Baron Briefs

Two reports this week indicated the U.S. housing market continues to slow. On Wednesday, the National Association of REALTORS® released existing home sales data showing July sales slipped 11.2% from a year ago. On Thursday, the Census Bureau reported new home sales were down down 21.6% from a year ago.

Fear not, says Bill Tancer, General Manager of Global Research at Hitwise. He’s plotted NAR’s existing home sales against the search term “homes for sale” and predicts an uptick come September:

…barring any unusual circumstances over the next week, our search term data indicates a reversal in the downward trend reported by NAR yesterday. The August numbers, scheduled to be released September 25th, should reflect that reversal.

I’ve been slowly evolving RealtyBaron’s lead trading platform since its launch in 2004. In that time, I’ve learned quite a bit from users (don’t we all). For example, I initially modeled lead auctions after eBay auctions–3, 5, 7, and 10 days in length. However, agents complained consumers didn’t respond to emails after a lead auction completed.

After some good ol’ fashioned research ‘n analysis, I concluded a lead becomes quite “cold” after 24 hours…a fact that’s prolly well known by other lead services on the Web. So, I made some changes recently to counter this effect:

1. Instead of giving a choice of 3, 5, 7, or 10 days, I now give no choice and impose a 24-hour time limit on all lead auctions.
2. I added the concept of a “stop bid” which can be used by consumers to immediately stop the auction if a certain bid amount is received from a Realtor®. Not only does this prevent bidding from reaching absurd lows, but it can significantly shorten a lead auction. I now see some lead auctions end within hours of starting.

The first wave of feedback is just now being received after making these changes:

Not bad, eh?

Since launching RealtyBaron.com, our auction platform has only been introducing homeowners to Realtors®. Today, we start helping the other side of the real estate transaction with Buyer Rebate Auctions.

Basically, anyone who has taken the home search into their own hands using vertical search tools such as Realtor.com, Trulia, or Propsmart can use this new feature to connect with a Realtor® who will represent them in the transaction. Realtor® bids are based on what sales commission (or flat fee) they’d accept as compensation. The rebate is the difference between the co-broke fee listed in the MLS and the Realtor’s final bid. For example, a co-broke fee of 3% minus a final bid of 1% = 2% rebate for buyer.

Like RealtyBaron’s current Listing Auctions, bidding on Buyer Rebate Auctions will be controlled by the gatekeeper algorithm, AgentRankâ„¢. As the name implies, AgentRank(TM) ranks agents and prevents underperforming agents from bidding. By specifying a minimum AgentRankâ„¢, buyers can ensure they meet a Realtor who has a proven track record.

For Realtors®, this feature is an easy way to connect with clients who have already absorbed the most costly part of representing buyers–the prolonged home search.

UPDATE: Inman News writes about our new Buyer Rebate Auctions. Thanks, Glenn!

Real estate brokers on the Realtor® mailing list, RealTalk, sounded off today when asked ‘Where have all the sellers come from?’. Here’re a few of the responses:

People bought homes with adjustable rates and now the payments have gone up to the point they can’t comfortably pay them.

A lot of the sellers I’ve talked with decided last year to cash in on the profits and move up to new and bigger homes. Now that construction on their new homes is being completed, they’re putting their current homes on the market.

Sellers home owners insurance being increased so much that they feel they have to sell and move out of the area A large chunk of them appear to be coming from investors.

Many of them planned to buy and flip and got caught when the market changed faster than they anticipated!

I say, “What about buyers?”. Shouldn’t they accept some of the blame? After all, if buyers were able and willing (i.e. demand) to do their part, there wouldn’t be an inventory build up.

The market is slowing and agents need to stand out in a crowded marketplace. Unlike marketing stunts that can easily be duplicated, a background in architecure or city planning strikes me as a unique value proposition that is difficult for competitors to match. What other examples of “real value” have you seen in the wild lately?

While polling the masses for a new RealtyBaronâ„¢ feature on our mailing list, the discussion took an ugly detour into familiar waters: are lead services a valuable tool for Realtors® or do they simply get in the way of hard-working Realtors®? I’ve decided to let the debate continue here in the comment section rather than pollute the mailing list. So have at it Realtors®…

The National Association of REALTORS® yesterday said they urge consumers to “do their homework” and “interview at least three REALTORS® before making a decision”. They suggest the consumer is dropping the ball when selecting a REALTOR® and include stats to prove it:

Fifty-eight percent [of buyers] talk to only one agent before deciding to use them. Sellers are worse: Only 26 percent of sellers talk to more than one agent before deciding who will market their property.

Sure, ‘homework’ should be done when selecting a REALTOR®, but who has time for interviews and marketing plans? And why are consumers expected to be the best judge of a marketing plan? It reminded me, however, that’s why we exist. Our business is REALTOR® selection. We automate both the interview and negotiation process–all within 48 hours. So remember, American consumer, you can do your own homework…or let us do it for you. We guarantee an A+ experience.

Doing Your Homework [NAR]