Wouldn’t it be awesome if it was drop dead simple to gather buyer’s contact info as they walk in the door at your next open house — all from your iPad? M Squared, a brokerage in Washington DC, now offers this to all agents in the form of an “app-less” iPad Open House Management interface. From the Press Release:

A record of every check-in is automatically emailed to the M Squared consultant for easy follow-up. In addition, open house visitors are automatically added to the consultant’s contact database so price updates, status changes and future listings can be quickly shared. Once an open house visitor registers at an event, they immediately receive an email with detailed information regarding the property they are viewing, nearby comparable properties and additional open houses taking place in the neighborhood. Best of all, the content is delivered in a mobile-friendly format for quick access on-the-go.

Sounds like a winning combination to me. My hunch is what M Squared has released is going to be a standard open house tool — in 2 years once the rest of the real estate brokerage community catches up to the technology leaders.

Are you using your iPad at open houses yet?

It was getting close to Inman Connect NY, and I could feel the urgency in a text message from Matt Beall, ”did you get my email regarding the social media case study for Inman?”

I’m sure somewhere—in the ether that is my inbox—sat an email from Mr. Beall. Knee deep in a Hawaii Life interface redesign, however, my Gmail account was left unmanaged and overflowing its 200G limit.

Since integrating social media into our real estate search in September 2011, I hadn’t really thought about the project. Social (from a business standpoint) was not driving sales, and my mind was on other things that were—specifically a recent surge in mobile traffic led by the iPad.

With Inman looming on the horizon, however, it was time to do a little digging into our social integration project. A text message to Yax, Hawaii Life’s lead programmer, and a few minutes later the Facebook insights installation was complete.

A quick test drive of the Insights interface (Facebook could learn a thing or 2 from Google Analytics) and I was off. 332,828 Facebook impressions in the month of December. Wait…what? 332K impress…ions? Could that be right? It was.

Still, with over 1.2 million impressions in the 4 months since launching the Facebook comment box and other social media buttons, it had resulted in zero trackable sales. But that doesn’t mean that the integration into search wasn’t working, just not how we expected.

Instead of generating leads that turned directly into sales, social media created a platform that allowed other people to share our brand.

Using Social Media to Build Brand

You can learn how Hawaii Life is using social media to build its brand in 2 ways:

1) Short & Sweet - The slides for the Inman presentation in PDF format, sexified by Winny (Creative D / Co-founder):

Case Study – How to (Effectively) Integrate Social Media into Property Search

2) Detailed – The entire report which was used to create the presentation:

Integrating Social Media into Real Estate Search

If you have questions, comment below. I’m sure there will be several. There were at Inman after Matt gave his talk, which I believe (without being bias) was one of the better presentations at the conference.

My hunch is Zillow’s next move is to figure out how to weave real estate agents into the Neighborhood Advice process — likely by giving Premiere Agents branding inside that Facebook Connect experience and encouraging buyers to contact the agents in addition to their friends who live there.

Sound cool? You can try it here.

This is a brilliant strategic product decision by Zillow in my book.

Sandicor is now in the business of competing to be a top 20 consumer real estate website in San Diego. Here’s the email that was sent out yesterday to all SANDICOR members

San Diego’s four Association of REALTORS® and Sandicor are excited to announce the release of a new consumer website! This website is designed to turn the consumer’s focus back to Brokers and Agents and away from third party sites such as Zillow and Trulia that rank among the top 20 websites in the category of San Diego real estate. In addition to the Sandicor MLS site, there will be four additional websites branded to each of the four Shareholder REALTOR® Associations that own Sandicor. The goal is simply to reverse the trend of consumers going out to and staying on third party sites and to drive consumer traffic back to our member’s websites. Recent analysis (click here to view relevant video from Victor Lund) using HitWise (an Experian company) has shown that website traffic from third party sites to broker and agent sites has significantly declined and that consumers are staying on the third party sites for their San Diego real estate information. We want to change this! The four Realtor Associations and Sandicor consumer websites are intended to “unseat” these third party sites as the de facto resources for property searches and property information in San Diego County.

Developed around a powerful and flexible search engine, the websites provide the following benefits for brokers and agents:

–Deliver leads to brokers and agents
–Drive traffic back to brokers and agents and away from third party sites like Trulia and Zillow
–Facilitate a consumer’s search for San Diego County real estate information and properties.
–Provide consumers with unbiased, timely (updated every 10 minutes) and comprehensive data – all of which are valued and preferred by the consumer
–Allow the consumer to find an agent using a name, affiliated office or location
–Permit county-wide Open House searches
–Provide valuable Community Data
–Provide links to helpful information such as Population Statistics, School Systems, and Government Resources
–Offers a variety of reports for both Brokers and Agents on their listings such as the number of views of their listings in a search, the number of times the listing was displayed and emailed and more.
–Lead to a reduction in the fees paid by Brokers for participation in national third party sites.

There is no additional fee to provide this tremendous benefit. Sandicor can leverage the consumer view that the MLS is the trusted source for real estate information provided by and for the real estate professionals in San Diego County. The consumer knows MLS data is unbiased, timely and comprehensive.

Please watch for future emails informing you of what reports will be available to you and how to update your contact information. We look forward to making the sites a success and to help bring the business back to you! Go ahead, click on the link below and take a test drive now!

http://consumer.sandicor.com

My Thoughts

My big question is WHY would a consumer use the site Sandicor released? Why would a consumer look at Sandicor’s new consumer site, as opposed to an agent or broker site like Gellens.com or SanDiegoCastles.com (both of these sites are clients of Virtual Results). On the agent/broker sites? The listings are the same. The community data is better. The search experience is BETTER. That leaves me puzzled why money was spent on this new “consumer” site.

As far as Sandicor’s goal of ranking as a top 20 site in their market? Remember, you need a solid SEO foundation to rank – and this is not a solid SEO foundation if you ask me. For proof — visit the “community info” portion of the site, navigate to ANY community from the drop down in the upper left, and notice that the URL (http://consumer.sandicor.com/sitecontent/snd/communityinfo.aspx) and title tag (Community Info) remain the same no matter what community you are viewing. That means that community portion of the site is 1 page in the eyes of Google.

The Zillow’s of the world have absolutely nothing to worry about. Honestly, I struggle to see how MLS’ ever plan to compete with the Zillow’s of the world. They are not in the business of building amazing consumer experiences. Zillow is.

As I commented on Kris Berg’s post, why the industry continues to pay for, and release subpar website solutions like this that will likely never yield any results, I have no idea. My hunch is this site will be scrapped in a year or two and will just serve as a distraction for the MLS in their quest to remain relevant to their members.

But what do I know…

+

Wow, the Zillow acquisition of Diverse Solutions for $7.8 million in cash and stock is big big news for this industry. I’ve got a unique perspective on this announcement for a few reasons:

1. At Virtual Results, we work extremely closely with Diverse Solutions. Their dsIDXpress comes standard with every Predesigned Website that Works (dsSearchAgent is optional), and on most of our customs.
2. I worked for Zillow for almost 5 years & worked with Diverse Solutions as an API partner starting back in 2007 (& 2008).
3. I happen to be close friends with a few people at Diverse Solutions

It goes without saying that I want to congratulate all those involved. I have many friends at both organizations, so I’m obviously happy to see them join forces. But, what does it mean for everyone involved you are likely wondering?

Zillow

First, this gives Zillow relationships with the roughly 200 MLS’ that Diverse Solutions currently works with. It’s a much easier process to work with one data provider like Diverse Solutions than working with 200 different MLS’ individually. We all know listings quality continues to be a pain in the rear for all real estate portals — one interesting product that will certainly come as a result of this acquisition is a seamless listing syndication program for all Diverse Solutions clients that’s hooked straight to MLS data.

Second, there is certainly revenue growth here for Zillow — the deal gives Zillow the ability to sell Diverse Solutions products to their sizable advertiser base, as both a package deal with Zillow Premiere Agent subscriptions as well as a standalone IDX product.

Third, Zillow gets one step closer to being able to offer agents and brokers everything they need to power their respective online marketing efforts.

Diverse Solutions

There is certainly no question this is a massive win for the team at Diverse Solutions. Being backed by the largest real estate site on the web gives them increased engineering resources, sales and marketing, and just general long term strategic security that they didn’t have before.

Diverse Solutions Clients

I expect Diverse Solutions to get a significant bump in terms of development resources, which should mean better products for clients of Diverse. The holy grail of listing management is for an agent/broker to maintain their listings in one place, and have that seamlessly feed into their entire online marketing; this takes Diverse Solutions clients’ one step closer to that (once a seamless syndication product is integrated).

MLS

The MLS data agreements that Diverse currently has in place will all be honored, so I really don’t think this should be much of an issue for MLS’.

Rob picked up on the hostile interpretation of the acquisition – which is the possibility of a “ZDX” that COULD come at some point down the line. “ZDX” (or whatever you want to call it) would be an IDX experience for agent and broker websites powered by Zillow listings rather than IDX data. So, I guess MLS’ might have something to worry about after all. But, this certainly won’t happen for awhile — if at all.

Now, Zillow just needs an integrated website product and a CRM to be able to give agents and brokers a one stop shop of products to power their entire internet marketing efforts

What do you think of this acquisition?

The basic problem is that the data wasn’t accurate, first because of bugs then ultimately because of problems with the source data in MLSs.

I have to admit, I wasn’t expecting they’d take the whole thing down. I thought they’d iterate, change the interface a bit, fix some data challenges, etc — not take the whole thing offline for good. Granted, I haven’t looked at the underlying data to know how bad it is. And my hunch is if Redfin took the whole Scouting Report feature down as a result of the data, it’s probably worst than I was expecting in terms of quality.

So, now what?

Consumers want the data; that much is apparent. I think Glenn is right:

If we don’t do it, media sites will, and they’ll charge you to advertise there.

We’ll just have to wait for the Zillow’s of the world to try their hand at this and see if we see just as much of an industry backlash. And if they don’t do it? I’m willing to bet a few lesser known media sites will do it if for no other reason than the publicity (and SEO) that it will bring them.

Finally, I have to applaud Glenn and the entire team at Redfin for taking a stab at this. It was a big risk, and a gutsy strategic move on their part. On the plus side for them, they got a massive number of links and publicity for the feature — so all their efforts weren’t in vain.

Like I said, I think the concept of open performance statistics is here to stay — even if it’s not Redfin bringing it to you.

What do you think? Should they have pulled the plug?

While most of the discussion has centered on the vast inaccuracies of the reports, the lack of adherence to MLS membership rules, and the lack of transparency in the user interface, it makes sense to step back and look at a larger subject.  Is it possible that the influx of venture capital into a real estate tech startup is creating an even larger change in the way we work together as an industry?

Tech Startup Culture

I worked in, and consulted for, a number of tech startups in the Silicon Valley over a decade ago.  The energy within these companies is immense, and creates not only a sense of confidence but also a fair bit of hubris.  When you work within a company that is “changing the world”, pats on the back are never far away, VC money supplements your shortfalls, and the rallying cry is “always faster, before someone else does it.”  A tech startup’s focus is getting new information to the consumer as quickly as possible.  Transparency takes on an almost religious tone in this world:  “We are delivering information.  What we’re doing is important.  What we’re doing is good!”

The quest for larger amounts of public data at ever-increasing speeds is certainly positive in many ways, but it seems that sometimes we allow ourselves to forget our most basic responsibilities in our rush to achieve those goals.  Case in point:  our current debate over publicly displaying agents’ sales statistics and doing so in an accurate and transparent fashion.

The Ethics of Open Data vs. Accurate Data

I’ve stated before that I’m open to this data being public, but the majority of my colleagues are not.  This is fine, because we belong to member organizations which can vote on these kinds of decisions.  Inaccuracies in data will certainly lend themselves to legal issues for those who display incorrect data about business competitors.  More importantly, though, the personal interaction between our industry’s professionals is being thoroughly tested.

At what point does the need to be “first to market” in Seattle trump the damage done to a small business owner in Sonoma County, CA?  When consumers in Cynthia Larsen‘s neighborhood search online for her name, what does it cost her when they find a page on another broker’s site stating that she only sold 2 homes in the past year (missing 95% of her sales)?  Cynthia doesn’t know, because those potential clients will never call her.  She doesn’t have millions of dollars in venture capital to create a comparable online presence to combat the misinformation.

What happens when agents in Phoenix, looking for a new brokerage, search for Jay Thompson’s company statistics and 44% of his agents are not even listed with Thompson’s Realty?  Jay doesn’t know, because those potential agents may never call him about joining his brokerage based on that data.

Were These Questions Even Asked?

What does this say about the publication of such a model in this manner?  The Realtor Code of Ethics certainly comes into play.  I’ll give the benefit of the doubt in saying that Redfin didn’t intentionally disregard the well-being of thousands of professionals’ small businesses across the country.  More likely, it’s the arrogance that can be created in an exciting tech startup culture, distancing its members from the mundane details of industry, and allowing them to simply disregard the ethical implications.

This service was released publicly with a brazen “Let’s just see what happens,” attitude.  There was no timeline in which it needed to be released, no deadline coming from some regulatory board.  There was plenty of time to make sure that it would not unduly harm other professionals, but no one felt the need to raise those concerns.  Why?  Because it was going to be exciting.

Real Estate Is A Cooperative Industry

Real estate is unlike many other industries.  Most sales professionals compete against each other until one makes the sale.  Attorneys compete with one another for clients and in litigation, and at the end of the day, one wins and one loses.  In real estate, while we compete for clients, positive results are only achieved when we work together with our professional competitors to create a satisfactory transaction for both sides’ clients.  The only success for buyers, sellers, and brokers, lies in all sides reaching an amenable agreement and the subsequent closing of a home sale.

Whether my cooperating broker in a transaction is from my Seattle real estate brokerage of Coldwell Banker Danforth, or a competitor such as Windermere, John L. Scott, RE/MAX, and Sotheby’s, we know that our clients’ best interests are served when we aggressively negotiate for them, but maintain a professional relationship throughout the process.  The majority of brokers actually enjoy working with our competitors. We have a genuine concern for our cooperating brokers’ well-being, because will be working with them again in the future.

Redfin is hoping to expand its partner agents nationwide.  Whiteboard Friday lesson:  “Partner”.

**UPDATE**  As this was being published, Redfin was making the decision to pull the plug.  Inaccuracies in data were noted as the cause for the decision.  I’d be more inclined to believe that the threat of widespread litigation, multiple MLSs declaring it in violation of their terms, and the burning bridges within the industry had a lot to do with it also.  If this can be done correctly in the future, by a neutral party, we can give it another shot.

For an example, take a look at Kris Berg‘s scouting report. I picked Kris because I’ve known her for years and know (hope) she won’t get mad.

Brian Boero at 1000Watt and Jay Thompson have already written about the announcement, and there are some great conversions in the comments — so I urge you to go read both articles. Below is part of my comment on Jay’s post:

“I wish Realtor Associations had taken the initiative to do what Redfin is trying to do here.”

I seriously don’t get how not a single MLS in the country has done this? Diverse Solutions did all the work in august of 2009 in two stinking days (granted, they have a few KICK ASS developers). That was more than 2 years ago. What have MLS’ been doing for the last 2 years? Why hasn’t an MLS gone and bought that technology from Diverse and implemented this..like 18 months ago? Consumers want the data — that’s obvious.

The main complaint I’ve heard voiced thus far is data inaccuracies. Sure, there are data issues to overcome. So what? The first version of any product or idea is seldom, if ever, perfect. This is just exposing the belly of the MLS data issues that have existed for years.

What I find shocking is that EVERYONE saw this product coming a million miles away (the product was on stage at Inman 2 years ago), but no one did a d*mn thing about it. Whether you like it or not, we’re seeing a shift toward more information available publicly, for anyone to see. The curtain is being lifted, and the consumer is driving that process. Whether it be you as an agent, your brokerage, another brokerage, your MLS, an IDX vendor like Diverse Solutions, or Zillow — someone is going to give the consumer what they want. Those that do will be swimming in online traffic. Those that don’t are going to be left squabbling for the scraps. I firmly believe that’s a good thing.

We know consumers want to see median sales price, average number of price changes, and average days on market. We know they want to see all the data on a map. Why don’t agents and brokers lead the next charge and be the ones to put sales history and performance statistics directly on their own real estate websites for all to see?

You can verify the data is 100% correct for yourself, your team, and your agents. So, what’s stopping you?

Some brokers such as Doug Heddings already post every single sale from their entire brokerage for anyone to see. It’s not perfect — it doesn’t have aggregated performance statistics nor are the listings overlaid on a map in a user-friendly way. But it’s sure as heck SOMETHING.

Remember, if you don’t do it, someone else will. However, fear of someone else beating you to the punch is not the reason you should do it. Do it is because it helps consumers make more informed decisions about the agents they hire. Do it because you have nothing to hide. Do it because you are proud of what you do. Do it to drive more business to the agents that view real estate as a career instead of a hobby and are actually performing — and less business to those who aren’t.

And, yes, this industry needs to invest in some innovative companies and individuals.

Believe it or not, popular and desired domain names can go for several million dollars, as the owner of RealEstate.com just realized. The transaction included hundreds of real estate domain names, including RealEstate.com, as well as a network of brokerage companies. The entire package sold for a shocking $8.25 million. The new owner is MarketLeader.com.

The new website will be revamped and updated to help assist real estate professionals, buyers, and sellers acquire the information and connections they need.

Why is this acquisition an incredible deal for MarketLender?

First and foremost, MarketLender obtained an incredible domain name in a pivotal real estate market. The acquisition will allow the company to take advantage of the current real estate market and recreate the website in a manner that attracts a variety of individuals. The key to making this website successfully in being able to link real estate professionals with key players in the real estate industry while providing essential information to buyers and sellers. High quality information will be the starting point for this website.

Second, MarketLender is already well-known in the field and is more than prepared to move forward with high-quality marketing that will attract visitors to their newly acquired websites. Obviously having a domain name like RealEstate.com will work in their advantage as one of the most important keywords is already in the domain name.

In the end, it will be interesting to see what MarketLender does with these domains and to keep track of the incredible profits the company is likely to make if they structure the website in a user-friendly and informative manner. Sure, $8.25 million is a large sum of money, but the company will probably make that back and much more just on RealEstate.com alone.

The vast majority of real estate professionals I encounter dismiss the value of these models, sometimes for very good reasons which I’ll discuss later.  Technology enthusiasts like myself, however, find the same fascination with these valuations as the average consumer.  It’s a brave new world in the real estate industry, and the amount of intellectual and financial horsepower being driven toward these online outlets of real estate data seems almost unlimited.  In the end, though, my concern is with who really benefits from online automated real estate valuations?

Clear Benefit:  Real Estate Consumer Websites

Zillow, Trulia, and their cohorts are in the business of differentiation.  There are already tens-of-thousands of agent-based local websites delivering accurate, timely listing data for consumers.  Recreating this same database on a national scale doesn’t add value for a local home buyer.  To pull a consumer away from their comfortable neighborhood home, something shiny and new is required.

The national real estate websites are leveraging their superior finances and workforces to create tools that an average agent cannot.  Automated valuations create a unique, interesting, and (potentially) financially valuable tool for consumers.  When a home buyer begins using one real estate site to compare home values vs. home prices, he or she is likely to continue using that same site for a long period of time, to guarantee the consistency of the metric being used in the search.  This creates a consumer who not only views a large number of pages within a site for comparison purposes, but does so repeatedly, day-after-day.  Consumers will many times become quite loyal to the site, out of appreciation for its unique value, or even out of fear of making a mistake by not coming back and consulting this source of information.

This loyalty and traffic, generated by the unique content, creates a great amount of SEO and financial value through advertising.  For a real estate portal with no associated brokerage actually selling homes, this is the number one goal.  Profits come from advertising, and advertisers buy traffic visibility.  Make no mistake, Zillow didn’t become one of the world’s most popular real estate sites because the forums had nice discussions.  Zestimates were the sparkling new bauble leading the news media and the public through the door and allowing the company’s introduction to a massive audience.

Unintended Benefit:  Real Estate Macro Market Statistics

Although I can’t guarantee this, after watching a company like Zillow for years, I don’t imagine that the founders ever thought that their market data would be used in the way it is today.  The tools, in the beginning, were designed to compile large amounts of data and apply it to one home, creating one estimate of value at a time.  The massive undertaking and collection of data sources, in the end, created an unexpectedly-accurate database for national real estate forecasting that is nearly unmatched in size.

Stan Humphries, Zillow’s chief economist, has been making a name for himself by beating Case-Shiller to the punch on housing statistics of late.  The statistics are actually a very good thing for the overall real estate market, as they add another voice with a large body of credible data to back it up.  The extra publicity doesn’t particularly hurt the company either, as Humphries and CEO Spencer Rascoff are regularly featured as national real estate figures based on their data.

Partial Benefit:  Home Buyers

This point has been made by real estate agents ad nauseum, but I’ll repeat it because it is valuable.  Automated home valuations have a small benefit to a buyer in their home search.  In an introductory phase, buyers may want to see sales prices and values in a general area to begin to understand the area in which they’ll buy.  Estimates may flesh out the neighborhood a bit more than simply viewing recently closed sales.  The additional data could help a buyer understand that most homes in their preferred neighborhood are worth between $350,000 and $400,000.

That’s it.  That is where the value ends for a home buyer.  Estimates on individual properties are not worth the screen they’re displayed upon.  Since Zillow is the most popular, and I know and like a bunch of people at the company, I’m going to pick on them in particular.

Nationally, Zillow’s estimates missed the sale prices of homes 45% of the time by more than 10% of the value.  Zillow’s estimates missed the sale prices 25% of the time by more than 20% of the value.  From these two statistics alone, it’s clear that you’d be foolish to make a home purchase decision based on an automated valuation.

This isn’t an opinion, it comes directly from Zillow’s statistics.  The  company itself points out that its estimates are not to be used as an appraisal, and is highly transparent about its own inaccuracies in the data for individual homes.  Unfortunately, it seems that there are far more consumers relying on Zestimates than there are actually reading those disclaimers.  Buyers should understand that once they’ve gotten past the initial phase of scouting out a neighborhood, using an automated valuation model isn’t going to provide accurate information on individual homes’ values.

Net Zero Benefit:  Home Sellers

Home sellers register the most complaints with real estate professionals over automated home valuations, with good reason.  While home buyers might miss a potentially good buy because they relied upon an online valuation, there are always other homes to buy.  Sellers, on the other hand, have just one iron in the fire.  If a seller lists his/her home for sale and an inaccurately-low value is being posted next to their house online, the seller is stuck explaining a botched mathematical calculation to buyers instead of promoting a home’s best features.  There is no upside to a high valuation.  Sellers have already named their price, and buyers won’t be increasing their offers because of the high valuation.  While the number of potential buyers who may undervalue this home based on that valuation is unknown, it creates a great amount of anxiety for a home seller that they’re being unfairly judged by an outside source with little direct knowledge of the home.

All of the major real estate sites claim to have procedures for human input on their valuation models to adjust a poor valuation.  This is very temporary band-aid, however.  Human input will always be subjective.  High valuations won’t be appealed.  Listing agents and sellers will always appeal low valuations, even if their home is overpriced.  In the end, human input altering the outcome of the model just reduces the intergrity of the model itself.

Automated Valuation Models Have a Long Way To Go Before Truly Benefitting Consumers

We’ve certainly seen some benefits to real estate statistics and greater market knowledge, and I enjoy watching another statistical powerhouse competing with the old guard for the most accurate industry projections.  It’s fairly clear, though,  that these automated valuations have benefitted their creators much more than individual home buyers and sellers.  In the spirit of technology progression, I’m hoping that these algorithms are developed to the point that they become somewhat-accurate predictors of value.  However, as much as I’m admirer of our ever-increasing ability to manipulate data for research purposes, I’ve sold far too many homes to believe that a computer model can compare one neighbor’s shiny granite counters to another’s crumbling laminate.  The data is a nice tool for economists, but for the individual consumer it’s more entertainment than sound financial advice.