blog

I’m a big fan of facts and proof. Last night I was watching the Science Channel about how there is some disagreement in the scientific community about how best to get humans to Mars. It caused me to think about the real estate community’s disagreement about commissions.

I think people generally believe that the following statement is true: “Real estate commissions are too high, and real estate services are overpriced”

I began to think where is the proof of that? How do we know it is true? It seems to me that we would need some supporting facts, to be able to confirm that statement applies in all situations. We need to know the following:

1. What are the standard elements to the real estate process
2. Can a baseline cost be applied to each of these elements
3. How does “service level” impact the premium placed on the baseline cost
4. What effect does the market have on the costs
5. What other factors would affect the premium calculation

Over the next couple of days I’ll examine those questions and how the commission argument has developed among our community.

If you’re thinking your going to read a scathing rebuke of Redfin… you can bounce out right now.

I was trolling the real estate blogsphere over the weekend and was shocked by the absolute hate that Redfin receives from the real estate community. Its really more sad than anything. When an industry attacks innovation it is a sure sign of that industry’s impending death.

The major airlines attacked Southwest when it started, and left a lasting scar which is still visible to this day, (you can’t fly into Texas on Southwest from any state that doesn’t touch Texas, so no direct flights from LA to Dallas) They almost killed them. However, today, Southwest is one of the few airlines that can turn a profit, all of its attacker have long since gone or are now emerging from bankruptcy, realizing the status quo can no longer be maintained.  They fought their competitors, unions, and the airports, built systems that save consumers money and time and most of all made the short air travel enjoyable and affordable.

Redfin could be the next Southwest.

One thing is a sure bet, if we are attacking innovation, especially consumer centric innovation, we are losing the consumers hearts and minds. A battle we should and NEED to be winning.

What are we telling the consumer? We don’t care about you? We care more about protecting our tuff than helping you keep more of your money?

I’m embarrassed by the cheers that went up when Redfin got hit with a $50,000 fine for posting reviews of homes for sale? Can you imagine? What if Roger Ebert got hit with a fine for being critical of a current movie? What was even more galling, was the fact that were Redfin simply a consumer, instead of a licensed brokerage, posting those reviews nothing would have happened.

We ultimately make it harder for us all, when we poop on the consumer, we are lumped into the heap of deplorable professions like “used car salesman” or “blog operator”.

 Let’s elevate the discussion… if you’re better than Redfin, why?

I was just thinking about what the computers response would be to that ridiculous commerical by Century 21.

 see that commerical here.. http://www.youtube.com/watch?v=ANQdmWpehBU

Update to the earlier post:  “I love Paris Hilton”  On my way in to the office today every and I MEAN EVERY news channel was covering her squad car ride to the courthouse, kinda reminiscent of OJ’s bronco chase of years past.  Her face was on every news crawler and her name on the radio.  You can’t buy that kind of coverage.  For the people that hate hilton… well they’ll still hate her, but for her fans… she is now a goddess, a martyr.   Her little book about her ordeal will be a best seller and she’ll be on Larry King after this talking about what she has learned, and how her life has been changed by this experience.  That sucking sound your hearing is her…  sucking the money out of your kid’s piggy banks..

That sassy hotel heiress is out of the pokey after serving just 5 days of her 23 day sentence for a probation violation.  Its reported that she was let out because she was sick…  I wonder if former Homestore Inc. CEO Stuart Wolff, is feeling kind of sick right now??

What does Paris have to do with real estate… well I was justing thinking of the parallels between Paris and Redfin… everyone hates them but their are always in the news…

What did Oscar Wilde  say the “only bad press is no press” or something like that.  Its funny how many times I see the word “Redfin” out there on traditional real estates blogs… I wonder if they realize they are doing them a favor?  Google the word “Redfin” and your get about half a million entries…  now thats a long way from Paris’s 50,000,000, but it means that people are talking about them and it is given Glenn, et al the opportunity to open a dialog with the consumer and the real estate community.

Sometimes pissing people off gets you more notoriety then making them happy

over at the inman blog

http://blog.inman.com/inmanblog/2007/06/midyear_housing.html

they are talking about the fears that are affecting the house market for 2007… but in my opinion I welcome the sound of some glass breaking.  I would love to get thru this correction quickly, there is a lot of money sitting on the sidelines waiting for prices to get back to earth.

 Wasn’t it Mayer Rothschild that said “when there is blood in the streets buy real estate”