Are You Real or Not?

I usually receive anywhere from 50 to 100 non-spam emails a day to my work account. These emails are from clients, other agents, and sometimes potential clients.

Real or Fake?The potential client emails come in two formats, directly from a person to my email address or through a real estate website like Realtor.com, Zillow, etc. to my email address.

Emails that come from a person directly to my account are usually from “real” people. By “real” I mean not some bot that is sending out thousands of phishing emails. They’re from people that know me through someone else or have been referred to me. I find that the emails from the real estate websites are harder to distinguish though. It’s not always clear if they’re real or trying to scam me in some way. Below are three actual emails I recently received from a real estate website. Can you determine which one is not from a real person?

Email 1: “I am interested in putting my property up for sale soon. I am looking for advice on determining my home’s worth and walk-through advice from an agent on what I can do to maximize the value. Pls call my cell or email me anytime.”

Email 2: “Hi Amy: what is the amount of the real estate taxes??? Thank you, XXXX”

Email 3: “I am Mr. XXXX XXX Japanese origin I need a 4 bed room single family home to buy, in a nice area in any city in your state its going to be a cash buy,price should be $500,000 please send me some listing/MLS Email:XXXXXXX_XX@hotmail.com”

So, which one is a scam/spam? Typically a person is asking a direct question about a specific property. Or they ask to go see a specific property. Or they ask you to come give them a valuation on their home.

While it seems enticing to an agent, Email 3 is the scam/spam. Most agents really like working with cash buyers, so the spammer is dropping that tidbit to draw the agent into responding. It’s not really clear what their intentions are, but I’m not buying it. I did actually respond to the email as an experiment to see what happens so I could write about it in this post. Mr. XXX wrote back, but he was not any more specific, asking again to have listings sent without giving any sort of criteria, despite being asked multiple times. With some emails like this we get a response back full of links to suspect websites, or an attachment that probably contains a virus. Really not nice, but we just delete them and move on with our lives.

Determining if people are real or not can add some adventure to an otherwise average day. The responses to these emails are often worthwhile for us, just as long as they don’t make our computers sick…

Are Real Estate Websites Your Friend?

Real estate websites came up in yesterday’s post. The basic question was, “Can buyers rely on public real estate websites during a home search?” I think we can all agree that they’re fun to look at, and they do a very nice job at presenting and consolidating data. But do they have a buyer’s (or seller’s) best interests in mind?

Downtown Hartford from Bushnell ParkI don’t think they do. Their goal is to make money. Basically all the sites make money by selling advertising to realtors, mortgage lenders, and credit people. They want to generate as many page views and clicks as possible, since that’s what translates into revenue. Buyers are heavy users during their search, but once they get a home under contract they no longer need to keep their preferred site open in the browser tab all day at work.

It comes down to an alignment of incentives. The public websites need to be engaging enough to capture a buyer’s interest, but not so helpful that they find a home immediately and are no longer a user (potential source of revenue). They benefit from extended home searches.

There are a few different ways that sites disrupt the search process, whether it’s intentional or unintentional:

Data Lag: Listing information is updated on different schedules for different sites. In all honesty, this could be related to how the different MLS systems (realtors) around the country make their data available. All I know is that some sites are faster than others.

Not Clearly Marking Homes Under Contract: We get a lot of calls about listings people see online that are already sold. They’re not closed yet, but the seller has already accepted a bid from a buyer. Getting distracted, or even emotionally hijacked, by a property that’s not really available causes buyers to miss out on legitimate opportunities.

Suspect Valuation Estimates: One site in particular touts their ability to value any property in the Country. Our experience is that buyers who take these valuations too seriously are unable to make realistic bids and have trouble buying a home. The estimates are inevitably too low, and the buyer isn’t going to “overpay,” so they keep lowballing sellers and never get a home.

Distressed Properties: Introducing distressed properties into the mix makes buyers more uncertain. Some try to use foreclosure pricing to support bids on non-distressed properties, which is generally not effective in this area. Others decide they want to pursue a foreclosure, not realizing that the process can be very different and it may take months to get a response.

Despite these concerns about the public real estate sites, I think they’re entertaining and provide a valuable service. They each have their own angle, and generally do a nice job presenting their data. As long as home buyers recognize the motivations and potential weaknesses of each site, they should definitely feel comfortable using the one they like best.

In the comments of yesterday’s post, Michael suggested that the realtors offer the general public the opportunity to subscribe to the actual MLS. It’s an interesting idea, and could be a way to reduce the (modest) annual fees that agents pay to support the existing system. I wonder if the local board has considered that possibility? Anyone from GHAR reading today? In some ways the realtor.com site is just that … the data is updated very frequently and comes directly from the MLS. However, it’s also like all the other sites in that there are ads and attempts to collect contact information.

Even this site has an agenda, though our incentives are much more aligned with our clients. We only benefit when someone successfully completes their transaction … so hopefully the GHREB can still be your friend.

Home Pricing Strategy for the Internet

You’re ready to sell your house and you’ve met with your agent to go over their pricing recommendation and marketing plan. The agent feels your house would be competitive in the market if it was priced anywhere between $290,000 and $300,000. So what do you choose as a listing price? There are lots of options, but the most popular choices in this situation would most likely be $299,000 or $299,900 or $300,000.

One aspect of pricing that most people don’t think about is how the price you choose affects the number of people that find your home through their internet searches. For example, let’s say you choose to price your home at $299,000 or $299,900. You want the psychological advantage of pricing your house just under $300,000, without much downside to you. There is an issue with this strategy when it comes to most real estate website searches though.

Pretend you’re a buyer. Most real estate websites use drop down menus to allow you to choose your price range when doing a property search. The values in the drop down menus are static (you can’t change them) and typically in increments of $10,000, $25,000, or $50,000. If I’m a buyer searching for homes up to $300,000, it’s perfectly fine if you price your house at $299,000 or $299,900. I’ll see the result. But what if I’m a buyer and I’m looking between $300,000 and $400,000? I won’t find your house because these static searches have blocked you out.


Realtor.com Search

For example, right now in West Hartford, according to the MLS, there are 13 houses actively for sale between $290,000 and $300,000. One of these houses is priced at $300,000. Nine of these houses are priced between $299,000 and $299,900. Two of these houses are priced at $298,000. The 11 houses that are priced between $298,000 and $299,900 are missing all of the buyers that are starting their search at $300,000 on the web, while the one house priced at $300,000 is showing up for the buyers that are searching up to $300,000 and those with a price range starting at $300,000. Which seller do you think has more people finding them online? Which seller would you want to be?

Realtor.com recently updated their website and replaced their pricing drop down menus with text boxes. Unfortunately most people have been conditioned to search using the typical incremental values of $10,000, $25,000, and $50,000. Most buyers will not think to start their search at, say, $297,000 to pick up all of the properties that are priced at $299,000 or $299,900. Agents see this similar situation in the MLS. We have text boxes where we enter the price ranges when setting up property searches for our buyers. The agent needs to be astute enough to manually enter a starting price slightly below the buyer’s range in order to pick up properties ending in $XX9,000 or $XX9,900. Agents, like buyers, sometimes have tunnel vision and don’t necessarily do this. So the buyer is missing out on potential matches. One of which may be your home.

If your goal is to have as many buyers find your house as possible, it may be best to go against the conventional pricing psychology and choose the slightly higher price that starts with a bigger number. More people will find your home during their online searches. Besides, when I’m showing a house that’s priced at $299,900 and the buyer asks me how much it is, I say “$300,000” because in reality, that’s what it is. You’re not really fooling anyone.