This is not an easy question to answer, because you have to count up all the properties for which we have tax assessor records and compare that to all the properties for sale in the MLS, on bank websites and on for-sale-by-owner websites.

Enter the great Arthur Patterson, a hyper-intelligent, near-mythical creature roaming the Redfin office in his socks at 7:15 a.m., oddly pleasant but always precise, and undoubtedly capable of assembling an atom bomb before breakfast.

Arthur helped put together the table below. He asked me to note that the percentages are probably a little too high, because our tax-records aggregator always misses a few properties but the margin of error is still less than 5%.

What immediately jumps out is how few homes are for sale compared to the number of properties available the city of San Francisco, where there are plenty of rental properties and the inventory of single-family homes is still slim.

At the other end of the spectrum, nearly 1 in 20 homes are for sale in Chicago, so there’s a lot of turnover in the heartland.

[And many thanks to Redfin reader Kim for  her comment on our photo of a Burmese python: "I suspected my x had once again fallen into the hands of the law."]

The post Which City Has the Lowest Percentage of Homes for Sale? Envelope Please… appeared first on Redfin Real Estate Blog.

Since the price drop-data is for November while mortgage rates declined in December, it may be that the market just needs time to respond. But one analyst called the price drop “breath-taking” and “god-awful.” The WSJ quoted an economist as saying that “the housing industry is in the process of reducing capacity to dangerously low levels.” A second economist said that, “outside of distressed properties, the [California] market is nonexistent almost.”

This made us wonder whether it’s really true, in California or elsewhere, that most of the homes for sale are foreclosures being liquidated by banks.

Since Redfin’s database includes virtually all the homes for sale (basically everything except what’s on Craigslist), including bank-owned listings as well as for-sale-by-owner (FSBO) listings, we can measure what percentage of homes for sale are bank-owned. And we can do this with unusual precision because we map all the data down to the level of a city, neighborhood or postal code.

Here’s what we found for nine of the largest cities we cover, sorted from the highest concentration of listings in foreclosure to the lowest, as of December 22, 2008. We measure the ratio of for-sale-by-owner listings as a percentage of the total homes for sale in each city, and then do the same for foreclosures.

And it’s true that in major California cities south of the Silicon Valley peninsula, about 1 in 4 homes for sale have been foreclosed, and others are being sold by sellers trying to avoid foreclosure (short sales). But the number of short sales may soon be decreasing, as banks are now soliciting short sellers to modify their loans at the new low rates so folks can keep their home.

I used to worry that the low rate of foreclosure in Seattle and San Francisco was a disaster waiting to happen. Prices will fall through the floor in those markets if the percentage of listings being sold by banks increases in either place to 20% or 25%.

But because the downturn in Seattle and San Francisco prices started a little late, and mortgage rates fell soon thereafter — unemployment, not increasing mortgage payments, will be the main driver for foreclosures here — maybe Seattle and San Francisco can avoid the huge pile-up of distressed inventory that is dragging down the market in Southern California.

What do you think? Why do Seattle and San Francisco have such low foreclosure rates? And will this continue?

(Photocredit: Ironside on Flickr)

The post Are All the Homes for Sale in Foreclosure? I Don't Think So… appeared first on Redfin Real Estate Blog.

“The most important success factor for these sites,” Erick writes, “is how comprehensive they are.” By comprehensive Erick means within a market: nobody wants to see every listing in the U.S., just every listing wherever he or she wants to live.

So Erick published a study from Roost, a lead-generation site with a feed from the MLS — the database that, in nearly every market, all brokers use to share listings. (Redfin has MLS listings like Roost, but also for-sale-by-owner homes and bank-owned foreclosures not yet in the MLS.)

The study showed that on the strength of its MLS access, Roost has far more broker-listed properties than sites like Trulia, Yahoo and Google — which have to get their listings through one-by-one agreements with brokers.

Redfin wasn’t included in the study, and can’t even get a copy to assess its accuracy. But it was sad for us to see everything but the kitchen sink thrown at the study, from people who never denied its basic conclusion: that a site with MLS access has many more homes for sale in a market than one that doesn’t.

And while the debate in TechCrunch’s comments section raged over the quantity of listings, no one acknowledged the huge differences in quality: what brokers share with media sites is only a teaser photo with a few basic details, rather than the complete MLS listing shown by Redfin and Roost, with dozens of fields and photos, updated as transactions occur. The difference in quality is plain for anyone to see: compare Redfin’s Washington DC listing to what appears on media sites.

But since everyone focused on Swiftboating the quantity claim, let’s take a look at the arguments:

• The study was arbitrary. That’s true. The parameters were arbitrary: 3-beds, 2-bath homes between $400,000 – $450,000, in Miami, Dallas & San Diego. But to argue a study is skewed, don’t you have to say how it was skewed? Which parameters would have shown that Trulia, Yahoo or Google has more listings?
• Actually, “we have roughly 70% coverage in most major metros.” Trulia argued that its coverage was better than reported, at 70%. Setting aside that missing 1 in 4 listings is itself a calamity, we wondered 70% of what? Of MLS listings? The claim seems as arbitrary as the study Trulia was trying to rebut.
• Consumers care most about “filtering options,” not seeing all the homes for sale. Redfin has a dozen advanced filters but 94% of our searches are on the basics: price, beds, baths. One of the most common filters is no filter at all.
• Only 80% of the properties in the U.S. are sold via the MLS.  Academic studies have found that even in Madison, Wisconsin, reputedly the nation’s capital of for-sale-by-owner homes, 86% of the properties were sold by a broker via the MLS. In other areas with an MLS, that percentage is much higher. Where did 80% come from?
• The MLS doesn’t include foreclosed homes, which comprise 31% of home sales in San Diego. But in fact foreclosures are likely already in the MLS, because banks hire brokers to put them there. Redfin obtains listings from the banks and directly from the MLS, so we know how the numbers break out. Here’s what we have as of this past weekend:
  • 6,000+ MLS-listed properties in San Diego.
  • 715 of those MLS listings in San Diego are bank-owned.
  • 184 bank-owned properties in San Diego are not yet in the MLS; Redfin displays these listings by scanning bank sites directly, and comparing what we find to the MLS. We undoubtedly missed some banks’ listings, but it is very likely that most bank-owned properties are in the MLS.
  • 120 for-sale-by-owner properties in San Diego are not listed on the MLS. An unknown number of sale-by-owner listings are available on Craigslist, but this doesn’t help anyone: Craigslist refuses to share its data with any real estate websites.

  The suggestion that 31% of listings are not in the MLS because of foreclosures is off by an order of magnitude.

• The study was “silly.” It isn’t silly to worry about whether you’re seeing all the homes for sale. And trying to make a joke out of the whole issue by saying “I was thinking about commissioning a study saying that I’m a size 2 supermodel” implies that Roost is trying to prove something unimportant and obviously untrue, when in fact it is trying to establish, however artlessly, something important and almost undeniably true.

But here’s what’s great about TechCrunch. Erick didn’t just print the he-said she-said arguments between websites. He queried all the websites himself, and found that Redfin had slightly more listings (6,300) than Roost (6,036), and Roost had far more listings than Trulia (4,395).

Zillow, which had the lowest number of MLS listings in the Roost study, claimed the most listings of all, 7,661, but Erick couldn’t confirm this because Zillow’s site searches on the county of San Diego, not the city. Redfin gets listings from Zillow as well as the MLS, so any listings on Zillow that aren’t on Redfin should appear shortly.

Hats off to Erick for having done the research.

He shouldn’t have had to. The pledge of every new real estate site has been to bring transparency to real estate. But so far, most sites have been anything but transparent about what they have and what they don’t. Now Joseph Ferrara at Sellsius blog is asking us all to stop hiding the ball and say where our listings come from and what we’re missing. Since April 2008, Redfin has done just that. Trulia, Yahoo, Google, please step forward.

Photo credit: Roberdan on Flickr.

The post TechCrunch Asks the $24,000 Question appeared first on Redfin Real Estate Blog.

Some of you may have noticed that San Diego listings on Redfin.com haven’t been updated over the weekend. Sandicor, the San Diego area MLS, has been having some issues that mean it can’t export listing data to MLS-powered websites like ours.

We’ve talked to the folks over at Sandicor and they’re working hard to resolve the issues. They run a tight ship, so we’re confident the data will be moving again soon.

San Diego listing data highway: temporarily closed.

It bothers us whenever the data on our site isn’t as fresh as possible. We’re a member-broker of the MLSs in each of our markets so that we can get the most accurate and up-to-date listings on Redfin.com. We update our site with new data from most of the MLS databases every 15 minutes.

But sometimes problems come up. You should know what you’re getting on Redfin.com, so here’s what you can expect:

We’ll update listings on Redfin.com every 24 hours, or sooner.
This applies to our MLS listings, as well as foreclosure and for-sale-by-owner (FSBO) listings. An update means the latest data from our listing data providers is on Redfin.com. For sources of data that change less often, like tax records and school information, you can expect the data to be updated less frequently.

When we can’t, we’ll tell you why.
Whenever our listing data is more than 24 hours old, we’ll post a note in the forums for each market that’s affected, explaining the issue and giving you some idea of when it will be resolved.

And then we’ll fix the problem ASAP.
If the problem is on our side, you can rest assured that we’ll attack it like rabid dogs until it’s fixed. On weekends, we may be slower to discover problems with our data, since our developers personally monitor the data feeds and they occasionally, but only occasionally, take part in non-development related activities – i.e. “personal life.” If it’s our partners who are having trouble, we’ll give them whatever help they need.

We simply want to build the best real estate website in the world, and as part of that we’re making this public commitment on our listing data. Comments are, as always, welcome.

Photocredit: sillygwailo on Flickr.

The post Trouble in the Southland appeared first on Redfin Real Estate Blog.

The policy was suspended while the lawsuit lumbered through federal court. And in the interim, Redfin was able to cite the lawsuit in convincing investors that we could compete straight up, broker to broker, without losing access to all the listing data controlled by other brokers.

And it’s still why Redfin, alone among the major new websites, has had all the broker-listed homes for sale: we’ve been able to become members of the Multiple Listing Services (MLSs) that Realtors use to share data, and have made our peace with its other rules.

But plenty of folks wondered what would happen to Redfin when the NAR suit settled. We wondered too. Well, today the suit settled. When I first read the NAR press release, I suddenly remembered what Billy told his platoon of mercenaries at the beginning of “Predator”: “We’re all gonna die.”

The National Association of Realtors proclaimed a stunning victory, first because it didn’t have to admit to any wrongdoing, though this is a standard feature of many settlement agreements; and second because the NAR also said that it didn’t have to pay any money, though this is hardly what the Department of Justice was after.

Greg Swann at Bloodhound, quoting Hamlet Macbeth, rightly said so what.

But the proposed settlement agreement did result in a major change, the permanent repeal of the Internet Listings Display policy that would have allowed brokers to selectively withhold listing data.

So for the consumer (and for Redfin too), the settlement is good news: an MLS can’t discriminate against Redfin or any other broker because of our business model or our technology. Any information that can be whispered by a real estate agent to his client — such as how long a home has been on the market, or how its price has changed over time — can be distributed by Redfin through its site. Hooray!

But the NAR wasn’t about to set the data free willy-nilly, especially when its member Realtors are accountable to home-sellers who want to see their homes marketed, not discussed or criticized. For one thing, the DoJ protections only apply if we ask site visitors to register, which turns off about 90% of the people who visit a real estate site (how would Google have grown if it required registration to search?).

Beyond that the NAR claims that “the new policy protects sellers from having false or other unwanted information about their listings appear” on sites like ours. We wondered what that meant. According to the exhibits in the settlement agreement, a seller can opt out of:

“1. allow[ing] third-parties to write comments or reviews about particular listings or displays a hyperlink to such comments or reviews in immediate conjunction with particular istings, or
2. display[ing] an automated estimate of the market value of the listing (or hyperlink to such estimate) in immediate conjunction with the listing.”

The automated estimate mentioned in the exhibits is exactly what we’ve integrated from Zillow, eppraisal and Cyberhomes. And the online discussions are something we’ve tried to host before, too. We suspect that some brokers will include such prohibitions in their standard listing agreements, so that many sellers will opt out.

Ultimately, we think that ducking a conversation like this is just sticking our heads in the sand. We can understand why the NAR took the position it did, but in the final analysis it marginalizes Realtors, and limits our ability to connect buyers and sellers.

People will talk about homes online, and they’d rather do it on brokers’ sites, where all the listings are available. But if they can’t talk here, they’ll go somewhere else.

So all in all, we were glad to see that the settlement protected all brokers’ access to data. We just want to make sure we can still do something meaningful with the data, too.

Bonus link: The NYT gets snarky about Paris Hilton, AGAIN…

The post No One's Going to Take Away Our Data, But What Can We Do With It? appeared first on Redfin Real Estate Blog.

“Great question,” I said as real estate inventory has somehow become one of my favorite subjects, second only to “how popular I was in high school,” gossip, my many grudges, and what different drugs are like. “We have all the broker-listed homes for sale.”
“And that’s ALL the homes for sale?”
“Well, technically there’s always a few sold by the owner, without a broker. It’s called FSBO.”
“Yeah?” Conan said. “You don’t have those?”
“No.”
“Is that it?”
“And there’s also stuff in foreclosure, that’s been repo’d by the bank, before the bank has hired a broker to put it in the MLS.”
“Yeah?” Conan said. “Is THAT it?”
“And there’s always the possibility that you could sell your place to your cousin, without ever putting it on the market. We wouldn’t have that either.”
“So basically you’re saying you kind of suck,” Conan said. We had now come to very familiar ground in our 20-year friendship.
“Yeah,” I said. “But everyone else sucks too. Many suck worse.”
In the background, I could hear Conan typing in his first search.

A few minutes after our call ended, the U.S. real estate market collapsed, putting more inventory in a gray market of foreclosures. And we soon began working with I-don’t-have-an-office-number-just-a-cell-phone middle-men, data-scrapers and offshore aggregators to get our hands on every home for sale we could find, minus outdated garbage, copyrighted information, stuff that wasn’t really for sale, and teasers where consumers would have have to pay someone else for the address.

This culmination of this effort is the latest version of our site, live since 6 a.m. this morning, which has bank-owned foreclosures and for-sale-by-owner listings alongside all the listings from the Multiple Listing Service (MLS). It’s a little controversial, and lots of fun to play around with and of course we think it’s beautiful too.

Not that even now the new version of Redfin has all the homes for sale – we only had enough money to get data on foreclosures once the bank owns them, but not before, when they’re up for auction. For the markets we serve, we should have more real estate listings than anyone else. And the foreclosure data we do have is unique, because we give the foreclosures’ actual addresses and bank contact information, which other sites require you to pay for. Redfin is the only site we know of that aggregates bank-owned properties for free.

We’ve hit up more than 50 for-sale-by-owner sites for their inventory, with only two major gaps: Zillow and craigslist. Zillow is, we hope, coming soon. Someone offered us a craigslist feed, no questions asked. But when we emailed craigslist about it, Internet god Craig Newmark confirmed this was a violation of the terms of service. What was incredible about his reply was that it took exactly three minutes and it came from The Man Himself (Craig Newmark rocks).

On other fronts, we’ve fixed up our URLs for Google, and juiced up our MLS integration again, in both Boston and Southern California, so that we can get comprehensive inventory updates every 15 minutes (our only laggard MLS integration is now in Ventura County). While we were at it, we grabbed more open-house data, let people search for open houses, and upgraded our email notifications to tell people when their favorite listings change prices or sell. Next up, the data team is hoping to get photos of very-recent past sales.

But for now we’ve also made it more obvious how to search for data on past sales, a sweet feature that Redfin has always had but which no one ever knew about because it used to be hard to find. No longer! For the markets we serve, you can easily see what any home sold for between last week and 20 years ago (the lag is often more than a week, depending on how long it takes the transaction to record).

What does this all add up to? As our press release explains, the new version takes us deeper and deeper into Freakish Depth, which is our strategy to build the best real estate site by getting the best data. Because we’re a broker in the thick of doing deals, we have access to data as it’s being recorded. And unlike lead-generation sites, we want people to use Redfin to go all the way, getting everything they need to buy the home without having to talk to anyone or pay anything.

The strategy started in January with super-low-latency-MLS integration, bird’s-eye views, two new estimates, Excel integration, neighborhood boundaries and comparable listings. Then we got deeper with listing statistics, which analyzes where the traffic for a listing is coming from, and how inventory levels in the neighborhood have changed.

A gratifying subplot of all this is that the MLSs with whom we have sometimes jousted worked with us on this release. One MLS guided us on how we could show different types of inventory without violating the rules. And another provided the square footage data we’d been asking for. It’s still a delicate balance, sharing data among competitors, and working within a common set of rules to protect the different brokers’ clients.

Which makes us all the more careful not to screw things up. For years, we’ve wanted to add inventory to Redfin’s site, but have hesitated out of respect for the brokers who share their listing data with Redfin, many of whom have legitimate concerns about properties for sale directly from banks or owners. In the end what swayed us was:
a. the consumers who want above all else to see all the homes for sale,
b. the market, where in places like San Diego 40% of the sales have been foreclosure-related,
c. guidance from some of the MLSs we work with.

Hopefully, we’ve found a way to show consumers more information without causing any harm to other MLS members. We’re going to roll out flat-fee services in the next few weeks to work with buyers on for-sale-by-owner and foreclosure properties, but we won’t help anyone go around a listing broker if one has been hired.

Many thanks to all the engineers, product managers and customers – a San Francisco focus group talked us into buying the addresses for foreclosures — who came together to create this site. We worked awfully hard on it, some of us through occasionally daunting circumstances, and are anxious to see how you like it. We hope there aren’t too many bugs. And please, spread the word!

*PS: we may add auction properties in the future but in that case we would have to require users to pay an extra fee to see the address.

The post All the Homes for Sale (Well, Nearly All) appeared first on Redfin Real Estate Blog.