Tech Companies Real Estate Invasion
Tech companies want a piece of the real estate pie. Amazon. Zillow. Opendoor. Rex. It seems like every week there’s a new company announcing its venture into the game. Here are some things swirling through my mind as I think critically about this trend…
The obsession with speed: There is space for escrows to be faster as tech firms say, but I hope we don’t lose sight of the importance of time. It’s okay to have space for necessary inspections, negotiation based on those inspections, and a reasonable contingency period so buyers and sellers are sure about their decision. There’s this idea that real estate should be instantaneous, and maybe one of these days it will be on the blockchain, but mistakes are easy to make if we go too fast. On that note, let’s be cautious about expecting too much from appraisers in this climate because speed can water down quality. Do you know what we need more than fast appraisals? Reliable appraisals… Read more »
- Tech Companies Real Estate Invasion - August 26, 2019
- Help Appraiser in a Coma - March 1, 2019
- Let’s Get Rid of Appraisers. What Could Go Wrong? - November 30, 2018
I’ve heard similar stories from other listing agents. Zillow apparently uses the listing price as an input into their Zestimate of house prices.
https://twitter.com/erinnstumpf/status/1163987132660084736
This is intriguing. Do you think a person could list unusually low, pull off market, working the avm down and then use that to argue down assessed valuation? Zillow just handed home owners a really effective way to fight high taxation. How many assessors offices around the country rely on these systems or accept their results in personal assessment appeal requests? When it comes to taxation, the numbers are too high.
https://www.opendoor.com/homes/atlanta
Opendoor now FLOODING THE MARKET with excess inventory.
Seeing some listed homes priced BELOW what Opendoor paid original Seller.
Check out inventory levels in Phoenix AZ or Dallas Tx……its OUTRAGEOUS!!!
This is shaping up to be an EPIC DISASTER…….
Home Values in the sub $400,000-APPRAISAL EXEMPT AREAS are going to be hit VERY HARD.
Also related and interesting. Classic mistakes in real estate management. Don’t underestimate your holding costs. It was all so hot and buzzing when they were on that buying trip, acquiring every available home, enjoying a climate of no competition, no testing of price and value in the open market.
Looks like these big tech companies may immediately skew market data, then continue to exaggerate market distortion with their continued presence. Then they rely on each others data.
https://www.highya.com/opendoor-reviews
Company summary & reviews. I enjoyed reading the rants and raves of the low star reviewers.
I see your Phoenix and Dallas locations and raise you San Diego. In researching for two assignments today, one case reflected 78 like sales over the past 12 months with only 3 active listings. The second had 57 sales over the past year with only ONE active listing. A 3rd assignment (a difficult twinhome / panoramic view +/- $900,000), was active for only 1 day, however the borrower took the appraisal waiver option and the appraisal assignment was cancelled.
Dozens of people tripping over themselves trying to buy properties all while big brother government is being the accelerate (appraisal waivers) to an already unhealthy environment, what could go wrong.
Seek the truth.
An industry (tech) where leaders have repeatedly proven a willingness to violate the most fundamental of American rights (privacy); demonstrated sloppy security and created an internet credibility & integrity gap so bad that it is a joke whenever someone says “Oh, I read it on the internet’.
In essence the internet along with many of its leading ‘tech stars’, is a LIARS haven. Doubt me? If Big Data is so reliable, how come they can only ‘identify predictable future signals’ only in retrospect?
Anyone convinced yet of the year or month when the next recession will hit? Lots of data to work with!
Now, HOW could it be made any worse one asks?
How about if we merge it with another traditional industry that has been plagued by corruption since at least 1933; & gross incompetence even a 50-years before that? That’s right. Mortgage and real estate sales industry.
I’m thinking the tech companies may look at real estate differently. Going to just keep offering for insane liquidation pricing until they either go for it or someone upstairs accidentally clicks yes.
The Obsession for Speed. While Complaining about Appraiser Fee’s. “Don’t call me overpaid just because I did the Appraisal Fast! That’s exactly what you wanted!
I agree 100%…
I’m working on a multi-million dollar beach pad right now…
I quoted a fee that was equal to 3 appraisals, and they paid it..
So if a client agrees to do that, I accept the order, take my time, and make sure that there is not a single stone in my market research left unturned
Now that’s the way to do appraisals !!!
Good points Ryan, but sometimes the old ways still have benefits today.
Locally (San Diego), our public record files still provide the Thomas Guide page and grid and that is what I use to fill out the Map Reference question in the report. The benefit “to me” is that I have 30,000 appraisal reports on file where in a click of a heading I can sort to find any and all old assignments (DATA old and new) very near my subject. Forget about narrowing by zip code, neighborhood, census tract, etc. as nothing in my opinion compares to the Thomas Guide page and grid search technique. In fact, this heading sort system (Map Reference), is one of the first steps I do in starting to build a report.
Seek the truth.
Dude, I still love the paper map book. It’s always reliable, never costs me anything other than the one time purchase, total data privacy, and I can take whatever shortcut or route that I want.
The recreational guides are awesome as well. In an effort to keep paper alive, to avoid recurring cost of using services fees which are now becoming apparent, I bought everyone in my family a map book and recreational parks guide a few years back. They really liked them and you know, wrote off the ones I got for me. I keep one in each car all the time. It’s like wasteful to have to use electricity and pay membership fees, contribute to ewaste, recurrent payments, just to read a map. The data on the map usually does not change, paying a monthly fee to access a map is for consumers who like to throw money away. Please help keep this organization going, they almost went under a few years back. Primarily because I want that map book and boy, I panicked using quite old map books, luckily a 2015 came out in Denver and I think there is a newer one which I’m going to pick up soon. Navigation has cost me 2x $40 books over the past 4-5 years. $90 one time for two books, 4-5 years active use. $22 or less a year expense and I could stretch that further if I wanted. Don’t they charge that per month for those navigation programs? I should have gotten into selling digital maps, sounds like easy money.
https://thomasmaps.com/
I buy Los Angeles/Orange County; Riverside/San Bernardino TG maps regularly. Periodically San Diego & Ventura. They provide so much more information ‘at a glance’ than any online mapping service does.