Monthly Archives: February 2012

In Which I Try to Make Sense of the Austin IDX Kerfuffle


Making Sense... Out of Nothing At All... (apologies to Air Supply)

I had to interrupt my series on Redfin 3.0 and what it might mean for brokerages because parts of the just blew up over the past day or two. AgentGenius (AGBeat?) reports that there is a dispute going on in Austin, Texas, between a group of brokers and agents (who mostly serve the luxury market) and the local MLS about IDX policy. Although this sort of thing was inevitable in my view, I take no pleasure in getting my Nostradamus points.

I have written that one cannot be anti-syndication but be pro-IDX, since the two are actually the same thing, intended to serve the same purpose. Reasonable people disagree, and that’s wonderful; we advance through debate and discussion.

But reading through the AGBeat post and the comments there, I think there’s a lot more of an emotional response than reasoned discussion going on. I thought I should make a small (okay, large and lengthy) attempt to try to clear up some of the mess so that we can focus on the core issues in the debate.

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Rethinking Brokerages After Redfin 3.0, Part 2


The Owner of the Customer Relationship?

(Part 1 is here)

So in the last post, I made the case that Redfin 3.0 is significant because of who made the decision. Redfin was and remains (a) an innovator in brokerage business models, (b) a technology leader, and (c) led by smart people who don’t make snap decisions. Their decision to move away from the whoever happens to be available brokerage-to-consumer model to a one-to-one agent-to-consumer model suggests that perhaps the real estate transaction is so emotional, so psychological, so personal that consumers cannot form a relationship with any company or brand, but only with another human being.

In this part, I explore the possible consequences of that assumption: real estate consumers can and will form a customer relationship only with a human being. I believe that assumption has real implications for the hot topics the industry is debating and talking about today.

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Median House Prices, 1970-2011… in GOLD

I’ve seen quite a few posts of late suggesting that the housing market has finally hit bottom. Agent friends of mine are telling me about increased activity in their local markets, multiple bids on houses, low inventory, and so on. We have Stan Humphries of Zillow saying the Spring 2012 season should be positive. And none other than Calculated Risk, hardly a cheerleader for housing, has called the bottom on housing:

And it now appears we can look for the bottom in prices. My guess is that nominal house prices, using the national repeat sales indexes and not seasonally adjusted, will bottom in March 2012.

There are several reasons I think that house prices are close to a bottom. First prices are close to normal looking at the price-to-rent ratio and real prices (especially if prices fall another 4% to 5% NSA between the November Case-Shiller report and the March report). Second the large decline in listed inventory means less downward pressure on house prices, and third, I think that several policy initiatives will lessen the pressure from distressed sales (the probable mortgage settlement, the HARP refinance program, and more).

I’m working on the Redfin 3.0 post, but this was interesting enough that I took a short break from that to run some quick numbers. Maybe all these green shoots of positivity will indeed result in the housing market finally turning around. For a variety of reasons, I’m skeptical of such a thing, but I could be and hope to be wrong.

What I wondered about is whether this increase in housing activity, increase in prices, were actually just a reflection of higher inflation and inflation expectations. Well, there might be a way to measure that…

Enter GOLD!

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Rethinking Brokerages After Redfin 3.0, Part 1



So many interesting items in the news these days. Last week has been a busy week for blogging. And it ended on a most interesting note. Following all of the excitement around Zillow and Howard Hanna and all that, I saw this news from Redfin:

Introducing Redfin 3.0: Redfin Becomes a No-Brainer

Redfin is proud to launch today a massive upgrade to its service, designed to ensure that each Redfin customer has a one-on-one relationship with his agent.

The Redfin agent who works with you throughout the touring and negotiating process now meets you from day one, sees with his own eyes the home you’re buying or selling, and attends the closing.

Because we believe this service upgrade is of the same magnitude as our decision to offer free unlimited home tours, known within Redfin as Redfin 2.0, we are calling this new service model Redfin 3.0

I thought this was interesting for a lot of reasons.

First, love ’em or hate ’em, Redfin has always been a truly innovative brokerage since it began. So many companies want to claim they’re innovative, that they think outside the box, and so on, but Redfin has actually proven it… to mixed results, to be fair, but they’ve walked the walk for years. Second, Glenn Kelman is what you might call a Big Brain; he doesn’t make whimsical moves. The tired and overused term “thought leader” applies to fewer and fewer people, but Kelman I think lives up to the moniker.

So I think Redfin has done the research, thought about the decision a whole lot, and then pulled the trigger after serious consideration.

And finally, Redfin has been, without a doubt, a technology pioneer in the brokerage world. They’ve been so advanced, in fact, that many brokers routinely think of Redfin as a web portal first.

So Redfin 3.0 is of interest. Let’s think about it some more, and think about what their moves might suggest the future of brokerages everywhere might be.

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Some Thoughts on Zillow’s 2011 Results and Howard Hanna (In Which I Declare Peace In Our Time)

That tagline is more meaningful today

Was it just yesterday when I was speculating on Zillow’s recent hiring of Bob Bemis? Why, yes, yes it was. How things change in 24 hours when you live in interesting times. [Editor’s Note: Obviously, you started writing this on the 15th and didn’t finish? Nice managing the deadline, Rob.]

Today, Zillow released their Q4/2011 results, which shows its full year results as well. The numbers are… shall we say… ah… scintillating given the state of the real estate market today? And there’s just so much here that points to the future of real estate, where the battle lines will be drawn, and what the next set of tensions will be.

I warn you now. This will be long and filled with the kind of “paranoid speculation” that makes most insiders guffaw with disbelief… until it happens.

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