May 16, 2008
A few months back, we released a new version of the site that let our customers download listing stats and past sales data to a spreadsheet. Then last Tuesday night, we began to require registration on Redfin’s site before allowing customers to download results from the map. People typically use this data when they’re doing a Comparative Market Analysis or CMA.
We made the change because a few of the MLSs to which we belong have requested that don’t allow indiscriminate access to listing data. As one MLS has already pointed out, this will help protect home-sellers from being snail-mail spammed by movers. It’s a way to balance buyers’ hunger for information with sellers’ privacy.
And no, we’re not complaining about the MLS. As we observed this week in the New York Times, MLSs are getting more and more Internet-friendly all the time. We know how hard it is for them to set up rules that all the brokers can abide by when sharing their data, and we like belonging to the MLS. Being able to show all the homes for sale is much better for us than trying to build our own partial database, which is what the non-brokers have to do.
Here’s an example of the data you can download once you’re logged in:
Several Redfin users have noticed the change. One asked us the question:
I can’t seem to see/find the download button when pulling data for homes that have sold, to build comparisons.
What am I missing?
Thanks,
ZK
ZK, you’re not missing anything, but now you need to register and log in to see the data. If you register, we won’t spam you, sell or rent your email address, or otherwise do nefarious things. And of course you get to use all kinds of cool site features like email updates on your search, RSS feeds, and the ability to tell the difference between homes for which you’ve viewed details (lighter colors) and those for which you haven’t (darker).
We think registration for download is a good thing: serious buyers still get the data that helps them make a sound offer, as well as other benefits. And sellers don’t get spammed.
May 5, 2008
While in general we believe that more information is better, we recently learned how the information on our website can be used for indecorous purposes. The winner of DC Metrocentric’s most recent PriceChecker competition used Redfin to look up the price of a DC condo, rather than make a guess. DC Metrocentric is a blog about housing and development in and around Washington, DC. We’re fans of their PriceChecker series in which they profile a property and ask readers to guess the price. After a few days, they reveal the listing price and a winner based on the closest guess. The property profiles are great, especially if the property has an animal skin rug.
The winner of the latest PriceChecker found the list price on Redfin. In the comments, Roy, the winner, admits he used Redfin to get the price. Fransie wants Roy’s “PriceChecker Crown revoked.” Clearly the commenters are having fun with this. While we’re glad that Roy uses Redfin and was able to find the property, we hope this doesn’t lead to the downfall of the PriceChecker series. What do you think? Cheating or smart research?
Photo credit: laffy4k on Flickr.
May 5, 2008
Everyone is dancing on Yahoo’s grave this morning, after Wall Street punished the company for rejecting Microsoft’s merger offer. But perhaps because I came of age when Yahoo! celebrated everything fun and weird about the Internet, or because it’s good to see a nerdy founder replace a bigshot media executive, or because Yahoo is an underdog, I smiled when I read the news. Already people have forgotten how perilous getting bought by Microsoft would have been for Yahoo. Yahoo has hemorrhaged talent, been rightly strung up for its cooperation with repressive governments — not that Yahoo was the only one — and its executives can’t stop selling out the company to the press, but the Silicon Valley I know should be celebrating Yahoo’s pluck. It isn’t easy competing against Google, and it’s unclear that Microsoft would have made it any easier.
May 2, 2008
Our discussion board, creatively named Redfin Forums after an agonizingly long brainstorm session, was started to give home buyers a place to gripe about home prices, share who their ace termite inspectors are, and ask us how buying a home online works. So it surprised us when customers would use the Forums to gush about the Redfin agent they’ve worked with. A post today from Mitch, a custom home builder in Oakley, CA, made us blush… but not enough NOT to share it with you: 
I would just like everybody to know what a great job Susan Stalker of Redfin has done for me as my agent. I am a custom home builder and have been buying and selling homes for the last ten years and have had a number of agents at my side and none of them have tried and worked harder than Susan Stalker. If anyone out there is looking to buy or sell you would be smart to ask for Susan you will be happy you did. I am now on my second home with her and couldn’t be happier. Susan Stalker and Redfin are a friend and business partner for life. So to Susan Stalker and Redfin I would like to say thanks!
Mitch
Technology Builders
Mitch and his son are in the middle of building an empire of rental properties out in the East Bay. They’ve purchased two properties with us so far. Thanks for the kind words!
April 30, 2008
One Sunday morning last fall, my great friend Conan, a debonair former nose-tackle who often advises me to get in touch with my feminine side, called to ask about using our site. It took half an hour to convince someone who knows I would never lie to him in a million years to run a search on Redfin. And almost all that time was spent on one simple question: “do you have all the homes for sale?”
“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.
April 28, 2008
Most of us spend our lives trying to forget the world we had imagined for ourselves as children. But occasionally a single act is so transcendently shameless that it makes us feel happy and human again. For example: an indignant would-be competitor in Arizona just asked an online real estate forum for help getting his money back on an effort to clone Redfin.
My name is Ron Park and I have been working with a service provider, TechnoUSA, from Houston/India to create my real estate mash-up site. My project on getacoder.com was for a Redfin.com clone, in all functionalities and appearance. They were supposed to finish the site by January 25th, 2008 but yesterday, 4/24/08, I told them I’m through with them. The site is nowhere near being a Redfin clone, and they’ve just been problematic from the start. I have given this company a total of $10,500; and the amount of money I can possibly retrieve back with these credit card disputes is $8,500… the agreement was for a Redfin clone. [the emphasis is ours]
It is one thing to copy another site, another to copy it letter for letter, yet another to publicize matter-of-factly your efforts to clone it, and still yet another to feel wronged for what you have done.
To process Mr. Park’s refund, the credit card company is asking for “a letter from another reputable merchant or service provider supporting your claim.” So far, no one has come forward. In fact, we were gratified to see other folks leap to our defense. One respondent said you could never build Redfin.com for $10,000; the true cost is apparently closer to $40,000 (which is what one of our engineers costs over three months).
The clone site copies Redfin right down to the Sweet Digs link in the footer and the message we display while fetching listings. Reviewing the site, it’s hard not to wonder if the developers had ever heard of “search and replace”: many Tareu.com pages still encourage visitors to work with Redfin. But it was the one original element that turned out to be our favorite touch: “Copyright 2008 TAREU.COM.”
What’s amazing is that these guys aren’t even the first Redfin clones. That honor belongs to Allcheckdeals, an online brokerage in India run by naukri.com. Allcheckdeals copied Redfin right down to our graphics, albeit with a Groucho-Marx style disguise:
Here, courtesy of Sellsius blog, are the graphics Redfin was running at the time:
Many thanks to Morgan Carey, CEO of Real Estate Webmasters, for bringing this to our attention. Mr. Park participated in the Real Estate Webmasters’ forums but is not a Real Estate Webmasters customer.
April 25, 2008
On Monday, we looked at what makes a property hot in Boston, so we’re closing the week with a look at a market on the other coast: Los Angeles. The big question: will we see the same trends coast to coast?
We found there really are (hot) pockets of sunshine in the Los Angeles housing market, and this is not according to my trusty Magic 8-ball. We analyzed 2,364 real estate records for single-family listings in Los Angeles County, Calif. that entered the market between Oct. 1, 2007 and March 31, 2008, and sold.
We looked at the Los Angeles real estate market next because, well, you asked.
Here’s a rundown of the neighborhoods with the most listings that sold within seven days on the market; the numbers in parentheses calculate the hot properties as a percentage of the total houses that sold in those areas:
- Beverly Center, Miracle Mile: 12 (26%)
- Brentwood: 12 (27%)
- Los Angeles, Southwest: 10 (12%)
- Sunset Strip, Hollywood Hills West: 10 (11%)
- Westchester: 9 (17%)
For the areas where there were a significant number of hot properties, we compared the listings that sold in seven days or less with everything else that sold in those areas. Our goal was to develop a clear portrait of the hot property, so our buyers would know when they really had to hop to it. And here’s what we found:
- Beds and baths were the same for both types: there was no pattern in terms of bedrooms and bathrooms. Hot and “not” (not properties took more than eight days to sell) properties both had three bedrooms and two bathrooms. The coasts agree!
- Hot properties are bigger, slightly: The median square footage for hot properties was only slightly larger (.2%) than not properties, but the median lot size was 3% larger. Clearly, the LA sprawl doesn’t mean buyers get more space. Boston homebuyers got 13% larger lots with pretty similar sized homes – 1,669 square feet in Boston vs. 1,735 square feet in LA.
- Hot properties are newer: the median year built (1948) for hot properties was four years earlier than for the nots. Bostonians bought slightly older homes, but maybe that’s because most east coast homes are older?
Hot properties are expensive: it turns out that hot properties weren’t exactly priced to move. In fact, the median list price of hot properties ($1.1 million) was 16% higher. And the high price isn’t just because the houses are bigger: the median dollars per square foot was nearly 16% higher for hot properties ($633) as compared to the nots ($548). The median list price of Boston’s hot properties was $459,000 … you can get two for the price of one in Boston.
There wasn’t a huge difference in the days on market for the hot areas (43) and the entire Los Angeles market (45), but, on average, the hot properties sold in almost five days (Boston hot properties sold in about 4.5 days).
The bottom line is that hot properties are slightly bigger, newer and more expensive. There are distinct areas and house types where properties still sell fast, which continues to support our reason for doing this study in the first place — the real estate market isn’t really clinically depressed; it’s more of a split personality, with the good stuff selling fast, and the rest languishing.
Did you just buy a home in one of these neighborhoods? What was your experience?
Bonus link: The Wall Street Journal reports on the heartwarming side of the housing bust. [Warning: shameless Redfin plug] Read about a couple who escaped their 100-mile, LA-freeway commute.
April 24, 2008
Redfin reported on the Redfin Advantage last month, analyzing 65,242 records from the Multiple Listing Services that brokers use to share listing data in the Bay Area and Seattle. Our goal was to understand whether Redfin customers fared as well as customers of traditional brokers in their negotiations, so we compared the price our customers paid to the list price, and then compared what customers of other brokers paid too.
And we found that our customers fared better than the average, though we were careful this time to acknowledge that this may have been because our customers were more engaged in the negotiations, or because they were focused on properties more likely to sell at a discount to the list price. We reported that in San Francisco County, our customers’ negotiating advantage compared to the average was 1.635%; in Santa Clara County it was 1.079%; in Seattle it was .498%. The average difference was 1.07%.
But most of our deals came in Seattle where the difference was smaller. In table 3 of the white paper report, we calculated the weighted average of the negotiating advantage. We measured our buyers’ average final price as a percentage of list price, weighting the average according to the number of deals we had completed. We also measured the average final price as a percentage of the list price paid by other brokers’ customers, weighting the average according to the number of deals completed by those brokers. As the table in the report makes plain, we then subtracted one number from the other for a weighted average.
On a call earlier this week, a Windermere broker asked if we should calculate the weighted average differently. He was right to ask. The accurate way to calculate the weighted average is to calculate the difference between Redfin and other brokers, and weight it based on the number of deals Redfin completed in each market. We have adopted this approach, and are re-publishing the report, and changing our site. The new weighted average is lower than it was: .603%. The average for each market was always correct and remains the same.
Our goal was not to overstate the Redfin Advantage; we published the data for others to perform their own calculations, and we are issuing this correction though the broker had already said his question would remain private. We just notified every blogger we briefed or emailed about the Redfin Advantage, explaining the error.
Those of us who are computer scientists, statisticians and brokers deal in numbers every day, and we should know better. We checked and re-checked all the numbers for each market, but our statistics team did not validate the weighted average. The marketing team that prepared the report calculated and re-calculated the weighted average, but just did so by calculating two numbers — one for Redfin, one for the rest of the market — and then subtracting the two.
The Redfin Advantage is still an advantage, and it’s the same advantage that we reported for each market, but the weighted average was miscalculated. We are sorry for our mistake.
I know it has been a ragged week at Redfin. We hold ourselves to a higher standard than this, and apologize to everyone to whom we gave the wrong weighted average. Thanks to the Windermere broker for bringing this to our attention.
April 22, 2008
For no real reason, a San Diego Sweet Digs blogger attacked real estate broker Kris Berg today. The contract blogger, a usually kind person who deeply regrets the post, no longer works for Redfin because she violated the first rule of our culture, which is that everyone is respected. The charter of Sweet Digs is to write about local real estate, and to leave the shooting-yourself-in-the-foot-stuff to me.
The post makes me physically ill, not only because it seemed mean-spirited but because we know Kris Berg to be a wonderful person, a total pro and a darn good blogger. Worst of all, it deepens a brainless, destructive division between Redfin and our peers that has caused me great — this is the right word — anguish. We have already commented directly on the post, and Kris has already been gracious enough to accept our apology. So the rest of this post is an apology to everyone else in real estate, many of whom have reacted to more than just what we said about Kris last night. And because this is so hard to write, it’s also a list of small but important things we can’t apologize for too.
We all know that Redfin’s business model is different than yours: we try to get customers via our search site, we pay our agents salaries and customer-satisfaction bonuses, we want to put the escrow process online to avoid talking so much to our customers, and we refund part of our commission. This makes us freaks perhaps, or even fools if you like, but not an enemy.
Just because our model is different doesn’t mean that we think it’s universally better than the commission-based model. You have no idea how many times a day, every day, all night, we worry that we can’t make it work, usually right before we’re filled with euphoria at our prospects. We long ago imagined the party you’ll throw on our grave if we fail. But the reason we can’t give up on Redfin is that it’s what we would want for ourselves. Clearly, most consumers still prefer the traditional model. But some consumers have chosen our model too.
So that’s what we can’t apologize for: for who we are, for tinkering to make our model better (especially around tours, where it has been broken), for believing we can make it work. But we are sorry for our tone — I am sorry for my tone. What is most important to us is that Redfin’s (often ineffective) calls for reform stop ticking you off. Like you — and unlike the Zillows and Trulias whom you love (and whom we sometimes find ourselves admiring too) — we are real estate agents. We have a vested interest in making real estate better. We share our data via the MLS. We play by its rules. And we work together buying and selling homes.
The change we want is change everybody wants: that consumers can choose the services they pay for without fearing retribution, that they can access property information on their own. That’s it.
I don’t know how we’ve screwed things up so badly that our complaints about vandalized yard-signs or blocked offers have ticked you off. We should all denounce the one-in-a-zillion nut jobs who pull these stunts, because they make us all look bad, and it only takes one or two to terrify an entire market (#1 reason Redfin.com visitors don’t buy through us, 2 years straight: “fear of discrimination”).
It took us a while to realize how stupid it is for us to talk to the press about these incidents — nobody is ever punished, in even the slightest way, even when caught red-handed, and nobody else in real estate is outraged — but we’ll try harder to work out future incidents in private.
And, today’s blog post aside, there is reason to believe we can patch things up with everyone else. Last week, I finally told Greg Swann — he was so nice and gracious — that I was sorry for picking fights with him. Last month, an MLS decided to liberalize its data-sharing rules. Yesterday, a broker phoned to point out — privately, kindly — a possible error in one of our marketing claims (which we will correct if it’s wrong). And Kris Berg took my call today when 9 out of 10 people would have hung up in my face. Every week or so, I get a thank-you note from an agent about a deal we worked on together. How wonderful, how unnecessary and necessary, is that?
So maybe there’s hope that we can work things out. This isn’t a promise to be boring. But at least we can be civil. We weren’t today. We are sorry for the post about Kris Berg. We wanted to say to everyone else in real estate talking about this post that we hope there can be peace between us.
April 21, 2008
Redfin’s Chris Glew — Redfin Advantage essayist, Boston hockey fan and student of ancient Mexican turds — stopped another fur-flying meeting in its tracks last week with an arresting observation. He said that even in this slow real estate market, he could tell just by looking when a new listing was going to sell in a couple of days. “I see it all the time,” he said, to a now-quiet room.
Whereupon further fur flew. Someone said that the only common characteristic would be a fire-sale price. Others talked about school districts, sex offenders, safe neighborhoods. And then someone quoted the founder of modern surgery, a corpse-stealing pragmatist who challenged the French mania for grand medical theories: “why think when you can experiment?”
Why indeed!
So the Real Estate Scientist leapt into his white lab coat and began sorting through 9,212 real estate records: single-family listings in Suffolk County, Massachusetts that were sold between October 1, 2007 and March 31, 2008.
Why the Boston real estate market? Because our ex-hippie, oils-painting, die-for-the-customer, hired-all-his-cousins market manager — Alex Coon — laid it on the line, betting that such listings exist, even in the dead of the miserable Boston winter, and that most of them would be in Newton. He was right!
Here’s a rundown of the towns with the most listings that sold within seven days on the market; the numbers in parentheses calculate the hot properties as a percentage of the total houses that sold in those areas:
- Arlington: 18 (23%)
- Boston: 21 (7%)
- Brockton: 16 (8%)
- Haverhill: 11 (12%)
- Needham: 14 (20%)
- Newton: 27 (16%)
- Wellesley: 12 (14%)
But it’s not just the location of the listings. Even in these markets, the average days on market was 85 days. The average for the entire Boston area was 105. This suggests that at least one reason hot properties were hot was the property itself.
So for the areas where there were a significant number of hot properties, we compared the listings that sold in less than seven days with everything else in those areas. Our goal was to develop a clear portrait of the hot property, so our buyers would know when they really had to hop to it. And here’s what we found:
- Beds and baths were the same for both types: there was no pattern in terms of bedrooms and bathrooms. Hot properties and pariguayos (party-watchers, aka slow-to-sell properties) both had 3 bedrooms and 2 bathrooms.
- Hot properties are bigger: The median square footage for hot properties was 7% larger than the pariguayos. The median lot size was more than 13% larger. Maybe that seems obvious to you — bigger is often better — but when we began the analysis, we had imagined hot properties as cute little cottages.
- Hot properties are older: the median year built (1949) for hot properties was 29% earlier than for the pariguayos.
- Hot properties are expensive: it turns out that hot properties weren’t exactly priced to move. In fact, the median list price of hot properties ($459,000) was 78% higher than the pariguayos. And the high price isn’t just because the houses are bigger: the median dollars per square foot was nearly 40% higher for hot properties ($275) as compared to pariguayos.
The bottom line is that hot properties are bigger, older, and more expensive. That there are distinct areas and house types where properties still sell fast supports Chris’s notion that the real estate market isn’t really clinically depressed; it’s more of a split personality, with the good stuff selling fast, and the rest languishing.
You could take that theory a step further, and say one reason the market is bad is because the inventory is low-quality, first because some of the least appealing properties are being forced onto the market by foreclosure and second because lots of unappealing inventory is hanging out from the year before when the rate of new listings was higher. We’ll have to test that theory out on another day.
Bostonians, what do you think of these findings? Real estate watchers, what other markets would you like to see us analyze? Many thanks to Redfin’s Rick West for doing all the hard analytical work.
Bonus Link, from the Original Friend of Redfin: Washington Redskins cheerleaders stun massive Indian cricket crowd.
Also, since cycling season is about to begin, we are releasing some new footage of the Redfin cycling team on a training ride:
Photo: Shutterscript on Flickr.
