May 30, 2007
In an attempt to be provocative, on May 17th I recently did a post entitiled “Are Newspapers Dead?“, discussing that the vast majority of visitors to my recent listing in Mountain View found it from online sources, with only about 0.7% coming from the ads I ran in area newspapers. The home is in the downtown area, with a large amount of foot traffic, so I had 11 groups (8%) drop in from seeing the 14 Open House signs I had placed around the neighborhood.
The remaining 89% came from online MLS sites or by hearing about the home from their Realtor. I attributed this online bias to this house being in the heart of Silicon Valley and in the crosshairs of the digerati demographic.
I tried the same experiment with a new listing in Redwood City, which is a more traditional market. I lived there before moving to Mountain View, so I’m not stereotyping, just commenting on my former neighbors and their preference for traditional media sources (TV and newspapers) over online.
I ran ads in the Palo Alto Weekly and the Open Homes sections of the San Mateo County Times (local paper) and San Francisco Chronicle. And the results? Out of 52 groups over two weekends, a total of zero came because they saw an ad in a newspaper.
Menawhile, the listing for the house on my website has been visited 101 times, and the virtual tour on the MLS and other online outlets has received over 1600 hits from nearly 200 visitors.
So far, the data is backing up my original thesis that newspapers ads for homes for sale are about promoting the Realtor, not the house. Buyers find houses online, either via the MLS or online real estate tools like Oodle, Trulia, etc.
I welcome your questions, comments and the odd angry rant.
If you know of someone looking for a 3 bedroom, 2 bath ranch with a full basement and a pool on the border of Atherton and Redwood City, please direct them to: http://www.247WOakwood.com.
Thanks for reading . . .
Tags: Real estate
May 22, 2007
When I saw the above article in yesterday’s Mercury News, I nearly spit a perfectly good latte all over the paper.
The schools in Palo Alto are a major driver of real estate values in the city and are consistently marketed and believed to be the best public schools in the area.
The local real estate community feels so strongly about this that they have an annual drive for donations to Partners in Education, to solicit donations for Palo Alto schools. In return for their generosity, local real estate agents who donate get their picture in the paper as a thank you for being donors and supporting Palo Alto schools. In recent years there has been quite a competition between the various real estate companies in Palo Alto for who donates the most money, which is kind of losing sight of the point of things, but I digress . . .
Interestingly, in Newsweek’s 2006 rankings, we saw a disparity in the rankings between Palo Alto High School and Gunn High School, with Paly coming in below Los Altos High and Cupertino’s Monta Vista.
Last year, Gunn High School in Palo Alto ranked 79, and Palo Alto High School ranked 361. But this year, prompted by concern at both high schools, the Palo Alto district refused to send in Newsweek’s required forms.
This also lends fuel to my personal fire that as increasingly affluent and educated people are moving into cities like Mountain View, they are injecting more money into the schools, while also demanding more of the administration. I prognosticate that we will begin to see increasing parity between Palo Alto public schools and those of the surrounding communities. If this happens, the upward price pressure resulting from a demand for homes in Palo Alto in excess of Supply could be lessened, leading to a stagnation of home prices or even sales.
Heresy! You say.
We will see. In the meantime I welcome your comments and tirades. I don’t pretend to be an expert on education or even to play one on TV.
You can see the rankings for local schools on the SJ Mercury website here.
Thanks for reading.
Tags: 94301, 94303, 94306, Home selling, Mountain View, Palo Alto, palo-alto-real-estate, Real estate, real-estate-prices, San Jose Mercury
May 18, 2007
This post is in honor of the citizen journalists at Redfin, whose months of efforts at writing witty, insightful property reviews were brought down by an over-zealous MLS association bent on maintaining the rightful balance of power in the real estate business — ie, that the listing agent is at the top of the pyramid, the buyer’s representative is significantly lower, and the consumers…well, they’re not really that important, let’s face it.
I’m a good 800 miles out of the jurisdiction of the NWMLS, but I’m sure our local MLS’s are paying close attention. So, here’s what my semi-regular property reviews would look like if they were to be NWMLS-compliant…
Ken DeLeon, Wilson Sonsini attorney turned Keller Williams mega-agent, has a new listing at 994 Loma Verde. Like half of today’s tour, it’s priced just a whisker under $1.3M, but good common market sense would suggest it’ll go somewhat above that. At ~1800 sq ft, it’s spacious and bright, and — as we would expect — it’s impeccably staged. Another met expectation was Ken’s food line up — he always does a full-court press to bring in the agents, and we were there in force. Ken’s open house schedule for this weekend is standard for him: 1pm to 5pm on both Saturday and Sunday. That is, while other agents are still enjoying lunch, Ken is already out there at the property; while other agents have long gone home, Ken is still there, trying to get the best deal for his client.
(Full disclosure: Just so there’s no mistake, I am not Ken DeLeon. My name is Kevin Boer. Ken is a friend, and, technically, a competitor. I’m with Alain Pinel Realtors, not Keller Williams. 994 Loma Verde is not my listing. I am not advertising the listing. I am not pretending as if I am the listing agent in an effort to get people to call me about this property. I am talking about the property because I saw it on tour today and it was pretty neat.)
Tags: Alain Pinel Realtors, Industry, Keller Williams, Ken DeLeon, Real estate
May 17, 2007
It was inevitable. First this, and now word from the Seattle Post Intelligencer is that the NWMLS is fining Redfin $50,000 because its “Sweet Digs” property review blog apparently breaks “rule 190″ — you know, the one that says you can’t “advertise” another agent’s listing without their express permission.
It was only a matter of time before the old guard found something else with which to get back at Redfin. The timing of this announcement, coming on the heels of Redfin’s 60 Minutes coup, may be coincidental — though we’ll never know for sure. I’m sure the NWMLS has been on Redfin’s case for a while, but it’s not hard to imagine some cigar-chomping good ol’ boys from the Realtor association getting together right after the 60 Minutes segment and chortling to themselves, “Ok, enough is enough. Let’s see…how about rule 190?”
And we wonder why the real estate biz has such a bad rap? How about because instead of competing with different business models in the open marketplace, we try to shut them down with stunts like this?
Defenders of the NWMLS’s action will say, “But they were putting inaccurate information up! They were advertising others’ listings! They were panning some homes!”
But here’s the real point: many of the ridiculous MLS rules are based on what you might call the mushroom theory of consumers: the notion that it’s best for us in the industry if we keep ‘em in the dark and feed ‘em crap. Rule 190 is no exception. Another common ridiculous rule — which apparently has also led to Redfin wrist-slap — is the prohibition on displaying “Days on Market” figures. The only possible reason for that rule is to maintain Realtor hegemony over critical pieces of data.
The irony is that public Realtor-affiliated sites themselves sometimes break these rules as well, but with no consequence. Example: well before our local MLS finally allowed displaying sold listings on web sites, Realtor.com was doing exactly that. I called our MLS to “report” Realtor.com and was basically told “Well, they’re not in violation because they get their sold data from a non-MLS source, so they’re not really displaying sold listings, they’re displaying sold homes!” Huh?
So what options does Redfin now have? I see several:
- Continue with Sweet Digs in its current form, but explicitly ask each agent for permission to showcase their listing. This probably won’t work, as 99% of agents probably won’t give permission.
- Change Sweet Digs into a subscription-only model.
- Set up a separate entity to host the content, with very little reference to Redfin.
This raises some issue for this blog as well, since I often do property reviews. I do typically — but not 100% of the time — get permission from the listing agent before mentioning a home, and I’m careful to attribute the listing agent, and provide a link to the property’s web site and/or the MLS listing.
To agents here in Silicon Valley: If I’ve mentioned one of your listings without your permission on this blog, please let me know and I’ll modify the offending article. I completely understand that you don’t want your listing exposed to as many potential buyers as possible.
- Greg Swann, a Libertarian’s Libertarian, starts by assuring us that he still despises Redfin, but sees this move by the NWMLS as classic Rotarian Socialism. (Question: could this be the beginning of another Damascus Road experience for the Bloodhound? His former antagonism towards Zillow melted around the time they got in trouble with the NRCC).
- San Jose Mercury News’ Real Estate Blog
- Roberta Murphy at Luxury Home Digest
Tags: Real estate, Redfin
May 17, 2007
I wanted to have a compelling title for a little experiment I recently did with my listing at 206 Palmita Place in Downtown Mountain View. It’s a newer construction home and I thought the location and price would appeal to couples or small families. Based on that demographic, I assumed more people would be searching for homes online, so I built a custom website for the house, and posted links to it on a number of real estate websites in addition to the ones like mlslistings.com that link to data on the MLS.
I then did some informal polling at the various open houses, asking visitors where they found out about the open house, leaving it as an open ended question. I also tracked hits to the website and looked at who the referring domains were. I found the results interesting and surprising.
Where did they come from?
Over the course of 4 days of open houses (Thurs and Fri evenings, Sat and Sun afternoons) we had 135 groups of visitors through. Of these, only 2 said they came based on the ad in the MV Voice, 1 from the Palo Alto Weekly and 1 from the SJ Merc. Another 11 groups had seen the open house directional signs (I blanketed the neighborhood) or the For Sale sign in the yard as they were passing by. That’s 14 out of 135 groups, or about 11%. The other 89% of visitors either found the listing online or were referred by their agents.
I also tracked where hits to the website came from. There were over 2200 hits to the website, and initially 70% of those came from Movoto which is an online real estate information / referral site. After the first two days, mlslistings.com caught up, and after the first week was the source of about 70% of the hits. The house went under contract after a week, so I stopped tracking then.
While I admit that I am biased, I have had a theory for a while that newspaper ads for listings, especially in Palo Alto and surrounding communities, are more for advertising the agent and getting him or her more clients than getting potential Buyers into your home.
The National Association of Realtors estimates that 74% of home buyers begin their search for a home online, and the estimate for Silicon Valley is 92%. I’m still running an ad for my new listing in Redwood City, but it is only 1/4 page and that is because the sellers believe that potential buyers read the paper. I am also flooding the internet with placements and links, and I’m trying an experiment by posting the home on Zillow as well. It’s another experiment, and I’m partially doing it to get under Kevin’s skin as Zillow is a hot-button for him.
I’m tracking the marketing response on the Redwood City house as well, and I’ll do a post on the results from that when it goes under contract. In the meantime, I welcome your comments and hope for a bit of banter on online vs. print marketing.
Thanks for reading.
Tags: 94041, Advertising, Alternative business models, bay-area-real-estate, Business of real estate, California Association of Realtors, Demographics, Fun with Zillow, Home buying, Home selling, Keller Williams, Movoto, Online-real-estate-advertising, Real estate, Real-estate-advertising, Redwood City, San Jose Mercury, Technology, Zillow
How To Find A Good Stager
May 16, 2007
You’ve made the wise decision with your Realtor to stage your property before sale, but now what? How do you find that special person who’s going to make your property jump off the market?
Besides reading blogs and finding knowledgeable stagers that way :), there are many sources to find and compare qualified stagers. If you are working with a Realtor, they will likely be your first source for a referral. Perhaps the best source, though, is to visit some open houses in your neighborhood and see who’s done the staging in them – often stagers will leave their cards in either the kitchen or near the entryway. This way, you’ve seen an example of their work in a setting that would be similar to your own home.
The web, of course, provides endless opportunities to find stagers. Craigslist is a great way to localize your search. ActiveRain, a real estate website, has many stagers in its blogging community, so you’ll be able to read about their accomplishments and qualifications. There are also many websites out there attempting to aggregate stagers’ information. Don’t rely too heavily on this source, though – it’s just like any other advertising – most of the stagers listed there have paid for their info to be posted. You’ll also likely find a number of training or accreditation programs who list their graduates, and state that only their graduates are true “stagers.” While these programs often do provide substantive training, don’t be fooled – just as anyone can hang a shingle and call themselves a stager, anyone can take these courses.
So once you’ve found some names of local stagers, how do you evaluate who’s going to be the best stager for you? Not all stagers are created equal, and it’s often a mistake to make your choice based on price alone. I’d recommend talking with at least two stagers, perhaps one recommended by your Realtor, and one you find on your own. You may be dealing with this person quite a bit – make sure that you like their vision for your property and that you will be able to work well with them. Here are some other things to look for and ask your stager:
- Do they have a portfolio of their work you can look at?
- How do they describe their style? A good stager will be able to adjust their style to match your property type.
- Do they have references, either written or past customers you can call?
- What areas do they serve? Are they familiar with the market in your neighborhood?
- Who do they envision as the market for your property? Does this vision match yours or your Realtor’s?
- How long will it take to stage the property?
- Are they available to stage the week before your photos are taken or your open house?
If your Realtor has a strong opinion and is going to be involved in the process of working with the stager, I’d give a lot of weight to what your Realtor has to say – he or she knows this market, knows the stager, and is there to save you time and heartache. On the other hand, if your Realtor is not involved in the staging process, do your homework and go with the person you think will make your property look its best.
Tags: Real estate
May 8, 2007
I received another update on changing guidance in mortgage lending from Rachel Van Emon at Opes Advisors. While she consistently seems to be the bearer of bad news lately, she is actually a delightful person! So . . . don’t shoot the messenger.
A key point she brings out in her latest article is mortgage guidelines can change withour notice. This means that if you haven’t locked a mortgage and rate on a particular property, you can find that funding scenario disappearing in the wind.
A prominent national lender recently changed their guidelines to include the following:
· To qualify for an Interest Only Jumbo loan (over $417,000), a fully amortized payment must be used. This means borrowers must make more income to qualify for the same loan amount and program.
· On loans where over 40% of the combined annual income of both borrowers is from verifiable sources (salary, W2, etc.), Stated Income will not be allowed.
· For No-Income verifier loans, first time buyers are not allowed and payment shock is limited to 12% of current housing payment.
In an area where a number of first - time buyers are purchasing with 10% or less down payments, and many others are self employed, consultants, or contractors, these new guidelines can have a ripple effect on even the market in Silicon Valley where, unlike most of the country, we are enjoying rising property values and strong housing demand.
Unfortunately, most major lenders provide loans nationally, and so need to take a “one size fits all” approach.
Click here to link to the full article.
Thanks for reading.
Tags: bay-area-real-estate, Home buying, Loan Application, No Documentation (ND), No Ratio (NR), Preapproval, Prequalification, Real estate, Stated Income Verified Assets (SIVA)