later.

-rsh

Time to Reinvent REBarCamp

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A familiar sight for REBC veterans

So here I am sitting in my hotel room on Monday afternoon. I came in early because I had wanted to attend REBarCamp NYC being put on by the awesome folks at Lucky Strikes Social Media Club. You will notice the word “had” in the preceding sentence, because I just decided I’m not going to go to REBarCamp. This is not a knock on Patrick Healy, Scott Forcino, or the rest of the amazing, wonderful folks at LSSMC; I was involved with planning the REBCNY last year, and I thought we all did a great job. I’m certain, positive, that the crew of 2011 will do an even better job, and it will be among the best REBarCamps ever.

No, I just decided that I’m not attending because… let us be frank: the REBarCamps have become a more-or-less standardized affair over the last three years that is much less about conversation amongst equals and much more about social media and technology training for newbie real estate agents. Since I’m not a real estate agent, and not a newbie, I find myself looking forward more to hallway conversations and #lobbycon chats than the sessions themselves.

No reason to take up a valuable spot then. But I know I’m not alone in feeling this way. Which is why I believe it may be time to reinvent the REBarCamp, and perhaps bring it back to the future.

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One Step Closer to the Edge…

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It appears that the Massachusetts Supreme Court may rule soon on whether transfers of mortgages were properly done in a case called Ibanez. [UPDATE: The Court has ruled; the banks have lost, and we've got a problem. More on this later.] The lower court has already ruled (twice) that the foreclosures were invalid because the foreclosing bank did not hold title to the properties. This case is the first major state court case that deals squarely with the chain of title problem, especially in the second ruling where the lower court held:

Moreover, their newly-presented facts do not lead to a different result. Instead, they show that the plaintiffs themselves recognized that they needed mortgage assignments in recordable form explicitly to them (not in blank) prior to their initiation of the foreclosure process, that the plaintiffs’ “authorized agent” argument fails both on its facts and as a matter of law, and reaffirm the correctness of the original judgment. They also show that the problem the plaintiffs face (the present title defect) is entirely of their own making as a result of their failure to comply with the statute and the directives in their own securitization documents. (Italics in original.)

If the Supreme Court upholds this ruling, we can consider the systemic risk clock to start ticking. Hard. And fast.

How hard? How fast?

Well, as of December, 2010, we’re talking about 40% more litigation and a switch from consumer lawsuits to investor lawsuits:

“In recent months, the focus of mortgage litigation has begun to transition from primarily consumer foreclosure disputes towards loan documentation and servicing issues. Therefore, an increase in residential note repurchase litigation from investors in securitization trusts and banks that face indemnity claims from government-sponsored enterprises should be expected,” said Patrick McManemin, a partner in Patton Boggs’ Dallas office. (Emphasis added)

Repurchase litigation is another way of saying, put-back claims. And as I’ve noted before, those put-back claims could be more than the entire capital reserves and market capitalization of the largest U.S. banks.

Oh, by the way, Massachusetts is a non-judicial foreclosure state. And there was no mention of fraudulent affidavits in the lower court’s rulings as in the judicial foreclosure states. This was a straightforward “foreclosure is void because you’re not the mortgage owner” case. Let us pause a moment to remember that California is a non-judicial foreclosure state….

More on this issue later.

-rsh

Initial Questions on Alex Perriello’s Shared Equity Idea

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Share the pain; share the rewards

Alex Perriello, the CEO of Realogy Franchise Group (the parent company of Coldwell Banker, Century 21, ERA, Sotheby’s, and Better Homes & Gardens), who used to be my boss’s boss, has an op/ed in yesterday’s New York Times. In it, he proposes a novel solution to the foreclosure crisis:

Fortunately, there is a solution. Rather than be at odds, homeowners and investors should partner in long-term equity-sharing arrangements.

Here’s how it would work. Let’s say a homeowner purchased a house in 2004 for $300,000 with no money down, and the property is now worth $150,000 — a 50 percent drop in value.

In an equity-sharing arrangement, the lender would write a new loan for $150,000, retire the original $300,000 loan and, to make up for that loss, take a 50 percent deeded ownership interest in the property. The homeowner would also agree to split 50 percent of the net proceeds of any future sale of the property with the lender. The new arrangement would also include a buyout provision, so that if the homeowner ever wanted to take over the lender’s share, he would simply pay the lender a predetermined amount of cash.

Read the whole thing. It’s worth considering, given both Alex’s position in the industry, as well as his decades of experience in this crazy industry. I may not agree with everything Alex always says and does, but he’s seriously one of the wise men of our business and a leader worth paying attention to.

Let’s think this through briefly, because there’s a lot to like here, but ultimately a couple of reasons why it will be much, much harder to implement than Alex believes.

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Doom-mongering, With Sandwichs!

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Yum, with a side of DOOOOM!

If anyone is attending the Inman conference in NYC next week, and have no plans for lunch on Wednesday the 12th, consider joining me, Mark Boyland, and others for a fun-filled (okay, maybe not, given the topic) informal lunch-a-ma-thingamajig. I figure we’ll go from around noon till about 1:45pm or so. We’re going to talk about foreclosuregate, folks, and its impact on real estate brokers and agents. Oh yay!

Mark is a pretty frikkin’ smart guy, who also happens to be a specialist in short sales and REO’s in Westchester county, NY. He operates this website, for example, and knows his shit.

I figure we’ll do some pleasant chit-chat, then get into frightening doom-mongering type discussions, and hopefully emerge out the other end with possible solutions and things that the every day broker and agent can do about the situation.

There’s no cost, except you pay for your own food and drink. This isn’t anything sanctioned by anybody — just a purely informal thing. But, hey, if any of you big title guys or mortgage people want to sponsor it and have the opportunity to explain to some very interested real estate industry people why they should or should not worry about this whole foreclosure mess, feel free to contact me. :)

I haven’t picked a restaurant yet, because I have no idea how many people might be interested. So, if you’re interested, leave a comment here, or ping me on Twitter or Facebook. I’ll announce where once I have a rough headcount.

Or, it could be just me and Mark having lunch and getting real depressed. :)

-rsh