Archive for the ‘Most Comments’ Category
June 24, 2008
Being on TV is a junkie kind of rush. Even if you’re as stuck up as I am about it, you fall into hoping TV’s magic will transform you during the broadcast into something larger than life. But then you get airbrushed with make-up (new for HD, it feels soft and good), the mic-man publicly undresses you to the navel a minute before the segment starts, and you’re rushed off the set in another two minutes feeling more, not less, inconsequential. 
Redfin was on Fox & Friends’ segment this Sunday to talk about our business model (save $10,000!) and to answer the usual questions (we’re not putting anyone out of business). At the end of it I felt a little blue. I walked through the saddest place on earth, a darkened “Geraldo!” set. The streets in midtown Manhattan were empty at 7:30 a.m. I answered an email from a lone Connecticut fan wondering about our expansion plans. I called my mom, and told her my day felt already over. I remembered that a 60 Minutes producer — he was such a prince — once said “everyone is always depressed after the interview.”
Then I got on the 1 subway uptown… and saw people in tank-tops and bibs. A race!
I got back to my room, changed, and ran to Central Park, in what I only then realized was an event for disabled & able-bodied people alike (registration fee paid later).
As usual for Manhattan, folks lined up for the seven-minute-a-mile pace who would almost immediately begin walking, leading to altercations with punier, faster runners. There was a small-voiced, encouraging speech by New York Road Runner’s president Mary Wittenberg and, from the beginning — and all the way through — there was cheering. I LOVE people cheering! Why don’t we do that more often?
And there were so many runners -– I had not thought there could be so many — competing on prosthetic legs, of an age that many must have been injured in Iraq. A large, magnificently muscled man running outside the lane and against the current was yelling, Marine-style: “UP AND OVER, UP AND OVER, COME ON.” It was good to see some of the vets running together. We can never re-pay them. It’s hard not to be almost-scared of the intensity of their experience. But everyone on the course was glad to be doing something with them.
A few racers ran arm-in-arm with their parents, very close to one another, some encouraging me though I should have been the one encouraging them. Melted make-up streamed down my face. And perhaps because I was deranged from trying to run faster than I really could, or because of the cheering, I was overcome with love.
February 12, 2008
The New York Times reports Friday that alone among all the cities hoping to be the next Silicon Valley, Seattle “is actually doing it.”
But the Times didn’t talk to iLike President Hadi Partovi, or Zillow.com CEO Rich Barton, both entrepreneurs who, like many of the folks at Redfin, shuttle between Seattle and Silicon Valley. None of us thinks Seattle is ever going to be much like Silicon Valley. We believe instead that what other cities can learn from Seattle is how to be different than the Valley, not the same.
In reality, most places don’t even want to try to be like the Valley. Seattle has become unrecognizably wealthier in the past decade, yet is oddly unhappy about it. Many Seattleites wish we were still a modest boreal town rather than a Microsoft-Amazon megapolis. The question I am most often asked here is where I went to high school — twenty years ago — not what I’m doing next.
The Valley by contrast is a heartless amnesiac. In my 16 years there I can’t recall anyone’s ever expressing nostalgia for how it
used to be. This is probably because almost no one in Silicon Valley has any idea how it used to be. Internet guru Michael Arrington often opens conferences by asking audience-members from Silicon Valley to raise their hands and then, if they were born in the Valley, to keep their hands raised. Hands go up and down like The Wave.
And this is what Michael loves about the Valley: that it calls out at dog-whistle frequencies to nerds across America, Russia, India and China. The single-mindedness of their migration belongs in National Geographic. My first roommate spent four years building a company in San Francisco without ever buying furniture. When his startup went bust, he packed for the trip home to Toronto the same day.
Seattle is different. People live in Seattle because they love Seattle. When I was still looking for a reason to be here myself, I often asked Redfin recruits what brought them to town. The answer I always hoped for was “CONQUEST.” But what everyone talked about was something I still barely understand: the lifestyle and schools, the mountains and lakes. “Do you have any idea,” I finally told one candidate, “how bizarre it is to swim in a lake at the center of a city?”
Failure to appreciate a lake is viewed by many Seattleites as a sign of mental illness. But the Valley’s monomania is really just a kind of pubescence. What else could account for the Valley’s self-righteousness, its congregations of frustrated dudes, its all-nighters, idealism, delusions of grandeur, mood-swings, longings, dramas, hero-worship and pranks? Anywhere else by contrast seems all grown-up.
No one in the Valley can afford to grow up. Just as stressful environments delay the onset of sexual maturity in marsupials, a high cost of living – a two-bedroom house in Palo Alto typically costs more than $1.5 million — prevents people from buying homes and having children. In Silicon Valley, Seattle’s 28 year-old family man is still working his tail off for a hit.
The Hogwarts of Silicon Valley
The other source of Silicon Valley’s youthfulness is, in fact, places like Seattle. Seattle has some of America’s best high schools, but sends many of its best computer science students to California.
The founders of Apple, Google, Intel, Sun and Yahoo! all graduated from Berkeley or Stanford; an enormous graduating class seeks to follow in their footsteps every year. The whole state of Washington produces about 150 computer science graduates a year.
Stanford in particular is not just the source of Silicon Valley’s manpower but its magic. Guy Kawasaki says it is “the single biggest reason for Silicon Valley’s existence.” And as Hadi notes, “very few colleges spit out 21-year-olds who think they can be the next Jerry Yang or Larry Page.” It’s painful for those of us never admitted to Stanford to marvel at its sunny rejection of failure, its Hadron-sized Internet connections, its courses on venture capital and Facebook, its magnificent sense of entitlement.
Yet we all know that without Stanford the Valley would grow old and die. Native Seattleites hardly notice Seattle’s Stanfordlessness; Valley expats never get over it.
Rotarians and Pirates
This is not to say that Seattle is all bad for entrepreneurs, only that the ways in which it is good only show how different it is compared to Silicon Valley. Start with Seattle’s Rotary Club, the largest in the world. High-tech entrepreneurs are expected to be pillars of the business community here, not, as Silicon Valley’s establishment likes to think of itself, pirates of the Caribbean.
At one of the first conferences I attended in Seattle, I was shocked to hear a speaker talk about how to improve K-12 math education, not how to hack a Tivo. It took a while to realize that “K” stood for kindergarten, not kilobytes. But this mindset connects us to a set of civic virtues bigger than any one company. It’s why I’m optimistic about Seattle over the long haul.
And it has nurtured a rookie CEO like me. A Seattle journalist e-mailed me while I was still loading the tiny U-Haul that brought me here. A VC who should have eaten my gizzard for breakfast invited me to his lake house for dinner. A startup CEO who offered money-raising advice over lunch diverted us from Quiznos to Carmines. Redfin is better because of their help.
Far from the Madding Crowd
Few people would have had the time to help in Silicon Valley. The chaos of newcomers and the desperation of those who want to stay make the Valley seem like a capital about to fall in a coup. Dingbat ideas are scattered like pennies on a sidewalk. Overlooking last night’s website launch is like showing up at a party with last year’s purse.
The cult of the new may seem like madness but here’s the method to it: what’s often most difficult about developing a new idea is figuring out if it’s already an old idea. A business just like the one you’ve been dreaming of may already be forming within Google, or preparing to launch on its own.
When you and everyone you know spend 18 hours a day downloading, hacking, breaking, sharing, gossiping, criticizing and arguing about the Web, it’s easier to tell when an idea is truly new. And if you don’t, it’s almost impossible to catch up.
This is why Hadi says so many Seattle entrepreneurs develop ideas late. We aren’t slow; just out of the loop. Even Seattle’s greatest two start-ups, Amazon and Microsoft, were first conceived somewhere else.
But being apart from Silicon Valley can give entrepreneurs the latitude to think about what works, not what’s fashionable. It was, at first, hard for me to break out of the Valley mindset. My initial question in setting Redfin’s course wasn’t “Is there a business here?” but “Is it cool?”
Because Redfin’s business — real estate — isn’t cool. And taking on the messy business of serving customers directly definitely isn’t cool. But some of the best – and most meaningful — new ventures may be the ones that combine old and new business models, experience and youthful recklessness, perseverance and opportunism. And it is these ventures that really seem to belong in Seattle.
Loyal to a Fault
Because if it turns out that Zillow, iLike or Redfin are on to something good, it may be easier to build a long-term business in Seattle. Ten years on at Microsoft, engineers deep in Redmond’s rain forests are still writing the next version of Office. Meanwhile the engineers at Google are, as Zillow’s Rich Barton points out, plotting their next startup on the company dime.
I’m not sure which engineers one would rather have, but it is true that there is a blue-collar dedication in Seattle that you don’t find in the ADD-addled Valley. “You work hard here because it’s gray,” Rich writes. “Then you go hiking or fishing or skiing.”
I really like that advice. Unfazed by any heavy weather ahead, Rich keeps chugging along and having fun. And Seattle does, too.
Thanks to Rich Barton, CEO of real estate portal Zillow.com, and to Hadi Partovi, president of music discovery startup iLike, for their help.
August 20, 2007
I’ve been asked by many of my friends and family why I decided to leave my position at Microsoft, where I was appreciated and rewarded, for more work, more responsibility, and more stress. Well, the decision was mainly a result of three factors. First, someday I may start my own company, and transitioning from a startup makes that much easier. Second, I didn’t agree with many of Microsoft’s decisions and direction. Third, I wanted to build a product that would really cater to consumers and could stand on its own.
Almost all the top engineers I know talk ad nauseum about starting their own company, with the caveat of, “I’ll stay at big company XYZ for 2-3 years, then I’ll go out on my own.” Well, it never made sense to me how they thought that they could make the transition from being so removed from the business and the end to end process of creating and shipping a product. Working at a startup, you’re about as close as you can be to running your own business, and you don’t have to spend nearly all of your time and effort trying to raise money. For instance, the only financial statements I ever saw at Microsoft were quarterly reports (as a shareholder), and even those were a mystery. At Redfin, we get to see all of our financials, like pro forma cash flow statements that we might show to investors, and are encouraged to understand it and ask questions. Even raw talent can’t make up for this kind of experience.
While I was at Microsoft, many things didn’t make sense to me. I didn’t understand the massive “re-orgs”, which, if you hadn’t heard about ahead of time, it meant nothing material changed for you. I didn’t understand why we’d try to enter dominated markets with an uncompetitive offering. I didn’t understand those little table tents on the cafeteria tables or the giant banners and posters promoting intranet websites. I didn’t understand why site searches on MSDN were abysmal. I wasn’t the only one who was confused. Minimsft would try to speculate about a re-org or an acquisition. And on popular internal aliases like “litebulb”, for instance, there’d be email threads where people would ask why Vista had 6 (ok, 
SKUs, why Zune wouldn’t work with PlaysForSure, why their product had to be renamed from something cool to something like Windows Communication Framework, or why there were 2 confusing boxes on local.live.com (or so adverse to just calling it “maps.live.com” in the first place). Legitimate questions often got defensive responses. To paraphrase one developer, “Why are these responses always along the lines of, ‘We know what we’re doing’? Personally, I’d welcome the feedback, because that’s how I’ll improve. Why can’t you provide the reasons that led to your decision?” I couldn’t have agreed more.
Once I had decided I was leaving the company, I spent a lot of time trying to find the startup I’d be most passionate about. It sounds arrogant, but good software engineers can pretty much choose where they want to go. And it’s nearly frictionless to change jobs these days. You can post your resume up on Monster and get daily calls and emails. So, you do your homework and find a startup that really appeals to you. I was definitely not looking for some me-too social networking site or some company that was funded purely based on its management team’s connections. When I found Redfin, I knew it was just what I was looking for. During my home buying process a few years ago, I was convinced the real estate industry needed some serious changes. For instance, searching online required clicking in a multiple highlight box with 50 neighborhoods I’d never heard of, but I checked them anyways just in case they were somewhere near where I wanted to live. After much research, I learned that my agent would probably be getting a 3% commission when I bought a house. It wasn’t a “free” service as many led me to believe. Ten grand to drive me around and guilt me into buying a house I didn’t feel was right for me? Redfin’s scrappiness and audaciousness to battle it out with the traditional agents, brokerages, and MLSs on behalf of consumers like me was very appealing.
Startups aren’t for everyone. But for any of you on the fence and considering the startup world, here’s my advice:
- Plan for the future. Thinking about what I could accomplish in 5 years at a well established company versus a nascent one intrigued me. You’ll have much more influence over the development of an infant than you will a 30 year old, and the rewards should be commensurate.
- If you refer to your company in the third-person, or have to ‘beat’ the system to be productive, it’s a bad sign. (One rumor at Microsoft was that your group should spend exactly 100% of its budget/headcount, otherwise ‘they’ would cut next years.)
- Make sure your whole company feels like one team. Ballmer once joked at a company meeting, “Why do the different groups only clap for themselves?”
- Be as important to the company as it is to you. In a technology startup, the people ARE the startup. Our CEO reminds us, “The company’s only assets walk out the door every night.”
- Consider working where there are no sacred cows. Don’t like something? Be able change it!
- And finally, to quote Paul Glen, “Never underestimate the power of free food.”
July 18, 2007
Redfin has been futzing around with some new designs for the home page of our website and could use your help picking one out. Our goals are to get people searching and to explain how Redfin works.
We only get one shot at the explanation because returning visitors see a view of our map as they left it on their last visit. Many are so thunderstruck by Redfin’s search superpowers that they never realize we have to make a living buying and selling homes.
When we surveyed our customers about what they wanted to see on the home page 58% asked for an explanation of our commission refund, 47% for an overview of our company, and 45% for a step-by-step guide to the process. But you should just say what you want: even though this blog is by and for people at an absurd remove from reality, please don’t feel like you have to channel anyone normal. It never works.
Here are the choices, which you can click to enlarge:
1. Illustrated explanation of the buying process:
2. Photo illustration of the buying process:
3. Who we are, in paragraph form:
4. Who we are, in bullet form:
Tell us which one you like first, second, third and last; suggest modifications or an entirely new treatment. Thanks to Savan Kong, Jason Wu, Michael Young, Matt Goyer, Jeff Yee, Marc Singer, Dana Irming, Bryan Selner, Leo Shklovskii and many others for their input so far. And thanks to everybody else for your feedback now…
We’ll also post a link to Redfin Forums, too.
July 18, 2007
Redfin today announced its expansion to the Washington, D.C. area and a $12-million series-C financing led by Draper Fisher Jurvetson, the folks behind Skype, Overture and Hotmail.
The whole process of raising money from DFJ seemed to encapsulate the essential Redfin traits (persistence, serendipity, adventure, speed): Redfin wooed DFJ somewhat unsuccessfully over the course of a year; but it was a zealous customer who arranged the initial meeting; which we traveled to by plane, train and bicycle; demonstrating a website that had only been launched the day before; resulting in a closing that took just a few weeks.
In the DFJ bathroom, I remember seeing a photo of one of the partners being strapped (was it head-first?) into a go-kart for a big race and also a piece of artwork painted by another partner, and feeling sure we had come to the right place. And we had. Of all the investors we talked to, DFJ was the most committed to building a long-haul, consumer-centered business, which sounds like motherhood and apple pie but is increasingly unusual in an ad-addled world.
DFJ’s Emily Melton will join Redfin’s board; she shares the Redfin spirit of candor, dog-craziness and derring-do but also brings with her Silicon Valley’s smarts and values. In a pinch, she drives the wrong way down one-way streets.
The fund-raising itself was fun. We roared around San Francisco in a convertible Mustang; felt glamorous in big, drugstore-bought sunglasses; listened to dance music on the radio; sat around a Starbucks getting nervous in between meetings. For no reason at all, we wore cufflinks, ran demos that didn’t work, slept on a friend’s couch to save money.
Many thanks to the folks at Redfin now and before who got the company to this point, to our partners at Madrona, Vulcan, BEV and Orrick for their constant support, to DFJ of course for leading the round, and last but not least, to all our friends in Silicon Valley and San Francisco who gave us a little help along the way.
And now of course we have to celebrate, with the opening of the Washington, D.C. market, which includes Baltimore and suburban Virginia. We used to launch these markets with one guy in his basement, e-mailing a dozen of his neighborhood friends for our “viral campaign,” but now we’ve got a huge list of people to notify that we’ve arrived in the area, and a team of folks led by Catherine Jardine, and many promises to keep too.
July 13, 2007
A year ago, the Diddy spirit pervaded Seattle, resulting in a NerdPartySupernova led by an Ephod-clad Michael Arrington as the Grand Poobah. Beer-hauling trucks conked out, young men fell fatally in love, entrepreneurs with Hare-Krishna looks in their eyes rampaged through the ranks of venture capitalists.
This year, we’re doing something bigger. First of all, we’re bringing in the barbecue pit. More importantly, we’re on a mission to introduce journalists to entrepreneurs, so that little companies with big ideas can put themselves on the map, and figure out how they want to talk to the press. With a tip of the hat to Robert Scoble, we’re calling the event The Naked Truth.
Rebecca Buckman from the Wall Street Journal, Fred Vogelstein from Wired, Michael Arrington from TechCrunch, John Cook from the Seattle PI and Tricia Duryee from the Seattle Times will be on a pre-party panel to answer questions. And startup bigshots like Hugh Crean, Hadi Partovi, Jason Goldberg and Ben Elowitz will be in the crowd to ask.
Here are the details:
When: Tuesday, July 24, 2007. The panel starts at 5:30, the party starts at 6:30.
Where: The Havana Social Club, 1010 East Pike Street, Seattle
Who: every entrepreneur, dreamer, procastinator, narcissist, coder, starter, joiner, flim-flam man, gonzo PR guy, bigshot, littleshot and networking twizzler in town… please come!
Madrona Venture Group and Redfin are paying for the kegs and the ‘cue, and iLike, WetPaint, Farecast, Jobster and WildTangent are helping us put it together. If you want to come, you have to sign up in advance, or overpower our HGH-juiced Cambodian bouncer at the door. Panel attendance is limited to 200 people. We’ve tented a nearby parking lot so the party can handle 500.
Madrona’s Greg Gottesman, master of ceremonies for the panel, has already laid down the law for his approach: “I have come here to chew bubble gum and kick ass—and I’m all out of bubble gum.”
Edit the wiki to put your name on the list…
May 28, 2007
About a week after Redfin showed up on 60 Minutes, Century 21 started running an ad challenging the idea that you could buy a home online.
“Some people think they can do it all on the computer,” the actor says.
Find a home, sell a home. Except the computer can’t do what I do at Century 21.
Understand your needs.
The subtleties of the market, the neighborhood… the schools… the process!
To watch your eyes when you walk into a home and know right away that you’re in love with it.
No computer can do that.
I like the music, and the shy way she never quite stands in the center of the screen, or how she scrunches down as she talks about understanding your needs, even while the background darkens. The ad seems to be a self-conscious departure from the sinister tone of Century 21’s earlier efforts, which like most real estate marketing, oscillate between corn-pone dreams of home-ownership and scaring you to death.
But, since we still are one of the only online brokerages, it feels like a blunder for Century 21 to take us so seriously. Watching it, I was overcome with the elation of a high-school nerd after the prom queen noticed him enough for a put-down.
And the ad falls into the same old trap, arguing that customers need help picking out a home. Most don’t.
According to the market research we conducted before launching Redfin Direct, people value a broker for putting together a winning deal over helping them pick out a place, by a margin of about four to one. Buyers’ big anxiety is that their agent, because he’s paid by the seller, isn’t completely on their side. Negotiations, contingencies, legalities are of course where Redfin’s salaried agents focus all their efforts. The ad doesn’t really speak to any of that; it acts as if online brokerages don’t even have any agents.
Our CTO, Michael Young, disagrees. He thinks the ad is bad news for Redfin. In an e-mail, he worries that traditional brokerages “have a lot of money to spend… there’s a consistent FUD [Fear, Uncertainty, Doubt] attack against us that we’re just a bunch of low-touch clerks that we don’t combat well in our current marketing.”
Redfin spent peanuts on marketing last year vs. the traditional industry’s $12 billion. Mike suggested all sorts of guerilla tactics for getting the word out that we offer better service from offer to close than a traditional agent. Somebody suggested providing complete real-time access to customer survey results. My favorite was cinema verite of Redfin customers and agents working together. Our founder, David Eraker, once proposed picketing traditional real estate brokerages. (”What would we put on our signs?” I said.)
And so we’ve started to think about how we should change up our marketing, and could use a few suggestions. We’ve already got some raw material: Redfin customers have shown up on TV in Seattle, San Francisco, San Diego and nationwide. We’ve got heaps of agent and customer photos and testimonials buried somewhere in our site. We’ve also written an exhaustive overview of the home-buying process, more than I thought anyone would ever read, except we know from all the questions we get in web seminars that occasionally they do. It has been downloaded about 25,000 times in a few weeks.
If you know someone handy with home-movies, or you have an idea about what we should do to spread the word, let us know.
Bonus link, in honor of Memorial Day.
May 14, 2007
Redfin and the traditional real estate industry duked it out on 60 Minutes last night.
The segment aired second, after Mitt Romney took a stand against polygamy, but was the most popular video until losing out to a wayward penguin who swam 3,000 miles to Peru (Sasha Aickin just sent an e-mail around saying “we beat the penguin,” so I guess we’re back on top).
Here in Redfin Seattle, we watched the show in a conference room with a mixture of apprehension and desire; people brought their families and we all made fajitas. Seattle PI reporter John Cook showed up and began taking video with his digital camera.
Then the segment got rolling. Our favorite moments:
–> Rob McGarty wearing a blazer for the first time in his life, Kelly Engel stealing every scene, Fadi Hafzalla rolling up his sleeves and getting down to business.
–> The strange Borat-like moment when the traditional realtor was asked if she had refunded any commissions last year (”absolutely… NOT”).
–> The traditional agent’s explanation of why real estate agents charged nearly four times per transaction what they once did: increased postage costs…
–> The terrifying loss of perspective as the camera panned back on the National Association of Realtors’ sign as if it were a Star Wars spaceship.
–> B-roll of me complaining about our $4,000 copy machine, which is just so typical, cheap and mean-spirited (I HATE that thing).
Everyone in the conference room got quiet when the CEO of a company that had once embraced a business model similar to Redfin’s told Lesley Stahl he’d lost $33 million. Then we all cheered up when someone said we don’t have to worry about that because no one will give us $33 million.
And then the phones started ringing off the hook, and all of us — developers, executives, testers — scampered back to our battle-stations to answer them.
The website groaned under the load; first from 4:40 to 5:00 p.m., after the piece aired on the East Coast, and then again from 7:35 to 7:50 after the piece aired on the West Coast. Before our routers tapped out, we had served 40 times the volume of content that we normally do. We put up an emergency home page with search disabled. But without the Google Analytics tags on our standard home page, we could not see to see: we have no idea how many people saw that page.
It was fun working the front-lines. Many folks wanted to know if we could sell their property in Aruba, Italy, Mexico and Canada (Redfin’s dedicated agents immediately volunteered to handle Aruba, Italy and Mexico). One disgruntled 60 Minutes viewer called Donald DeSantis and told him he hoped he “died a slow, excruciating death” with one delicate body-part somehow wrapped around his neck.
A man with an ecumenical-sounding “SpiritJohn” e-mail address asked if I wouldn’t mind some constructive criticism; sure, I replied. Then he called me a “sissy” who “has been defrauding the American public for decades” (I started at Redfin just over a year ago; I wasn’t able to drive two decades ago). A third called and asked for Kelly Engel, then told her off. A very nice real estate agent e-mailed me offering herself as a corporate hair-stylist. A far-right radio show host asked me to name the “government bureaucrats” who blocked real estate reform.
Robert Scoble and Greg Swann reported a huge disturbance in the force, as hundreds of “60 Minutes” viewers descended on their site in search of Redfin (Robert’s blog about Redfin is the 7th Google search result for a Redfin search; we weren’t able to find Greg’s in the result set). A blog post that challenged Redfin’s facts began by noting I was a Harvard MBA (I never went to Harvard, I do not have an MBA). Another real estate blog argued for higher commissions (”6% is squat”) and lusted after Lesley Stahl (”what I wouldn’t do to have that blond hang out with me for one day as I go prospecting”).
For all the consumer enthusiasm, thousands of real estate agents and brokers have mobilized against CBS. The President of the NAR sent an e-mail to all 1.4 million members describing herself as “disappointed and dismayed” and encouraging agents to give CBS a piece of their minds. The real estate paper Inman News describes an industry in uproar. CBS News posted the text of the piece, alongside 46 pages (and counting) of comments.
Now it remains for us to sort through all the e-mail, call everyone back, and pick up where we left off building our little business. Thanks to everyone for all your kind wishes. If you have further thoughts on the segment, please just leave a comment below.
April 1, 2007
Redfin launched the real estate consumer’s bill of rights today, which Inman News is blasting out to its hundreds of thousands of real estate subscribers some time this morning. The premise of the bill is that consumers should have all the information the agent does about a house they’re trying to buy or sell, and about how the whole process works. Nearly a dozen Redfinners worked on it, from real estate operations, engineering and marketing.
Now we’re trying to recruit other brokers and real estate bigshots to support this idea. Already, we have our first, Kevin Boer, of 3 Oceans Real Estate, and we hope plenty will follow. So consumers can get in on the act, we’ve also started a petition that we plan to send to the National Association of Realtors and to all the local MLSs to which we belong; we hope you’ll sign it.
Maybe this can become a movement. Maybe real estate really can get better. The last time I circulated a petition, it was to get my beautiful but cruel high school French teacher fired, which involved premature exposure, humiliation, a year of intricate recriminations, and a very poor participation grade. Read the rights, and let us know if you think this stands a better chance.
1. Choose the services you pay for: Laws in more than a dozen states forbid brokers from refunding commissions to you, or require brokers to provide services you may not want to pay for. These laws protect the industry, not the consumer.
2. Know how your agent makes his money: In real estate, the seller pays both his own agent and the buyer’s agent a percentage of the sale; the agent earns more when his client pays more. If a house seems difficult to sell, the seller may even offer buyers’ agents an especially high percentage. Buyers’ agents should be required to explain to their clients how they are paid.
3. Know when you are committed to an agent: Often just showing a property entitles an agent to the commission for representing you, regardless of whether you intended to work with someone else or even preferred to represent yourself. The relationship between an agent and a consumer should always be explicit, so that both parties know when they’re committed to one another.
4. Know what services your agent will provide: Much of the work of a buyer’s agent begins after the buyer has agreed to buy a house. This work includes coordinating inspections, repairs, mortgages, title reviews and escrow services. But agents today are paid only to bring a buyer to a transaction. Once that happens, it is virtually impossible to fire your agent. In most cases, this is appropriate, as the agent who puts a deal together deserves the commission. But in becoming committed to an agent, you should know what services the agent will provide as part of that commitment and what recourse you have if the agent doesn’t perform those services. An open agreement between you and the agent protects the agent from being unfairly dismissed, and ensures you get the service you expect through closing.
5. Have an agent that represents only your interests: Most states allow an agent to represent the buyer and seller in one transaction, and get both sides of a commission. As a result, some sellers’ agents are on the prowl for unrepresented buyers to bring to the seller. It’s a solicitation neither side can easily refuse because the seller wants the buyer and the buyer wants the house. But an agent can’t fairly represent the interests of two parties to the same transaction. An agent should represent only one party, and take commissions for only one party.
6. Know the commission refund you can get before you buy a house: Depending on the service provided by the buyer’s agent, some sellers vary the commission offered to buyers’ agents. This flexibility is good in theory, but in practice it’s often used to thwart commission refunds: buyers expecting a refund of $10,000 or more from their agent discover on making an offer that the amount has been radically reduced in favor of the seller’s agent. Buyers should know in advance what circumstances let the seller’s agent keep more of a commission for himself. It’s fine to change the price but not at the cash register.
7. See all the houses for sale: Many of the multiple listing services set up to share listings between brokerages forbid participating websites from displaying for-sale-by-owner houses alongside broker-listed houses. As a result, home buyers usually don’t see all the houses for sale, and home sellers have to hire brokers just to get their house on mainstream sites. MLSs should not require exclusive display of listings.
8. Have an open discussion about a house for sale: On the web, you can openly discuss almost any product for sale except a house. That’s because sellers’ agents “own the listing,” controlling where and how it’s posted for their benefit. The rules of some MLSs discourage real estate websites from publishing independent reviews and preclude owners from distributing MLS marketing materials outside MLS-sanctioned websites. Once a house is for sale, everyone in the market should be able to discuss it.
9. See all the information available about a house for sale: Many MLSs make it difficult for buyers to see recent past sales data, how long a house has been for sale, or whether its price has been reduced. Once a house is for sale, you should be able to see all the information available about it on your own, without becoming anyone’s client. The only exception to this rule is information whose publication jeopardizes the seller’s safety, such as when the presence of children precludes a showing.
10. Be sure your agent will show your house to everyone: Some sellers’ agents selectively refuse to show houses to a buyer represented by an alternative brokerage, which hurts the seller and the buyer. If, as part of his service, a seller’s agent doesn’t show houses to all buyers, the seller should know it, and the buyer should be able to contact the seller directly. When agents don’t facilitate showing a house, they should at least stand aside and let buyers see the house on their own.
OK, now you can go hogwild with the comments…
March 21, 2007
The old way: explain your real estate needs and desires to an agent, he searches for listings, wait, wait, wait until he shares the details with you.
The Redfin way: search for real estate on your own terms, whether in your PJs or work duds, get immediate information.
The old way: once you fell in love with a place the only way to find out what other nearby homes sold for nearby was to call an agent and ask for a comparative market analysis, or CMA.
The Redfin way: DIY! Redfin let’s you figure it all out yourself!
Let’s say you’re looking at moving to Pioneer Square in Seattle because you just accepted a job offer at Redfin. After a few minutes searching on Redfin.com, I found 97 S. Jackson St. #402.
But is this a good deal?
Redfin.com will tell you everything you need to know to make that determination. First, I would look at the details page for the listing (click on “Full Details” in the listing pop-up box).
Does it have a Zestimate? This one has a Zestimate of $618,021.
Does it have any past sales information? Yes, it sold for $387,000 in 1999.
Next, I would go back to the search page and look for similar listings on the market. I search for 1,000 to 1,500-square-foot listings and find 12.
At the bottom of the list below the map, we can see that similar units have a median price of $521,975, average square footage is 1,189 and average $/sq ft is $535.
This gives you a good sense of similar units on the market, but what have other similar units sold for? Click on ‘Show more options’ and select a timeframe under ‘Show Past Sales’ such as ‘Last 1 year’ or ‘Last 6 months.’
Now we can see a list of the units we are interested in along with two previously sold units in the same building.
Clicking on these similar past sales, we can get a good sense of what other listings have sold for in the neighborhood and compare the listing we are interested in.
Happy CMA’ing 
.
