Are Listing Agents Hurting Their Clients by Hiding Addresses?

At Redfin, we’ve long been opposed to dual agency, where the same agent represents both seller and buyer. This hasn’t always been an easy call because in some ways dual agency is more efficient. But it’s hard to represent both sides in a negotiation simultaneously, and the big problem is that it encourages the listing agent to market the property selectively to his own clients rather than broadly, to every possible buyer.

All the games that agents play with inventory were supposed to end now that that the DoJ settlement with the Realtors is being enforced. The settlement requires listing agents to publish to the web all the information about a listing that could be disclosed to a client in person. The loophole in the settlement is that the listing agent can require other brokers’ websites to register users before showing the listing, and to validate their email address.

In Long Island, where dual agency is common, a whopping two thirds of all listings on the market now require Internet visitors to register before seeing the address. The form New York agents use to list properties online includes a field indicating whether the address can be displayed without registration; for 66% of listings, the agent requires registration, overriding the default.

And overriding the default is definitely not in the best interests of the listing agent’s client, the seller. On our website last week, New York listings that freely publish their address got 42% more views than listings that require registration. If the seller discovers a registration requirement, he can ask the listing agent to remove the registration requirement, but most never find out: the Multiple Listing Service of Long Island doesn’t require seller notification or permission.

Why would a listing agent want to force Redfin to register you as a user before we can show you a listing’s address? Everyone knows that the vast majority of consumers don’t want to register, because most real estate websites are so spammy. And it has become increasingly clear that a web page requiring registration is invisible to Google — the Great Traffic Director in the Sky — whose indexing robots have no password, and no way of determining the addresses of these listings.

Perhaps some agents are old-fashioned and just don’t like listing information out on the web. Others want to protect the privacy of movie-star clients.

But withholding the address can be part of a bigger game to build the listing agent’s business, not a fiduciary duty to act in the best interests of a client. Any book on how to get your start in real estate begins with the advice to control inventory so you can attract buyers. “Listers,” the saying goes, “last.” It’s a big advantage if you can tell buyers about homes they can’t easily find on the web.

And by promoting their own listings  to their own buyers first and foremost, listing agents hope to double their fee by representing both buyer and seller in the same transaction. Recently, we’ve seen this happen most often with REO properties, which have been in high demand.

And it’s not just the gangs of New York that are doing this. In San Diego, where dual agency is much less common, more than a quarter of all home-sellers still do not publish basic information about their listing to the Internet. Here’s the break-down of San Diego-area listings in our database as of this morning:

• 73.8% are publicly visible, with no registration required
• 11.3% require registration to see the address; here, unregistered users cannot even see the property on the map
• 2.6% require registration to see the listing at all
• 12.3% agent-only, where even a registered user cannot see the listing via the Internet

And in San Diego, listing clients who don’t freely publish their address pay a steeper price: public listings get 110% more views than listings that limit the address to registered users.

What’s astounding about the San Diego data is that 12.3% of clients don’t publish their listing to the Internet at all; yes, because of the DoJ settlement, this requires seller permission but a listing agreement is so complicated that we wonder if the seller signs this permission away without even realizing it.

Now some agents will respond that showing a very high-end home to every Tom, Dick and Mary on the web won’t contribute one whit to an actual sale. But especially now, when so many high-end buyers are using the web to shop from overseas,  it’s hard to believe that 1 in 8 home-sellers are willing to take that chance. As of 2007, the California Association of Realtors estimated that 72% of consumers start their home-search online.

Of course, there’s a precedent for this. Back in the ’90′s, investment banks used to sell IPO shares to their cronies in exchange for a promise that the cronies would sell the shares back through the bank, doubling fees. This hurt the IPO client, because the stock wasn’t marketed to everyone for the highest possible price, but only to a particular type of buyer, one in fact who was less desirable than other clients. The bankers who did this faced criminal charges.

Today, nobody is going to jail over a withheld address. But we wish that more listing agents, and more sellers, would publish every address free and clear. And we wish that the MLSs would just do away with registration requirements altogether.

(Photocredit: Oldvidhead on Flickr)

Promoting Your Home For Sale On Twitter

We think Lisa Hurt is the first Redfin seller to promote her home for sale in Bothell with Twitter!

While Lisa is new to Twitter it’s exciting to see sellers using different online mechanisms to promote their listings. I definitely think that Twitter, especially if you have a decent number of followers, can be a great way to generate traffic to your listing.

Don’t have a lot of followers yet? Check out Guy Kawasaki’s guide, How to Pick Up Followers on Twitter.

Or maybe you have a tech savvy friend who already does? Get them to Tweet your listing for you.

If you do have some followers and your Twitter and Facebook are already hooked up here are some ideas on how to use Twitter to promote your listing:

• Let your followers know when your listing hits the market
• Let your followers know when you hold an open house
• Let your followers know if you do a price reduction
• Keep followers up-to-date on how things are going. How many people came to your open house?
• Use a service like bit.ly (@bitly thanks for helping us with bulk URLs!) to make the Redfin URLs shorter and Twitter friendly
• You could switch your profile background to a photo of your house or a screenshot of your home’s details page on Redfin
• Change your Twitter web link to your listing details page
• Link to your listing details page from your Twitter Bio
• Ask your followers for help moving once it sells! :)
• Let us know at @redfin

Do you any other ideas on using Twitter for real estate?

You can find Redfin on Twitter in a number of spots:Our company account, Rob, Glenn, myself and many more.

If you have a question about selling your home ask in our seller forums and we’ll be happy to look into it!

Domo Arigato Mr. Animoto

After reading a TechCrunch post on Animoto, the new make-a-music-video-of-your-photos website, we decided to give it a quick shot for one of our own listings, in Bellevue (we had to use a Redfin listing because it’s copyright-infringement to take another broker’s):

I wanted to use Prince’s “Let’s Go Crazy” for the music, but we don’t have the rights for that either. As our lead search engineer & award-winning documentarian can tell you, it’s a problem for any aspiring film-maker.

Do you think this would make you more likely to look at a listing?  And what’s the best song for this house?

There May Be Blood…

After arguing that we should let foreclosures run their course, we saw just what this would look like in a bank-owned Oakland listing, first noticed by one of the Redfin Forums participants.

In the listing photos, a man sits in front of the house, seemingly with his head in his hands. In the floor of one room there is a large red slick of what appears to be blood, beside a pail of forlorn cleaning supplies. Is it a Halloween haunted house gone bad or something worse?

We cannot display the pictures in a blog post commenting on an active listing, per an agreement with our data providers. But feel free to join the discussion about what exactly is on the floor of this listing in the Forums or comment below…

It’s all about location, location … locution?

There have been a couple articles circling lately about the value of words in real estate listings. Quick, which of the following words will help sell your home?

• motivated seller
• good value
• clean
• quiet
• new paint

If you guessed all of the above, keep reading. Bottom line: words matter and none of these will help your home sell faster or for more money. Real-estate listings, not unlike personal ads, are crafted to minimize blemishes and maximize perceived selling points.

Deciphering home marketing-speak shouldn’t be complicated, but sometimes we need a decoder ring to help us read between the lines.

Articles in the Los Angeles Times and The Washington Post give us a few …

Dos and don’ts:

• Don’t use an overabundance of exclamation points (note buyers: they can show a sign of desperation and an openness to a lower offer).
• Do use descriptive words about price and location. Last year’s top words were: “flow,” “embassy-style,” “enormous” and “lazy.” Supposedly these words connote a lifestyle of to-the-manner-born comfort, mint juleps on porches and drawing-room cocktails.
• Don’t make a plea of “must see!” This is received about as enthusiastically as a dinner-time telemarketing call.
• If you can’t find anything better to say than “new paint,” perhaps it’s best to say nothing at all.
• Sellers would be best served by a listing with “just the facts, ma’am.”

Statistics:

• Homes where the seller was “motivated” took 15 percent longer to sell
• Houses listed as “handyman specials” flew off the market in half the average time.
• Words that denoted “curb appeal” or general attractiveness helped a property sell faster than those that spoke of “value” and “price.”
• Homes described as “beautiful” moved 15 percent faster and for 5 percent more in price than the benchmark.
• “Good-value” homes sold for 5 percent less than average.

and unusual descriptions … that worked!:

• “FAMISHED FOR A FABULOUS FLATFRONT ON A FAMOUS BLOCK? Come feast your eyes on this femme fatale! Even the finicky will find her fetching while fledgling families and canine fanciers will contrive to fraternize.”
• … “pixie perfect, proudly self-possessed and peerlessly positioned for easy access to senate, judiciary.” [HUH?]

Economist Chad Syverson, co-author of a working paper that was the basis for a chapter in Freakonomics, sums it up the best … “the way an ad is written won’t change a dumpy-looking house.”

Our San Francisco blog has a few examples of real listings we put through the decoder ring.

Decoder ring picture credit: Heather McKinnon, The Seattle Times

Patron Saint of the Bidding War?

We are experiencing some unseasonably cold weather in Seattle this week. Good for winter sports, bad for driving. During my rally-cross drive home, I caught tonight’s episode of Marketplace on NPR. They had a really entertaining segment about burying a statue of Saint Joseph to speed the sale of your house. Long story short, wherever you bury a statue of Saint Joseph the property is bound to sell. I am willing to bet this will be a question on Bluff the Listener on Wait Wait Don’t Tell Me this weekend.

The Marketplace story followed Mike Hickson, a skeptic turned believer after reading a testimonial about a “man who, while trying to sell his home, was given a St. Joseph statue, but scoffing at the notion, threw it in the trash. It went to the dump. Wasn’t he surprised a couple of weeks later when he saw in the paper that — lo and behold — the dump had been sold.”

Mike promptly ordered a statue and “dropped St. Joe into his basement sales office next to the For Sale sign on a Saturday morning anyway. Lo and behold, people viewed the house on Sunday, Monday and Tuesday. On Wednesday, we got an offer.”

We would like to conduct a more scientific study of the effect burying a statue of Saint Joseph has on selling a home. If you are selling your home and would like to be part of our study post a comment or send me an e-mail. Or if you’ve buried St. Joe to aid in the sale of your home, let us know the outcome.

Introducing First-to-Know

How do you sell a home that isn’t for sale?

Today, we’re trying to find out, as the first step in a program called First to Know. The home-for-sale-that-isn’t-for-sale is a Capitol Hill condo here in Seattle.

The condo owner, Eugene Lin, wants to gauge market demand. So he took some snaps and wrote up a nice little description of his favorite things about the place that we posted to our Seattle blog as a sort of MySpace page for the condo, and now we’re matching him up with all the people on Redfin’s site who have registered for updates on Capitol Hill properties. Hopefully, there’ll be a fit.

Instead of buyers searching an MLS of properties for sale, potential sellers can search a sort-of MLS of buyers.

What we like about this:

–> It’s direct and frictionless: Eugene hasn’t signed a listing agreement or hung a yard sign, and he isn’t interested in paying a traditional commission; he just sent us an e-mail answering some basic questions, with some photos attached.
–> It doesn’t just use the Internet as a marketing brochure: the Internet is great not just for displaying information, like a listing, but also at figuring out what information people want to see. Redfin has a pretty good idea of who would be interested in Eugene’s condo.
–> It’s fluid and provisional: the Internet lets people test ways to think (blogs), to be (MySpace, chat rooms), to do. If you get something wrong, you just change it. Eugene can get a sense of what his property can command in the market, then decide if he wants to sell it in the MLS, or directly to a buyer he meets in the next few days — or not at all.

Living with this quantum jitter of uncertainty is one of the most important ways the Internet has changed how we think. You still need an MLS, for properties that are unambiguously for sale, but marketplaces also need the fluidity for buyers and sellers to connect and converse without transacting.

The traditional real estate industry depends on this idea that buying or selling a house is a terrifying ordeal, consisting of one irrevocable step after another. But it doesn’t have to be that way. The notion that buyers and sellers can work together in a simpler way has stuck with us ever since we read in the papers about a young couple who bought a house from a Wisconsin woman representing herself:

“We sat there and had a glass of wine,” Ms. Murphy recalled. “And they said, ‘Hey, there’s that crack in the basement wall.’ And we said, ‘No problem. We’ll take care of it.’ ” Dealing directly with each other seemed so civilized, she said. “I keep coming back to that.”

But enough chit-chat. Check out the condo, or tell us what you think of the idea. It’s something we began talking publicly about since we first noticed a Finnish website that was letting people make bids on homes that aren’t for sale (the comments on that posting were particularly helpful to us in shaping our strategy, giving voice and urgency to concerns we hadn’t yet worked out). There’s a lot more that we still want to do with the idea.

In the meantime, if you’d like to gauge demand for your very own unlisted property, just write ftk (@) redfin (dot) com. Or, if you’ve already listed your place, you can still create a MySpace page for it on our Bay Area or Seattle real estate blog, too. Just use the same address and we’ll hook you up.

YouTubing Your House

At Redfin, we’re always interested in technologies that let you see more about a property in your PJ’s. So we wondered, why aren’t more agents uploading videos to places like YouTube? It’s free, and even when the video itself is kind of cheesy, it’s cool.

Check out the video for this Tukwila fixer-upper. And while you’re on YouTube, enjoy the many-many-splendored weirdness (Kermit lip-synching the Counting Crows, an acrobat-Kung-fu-breakdancer , the greatest lip-synch of all time, another Internet chestnut, and the latest lip-synching phenoms, courtesy of Slate) of the Internet.