360Digest

Redfin announced today an $8 million dollar cash infusion from the likes of Paul Allen’s Vulcan Capital, Madrona Venture Group, BEV Capital and The Hillman Co. Total financing now stands at nearly $9 million dollars to expand the online discount brokerage.

John Cook’s article “Redfin closes on $8 million funding” has the details and background. It states “Since starting the service earlier this year, Redfin has helped Seattle-area buyers purchase more than 40 homes valued at about $18 million.”

However, when I just did a search on the NWMLS, as of 9AM this morning, there were only 13 closed sales valued at only about $7 million dollars since they’ve started their new sales model. If they’re getting a 3% sales commission and refunding 2% of that and keeping 1% for themselves, they’ve made about $70K so far this year. Is that enough to justify a $9 million dollar investment?

I’ve attached the statistics here.

I imagine they’re poised to make this announcement at their big party tonight (I guess that’s where part of that $9 million is going….) Tonight’s the big Tech Crunch shindig at Conworks to toast Michael Arrington, sponsored by Redfin. Arrington comments today on the news in Tech Crunch “Redfin to change the rules of real estate sales“.

(I’m not sure that place is such a good choice for a party. Conworks is the art space hijacked by the staff from the founder, Matt Richter, and I think they’ve lost most of their subscription base and have had to resort to renting out their space to the highest bidder. I have been unable to support the organization since Richter’s ousting, but haven’t found it to be much of a sacrifice since their programming sucks since he’s left.)

I ran across this interesting piece on Redfin from Mortgage News Daily, Redfin lacks Zillow’s hype but may ultimately have more impact The author seems pretty well-informed about the company and offers this interesting observation on the dilemma faced by listing agents asked to show listings to Redfin clients:

In some states the listing agent would be within his rights for liability reasons to insist that the buyer be accompanied by his buyer’s agent on any visit to the listed property.

Actually, no agent in any state must show a house to a stranger. Nothing in any state law compels an agent to place themselves in harm’s way, if they feel that accompanying a stranger or meeting a stranger at a house will or could harm them.

Redfin Buzz….

Rain City Guide
John Cook’s Venture Blog
Virtual Broker
Silicon Beat
San Jose Mercury News (There’s an interesting bit of misinformation in this article “… considering Redfin’s progress in the Seattle area, it has promise. Redfin’s sole agent there has completed about 20 transactions since its February launch — a quick pace for the industry — mostly by working with the tech-savvy, do-it-yourself crowd” Actually, the NWMLS lists 6 licensed agents hanging their hat at Redfin.)

More Redfin buzz….

Post Bubble
David Brunelle
Lopolis

Read “Iraqi athletes targeted for wearing shorts“.

Unbelievable.

What do fundamentalist muslim beliefs have to do with real estate?

The same radical Muslim beliefs that punishes Muslims for wearing shorts because they violate Shari’ah law, also forbids borrowing money and paying interest. So, unless one can pay cash, without being able to take out a mortgage, the dream of home ownership is out of reach for most Muslims. So is investing in any kind of traditional way, as bank deposits, investing in the stock market or buying rental property on a mortgage.

Can a Muslim be a Real Estate Agent?

Real Estate Sales Fatwa

There’s a blog called “The Future of Real Estate Marketing” that discusses real estate marketing, the impact of the internet, Web 2.0 and blogging on the real estate industry. I can’t tell who it’s by, but it’s interesting so far, in its short life. Anyway, they had an article entitled “Is advertising going to be Zillow’s downfall?” that appeared last week. It asked the question do the ads on Zillow run the risk of compromising its usability?

Lots of pop-up ads, ads that follow your cursor, ads with sounds, etc….

I guess they weren’t the only ones who noticed and complained.

Mike McDevitt, Director of Business Development over at Zillow made a post on the Zillow blog basically apologizing for the obnoxious ads and (sort of) promising not to feature those again.

Apparently, we do not blog in a vacuum.

There was also a lot of discussion in Seattle Bubble about Susan Ryan’s article in Seattle Real Estate Professionals. The Tim also noted a few things I had to say last week…..

So far, no one’s particularly fascinated with what I have to say this week, but I did get an honorable mention in “Prikbord” with a link to my website. So far, my Unusual Homes page has received 514 hits, but I’m not quite sure if the reviews are good or bad, as it appears to be in Dutch…. Can anyone out there read this? The same page was visited over 200 times from a mention in X-Stage. I think this is in Russian. If you hover over the words “visit Outoja taloja“, it directs one to my Unusual Homes section on Seattle Dream Homes. I’ve also been “dug” at Digg, but only about 36 times. I’d feel bad about the low number of hits, but I’ve had over 1000 visits from Milk and Cookies. Weird!

Lots of buzz about Tribune Interactive buying ForSaleByOwner.com. That equals the equivalent of millions of dollars of free advertising for sellers who use the ForSaleByOwner.com services. “List with FSBO.com and have your home featured in the LA Times, Orlando Sentinal, and the Chicago Tribune for free” That was a brilliant move. I anticpate Google buying MLS Direct, Yahoo buying Discount Brokers and MSN buying FSBO-Direct .

The only option now is for the NAR to partner with a major publishing house or search engine. Or create their own.

The P.I. published an interesting article last month entitled “Flipping property not as easy as seen on TV, experts say”, about the trials and tribulations of buying, fixing up, and selling property for a profit.

It’s hard to do, because if it was easy, everyone would do it. But there are dozens of so-called real estate guru’s making big money selling books, tapes and courses on late-night TV telling viewers that they can MAKE BIG MONEY IN REAL ESTATE! YOU DON’T NEED A JOB! YOU DON’T NEED A DOWN PAYMENT! You don’t need a brain.

There’s a great website by John T. Reed entitled Reed Guru Rating. He published an alphabetical list of famous real estate investment gurus and seminar organizations which is hilarious.

You don’t need no stinkin’ money!

When purchasing these Real Estate Guru’s products, it’s truly “Buyer Beware”.

The Daily Mirror has reported American Idol judge Simon Cowell has bought Jennifer Lopez’s old house in Los Angeles. Cowell is said to have paid £6 million for the property, and is apparently going to knock the whole thing down and spend another £3 million rebuilding it. Apparently he didin’t like the decor. Cowell already owns properties in London, Dubai, Spain and another house in Los Angeles.

Why do I care about this stuff?

According to The Walk-Through, Katie Couric bought an $8 million 5-bedroom house in Southampton; Denzel Washington supposedly passes on an apartment in a former church; Developer Harry Macklowe is said to be buying multiple apartments at the Plaza Hotel for a total of nearly $35 million. Pamela Anderson lists Malibu house for $6.5 million; she paid $1.8 million for in 2001; Ethan Suplee, an actor in the NBC sitcom “My Name Is Earl,” buys a house in Studio City that Jane Fonda used to own.

What’s wrong with me?

From Zillow, Uri Geller, a psychic who has achieved fame for his spoon-bending abilities and other paranormal activities — along with two other business partners — have made the winning eBay bid for a home where Elvis Presley lived for a price of $905,100.

Why do I find this so fascinating?

From Celebrity Spider, separated Jessica Simpson and Nick Lachey are reportedly fighting over who will get ownership of their luxury $1.5 million condominium in Las Vegas, Nevada.

Am I sick or what?

Britney buys house for husband’s ex-girlfriend….

Shut up!

Brad Pitt buys an island home in the Dominican Republic…..

Stop it!

Extreme Makeover: Prince Edition
Landlord sued singer over purple alterations to Hollywood mansion

Yikes!

UPDATE: Someone just sent me this cool slideshow of Celebrity Homes!

Prudential Real Estate is offering a new program with Yahoo Real Estate called the “Online Seller Advantage program”. It’s designed to let sellers’ agents convey market information to their clients via email. Sellers will be able to receive a range of consumer-related and competitive market data.

The statistics, based on online property searches at Yahoo! Real Estate and Prudential.com sites and local property data, describe how often a client’s property appeared on search results; how often the property was viewed in a detailed format; how many viewers saved the property information; and discusses price changes of homes in the immediate neighborhood and status changes of other for-sale properties in the area. Clients also receive information about new property listings in the area.

Zip Realty, which offers a discount model of rebates and price concessions in 17 markets around the U.S., has reported a net loss of $800,000, or 4 cents a share, for the first quarter, down from a $700,000 profit during the same quarter a year ago.

It costs money to run a quality real estate office, pay for competent support personnel, pay errors & omissions insurance, pay for marketing, newspaper, TV or radio advertising, webpage design and maintenance, hosting & SEO, marketing postcards, real estate flyers, signs, keyboxes, and assorted sundry forms, brochures and business cards.

They are going to have to either raise their prices or lower their overhead if they want to make any money in this game. Luckily, they have $83.5 million of cash with no long-term debt, so they’ll probably be alright for awhile. But I also think there might be some shuffling when some of these business school grads who thought they were going after the low-hanging fruit of real estate sales commissions come to realize that the pickins’ might not be as easy as they seem.

Zip Realty is already having a change in personnel, as Eric Danziger, Chief Executive Officer, announced his decision to resign from the Company on August 1st. No word yet on who will take his place.

There’s a widely-quoted article about Warren Buffett in CNN Money “Buffett: Real estate slowdown ahead. The Oracle of Omaha expects the housing market to see “significant downward adjustments,” and warns on mortgage financing.”

His remarks, weighing heavily upon the minds of those with “real estate bubble” on the brain: “The day traders of the Internet moved into trading condos, and that kind a speculation can produce a market that can move in a big way. You can get real discontinuities. We’ve had a real bubble to some degree. I would be surprised if there aren’t some significant downward adjustments, especially in the higher end of the housing market.”

Is this true? Probably. But those speculators took a chance investing in something as illiquid as real estate. Some were stellar winners, some will be losers of mammoth proportions. Oh well. You win some, you lose some.

The winners are those who bought their property to love and live in.

It’s like art. You gotta buy what you love, because there are no guarantees it will go up in value. But if you love it, and you don’t have to sell it, it doesn’t matter. You live in your house, surrounded by your art, and it’s a beautiful thing. Both do best as long-term investments.

Zillow presentation by the Realtor Referral Network
Marriot Courtyard, Wednesday, May 10th Zillow presentation (by Jeff Somers, Director of Agent Services) meeting at the Realtor Referral Network on Wednesday, May 10, Marriott Courtyard, Lake Union, 925 Westlake Ave N from 9-10:00 AM. $10 Deluxe Breakfast Buffet. They encourage agents to bring listing flyers and buyer’s needs to share. Reserve now as they expect a large turnout. The whole RRN thing is put on by Julie McCullough Hale of Old Republic Title and Escrow.

Venture Breakfast – May 2006
Friday, May 12, 6:30 a.m.-9 a.m.
Bellevue Westin Hotel, 600 Bellevue Way
Topic: Pygmalion, The Wizard of Oz, and Chevy Chase
Speaker: Rich Barton, Chairman & CEO of Zillow.com, Founder of Expedia.com and Venture Partner at Benchmark Capital
Cost: $25 for pre-registered members, $40 for pre-registered nonmembers. Onsite registration available for an additional $5, as space permits.

Breakfast With The Publisher of PSBJ
Featuring a panel of CEOs from the 100 Fastest Growing Private Companies list of 2005. They’ll share their secrets for success in a Q & A format with PSBJ Publisher Emory Thomas Jr. at the Columbia Tower Club.
When: May 23rd, 7-9 a.m.
Location: Columbia Tower Club Columbia Center 701 5th Ave 75th Floor Seattle, WA 98104
Cost: $20 for Columbia Tower Club members and $25 for non-members.
To register or more information.

Battle of the Barristers
Breakfast with some of Seattle’s top real estate lawyers.
Thursday, June 1st, 2006
Program: 9:00 – 11:00 AM
Marriott Courtyard in Bellevue
11010 NE 8th St.
Bellevue, WA 98004
Tickets: $30, Includes Continental Breakfast
Online Registration
Moderator: Russ Cofano of Cofano Law PLLC, John Demco of Demco Law Firm P.S. , Jordan Hecker of Hecker, Wakefield & Fielberg, Chris Osborn of Foster Pepper and Doug Tingvall of RE-LAW.

And don’t forget to see Carleton Sheets or The Donald in Seattle this month too!

Dale Chihuly is the recipient of this years First Citizen Award, sponsored by the Seattle King County Association of Realtors.

This has not been a banner year for Dale Chihuly, nor for the National Association of Realtors.

Beleaguered, sued, and harassed, both face lawsuits this year. Realtors from the Department of Justice and Chihuly from an artist accusing him of fraud.

Coincidence? Conspiracy? Or Prophesy of a New World Order? YOU DECIDE!

First Citizens Ticket Info (May 10th)

Glassblower challenges integrity of Chihuly art

Chihuly Screwed Me

Halleluiah! Donald Trump has deigned, in his superior intellect and magnanimous selflessness, to share with us tips and techniques to greater wealth, here in Seattle.

He’s coming in a few weeks, to share with us the secrets of his success. Or maybe he’s just coming to sell us a $300 tape course.

Doesn’t this guy have enough money, for chrissakes?

Estimated to be worth at least $250 million bucks (though he’s currently suing Warner Books for misstating this, as he claims he’s worth at least $2.7 billion), you’d think he had enough dough, even for a high-roller, to last a lifetime. How many cars can you drive at one time or how many swimming pools can you swim in at once? Of course, at this level, this is not about the money with him. This is his reason d’etre, his mantra, his MO, his reason for living. At this point, it’s truly whoever dies with the most money, wins.

So, Trump will be making appearances at the Red Lion in Seattle on 5/16 and a few other hotels in Bellevue, Tacoma and Everett. It might be worth a laugh, just to go see him. Donald Trump Seminar Registration

I’m not immune to the Trump allure…. here’s me ‘n’ the boys before our vist to the Trump Tower in New York.

Trump’s not the only one hawking get-rich-quick schemes in Seattle….

Carlton Sheets pays us a visit too…..

The Northwest Multiple Listing Service released its April sales stats yesterday, ending (or fueling) speculation that the Seattle real estate bubble has burst. Sales may be slowing, but prices inch ever upwards, as homeownership in the Pacific Northwest continues to be unobtainable for many residents.

Kathy Mulady had an article in today’s Seattle P.I., Homeprices hit record–
Small inventory, high-end sales push median to $419,500.

For an opposing view of todays announcements, check out the bubble babble on Seattle’s Bubble Blog.

Seattle P.I.’s real estate blog Seattle Real Estate Professionals

Even the high-end homes get snatched up quickly by Elizabeth Rhodes, Seattle Times

Looks like a hiatus –
Home sales for the month of April take a breather, but prices continue to climb, by Barbara Clements, Tacoma News Tribune

The New York Times had an article a few days ago about buying stigmatized properties (Some Buyers Regret Not Asking: Anyone Die Here?) and elaborated upon by the folks over at Zillow (If these walls could talk…..). It concerned houses where people had died or been murdered and the possible existence of ghosts or bad ju-ju in the home.

Tonight on 20/20 they’re airing a segment How to Sell a House of Horrors — ‘Dr. Disaster’ Appraises Properties Where Chilling Crimes Occurred, about what happens when someone is killed, murdered or dies in a property. How much value does it lose? Will it ever sell? Apparently, if one holds on to it long enough, people forget. Nicole Simpson’s condo on Bundy, which sold just a few years after her murder for $590,000, $200K less than she paid for it, is now on the market for $1.8 million dollars. (The show also had a great piece on real estate flipping and falling prices in Florida — something our friends over at Seattle Bubble are going to love!)

The American Bar Association had a great article with a legal emphasis , Stigma Busters — A Primer on Selling Haunted Houses and Other Stigmatized Property. It used to be that sellers in Washington State were required to disclose a death in the home for sale. Now, the responsibility for investigation falls on the Buyers, as they have the opportunity to perform what’s called a “Neighborhood Review” where they can look into any past crimes, deaths or other disasters, traffic patterns, neighborhood noise, proximity to shopping and the like. Wanna see if there are any sex offenders in the neighborhood? King County Sex Offender Search.

Have you already bought a stigmatized house? Contact Heather Mack. She has an MA in Pastoral Studies from Seattle University and performs “House Blessings” to purify the home. You can call her at (206) 330-7158 or email her at HeatherAnnMack@Yahoo.com

A Washington D.C. man has repeatedly turned down offers of up to $2 million dollars for his row house, which now clings to the edge of a massive construction site.

NBC Video Link

Homestore, which has rebranded and now doing business as Move.com, has reported a net loss of $2.04 million in the first quarter compared to a net loss of $395,000 in first-quarter 2005.

The new Move.com property-search site integrates several existing Move Inc.-operated Web sites, including RentNet.com, HomeBuilder.com and Realtor.com. The site also features a link to a home-valuation tool that lists the value of recent home sales located near a home address entered by a user.

The site also integrates a new online version of the company’s Welcome Wagon offering, which connects homeowners with local businesses, services and special offers. Other links at the Move.com entry page relate to moving services, senior housing, a Realtor locator tool, and home and garden tips.

As a side note, I applied to be a “Welcome Wagon Lady” back in college. That just sounded so cool to me. Maybe it’s not too late.