Wednesday, May 31, 2006

Are you sitting on a market waiting for disruption

It was only a matter of time before the real estate market got shaken up. There has been a lot of interest in it lately. Interesting convergence actually.

Steven Levitt and Stephen Dubner brought it notoriety with their coverage of real estate commission practices in freakanomics. You have companies like one percent realty trying to get rid of the inefficiencies in the market without alienating their brotherhood. You have companies like zillo and zooven try to create user friendly web sites using "web2.0" tricks but not really going all the way.

Finally Redfin decided to bite the bullet and challenge the brotherhood. It is covered in this write up by mister web2.0 himself (sorry for the sarcasm *grin*). Some of the quotes are interesting, for instance...
Everything isn’t rosy for Redfin, though. They’ve been operating in Seattle for a number of years and have numerous war stories to tell about threats, stalkings and other disturbing behavior towards their employees and some customers from, apparently, angry real estate professionals. Hopefully things won’t get out of hand as they continue to disrupt this stubbornly inefficient market.

This stinks of "last resort" behavior from a caged beast. Whatever happens to Redfin, the real estate agents better wake up and realise that things will never be the same again and as a prospective home buyer all I have to say to that is Amen :-)

4 comments:

Corbett J. Klempay said...

Dubner

amar rama said...

corrected :) thanks

malita said...

hmmm - not sure how Washington real estate works but I'd like to see a web based program (and call center) represent and assist it's client during repair negotiations -especially when like in Austin foundation issues and 1978 aluminum wiring issues pop up. Oh and going over the HUD statement should be fun for them, and what happens when that map doesn't show their is a lien on the property or a break in title - wow you'll have fun with that too.

Are they going to help the buyer and seller if loan docs aren't to the title company on time and now the seller is paying out of pocket their PMI each day you don't close? This is exactly why discount brokerages end up costing the client more in the end, they do not get full representation but instead they find themselves in sub agency - which means you are a customer not a client... huge difference in the end... very interesting though - funny thing is we have these maps available to us through our MLS system - but we have to pay out of pocket for it... Oh wait we pay out of pocket for EVERYTHING!

amar rama said...

Malita, thanks for the post. I was not commenting on realtors per se as much as I was commenting on the state of the real estate industry and the status quo.

A web based program can never hope to replace the true value of a caring realtor such as you :-) but the fact remains that the industry in general is trying to resist change and retain inefficiencies through control and hiding information rather than dealing with them openly.

This is more fun reading from Washington Post (which you love I know) but shows how much attention this issue is getting lately.