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The Bay Area Rental Bubble - And Why Buying Might be Better

by Pacific Union

And with the supply of new homes on the market outstripped by demand, renting seemingly offers more flexibility and immediate gratification.

Well, not so fast.

It turns out that would-be renters may have as many – or even more — challenges than prospective homeowners. Let’s take a look at the state of rental housing in the Bay Area.

1. Rents are sky-high – and climbing

According to a new study by the National Low Income Housing Coalition, rents in much of the Bay Area are the least affordable in the country. The study, called Out of Reach 2012, found that the most-expensive counties in the United States – tied for first place, in fact — are San Francisco, Marin, and San Mateo.

Over the past four years, rental prices have climbed 13.7 percent in San Francisco, while occupancy rose only 1.3 percent. At the beginning of this year, the average monthly apartment rent in San Francisco County was $2,585.

It’s much higher in the city’s most desirable areas. For example, listings for lofts in the South of Market/South Beach area are starting at $2,700 and skyrocketing to $7,000.

In late 2011, apartments in Marin were more expensive than they had been in six years, with the average rent in Marin County up to $1,903, a 10 percent increase over 2010.

Data from Cassidy Turley reveals rent increases across the board in the Bay Area:

2. Inventory is tight

Fueling the fire is the lack of inventory. In a classic case of supply vs. demand, one of the factors driving up rent is the paucity of rental units.

For example, the vacancy rate in San Francisco is 3.2 percent, the tightest it has been since the height of the dot-com bubble in 1999. In Marin, the vacancy rate is around 2.8 percent – making rental units the scarcest they’ve been since 2008.

New construction hasn’t kept pace with demand. Since 2008, only about 1,710 units were built each year in San Francisco, compared with an average of 2,220 each year between 2004 and 2008 – and although new construction is on the way, many of the new units will be priced beyond the reach of working- and middle-class residents.

The result? Waiting lists, climbing rents (that supply and demand thing again), and increased competition for available units. The media is reporting on the rental feeding frenzy out there, with desperate applicants willing to bid up the monthly rate and looking for insider tricks to nab a place before it hits the market. And applicants are forking over nonrefundable application fees — some to the tune of hundreds of dollars — in the hopes of landing a home.

3. The dot-commers are coming (again)

And if you think it’s bad now, just wait until Facebook goes public.

The increasing number of Bay Area tech firms and workers, coupled with the increases in rental costs, has many pundits predicting another technology bubble. But even if that’s true, there’s no sign of it bursting any time soon. In fact, it could get worse.

The upcoming Facebook IPO will mint a host of new millionaires, many of whom will be looking to upgrade their accommodations. That might mean purchasing a home. But many will turn to the rental market, for two reasons:

• They are young and not yet ready to put down roots.
• They’ll be fighting the same battle as current home buyers: not enough inventory.

That influx of cash and demand could contribute to even higher rents.

Should you buy instead of rent?

Would-be apartment dwellers who haven’t been able to find a reasonable rent in the Bay Area don’t have many options outside the standard ones: split the rent with a roommate or two, move further away from the priciest areas, look at alternatives such as renting a room instead of a full apartment, and so on.

There’s another option that may be in reach for some: buy instead of rent. In today’s market conditions, it may make financial sense to explore this option. In fact, the national media will tell you it’s almost always better to buy than rent these days – with the caveat that this doesn’t necessarily hold true for, you guessed it, San Francisco. (Or for the other top-priced market out there, Honolulu.)

But it’s still possible to make the math work in the Bay Area. With restrictions on mortgages easing, and interest rates at near-record lows, you can end up with a home that represents an investment and equity, rather than simply shelling out cash for a rental with nothing to show for it.

For example, suppose you’re looking in the Sunset District of San Francisco for a 3-bedroom, 2.5-bathroom option with a two-car garage.

• Option 1: Rent a 1,350-square-foot home for $3,300 a month.
• Option 2: Purchase a 1,600-square-foot home (list price: $979,000) for $3,197.35 a month.*

*This assumes a 5/1 adjustable rate mortgage at 2.75% with a 20% cash down payment and doesn’t include insurance or property taxes in the calculation.

So it makes sense to explore your purchasing options before you resign yourself to paying ever-increasing rents. And if you need guidance, our partners at Mortgage Services Professionals are happy to help.

(Photo credit: Bay Citizen)

 

As Number of Homes for Sale Drops, Bidding Wars Erupt in U.S.

by Bloomberg News
 

As number of homes for sale drops, bidding wars erupt in U.S.

Mar 27, 2012 – 12:07 PM ET

David McNew/Getty Images

David McNew/Getty Images

Bidding wars, absent from most parts of the U.S. residential market since its peak in 2006, are erupting from Seattle and Silicon Valley to Miami and Washington, D.C.

  • By Prashant Gopal and John Gittelsohn

Matthew and Carina Hensley offered $10,000 more than the asking price for a three-bedroom house in suburban Seattle, then lost out to one of seven other bidders.

Their $270,000 proposal last month came with a family portrait and a letter introducing the couple, their eight-month-old daughter, Harper, and their desire to build a family in the Renton, Washington, house with a yard backing onto a woody hillside.

Bidding wars, absent from most parts of the U.S. residential market since its peak in 2006, are erupting from Seattle and Silicon Valley to Miami and Washington, D.C. The inventory of homes hovers close to a six-year low, while an increase in jobs and record affordability are tempting more buyers. The number of contracts to buy previously owned homes jumped 14% in February from a year earlier, the National Association of Realtors reported yesterday.

“We understand there is going to be fierce competition in the offers made for your house but Carina and I both felt very strong about letting you know what it would mean to us if we were given the opportunity to live in your gorgeous and charming house,” wrote Matthew Hensley, 33, a credit union branch manager whose wife is a dental hygienist. Such letters from eager buyers were common during the housing boom.

While listings will probably rise as banks accelerate foreclosures and sellers gain confidence in the market, the U.S. metropolitan areas with the strongest economies may be ready to absorb the additional inventory, said Mark Zandi, chief economist for Moody’s Analytics Inc. in West Chester, Pennsylvania. Low values and interest rates have made buying a better deal than renting in 98 of the largest 100 metropolitan areas, according to Trulia Inc.

 

‘Better Times Ahead’

“The housing crash is finally giving way to recovery in an increasing number of markets across the country,” Zandi said in an email. “The decline in unsold listings and vacant homes and the increase in rents presage better times ahead for single- family housing.”

The bidding wars seen in such places as Seattle aren’t found everywhere. In metropolitan areas including Atlanta and California’s Riverside and San Bernardino counties, housing remains weak as high unemployment and falling prices deter first-time and move-up homebuyers.

A contraction in supply hasn’t helped increase property values, which are down by a third from their July 2006 peak. Prices, hurt by discounted foreclosures and other distressed sales, will fall 2% more this year before rising 1.4% in 2013, according to a Moody’s Analytics projection.

Case-Shiller Index

Home prices dropped 3.8% in January from a year earlier, the S&P/Case-Shiller index of property values in 20 U.S. cities showed Tuesday. The measure is based on a three-month average, which means the January data were influenced by transactions in November and December.

A residential comeback would provide a boost to the U.S. economy. Housing will “contribute modestly” to the economy this year for the first time since 2005, according to Peter de Bruin, an economist at ABN Amro Group Economics in Amsterdam.

Rising demand for homes has cut into the supply, which is already low because many sellers — especially those with negative equity — are waiting for prices to increase before putting properties on the market.

Supply of Homes

About 2.43 million existing homes were listed for sale in February, the fewest for the month since 2005, the year U.S. home sales reached a record 7.08 million, the National Association of Realtors reported March 21. The number of listings rose by 100,000 from January, a seasonal bump that occurred every February since 2000 except for 2008, according to data collected by the Realtors.

The February supply of unsold homes listed for sale was down almost 50% from a year earlier in markets such as Miami, Phoenix and Oakland, California, according to Realtor.com, the National Association of Realtors’ official website.

The U.S. inventory of new homes stood at 150,000, a 5.8-month supply, in February, when new houses sold at an annual pace of 313,000, slower than analysts expected, the Census Bureau reported March 23.

The supply of new houses rose from 5.7 months in January “as builders put inventory in place for the spring selling season,” Stephen East, an analyst with International Strategy & Investment Group LLC in St. Charles, Missouri, wrote in a note to investors. “This is the fourth consecutive month inventory has remained below six months’ supply, which is broadly considered supply/demand equilibrium.”

The new-home supply peaked at 12.1 months in January 2009, forcing builders to book losses as the economy fell into recession. While the inventory has declined from that high, the housing market still has hurdles to overcome.

Negative Equity

One hurdle for the residential market is the more than 11 million homes that had negative equity at the end of 2011, meaning more is owed on the mortgage than the house is worth, preventing owners from trying to market their properties, according to CoreLogic.

“A big issue is underwater borrowers,” said Sam Khater, senior economist for CoreLogic Inc., a real estate data provider based in Santa Ana, California. “If they want to move, they’re not flexible with their price. The lowest they can sell at is their mortgage amount. So there’s price stickiness.”

In a sign that demand for new homes remains weak, orders fell 8% from a year earlier for the quarter ended Feb. 29 at KB Home, a Los Angeles-based builder that targets first-time buyers.

“In a recovering market, the results did an absolutely ugly U-turn,” East, the International Strategy analyst, wrote in a note after earnings were released March 23.

Lagging Indicator

The median existing-home price in the U.S. climbed 0.3% to US$156,600 in February from a year earlier. It was the biggest year-over-year gain since July 2010, when U.S. President Barack Obama’s homebuyer tax credit temporarily boosted values.

“Prices are a lagging indicator,” Khater said in a telephone interview. “The key metric to look at are sales numbers.”

Existing homes sold at an annual pace of 4.59 million in February, up 8.8% from a year earlier and the busiest February since 2007, according to the National Association of Realtors. The February number was down 0.9% from January, when an unusually warm winter in much of the country helped increase demand, according to Paul Dales, senior U.S. economist for Capital Economics in London.

‘Demand Picks Up’

“Good weather does not generate extra housing demand — it just brings it forward from future periods,” he wrote in a March 21 note to clients. “But the bigger point is that a genuine upward trend is under way, with sales 9% higher than a year ago and 13% above levels seen in July.”

Asking prices tend to be higher and inventory tends to be lower from March through May, while sales peak by June and inventory reaches a top in July, said Jed Kolko, chief economist for Trulia, a consumer-oriented real estate information service.

“As housing comes out of hibernation in the spring, demand picks up,” Kolko said in a telephone interview from San Francisco. “Prices peak early in the season and inventory peaks later. Buyers should be more patient, but sellers should move faster.”

Competition Increases

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Agents encountered multiple bids on about half of offers in Seattle, Boston, Washington, D.C. and Oregon this year through March 15, said Tim Ellis, real estate analyst for online brokerage Redfin. In the San Francisco area, Redfin agents reported that three of four offers involved competition, he said.

One home in Palo Alto, California, received 38 offers and sold for US$1.65-million, or US$452,000 more than its asking price, said Ken DeLeon, a real estate broker in Silicon Valley since 2002. Another client paid US$2.56-million for a home in 2007 and is listing it for US$3-million, with the expectation of receiving higher offers, he said. The seller wants to use the proceeds to buy a home in Saratoga, about 18 miles southeast of Palo Alto, where the market hasn’t heated up yet, DeLeon said.

Prices are hitting all-time highs, above Palo Alto’s 2007 peak levels, in the 94301 and 94306 ZIP codes, as buyers rush to purchase in advance of an expected flood of newly minted millionaires when Facebook Inc. has its initial public offering, DeLeon said. The Menlo Park-based social-networking company filed paperwork in February for an IPO that may result in a market valuation of $US75-billion to US$100-billion.

‘Hottest Housing Market’

“It’s insane,” DeLeon, who brokered 101 home sales last year valued at US$275-million, said in a telephone interview. “It’s probably the hottest housing market in the nation.”

In Phoenix, total listings as of March 23 were down 43% from a year earlier to 21,346 homes on the market, according to the Cromford Report, a Phoenix-area market research service. When pending sales are excluded, the number of available homes on the market fell 55% from a year ago. Distressed offerings dropped more, with the number of short-sale listings down 84% and bank-owned homes off 80%.

The average home’s time on the market fell to 90 days from 114 a year earlier, and the median sale price rose to US$126,000 from US$110,000, according to the Cromford Report.

Shopper Sentiment Improves

Contributing to the higher prices and faster sales pace in Phoenix were high investor-buying activity, normal homebuyers attempting to enter the market, speedier short-sale processes and an improvement in shopper sentiment, said Mike Orr, publisher of the Cromford Report. In a short sale, a property is sold for less than the amount owed on it.

“The inventory decline is accelerating,” Orr, who’s also director of the Center for Real Estate Theory and Practice at Arizona State University’s business school, said in an email.

The key ingredients are in place for a housing recovery in the strongest U.S. job markets, where sales are outpacing new listings and banks have worked through the backlog of foreclosures, Douglas Duncan, Fannie Mae’s chief economist, said in an interview.

The unemployment rates have fallen over the past year by more than one percentage point in the Miami, Phoenix, San Francisco, Seattle and Washington, D.C., areas, according to Bureau of Labor Statistics data.

Listings in Washington fell 27% from a year earlier in February, while the median price rose 11% to US$398,500 and homes sold after an average of 74 days on the market, a 20% decline, according to Metropolitan Regional Information Systems Inc., a real estate listing service in Rockville, Maryland.

‘Pricing a Little Low’

In neighbourhoods such as Capitol Hill, sellers are prompting bidding wars by asking less than they expect to receive, said Sean Aalai, an agent with Lindsay Reishman Real Estate.

“They’re purposely pricing a little low,” Aalai said in a telephone interview. “Buyers walk in and fall in love and the property starts getting bid up.”

Single-family home prices in the Miami area increased 19% from a year earlier to a median US$175,000 in February, the third consecutive year-over-year increase, the Miami Association of Realtors reported March 21.

The number of listings fell to 5,061 in February, or about six months’ supply, down from a nine-month supply a year earlier, as foreign buyers joined out-of-staters and Floridians seeking to take advantage of low prices, said Ron Shuffield, president of Esslinger Wooten Maxwell Inc., a real estate firm in Coral Gables, Florida.

‘Best Spring Season’

“This has been the best spring season since 2005,” he said in a telephone interview. “The entire world’s buying here. They love the weather.”

The Miami-area inventory of homes selling for less than US$100,000 fell to less than three months’ supply in February as investors snapped up low-cost properties and the availability of bank-owned homes shrank as lenders slowed the pace of foreclosures, Shuffield said.

Listings may swell in coming months as lenders allow more foreclosures to flow onto the market. The top U.S. mortgage servicing banks, which agreed to a US$25-billion settlement over foreclosure abuses last month, slowed the pace of foreclosures as they negotiated for more than a year with state attorneys general.

Foreclosures to Come

A shadow inventory of an estimated 1.6 million homes either facing foreclosure or already repossessed by banks was being held off the market in January, little changed from a year earlier, CoreLogic reported March 21.

“As we move into what is traditionally the peak selling season for real estate, servicers will certainly be watching closely to see if now is the time to move more inventory out of the shadows,” CoreLogic Chief Executive Officer Anand Nallathambi said in a statement.

Many states that don’t require court approval for foreclosures have worked through much of their shadow inventory. In Arizona and California, where banks take less time to repossess and resell foreclosures because the process doesn’t require judicial review, 7% of mortgages were delinquent at least 90 days or in foreclosure in the fourth quarter, down from about 13% in 2009, according to the Mortgage Bankers Association.

In Florida, where the court system is clogged with home seizure cases, 18% of houses with a mortgage are in the foreclosure pipeline, compared with 20% in 2009, the Mortgage Bankers Association reported. In other states that require judicial review, such as New Jersey and New York, the number of homes in the pipeline increased.

Time to Move

“If the foreclosure process has moved efficiently so that whatever problem there was has been taken care of, you’re going to see price appreciation as long as employment is growing,” Fannie Mae’s Duncan said in an interview.

For the most part, sellers are marketing their properties because of life changes, including taking a new job, getting a divorce or having their grown children move out, Khater said.

A four-bedroom home on 1.3 acres (0.53 hectare) in the Detroit suburb of Bloomfield Hills, Michigan, went on the market in October, when the owners decided to “downsize,” said Barbara Nigro, who has lived in the house since 1976.

“Now it’s time for another family to move in and raise their children there,” she said in a telephone interview from Scottsdale, Arizona, where she and her husband own a winter home.

The Nigros dropped their asking price by US$150,000 to US$950,000 in January, according to the listing. An offer is pending.

Seller’s Patience

“Maybe if I kept it for two more years I’d make more money,” said Michael Nigro, 71, a retired pediatric neurologist. “I don’t have the patience for that. I don’t want the responsibility.”

Lori Bakken, the agent who represents the Hensleys, said three of four bids she submits on behalf of buyers face competition. She said she expects the dearth of supply to be temporary.

“As word gets out there that there is a lack of inventory, I believe sellers will seize on that opportunity,” Bakken said.

The Hensleys haven’t given up on living in the Renton, Washington, area, where both sets of parents live. The winning bidder offered US$15,000 above the asking price and didn’t make the sale contingent on successful financing or inspection, according to Kimberly Hobbs, the Seattle broker who represented the seller.

“From this experience we learned that we have to move fast, especially if a house is nice,” Matthew Hensley said. “The competition is fierce out there.”

Bloomberg News

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Lessons from the Goldman Sachs Letter

by Pacific Union

 

In his letter, Smith called Goldman’s corporate culture “toxic and destructive” and explained that he no longer had the “pride…or belief” to continue working there after nearly 12 years at the firm. He went on to describe “decline in the firm’s moral fiber” and ascribed it to one major factor: a change in the way the company thought about leadership.

While we see no need to elaborate on what Smith wrote, we are obviously missing the balanced response from Goldman’s CEO which was likely circulated internally and to Goldman’s clients.

The timing is interesting. Tomorrow, Howard Schultz, CEO of Starbucks, will address an annual meeting and share the importance of culture and values for a vibrant, sustainable business. He will make the case that companies that earn the country’s trust will ultimately be rewarded with a higher stock price. Smith’s letter describes a business model at the opposite end of that spectrum.

Both of these stories prompted us to reflect on our values at Pacific Union International. And we’re happy to say that we think we’re on the right track.

Since CEO Mark McLaughlin took the helm in August 2009, we have been committed to the belief that “if we get the client service right, the rewards will follow.” Our real estate professionals practice a daily commitment to this culture, even through the most stressful and emotional client engagements.

For Pacific Union International, leadership is about innovation, measured risk, and extraordinary service – with full accountability for the good, the bad, and the ugly.

Even though, as with Goldman, our clients represent the source of our revenue, they are more than that. They are our advocates, our points of pride, and in many cases, our finest friends. We know that if we do the right thing with our clients’ and team’s best interests, the appropriate results will follow.

Our results of the past two and a half years support this belief. In an incredibly collapsed time frame, we have been able to empower our brand, intensify our cultural commitment to teamwork, and create multiple new initiatives to support our real estate professionals and their clients. We’ve exceeded our financial expectations and set a few new benchmarks, and the future for Pacific Union International is indeed bright.

These are Pacific Union’s core values:

Integrity – We maintain the highest moral and professional standards and honor our word in our relationships. We do the right thing even when no one is looking.

Trust – We respect each other and each other’s ideas. We believe in each other’s ability to deliver on commitments, creating a culture of which we can all be proud, and on which our clients can rely.

Luxury and service – We define luxury not by the price point of a home, but by the quality of our people and the unparalleled level of our service.

Accountability – We are committed to performance and results. We set clear, measurable goals and make it our personal responsibility to achieve them.

Teamwork – We recognize that through sharing and collaboration, we win both individually and collectively.

Innovation – We anticipate client needs and create opportunities that give us a competitive advantage in our markets. We value people who seek creative solutions and ideas that help us exceed client expectations.

Client focus – Our clients’ goals are our top priority.

We don’t only articulate our values; we support them every day. We walk the walk and talk the talk.

Thank you for your confidence in Pacific Union International and our values. Our continued dedication to these core values, both as individuals and as a team, will contribute to our brand promise of exceeding client expectations through extraordinary service, trust, integrity, and commitment.

 

The Hot Spot for the Rising Tech Generation

by
[COVER_MAIN2] Jason Henry for The Wall Street Journal

Gagan and Jasmin Arneja in their 1,800-square-foot home, which attracted 22 bids and sold for $1.5 million, 40% over asking price.

San Francisco

A bidding war broke out in November when a small house in San Francisco's tightly packed Noe Valley came on the market.

Twenty-two people, including employees of Facebook, Zynga, Google and Pixar, battled for the home. The winning offer was $1.5 million—40% higher than the asking price. The house had a great view, but it was only 1,800 square feet and came with an old kitchen which, like most of the interior, was covered in 1970s plywood paneling. Seen from the curb, there's hardly any house at all—just a one-car garage and gate leading to small front courtyard.

Photos: Where the New Tech Titans Are Buying

Winni Wintermeyer for The Wall Street Journal

Dolores Park, with a view of the Mission District and skyline of downtown San Francisco in the background, is a popular hangout for the new generation of tech entrepreneurs.

The inconspicuousness was part of the attraction, said Jasmin Arneja, 42, who bought the two-bedroom house with her husband Gagan, 40, a software engineer at a networking start-up. "It's the antithesis to these outrageous bizarre Gordon Gekko-esque houses. It just incorporates so much of our values," said Ms. Arneja, who runs a philanthropic advisory firm.

Housing prices in the San Francisco Bay area are once again soaring, thanks to an infusion of cash from the rising shares of Apple and Google and the initial public offerings by Zynga, LinkedIn, Yelp and soon Facebook, expected to be the largest in Internet history. But while a previous generation of dot-com executives opted for mansions in wealthy San Francisco neighborhoods like Pacific Heights and tony Silicon Valley suburbs like Atherton, this generation is gravitating to modest homes and condos in grittier parts of the city.

Ground zero of the current tech-fueled real-estate boom is the Mission, formerly a majority Hispanic neighborhood on the southern edge of San Francisco that's close to the main arteries that link San Francisco to Silicon Valley. Median home prices in the Mission grew 44% in December compared with a year earlier. Adjacent Noe Valley had a rise of 31% over that same period, according to the San Francisco Association of Realtors. The average number of days homes sat on the market in both neighborhoods has almost halved over the past year.

That's in sharp contrast to what's happening nationally, where the housing market continues to flounder, with the Case-Shiller 20-City index down for the fourth straight month in a row. It's even an aberration from the San Francisco area (including Oakland), which saw a 5.4% drop in home prices in December from a year earlier.

Newly minted tech millionaires in San Francisco are shunning mansions in wealthy neighborhoods and leafy suburbs in favor of modest homes and condos in grittier parts of the city. Geoffrey Fowler has details on Lunch Break. Photo: Jason Henry for WSJ

Real-estate agents say it's a cultural shift. The new generation of Internet executives—younger than the last generation of dot-commers—eschews the trappings and responsibilities of expensive properties. They want to bicycle, walk or take public transportation. They like living near food trucks and dive bars.

"You can spend a lot of money on a great restaurant here or just $5 on a burrito," said Christian Niles, 31, who bought a two-bedroom apartment for $585,000 in the Mission with his wife in August because he saw real estate as a good place to store the cash he'd made from selling his app called TrackerBot to Pivotal Labs last summer. He plans to never own a car.

StumbleUpon CEO Garrett Camp bought a 2,900-square-foot loft penthouse with four bathrooms and a patio for $3 million this past summer in the South of Market area. Twitter co-founder Evan Williams bought a $2.4 million house in Noe Valley in 2009.

The hottest properties are near corporate shuttle bus stops—where employees for companies like Google, Facebook, Genentech, LinkedIn and Apple line up daily for the ride to Silicon Valley. Real-estate agent Amanda Jones calls it the "Shuttle Effect" and said proximity can command as much as a 20% premium. Some real-estate agents said they're dying for a map of where the buses pick up. "When a listing gets deluged with people—that tells me it's close to a stop," said Ms. Jones.

Some companies share a few of the same stops, occasionally leading to employees getting on the wrong bus. Discussions can get animated about adding or moving a stop, said Jessica Herrera, Facebook's transportation coordinator who controls the stop locations for Facebook's eight shuttle busses, including a new glass-topped double-decker the company rented to make space for the growing crowds. "Everybody wants a stop that's next to their house that comes every five minutes," she said, adding that discussions have remained civil.

Winni Wintermeyer for The Wall Street Journal

The Mission apartment building where investor Michael Barton bought a condo: 'You can tell there is an upsurge going on here.'

Stephanie Pocino, 28, makes the 45-minute trip to Facebook every day from her rented apartment building in the Mission. She has no garbage disposal and no dishwasher, but the Victorian building has lots of charm and bay windows. She carries a wireless Internet card, which she uses to answer emails and work on presentations while on the commute, and her laundry, which she gets done free at the company's headquarters.

Soaring rental prices—up more than 10% in the Mission and Noe Valley in the past six months alone—are also making buying more competitive, said Vanguard Properties broker Craig Waddle. He's seen bidding competitions for rentals and rental offers coming in higher than the asking prices. At an open house for a one-bedroom offered for $1,400 a month, 40 people were filling out applications on the spot. One person walked up to the owner, offered $1,700 and got the place.

"It's been kind of shocking," said Raj Gajwani, 36, who has been looking for a house in Noe Valley for around $1.5 million for the past few months. A founder of two online companies, he and his wife are expecting twins and want a house close to a shuttle-bus stop for his wife's commute but with "culture, interesting people and activities." They also want something they will be able to sell for more money in five years, when they might have to move to the suburbs for better schools.

Mike Shaw, a real-estate agent who has worked for 15 years in the San Francisco market, said buyers often want something already renovated or vintage because they don't have the time or the interest to hire designers and architects. "That person in jeans and a sweatshirt could be low on the totem pole or a multibillionaire. They haven't realized the value of good design either in architecture or fashion," said Suzanne Tucker, a San Francisco designer who has remodeled many of the most lavish homes in the Bay Area.

Buyers argue they have a different sensibility. Ms. Arneja, who snagged the sought-after house in Noe Valley, said she was drawn to the interior, which is covered almost entirely by dark redwood and brick, lending it a feel that lands somewhere between a den and a tree house. "This is clearly a '70s house," said Ms. Arneja. "I would like to think of it as a shining example of good architecture during a bad period of design."

Pop-up restaurants with long lines, coffee shops that brew one cup at a time and shops selling curiosities like local honey have followed the influx of cash. Apple employee Amandeep Jawa, who takes the company bus to work, covered the driveway of his Victorian with a "parklet," a public space registered with the city featuring seating and greenery. His crowning achievement: a topiary triceratops, dubbed Trixie, made of succulent plants.

But the gentrification is far from complete. A surge in violence between feuding gangs called the Norteños and Sureños claimed two lives in less than 24 hours in the Mission in August, and there was a shooting in front of a coffee shop. Noe Valley saw a rash of sexual assaults; residents there have also reported attempted carjackings and armed robberies.

"The key word is coexistence," said David Campos, a member of the city's Board of Supervisors representing the Mission and Bernal Heights.

Blogs popular with tech workers keep track of the violence, and one UC Berkeley student produced a map called "Gangs and Cupcakes," which overlaid Norteño and Sureño territory with the Mission's most popular cupcake cafes. In recent years, somebody spray-painted "cafe gentrification" on the sidewalk in front of popular coffee shops.

The high prices and the changes in the neighborhood are only going to intensify, predicted Lawrence Coburn, 42, who first moved to the Mission in 1999 to found a start-up and has lived in an 1,100-foot rental loft there since 2003. "A lot of my friends are trying to hustle to buy a place before all the Facebook people get liquid," he said.

Investor Michael Barton, 48, recently decided to buy because he wanted to lock in his investment before Facebook's IPO money hits town. The area around his 950-square-foot, two-story loft is "kind of funky, and gritty and dodgy," said Mr. Barton. But an industrial building next door has been taken over by Internet start-ups. "You can tell there is an upsurge going on here," he said.

Buyers, Get Ready! New Homes Are On the Way

by Pacific Union

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By Pacific Union | March 9, 2012

Tags: , , , | Filed in: Contra Costa, Listings, Marin, Market Conditions

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Image of a home in Contra Costa countyHere in the Bay Area, we’ve been heartened by the recent signs of an improving economy. Between the improving job numbers and the extra buying power offered by today’s ultra-low interest rates, the factors are increasingly positive in supporting an upswing for our real estate industry.

But it continues to be predominantly a seller’s market, with inventory (available homes for sale) far outstripped by demand. In many of our areas, we’re seeing multiple offers, reduced time on the market, and a few frustrated buyers who just can’t find a property.

However, we’re seeing some early harbingers of change. One of our insider-secret leading economic indicators is on the rise: the availability of home stagers.

Home staging is the art and science of presenting a home in its best light to facilitate a sale. The best stagers create an attractive “blank slate,” through a combination of design and décor, onto which prospective buyers can project themselves.

These efforts work. StagedHomes.com reports that 94 percent of staged homes sold in 29 days or less, compared to an average 145 days on the market for non-staged homes. According to a HomeGain national survey, staging a home brings on average a 299% return on investment for sellers.

That means smart sellers make staging a priority, and an increase in business to stagers tends to precede an increase in homes for sale.

In several of our areas, home stagers are busier than ever — a great sign!

For example, the word from our Marin offices is that stagers are seeing increased demand for their services with properties in the $1 – $2 million range. One of the top stagers reports he is busier than ever – at the time we spoke with him, he was juggling 21 homes.

Other notes from Marin:

• There’s tough competition on almost every staging opportunity
• Many of the projects are larger in scope than usual
• Stagers are expecting to see this increased activity continue through June

All the Marin stagers we contacted had examples of properties they staged going into contract within a week, with one seeing 3 of 7 go into escrow in just 6 days. All 3 had multiple offers and went over asking.

Other Pacific Union branch executives throughout the Bay Area confirm that the number of new listings is on the rise. In our Contra Costa area, for example, the upcoming number of listings is double what it was two weeks ago – and most of these are brand-new to the market rather than re-listings.

All this means we’ll be seeing an influx of new properties coming on the market in the next 4 to 6 weeks. So buyers, start your engines! Looks like March might be the month to make your move.

 

An Open Letter to Trulia

by Mark McLaughlin

An Open Letter to Trulia

Trulia logoDear Trulia,

We’ve been partners for years now. We remember when you first started back in 2005, right here in our very own Bay Area, and we joined up with you shortly thereafter.

We loved your value proposition: Put our listings in front of people we wouldn’t otherwise reach, for free. In return, you got content that would allow you to grow — and eventually monetize – that audience.

It was a win-win agreement. But things have changed.

And frankly, we’re not thrilled about it.

With size and success come challenges, and one of the challenges we’ve seen you struggle with is keeping listing data current and correct. While we were happy to lend you our information – even our own intellectual property, such as photographs and custom-written descriptions — we did so with the expectation that the integrity of our data would be preserved and that your standards of quality would be similar to those of Pacific Union’s brand promise.

That hasn’t been the case.

We work hard to build the client relationships that create property marketing opportunities (listings) and we stake our professionalism on every one. And when the information displayed to consumers is wrong, through no fault of our own, that hurts both our brand and reputation. And it sure doesn’t properly serve a consumer looking to buy a home.

We’re glad that you’re making an effort to improve accuracy with your recent pledge. But the fact is, if you had to follow the same rules we do as licensed brokers, you wouldn’t need a pledge. It would be much simpler: If your data was inaccurate, you’d be out of business.

Speaking of how hard we work to build those relationships and property marketing opportunities, it’s disconcerting and frustrating to find someone else’s face plastered all over them.

Yes, we understand these are sponsored placements. And we’ll give you the fact that you identify, in tiny type, who the listing agent is and label display ads as such.  And yes, we know you need to make money.

But so do we.

Our real estate professionals earned those property marketing opportunities. We earned the trust of our clients. Invested years in analyzing market conditions and comparable sales and put in the long hours to clearly understand our clients’ objectives. It’s fair to say that for each property, the client has anointed us the subject matter expert.

We know the homes and the neighborhoods inside and out.

As a result, our clients prefer we answer questions and receive inquiries on their homes – which is why we have an exclusive listing agreement rather than an open listing agreement.

And yet, we see other smiling faces next to many of our listings. We’d guess that the average person browsing this site never notices that tiny disclaimer text. We’ll bet that most people make the assumption that this is in fact the listing agent. And that they believe the person who gets the “lead” is also the subject matter expert.

This shell game also does a disservice to the buyer.

If the agent who paid for placement doesn’t know the property, and in some cases doesn’t even know the neighborhood, how can they provide relevant guidance to the buyer? That’s not win-win for anyone. In fact, it’s a losing proposition for our exclusive clients.

Look, we know this isn’t an easy business in which to succeed. And we see the value in what you offer and want to keep supporting it. But the balance has tipped too far in favor of your interests over ours, and we’d like to ask you make things right.

Here are three things that we think you should do for us, and for any brokerage that gives you their listings.

1.Take down our listings when they’re off the market. Why?

- Because presenting a sold home as an available option when it’s not is misleading to consumers (and disrespectful to the new owner). You don’t sell ball bearings. You display hearth, homes, shelter – the most emotional purchase most people make. Misleading the user with incorrect details about price, location, and status frustrates and disappoints consumers.

- Erroneous information creates undue hardship for your real estate partners. When every “lead” begins with us having to first correct a caller’s assumptions about a property they just fell in love with, we end up spending time we don’t have to defend ourselves as a result of your loose policies. This may help you sell ads, but it hurts our brand – and yours.

2. Make the listing agent’s information clear and prominent. Why?

- Because, as your partner, this is important to our business and our clients.  We should not have to pay you to maintain the basic integrity of our listings. And, fine print or not, you’re leading consumers to assume the large agent photo adjacent to the listing is actually the listing agent. And most often, it isn’t.

3. Put our logo on our listings – and don’t charge us for it . Why?

- Because they are our listings. And because our logo is the official mark of our brand and has very clear standards – it must be displayed everywhere.

- Because by removing our mark you are misrepresenting our brand, which has a value in our marketplace. If you were a shopping site, you wouldn’t carry Nike shoes or apparel with the trademark swoosh airbrushed out. We’d ask for the same respect.

We’re not asking for the world here. We understand the value you can deliver. And we recognize that you’re a profit-making enterprise.

But what we want, at the end of the day, is to feel confident about how our listings are displayed.

When this happens, we’ll feel like the balance has tipped back to neutral. And that’s a win-win proposition I think we can all live with.

  • User Gravatar Amy Harrington
    March 2nd, 2012

    GREAT letter…all such valid frustrations and concerns, couldn’t be conveyed any better! Thanks!

  • User Gravatar Marianne Schier
    March 2nd, 2012

    What excellent points. In a business world that continues to rely more and more on the accuracy of the information ” out there “, we need to work to serve each other, but more importantly the customer or consumer! They are the ones who loose when a Broker from another area and/or company with no first hand knowledge of the property attempts to answer questions from a real Buyer. The equation is reciepe for disaster and the person who loses most the Homeowner. I have spent the first 15 years dedicated to one thing …..putting my Client first and I intend on spending the next 15 years doing the same.!
    I respect the need for more information to more people, but if and only if the information is true and correct. This greatly affects not only the Homeowner of the subject property , but in turn any other Homeowner in the neighborhood who is relying on the information to price their home for sale, and/or Buyer who is using the data as a benchmark for a purchase price in a tight competive market such as ours.

  • User Gravatar Fritz
    March 2nd, 2012

    Great letter Mark, your concerns are well directed from personal experiences. Please send the same letter to Zillow I’ve had even more issues with them.

  • User Gravatar Ginger Wilcox
    March 2nd, 2012

    Hi Mark,
    We understand your concerns about data accuracy. It’s an industry wide problem and one we are investing significant resources in. Our data comes primarily from brokers, MLS’s and franchisors so it’s as accurate as the source. We appreciate your feedback and would like to continue working with you to address concerns you have about the accuracy of your listings on our site. We are working with all of our partners to ensure better quality across the board.

    This is a very correctable issue. We’ve given your data team specifics on how to fix the data feed you send to Trulia to ensure the accuracy of Pacific Union’s listing on our site.

    We’ll follow up with you offline to work with you and your team to resolve the issues with your feed.

    Ginger Wilcox
    Head of Industry Marketing & Relations
    Trulia

  • User Gravatar pacunion
    March 2nd, 2012

    Thanks for the feedback, Marianne! We agree that putting clients first is an essential ingredient for success.

  • User Gravatar pacunion
    March 2nd, 2012

    Hi Ginger,

    Thanks for your comments. While we do agree that we need to ensure that our listing feeds are accurate, and do appreciate the efforts you’ve put in on our behalf to correct issues in the past, it’s disingenous to suggest that these problems always originate with the broker.

    In addition, while your comment addresses data integrity, it doesn’t touch on the other issues we have raised regarding the presentation of those listings, both in terms of brand integrity and in displaying the listing agents.

    We welcome continued discussion in these areas. Thanks!

  • User Gravatar Jami
    March 2nd, 2012

    Interesting read Mark! I’m about to purchase my first home, so it’s very relevant stuff.

    I’m curious though–because as a buyer, isn’t it in my best interest to have my own [buyer] representation? Surely, the listing agent probably knows every nook and cranny off the top of their head. But, does your letter suggest the listing agent should represent me too? If the seller agent is aiming for the highest possible price, and I am aiming for the lowest possible price–which client will ultimately be served?

    Being a regular user–I appreciate the options on sites like Trulia and the empowerment they are providing for consumers.

  • User Gravatar pacunion
    March 2nd, 2012

    Hi Jami, and thanks for the comment. We absolutely advocate finding the best possible real estate professional to serve your needs. In most our cases, the listing agent doesn’t also represent the buyer; that situation represents an extremely small percentage of all our transactions.

    However, if you as the potential buyer want to get more information about a particular property, it absolutely behooves you to know who the listing agent is — because that’s the person who is expert in the property. Our concern is that any buyer be able to get the most relevant, accurate information about a listing, and no one is in a better position to provide that information than the listing agent. In our opinion, the way Trulia presents its information can mislead a prospective buyer to click on the adjacent agent photo in the mistaken assumption that this individual is the expert (in other words, the listing agent)…and this does a disservice both to the buyer and the seller, who is hoping his home is well (and accurately) represented.

    Thanks again for your feedback!

  • User Gravatar Informed Agent
    March 2nd, 2012

    Mark – very well said and agreed on all points. The scale has certainly tipped to a point where it’s time Trulia and Zillow take these issues seriously. We, as the brokers and agents, own every bit of IP that’s on these sites in the form of listings / photos / descriptions / etc. All it takes is a national conference or two to spread the word of these injustices and brokers will unite to pull the plug on these services. Matter of fact, as Mark pointed out a few blog posts ago, a broker in San Diego is already gaining steam. How long till he gains critical mass?

    I’m glad to see Trulia stepping up their game and listening. They want to beat Zillow, right? Trulia – we’ve got your competitive edge ideas right here! Take the suggestions in this letter to heart and you’re making the right move. I don’t get the feeling from Zillow that they care…. they seem to have just wanted to go public then dream up their next venture. Hell, read their S-1 filing. They admit that their big earning days are behind them. I’m not sure I ever agreed w/ the $1B valuation. Maybe that was Wall Street’s ‘Zestimate’ a la LinkedIn or Groupon. Good luck w/ that, investors.

    In any case, Trulia’s got the edge at the moment and I’m rooting for them if they take broker & agent concerns seriously. But if they don’t, I’ll root for the brokers and agents to take back their IP with fury!! [ok, not just root, get involved]

  • User Gravatar Drew
    March 3rd, 2012

    If it’s in the buyer’s best interest to inquire about specific listings directly to each listing agent, wouldn’t the same apply to buyers who are viewing listings on your own web site, or any IDX web site for that matter? If not, what’s the difference between the best interest of a buyer who finds a listing on Trulia, versus the best interest of a buyer who finds a listing on PacUnion.com?

  • User Gravatar Kate McInerny
    March 3rd, 2012

    Mark,

    I love this because it’s honest, direct, and accurate. In this “brave new world” of online commerce, it is imperative that the human element not be forgotten. There really is nothing like “face-to-face” in business and it’s discourse like this that reminds us of that. The “school playground” follows us in life!

    The other essential element here is that consumers, the buying and selling public, are turned off and alienated when they suspect industry back-biting and conflict. How can they trust agents and brokers if there is struggle within the ranks?

    Thank you for stepping forward with this and inviting this very important and relevant forum.

  • User Gravatar Pacific Union
    March 3rd, 2012

    Hi Drew! Absolutely — we believe the same should apply no matter where you view your listings. That’s why you’ll see that on our site, as well as on other brokers’ sites, you’ll find the name of the listing agent as well as their brokerage right on each individual listing.

    Our concern is that with Trulia, the listing agent information is either buried or is visually trumped by the purchased advertisement of an agent who may not know anything about the adjacent listing. That can lead to a frustrating experience for both the buyer, who’s looking for immediate, accurate, and relevant information, and for the seller, who is hoping his property can be correctly represented to interested prospects.

    Thanks for taking the time to write!

  • User Gravatar Pacific Union
    March 3rd, 2012

    Thanks for your feedback, Kate! Appreciate the points you’ve made here about the human element, and thanks for joining this discourse.

  • User Gravatar Jose Perez
    March 4th, 2012

    Incredibly well said!

    The bottom line is that if the industry had taken the internet more seriously ten years ago companies like Trulia and Zillow might not exist. Although they do provide a valuable service in terms of distributing listings far and wide, the reality is that without the simple requests you make in your letter, brokerages are at a complete disadvantage and potentially being harmed.

    Brokerages need to take back control of the information they own and work hard for. This can be done by effectively driving more traffic to their websites, successfully engaging those consumers by providing an easy to use site with relevant information, and immediately responding to those that request more information about a listing or about the company/agent.

    By doing these things you expose your listings to as many people as possible, create more opportunities for agents, and deliver a better experience for the consumer who ends up on your site and is ready to talk. If brokerages can do these things effectively they will feel less inclined to be at the mercy of aggregators that might not always have the broker’s best interests in mind.

    There is no easy answer as every brokerage’s ability to deliver on the above will vary. That said, I think your requests are entirely reasonable and definitely a step in the right direction.

  • User Gravatar curious consumer
    March 4th, 2012

    @ Pac Union you mention “…you’ll see that on our site, as well as on other brokers’ sites, you’ll find the name of the listing agent as well as their brokerage right on each individual listing”
    Based on this statement why can I not find the Alain Pinel logo or agent located anywhere on your on the details page of this listing on your site? The example I am asking about can be found here: http://www.pacunion.com/homes/.....107394144/
    As a matter of fact the only person that appears to get this lead if a consumer uses Pac Union’s site to get more information on this property is Pac Union. On Trulia Mike Hirner is the listing agent and appears to be the one who gets the info if I were to hit either one of the contact agent buttons. Can you please point out on Pac Union where this information is on your site?

    The example I provided appears to be that of a paying client on trulia( I asked when I called if this agent was paying) so I chose this listing on 2063 35th ave and on Trulia when I hit ‘contact the agent’ it appears the info goes direct to Kenneth Hagan and the provided by links direct to this listing on Pinnacle Properties site. I contacted trulia and they told me this agent and company are not paying, but the lead does go direct to this agent for free since Kenneth claimed his listing. I asked what happens if Kenneth did not claim and they said that he would be one of 4 agent’s on the lead form.. I asked who would get the lead and they said all 4 agents including the listing agent, but if agents claim their listings on Trulia for free they are the only one that appears on the contact agent button. When I go to the details of this property on Pac Union I cannot find Pinnacle Properties anywhere on this page nor can I find a way to contact Kenneth. If I fill out the form on the right on your site can you tell me who would get my inquiry? Would it be Pac Union or would this lead go to Pinnacle Properties or Kenneth, the listing agent?

    In order to be fair I did some research on the other sites mentioned Zillow and Realtor.com and this is what I found –
    When I contacted Zillow they confirmed this broker and agent are not paying for any services. Zillow does allow agents to claim their listings for free, but still allows multiple paying agents to showcase themselves on other agents details pages & buries the actual listing agent and broker at the very bottom. When you click the contact agent button it is misleading since the actual agent is not one of the 3 choices of agents. When asked I was told an agent has to pay a fee to be the only person on your listing on Zillow.

    When I contacted realtor.com they confirmed this agent and broker are not paying for any enahancements. Realtor.com does not allow the listing agent info at all unless the agent pays for a showcase package and there is a broker level service as well. When I contacted Realtor.com they told me the form on the right goes to the agent or broker who buys zip codes. While realtor.com shows the brokerage name and phone number it does not click over to the broker site nor does it appear there is a free way to ‘claim’ your listing as you can do on both Trulia and Zillow, but based on my calls to all 3 companies only Trulia allows for a free option for the listing agent to get their listings and be the only agent with their photo, phone number, and receive leads on the contact agent form.

    You can see the difference on the each site for this listing here:
    Trulia: http://www.trulia.com/property.....o-CA-94116
    Pac Unionhttp://www.pacunion.com/homes/CA/San_Francisco/94116/2063__35th_Ave/107394108/
    Zillow:http://www.zillow.com/homedeta.....6282_zpid/
    Realtor.com:http://www.realtor.com/realest.....3268-44547

    Based on this it does appear Trulia has the best overall interest of the broker and agent contrary to your post. They are the only one out of Zillow, Realtor.com and Pac Union that I found that the actual listing agent receives the lead and when you click contact agent it actually goes to the actual listing agent without having to pay. The broker is clearly marked above the fold with a link to that listing to the broker site (I just learned what above the fold means) – in this case Pinnacle Properties and again the Broker is not paying. It seems as maybe your note should have been addressed to Zillow & Realtor.com and not Trulia or at least call all 3 companies out and not just one.

    Based on me taking 30 minutes out of my day to do a bit of research to see what you are very clearly upset about does not seem to be completely true or maybe you are misinformed. But as a consumer I find great value in these sites more so than I do broker and agent sites. These sites seem to have a more open way of finding information and I am not asked multiple times to register to get all the information. The data may not always be 100% correct but I think consumers are smart enough to understand to contact an agent when they are serious about moving forward and Brokerages like you and many others need to give consumers a lot more credit.

  • User Gravatar Jami
    March 5th, 2012

    @ Curious Consumer:

    Very well said! I am interested to see if Mark has any thoughts.

  • User Gravatar Pacific Union
    March 5th, 2012

    Thanks so much for your in-depth commentary and the work you’ve clearly done in exploring this issue. We’re very excited to see informed consumers in the marketplace, especially when they take the time to weigh in on industry issues such as this one.

    You bring up several points which I’d like to address one at a time first, if I may, followed by a little more insight into our position.

    1. Listing agent data on Pacific Union’s site. Our company site, http://www.pacunion.com, is proprietary and is developed, funded, and maintained by Pacific Union. The source of the information is almost exclusively the multiple MLS’s of which we are members. The information is updated directly from the MLS’s twice daily.

    As a licensed broker, we share listing information through an industry sharing and advertising policy facilitated by the MLS called IDX. It is policed, accurate, and accepted as a standard by participating brokers.

    Part of our requirement is to include the listing agent’s name and affiliated brokerage for every listing we display – and we do so. Please scroll to the bottom of the page (the “footer”) to see that information, which in this listing you referenced reads, “Courtesy of: Alain Pinel, REALTORS, Michael Hirner.”

    Is that information hugely prominent? No, it isn’t. And you’ll find that it’s similarly low-key on other sites where brokers display other brokers’ listing. And on our site, we do not promote other brokers’ logos or agents’ contact information — nor do they do so on their sites.

    Why? Because we are all displaying not only our listings, but also those of our direct competitors. With this in mind, you can see why placing one broker’s information in a prominent position on another broker’s website isn’t smart business.

    The key distinction between what we do and what Trulia does is this: Trulia is not a broker. It is not a direct competitor to any broker. Since the concern I outlined above doesn’t apply, it is entirely reasonable for a broker to expect their listing agent to appear prominently and exclusively on their own listings.

    2. Claiming a listing. “Claiming” a listing should not have to be an extra task in the marketing of a residential listing. The listing was actually “claimed” — or better yet, awarded by the client as an “exclusive listing” — at the time it was executed by broker and client and then entered into the MLS by the broker. To expect a broker to share these exclusive listings with a syndicator only to then be expected to once again have to “claim” them breaks the trust paradigm, in our view. If we syndicate to a Trulia or Zillow and we were the source of the listing feed, does it not make sense that we have already “claimed” the listing?

    3. Advertising/showcasing on a listing. We believe that selling advertising on a listing on any site that in any way makes it appear as though the paying agent is the appropriate or authorized property representative fractures the trust of a consumer. At http://www.pacunion.com we do not permit advertising on any listings.

    4. Zillow and Realtor.com. We are in active dialogue with Realtor.com and have reached out to Zillow.com for a meeting as well. We completely agree with you that each site operates very differently, as does PacUnion.com.

    5. Being upset with Trulia. I’d like to make it clear that we are not “upset” with Trulia. We’ve done business for many years, and we 100 percent recognize and value a role for the Trulias in our industry. However, we think there is room for improvement.

    Now, for the additional insight I promised.

    As a former executive with LoopNet, the largest commercial real estate listing service online, I experienced firsthand the delicate nature of two meaningful dynamics:

    - The trust and partnership we needed with the brokerage community that was (and is) indeed the source of over 85% of the LoopNet content. Our brokers were (and are) the lifeblood of our content, or inventory, or simpler yet our “supply”.
    - The interdependency of supply (listing content) and demand (clients or eyeballs). If we did not have the content (supply), the clients (demand) would not return to the site to search. If we did not have the clients (demand) at the site, the content (supply) would not return.

    The value proposition to the client was timely access to information across all product types and geographies. The successful business model was ultimately monetizing the demand for information in the form of content/listings.

    So with the above in mind, we would think Trulia would be honoring and exposing a broker’s “exclusive” listings as the most important content by which to attract clients. A Trulia executive recently informed us via e-mail “20 million serious home buyers and sellers come to Trulia each month to get the inside scoop on real estate.”

    If that’s true, then there are literally tens of millions of clients with a need and demand for accurate, timely information that had all the property and contact information that the home owner, broker, and MLS are willing to publicly promote.

    Wouldn’t it stand to reason that this information would be valuable – perhaps something a visitor would be willing to pay for? This would be a business model that would not put agents through a “claiming” process or require advertising to be sold on listings.

    For the record, we are not just talking about our concerns; we are acting on them. We have been in contact with senior executives at Trulia to establish a meeting to review and discuss these very issues — which they also consider paramount to our industry.
    So if we share the same values of timely and accurate information, our solutions are likely close at hand.

    Thanks!

    Mark

 

Displaying blog entries 1-6 of 6

Contact Information

Photo of Ken J. Gendemann Real Estate
Ken J. Gendemann
Pacific Union International
1699 Van Ness Avenue
San Francisco CA 94109
Cell: (415) 828-4063

Ken J. Gendemann, CPA
Pacific Union & Christie's International Real Estate
1699 Van Ness Avenue, San Francisco, CA 94109

Cell: 415-828-4063, Office: 415-345-3083
 License #: 01884446